Damage to Cargo

Damage to Cargo

If the intended cargo is being destroyed prior to loading where the charterer is under no obligation to load a specific cargo and in fact is required to provide a cargo from another source.

This example in fact applies to a cargo being destroyed by an excepted peril or so badly damaged as to be unfit to be carried to the destination.

Delay in obtaining or loading the cargo; leading on from the previous example it would be unusual for a delay in obtaining a cargo from the intended source to lead to frustration of the charter. The exception could be if the cargo was not available from any source within the loading range and the subsequent delay is sufficiently fundamental.

The example is the ‘Penelope’ where the vessel was fixed to carry coal from South Wales to the Mediterranean on a consecutive voyage charter covering a 12-month period from 20 May. On 1 May a general coal strike began which lasted until the end of December. It was held that the entire contract was frustrated, the eight-month strike having prevented the performance of the charter according to its true intent.

If it becomes illegal to ship a cargo, of the type agreed at the loading port, after the charterparty has been concluded the result is that the contract is frustrated and the charterers are excused from supplying a cargo.