Final Discharge

There is usually a clause in the charter party which provides the period within which a claim must be brought. In some charter parties there is, in the arbitration clause, a stipulation that a charterer/shipowner must bring the claim within 9 months of final discharge. However if the charter party contains such a clause but the goods are never “discharged” because the vessel carrying them founders, the clause has no application and the six years period applies. In Denny Mott and Dickson Ltd. v Lynn Shipping Co. Ltd. (1963) the vessel carrying the goods became a total loss on June 18, 1959. The action was brought against the shipowners on June 17, 1961 and the shipowners claimed that the claim was time-barred since no arbitrator had been appointed within 12 months of the date when the cargo should have been discharged. The Court held that the clause in the charter party did not apply. The claim was not time barred, and the words “final discharge” did not mean the date when the cargo was discharged or should have been discharged. Where a consecutive voyage charter incorporates an arbitration clause with the words “within 9 months of final discharge” means within 9 months of final discharge under the voyage in respect of which a dispute arises and do not mean within 9 months of completion of discharge of the last cargo carried under the charter party. Where a charter party states that a claim will be barred unless the claimant appoints an arbitrator within a specified period, the nominated arbitrator must be informed within that period that he is appointed otherwise the claim is barred. In Tradax Export S.A. v Volkswagenwerk A.G. the failure to inform the arbitrator that he had been appointed meant that the claim was time barred.