Hague Rules Article III Rule 6
Unless suit, that is to say proceedings, are commenced within one year or there is agreement between the parties to extend the one-year time limit then any claim relating to the cargo will be time barred.
The rationale for this approach was set out by Judge Diamond in the Leni (1992) case.
The time bar will apply even where there is an allegation that the owners misappropriated cargo.
In the Aries (1977) case, Charterers had, contrary to the terms of the charterparty, deducted from freight a sum intended to represent the shortfall suffered by the charterers as a result of a short discharge of a cargo of crude oil.
Charterers’ allegation was that the Shipowners had misappropriated the cargo. Shipowners commenced their action to recover freight after the one-year time limit had passed under the Hague Rules as incorporated into the charterparty.
Charterers, in their defence, put forward a counterclaim in the same sum as the amount claimed by owners representing their claim for short delivery of cargo and the losses that they had suffered.
The court rejected the charterers’ arguments on the basis that their claim was caught by the one-year time limit contained in the Hague Rules and was therefore time barred. Owners were therefore entitled to bring their claim for freight.