Madeleine

The charterer may not exercise his right to cancel until the cancelling date has been reached. He may not, in other words, cancel in anticipation of the ship not being able to make the cancelling date even if the ship will obviously be unable to make it. This is the law with regard to the cancelling clause itself, i.e. the purely contractual situation (The Madeleine (1967)). However, it should be remembered that a charterer always has an alternative remedy in this situation based on an alternative implied duty which the Common Law imposes upon a shipowner, which is that he ensures the vessel proceeds to its loading port with reasonable despatch. This latter course of action is, however, based upon failure to proceed with reasonable despatch and thus on “shipowner fault”. The rule that freight is payable on delivery of the cargo at the port of discharge is applied on a fairly rigid basis by the courts. (It should be remembered that the concurrent obligations of payment of freight and delivery of cargo are the general rule – it is open to the parties to make any agreement they want about how freight is to be calculated, earned and paid. The general rule applies only in the absence of alternative arrangements.) Freight is payable in full even on cargo which is delivered damaged. Freight is only not payable (because it will not have been earned) if the goods are not delivered because they have been lost or destroyed. Destruction of the merchantable character or commercial identity of a cargo has the same effect on the right to freight as a total destruction of the goods. In Asfar v Blundell (1896) the ship on which a cargo of dates had been shipped sank in the Thames. She was raised but the dates were found to be unfit for human consumption. It was argued that there had been no total loss of the dates and therefore no total loss of the freight on them. Lord Esher MR said that the ingenuity of this argument might commend itself to a body of chemists, but not to businessmen. His Lordship held that the test was whether, as a matter of business, the nature of the thing had been altered.