Redelivery

Returning to unseaworthiness for a moment, the charterer has no right to refuse delivery of a ship because of alleged unseaworthiness unless that unseaworthiness goes to the “root of the contract”, i.e. so fundamental that it would virtually nullify the long-term overall benefits which the charterer had a right to expect would accrue to him from the performance of contract. This, of course is the basic doctrine of common law contract which the student will remember from the previous course on Legal Principles in Shipping Business. A person is entitled to rescind the contract only where the breach by the other party is a fundamental one, i.e. is a breach of an important term, called a “condition”. Less important terms are called “warranties” and breach of such entitles the injured party to damages only. In further explanation of the charterer’s rights in this sort of situation he has, of course, a cancelling clause in his favour. If he were to discover that the ship was unseaworthy (but not seriously) he would be obliged to give the owners the opportunity to remedy it if the cancelling period had not yet been reached. It is important to realise that the entitlement of a charterer to cancel is not dependent upon there having been a breach of contract on the part of the owner. It is simply a matter of whether the owner has or has not delivered a seaworthy ship at the right place/time. There may be an absolute obligation laid down in the charterparty that charterers redeliver on a fixed date. This will probably be the rarer, the longer the period of the charter. Failure to redeliver by that certain date constitutes ipso facto a breach unless the delay can be ascribed to the owner’s fault. Where the charter is a stated period, e.g. 8 months or 3 years, the courts tend to apply a margin and thus give at least some flexibility to an otherwise rigid date. The length of this margin will naturally be set according to the length of the charter itself. In the Democritos (1975) 5 days was set as a margin on 4/6 months. The applying of this margin may be done even though the word “about” is not actually present, although the implication that there should be a margin is more readily appreciated if “about” is included.