Time Charter Speed Warranty: Speed and Consumption Claims, Good Weather, Off-Hire, and Underperformance

Time Charter Speed Warranty: Speed and Consumption Claims, Good Weather, Off-Hire, and Underperformance

Time Charter Breach of the Speed Warranty

Time Charter Breach of the Speed Warranty is one of the most common and commercially significant disputes in time chartering. A time charter is fundamentally different from a voyage charter because the commercial purpose is different. Under a voyage charter, the Shipowner normally agrees to carry a particular cargo from one place to another for freight. Under a Time Charter, the Shipowner places the ship at the disposal of the Charterer for an agreed period, and the Charterer may employ the ship commercially within the permitted contractual limits.

This difference of function. explains why speed, fuel consumption, loading capacity, cargo gear, hold condition, and operational efficiency are so important in time charterparties. The Charterer pays hire for the use of the ship and usually pays for bunkers. If the ship is slower than warranted or consumes more fuel than described, the Charterer may lose time, pay unnecessary hire, burn additional bunkers, miss cargo opportunities, and suffer reduced commercial profit.

Because the time charterer controls the commercial function of the ship, the time charterer is normally responsible for the resultant expenses arising from employment orders, port nominations, cargo operations, bunkers, and commercial voyage planning. The Charterer also commonly indemnifies the Shipowner for liabilities arising from the master complying with lawful employment instructions. However, this does not mean the Charterer accepts an inefficient ship. The Shipowner must still deliver and maintain a ship that complies with the charterparty description and performance obligations.

Although there are many standard forms of Time Charter, most time charterparties contain core clauses dealing with ship description, delivery condition, speed, fuel consumption, maintenance, off-hire, master’s duties, cargo employment, and redelivery. The speed warranty and consumption warranty usually sit at the centre of this structure because they define the commercial efficiency of the chartered ship.

Efficiency of the chartered ship is vital because the entire success of the commercial enterprise may depend on it. A ship fixed for a cargo program, a trading period, or a sub-charter may need to meet specific schedules and voyage estimates. If the ship cannot perform as described, the Charterer’s business plan may be affected from the first voyage.

The preamble or description clause of the time charter therefore sets out in detail the specifications of the ship. The most important specifications usually include speed, bunker consumption, deadweight, grain and bale capacity, draft, cargo gear, holds, class, flag, and delivery condition. The legal significance of these statements may vary according to the charterparty wording, governing law, and arbitration forum.

New York arbitrators have often treated specifications relating to speed and fuel consumption as continuing warranties that the ship should maintain such capability during the charter period. By contrast, English courts have generally treated speed and consumption descriptions as warranties as to the state of the ship at the time of delivery under the charter, although the Shipowner may also have a continuing maintenance obligation and a duty to keep the ship efficient during service.

Where a speed warranty is breached, damages may be measured by the loss suffered by Charterers, often calculated by reference to time lost, hire overpaid, additional bunkers consumed, or the difference between the market rate for a ship with the described performance and the ship actually delivered. In some cases involving breach of the speed warranty, Charterers may also attempt to treat the ship as off-hire for the appropriate period, but off-hire and damages are not the same remedy and should not be confused.

Ship Speed Warranty in Time Charters

Ship Speed Warranty in Time Charters is a contractual promise or description concerning the speed that the ship is capable of achieving and the fuel that the ship is expected to consume under specified conditions. The warranty gives the Charterer a basis for voyage estimates, freight calculations, bunker budgeting, sub-charter negotiations, and commercial planning.

A speed warranty is rarely absolute in all circumstances. It is usually qualified by good weather, smooth water, no adverse current, certain sea state limits, loading condition, draft, trim, engine setting, and the word “about.” The warranty must be read together with the entire charterparty, including performance clauses, off-hire clauses, maintenance clauses, and any weather routeing provisions.

1. Components of Ship Speed Warranty

A ship speed warranty commonly includes the following elements:

a. Guaranteed Speed: The Shipowner states that the ship is capable of maintaining a specified average speed under agreed conditions. The warranty may distinguish between laden speed, ballast speed, eco speed, or alternative engine outputs.

b. Fuel Consumption: The Shipowner describes the quantity and type of fuel expected to be consumed at the warranted speed. This may include VLSFO, HSFO where permitted, MGO, LSMGO, LNG, or other fuel types depending on ship design and charterparty wording.

c. Allowances: The charterparty may allow margins for adverse weather, currents, hull fouling, sea conditions, “about” wording, and other variables. These allowances are critical because they determine whether underperformance exists and how damages are calculated.

2. Importance of Ship Speed Warranty

Ship speed warranties matter because they affect:

a. Cost Management: The Charterer uses the warranted speed and consumption to calculate hire cost, bunker cost, voyage duration, freight income, and profitability.

b. Operational Efficiency: A ship that meets her performance description gives both Shipowner and Charterer a reliable basis for scheduling and commercial use.

c. Dispute Resolution: A clear speed warranty reduces disputes because it states the expected performance and the conditions under which that performance will be assessed.

3. Consequences of Breaching Ship Speed Warranty

If the ship fails to meet the warranted speed and consumption, possible consequences include:

a. Off-Hire: The ship may go off-hire only if the facts fall within the off-hire clause. Reduced speed alone is not always enough. There must usually be a qualifying event such as defect, breakdown, or other specified cause.

b. Damages: Charterers may claim damages for time lost, additional bunkers consumed, extra port costs, missed commercial opportunities, or other losses that are recoverable under the charterparty and applicable law.

c. Termination: Termination is exceptional. Ordinary speed underperformance normally gives rise to damages, not termination. Termination may arise only where the breach is so serious that it deprives the Charterer of substantially the whole benefit of the charter or where the charterparty expressly allows cancellation.

Ship Speed Warranty in New York Produce Exchange (NYPE)

Ship Speed Warranty in New York Produce Exchange (NYPE) is usually found in the ship description and rider clauses. The NYPE form is one of the most widely used time charter forms in dry cargo shipping. It provides a framework for hire, employment, delivery, redelivery, off-hire, cargo work, and the master’s duty to prosecute voyages with dispatch.

1. Ship Speed Warranty in NYPE

In NYPE, the speed and consumption warranty is usually inserted in the ship description. It may state that the ship is capable of steaming at about a stated speed on about a stated fuel consumption in good weather and smooth water, fully laden or in ballast. The precise wording may be amended by rider clauses, performance clauses, weather routeing clauses, and recap terms.

2. Importance of Ship Speed Warranty in NYPE

a. Cost Management: NYPE Charterers rely on speed and consumption figures when calculating hire exposure and bunker cost.

b. Operational Efficiency: The warranty supports the Charterer’s expectation that the ship will perform commercially as described.

c. Dispute Resolution: Clear NYPE performance wording helps avoid disputes over good weather, currents, routeing data, and hire deductions.

3. Consequences of Breaching Ship Speed Warranty in NYPE

a. Off-Hire: Under NYPE, off-hire depends on the wording of the off-hire clause. If the ship’s speed is reduced by a defect or breakdown in hull, machinery, or equipment, time lost may be deductible if the clause applies.

b. Damages: Charterers may claim damages for underperformance if they prove breach, causation, and loss.

c. Termination: Termination is not the normal remedy for an ordinary NYPE speed claim. It may arise only in extreme cases or under express wording.

Ship Performance Clause in NYPE 46, NYPE 93, and NYPE 2015

Ship Performance Clause in NYPE 46, NYPE 93, and NYPE 2015 reflects the evolution of time charter drafting. Each form approaches performance through ship description, maintenance obligations, off-hire provisions, and additional rider clauses. Modern fixtures often supplement printed wording with detailed speed and consumption clauses.

1. Ship Performance Clause in NYPE 46

NYPE 46 is the older and simpler version. Performance wording is commonly found in the description clause, with speed and consumption figures inserted by the parties. The printed form itself does not contain the level of detail often required for modern performance disputes, so rider clauses are commonly added.

2. Ship Performance Clause in NYPE 93

NYPE 93 modernized the form and gave parties a better framework for ship description, performance, maintenance, and employment. However, many NYPE 93 fixtures still depend heavily on negotiated rider clauses to define good weather, current, swell, consumption, distance tables, routeing company evidence, and claim procedure.

3. Ship Performance Clause in NYPE 2015

NYPE 2015 is more modern and reflects developments in commercial practice, environmental regulation, bunker use, and more detailed charterparty administration. It is better suited to contemporary trading, but parties still need to draft clear speed and consumption provisions because every ship, route, cargo, and commercial arrangement may require different performance wording.

The Ship Performance Clause in NYPE forms helps manage ship efficiency, cost allocation, and claims. It should not be treated as a standard boilerplate clause. The wording can determine whether a claim is measured voyage by voyage, over the full charter period, by good-weather extrapolation, or by an agreed weather routeing formula.

Ship Performance Clause in BALTIME 2001

Ship Performance Clause in BALTIME 2001 has a similar commercial purpose to NYPE speed and consumption wording, although the form and language are different. BALTIME is a BIMCO time charter form and is often used in trades where parties prefer a more owner-oriented structure than NYPE.

1. Ship Performance Clause in BALTIME 2001

The BALTIME performance wording is generally connected with the ship’s description and her capability in good weather and smooth water. The clause may state the warranted speed and fuel consumption and may be supplemented by additional rider clauses.

a. Warranted Speed: The Shipowner states the speed that the ship is capable of achieving under the agreed conditions.

b. Fuel Consumption: The Shipowner states the expected daily bunker consumption at the warranted speed.

c. Performance Allowances: The wording may include allowances for weather, sea state, “about,” currents, or other performance factors.

2. Importance of Ship Performance Clause in BALTIME 2001

a. Cost Management: The Charterer can estimate hire and bunker exposure.

b. Operational Efficiency: The clause identifies the ship’s expected commercial capability.

c. Dispute Resolution: Clear wording reduces later arguments over performance calculations.

3. Consequences of Breaching Ship Performance Clause in BALTIME 2001

a. Off-Hire: Off-hire depends on the off-hire wording and the cause of the performance loss.

b. Damages: Charterers may claim recoverable losses caused by proven underperformance.

c. Termination: Termination is exceptional and depends on seriousness and contractual wording.

Ship Speed and Performance Clause in New York Produce Exchange (NYPE)

Ship Speed and Performance Clause in New York Produce Exchange (NYPE) is central to time charter risk allocation. It allows Charterers to estimate voyage duration and bunker expenditure while giving Shipowners a defined standard against which the ship will be measured.

1. Ship Speed and Performance Clause in NYPE

a. Warranted Speed: The clause states the speed the ship should be capable of achieving in the agreed condition.

b. Fuel Consumption: The clause states how much bunker fuel the ship should consume at that speed.

c. Performance Allowances: The clause may allow adjustments for weather, sea state, current, “about,” or routeing company assessment.

2. Importance of Ship Speed and Performance Clause in NYPE

a. Cost Management: Accurate performance figures support voyage estimates and sub-chartering decisions.

b. Operational Efficiency: The clause helps ensure the ship is fit for the Charterer’s commercial use.

c. Dispute Resolution: A well-drafted clause provides a predictable calculation method.

3. Consequences of Breaching Ship Speed and Performance Clause in NYPE

a. Off-Hire: The Charterer may deduct hire only if the off-hire clause applies.

b. Damages: The usual remedy for breach of speed warranty is damages.

c. Termination: Termination is reserved for very serious breaches or express contractual rights.

Ship Warranted Speed in Charter Parties

Ship Warranted Speed in Charter Parties is the stated speed that the ship is expected to achieve under the contractual conditions. It may be expressed as “about” a certain number of knots, fully laden or in ballast, in good weather and smooth water, on a stated fuel consumption.

1. Components of Ship Warranted Speed

a. Guaranteed Speed: The speed figure stated in the charterparty.

b. Allowances: The margin allowed for weather, sea conditions, currents, “about,” ship configuration, draft, trim, or other factors.

2. Importance of Ship Warranted Speed in Charter Parties

a. Cost Management: Charterers use speed to calculate voyage duration and hire exposure.

b. Operational Efficiency: Warranted speed gives a benchmark for commercial performance.

c. Dispute Resolution: It provides a measurable standard for underperformance claims.

3. Consequences of Breaching Ship Warranted Speed in Charter Parties

a. Off-Hire: Possible only where the off-hire clause and facts support it.

b. Damages: The main remedy where the ship fails to meet her warranty.

c. Termination: Available only in exceptional cases or under express wording.

Ship Speed and Consumption Warranties in Time Charterparties

Ship Speed and Consumption Warranties in Time Charterparties define how the ship should perform during the charter service. The Shipowner provides a description of the ship’s speed and fuel consumption, and the Charterer relies on that description when planning voyages, fixing sub-charters, estimating freight earnings, purchasing bunkers, and calculating profit.

A “condition” is an essential contractual term. Breach of a condition may allow the innocent party to terminate and claim damages. A “warranty” is a lesser term. Breach of warranty normally gives the innocent party a damages claim but not a right to terminate. An “intermediate” or “innominate” term may produce different remedies depending on the seriousness of the breach.

Whether a speed and consumption obligation is a condition, warranty, or intermediate term depends on the wording and the commercial context. In many time charter cases, speed and consumption warranties give rise to damages rather than termination, unless the breach is exceptionally serious.

In a time charter, the Charterer may act commercially like a disponent owner by employing the ship, carrying cargo, or sub-chartering the ship. Speed and fuel consumption figures in the “Description” clause may therefore form the basis of business decisions. If those figures are wrong or the ship cannot perform, the commercial consequences can be substantial.

Ship Speed and Consumption Warranty Example

Ship Speed and Consumption Warranty Example clauses often provide separate figures for laden and ballast conditions and may specify different consumptions for sea, port, idle, and cargo gear working time. A typical clause may state that Owners warrant the ship, subject to good weather conditions, to perform as follows:

1. Loaded speed: approximately 13.0 knots.
2. Ballast speed: approximately 13.5 knots.
3. Type of bunkers: VLSFO 380cst for Main Engine.
4. Consumption:

a. At sea: approximately 30 metric tons of VLSFO and approximately 0.5 metric tons of LSMGO. b. Idle in port: approximately 2.5 metric tons of LSMGO. c. With gear working for 24 hours: approximately 5.0 metric tons of LSMGO.

Such figures should be drafted carefully. The clause should state whether the figures are “about,” whether any consumption margin applies, whether sea consumption includes auxiliaries, whether port consumption changes when cranes or grabs are working, and whether eco speed or ordered speed affects the warranty.

What is Good Weather Conditions in Ship Chartering?

What is Good Weather Conditions in Ship Chartering? Good weather is the weather and sea condition under which the ship’s speed and consumption warranty is tested. A performance warranty usually does not require the ship to meet the same speed in heavy weather, head seas, adverse swell, or strong currents.

Good weather should be defined in the charterparty. The definition may refer to the Beaufort Wind Scale, Douglas Sea State, swell height, current, sea direction, or a weather routeing company’s method. A common benchmark is Beaufort Force 4 or below, although the correct threshold depends on ship type, trade, and clause wording.

According to the Beaufort Scale, wind speed of 7 to 10 knots corresponds to Gentle Breeze, or Beaufort Force 3, with large wavelets and limited white foam. Wind speed of 11 to 16 knots corresponds to Moderate Breeze, or Beaufort Force 4, with small waves becoming longer and more frequent white horses. Many time charterparties treat conditions up to Force 4 as good weather.

Owners often defend speed claims by arguing that alleged underperformance occurred in bad weather and must be disregarded. However, courts and tribunals usually first identify good-weather periods. If the ship underperforms during good weather, that evidence may support an inference that the ship would also underperform in bad weather, subject to expert calculation and the charterparty terms.

Masters and officers should record weather accurately in deck logbooks and noon reports. Records should include wind force, wind direction, sea state, swell, current, visibility, course alterations, RPM, engine output, speed through water, speed over ground, and any reason for speed reduction. Good records can be decisive in performance disputes.

Weather routeing companies may provide independent evidence. If the charterparty gives the routeing company’s report special status, the parties should understand whether the report is binding, advisory, or merely evidential. The master remains responsible for safe navigation and is not automatically required to follow routeing advice if safety requires a different course.

Ship Speed and Consumption Warranty Arbitration Case

Ship Speed and Consumption Warranty Arbitration Case examples show how evidence is evaluated. In one New York arbitration, the issue was whether the time charterer could nominate a weather routeing company. The decision recognized that because weather delay risk normally falls on the Charterer under a time charter, the Charterer may appoint a weather routeing service at its own cost. However, the master remains the judge of the safest route, considering the ship, cargo, crew, and interests of both parties.

Performance monitoring companies may use statistical weather data, satellite information, nearby ship reports, and hindcast models. These may differ from the ship’s logbook entries. Where the charterparty contains no special wording, shipboard observations may carry significant weight because the master and officers observed the actual conditions at the ship’s position. However, Charterers may challenge ship logs if the entries appear inconsistent, unreliable, or contradicted by strong independent evidence.

Where differences between ship logs and routeing company data are minor, tribunals may prefer the ship’s records. Where discrepancies are abnormal, repeated, or technically unexplained, a tribunal may prefer independent weather analysis. In some cases, expert evidence on ocean currents, wind direction, sea state, and weather patterns may be decisive.

The impact of the term ABOUT in ship chartering

The impact of the term ABOUT in ship chartering is substantial because “about” creates a tolerance around speed and consumption figures. In practice, London arbitrators often allow around 0.5 knots for speed when the charterparty states “about” a particular speed. However, this is not an absolute rule.

The Court of Appeal in The AL BIDA made clear that the proper margin depends on factors such as the ship’s configuration, size, draft, trim, and commercial context. A large tanker, a container ship, a reefer ship, a bulk carrier, and a small geared ship may not justify the same allowance in every case.

For bunker consumption, English law does not impose a fixed allowance. A 5% margin is commonly discussed in market practice and some arbitration decisions, but the charterparty wording remains decisive. Some tribunals have allowed both a speed margin and a consumption margin. Others have rejected a double allowance where it would give Owners an unjustified advantage.

In SMA Award No. 2040, the panel rejected an automatic right to add 5% to warranted bunkers. The reasoning was that the speed allowance already accounted for some navigation uncertainties and that bunker calculations should be based on the warranted daily figure and actual time at sea compared with the time that should have been required. This approach prevents Owners from receiving a double benefit from the word “about.”

In some detailed clauses listing multiple speeds and consumptions, tribunals may give a smaller speed allowance, such as 0.25 knots, rather than the usual 0.5 knots. If the clause contains a table of performance levels, the allowance may be applied in a more precise and proportional manner.

As a general rule, where the warranty says “about X knots on about Y metric tons per day,” the usual meaning is that the ship should achieve at least X minus the appropriate allowance on about Y fuel. It does not automatically mean that fuel consumption must be reduced proportionately when speed falls within the “about” range. The result depends on the wording.

Ship Underperformance in Charterparties

Ship Underperformance in Charterparties is usually assessed through a staged method. The Didymi approach begins by assessing the ship’s performance in good weather. If underperformance is established in good weather, the next stage is to apply that performance deficiency to the wider voyage or charter period, making appropriate expert adjustments for all weather conditions.

The Court of Appeal later clarified that the assessment may require a three-stage approach. First, determine the ship’s good-weather performance on relevant sea passages, excluding periods of slow steaming ordered by Charterers. Second, apply the speed variation, with necessary adjustments and extrapolations, to all sea passages and all weather conditions. Third, apply any consumption variation, again with proper adjustments, to the relevant periods.

This approach recognizes that a ship that is deficient in good weather will probably remain deficient in bad weather, although the exact loss must be calculated carefully. Expert evidence may be needed to avoid overstatement or understatement of the claim.

Ship Speed Claim Example 1 in Charter Party

Ship Speed Claim Example 1 in Charter Party shows how a basic claim may be calculated. Assume a ship is fixed for a voyage from Port A to Port B. The agreed speed and consumption are:

Agreed Speed: 14 knots Agreed Consumption: 30 metric tons of fuel per day (MT/day)

Voyage Information:

1. Distance between Port A and Port B: 1,750 nautical miles (NM)
2. Weather and sea conditions: calm sea and favorable wind conditions
3. Ship's cargo: fully loaded with cargo

Step 1: Calculate the expected voyage duration:

Voyage Duration = Distance / Agreed Speed Voyage Duration = 1,750 NM / 14 knots = 125 hours, or approximately 5.2 days

Step 2: Calculate the expected fuel consumption:

Expected Fuel Consumption = Agreed Consumption x Voyage Duration Expected Fuel Consumption = 30 MT/day x 5.2 days = approximately 156 MT

Step 3: Compare actual performance:

1. Actual Speed: 13.5 knots
2. Actual Voyage Duration: 5.45 days
3. Actual Fuel Consumption: 162 MT

The ship performed below the agreed terms. The voyage took longer and consumed more fuel. The Charterer may have a claim for time lost and additional fuel, subject to good-weather proof, allowances, causation, and charterparty wording.

Ship Speed Claim Example 2 in Charter Party

Ship Speed Claim Example 2 in Charter Party uses a different ship and voyage. Assume the agreed terms are:

Agreed Speed: 12.5 knots Agreed Consumption: 25 metric tons of fuel per day (MT/day)

Voyage Information:

1. Distance between Port C and Port D: 2,500 nautical miles (NM)
2. Weather and sea conditions: moderate sea state with some headwinds
3. Ship's cargo: fully loaded with cargo

Step 1: Expected voyage duration:

Voyage Duration = 2,500 NM / 12.5 knots = 200 hours, or approximately 8.33 days

Step 2: Expected fuel consumption:

Expected Fuel Consumption = 25 MT/day x 8.33 days = approximately 208.25 MT

Step 3: Actual performance:

1. Actual Speed: 12.2 knots
2. Actual Voyage Duration: 8.67 days
3. Actual Fuel Consumption: 215 MT

This example may support a claim only if the underperformance occurred in qualifying weather conditions and after applying any “about” allowance. If 12.2 knots is still within the agreed margin, there may be no breach. If the charterparty allows a 0.5 knot tolerance, the claim may fail on speed unless other wording applies.

Ship Speed Claim Example 3 in Charter Party

Ship Speed Claim Example 3 in Charter Party shows a ship that performs at or above the agreed standard.

Agreed Speed: 15 knots Agreed Consumption: 28 metric tons of fuel per day (MT/day)

Voyage Information:

1. Distance between Port E and Port F: 3,600 nautical miles (NM)
2. Weather and sea conditions: mostly calm seas with some occasional crosswinds
3. Ship's cargo: fully loaded with cargo

Step 1: Expected voyage duration:

Voyage Duration = 3,600 NM / 15 knots = 240 hours, or approximately 10 days

Step 2: Expected fuel consumption:

Expected Fuel Consumption = 28 MT/day x 10 days = approximately 280 MT

Step 3: Actual performance:

1. Actual Speed: 15.3 knots
2. Actual Voyage Duration: 9.8 days
3. Actual Fuel Consumption: 274 MT

The ship met and slightly exceeded the agreed performance. Charterers would normally have no underperformance claim. Depending on the charterparty, Shipowners may or may not be entitled to a bonus or credit for over-performance.

Ship Speed Claim Vs Off-Hire Claim

Ship Speed Claim Vs Off-Hire Claim is a critical distinction. A speed claim is usually a damages claim for breach of performance warranty. An off-hire claim is a contractual suspension or reduction of hire because an off-hire event has occurred. The two concepts are often confused, but they operate differently.

In dry cargo time chartering, NYPE performance warranties often concern the ship’s capability at delivery, while tanker forms such as SHELLTIME 4 may contain more continuing performance wording. Even where the warranty attaches at delivery, later underperformance can be evidence that the ship was not capable at delivery or that Owners failed to maintain the ship properly during service.

A ship goes off-hire only if the off-hire clause applies. Under NYPE clause 15, this may include cases where speed is reduced by a defect or breakdown in hull, machinery, or equipment. Under SHELLTIME 4, the wording may be broader. If the ship is merely slower than warranted but there is no qualifying off-hire event, the remedy may be damages rather than off-hire.

The distinction matters financially. In a damages claim, any bunker saving during slower steaming may be credited against the Charterer’s claim. In an off-hire claim, the treatment may be different, and fuel savings may accrue to the Charterer depending on the clause and authorities such as The Ioanna.

Off-hire is often a net loss of time concept. If a voyage takes three days because of a defect but would have taken two days without the defect, the off-hire period may be one day, not the full period during which the defect existed, unless the clause is drafted as a period clause.

Charterers should be cautious when deducting hire on an off-hire basis. If the deduction is excessive or wrong, Owners may argue that hire has not been paid and may attempt to withdraw the ship. Underperformance damages may sometimes be asserted as an equitable set-off, but this should be handled carefully and in good faith.

What is Ship Speed and Consumption claims in Charter Parties?

What is Ship Speed and Consumption claims in Charter Parties? Ship speed and consumption claims are disputes between Shipowners and Charterers about whether the ship achieved the warranted speed and consumed the warranted quantity of fuel under the conditions stated in the charterparty.

These claims are common because speed and fuel consumption affect the economics of time chartering. A ship that steams slower than warranted causes lost time and overpaid hire. A ship that consumes more fuel than warranted increases bunker cost. In many cases, both claims are advanced together.

Resolving such claims requires analysis of charterparty wording, noon reports, deck logs, engine logs, weather data, current data, voyage distance, bunker soundings, weather routeing reports, hull condition, engine performance, and expert evidence. The calculation must also apply any allowances for “about,” good weather, currents, swell, or slow steaming orders.

Ship Speed and Consumption Disputes under English Law

Ship Speed and Consumption Disputes under English Law often arise from clauses phrased in the following style:

“speed about…knots, fully laden, in good weather conditions up to and including maximum force…on the Beaufort winscale, on a consumption of about…long/metric tonnes of…”.

This type of wording is common in performance disputes. Other forms may phrase the warranty differently. Baltime 1939, for example, refers to speed capability in knots and consumption in tonnes, often with “about” wording.

Where a ship fails to perform, Charterers usually claim damages for breach of speed and consumption warranty. However, other clauses may also be relevant, including:

Line 5 - “with hull, machinery and equipment in a thoroughly efficient state”

Lines 21/22 - “ship on her delivery to be tight, staunch, strong and in every way fitted for the service”

Clause 1 - “that the owners shall keep the ship in a thoroughly efficient state in hull, machinery and equipment for and during the service”

Clause 8 - “the Captain shall execute his voyages with the utmost dispatch”.

Clause 15 - “if during the voyage the speed is reduced by any defect or breakdown in any part of her hull, machinery, or equipment, the time lost and the cost of any additional fuel consumed as a result thereof, along with all other extra expenses, shall be deducted from the hire.”

If Charterers cannot prove breach of the speed warranty, they may attempt alternative arguments based on defect at delivery, failure to maintain, or failure to prosecute voyages with utmost dispatch. These arguments can be difficult. A master may reduce speed or alter route for safety, heavy weather, fog, or navigation reasons. Such decisions do not automatically establish breach.

The maintenance obligation is continuing but not absolute. Owners must act reasonably to keep the ship efficient, but they are not expected to repair every defect instantly if repairs require parts, port attendance, drydock, or reasonable logistical arrangements.

The performance warranty must be tested under the correct condition. If the warranty is for fully laden performance, evidence that the ship achieved a certain speed in ballast does not prove that she would achieve the same speed when fully loaded. The warranty concerns capability under the described condition.

Good Weather Description in Time Charter Parties

Good Weather Description in Time Charter Parties should be precise. NYPE 93 allows space for parties to define good weather. Many parties use Beaufort Force 4 as the threshold, meaning weather up to and including Force 4 may qualify as good weather. However, the clause may also need to address Douglas Sea State, swell, adverse current, wind direction, and speed through water versus speed over ground.

Owners may argue that bad-weather periods should be excluded because the warranty applies only in good weather. Courts and tribunals usually identify suitable good-weather periods first. If underperformance is shown during those periods, a wider claim may be calculated by extrapolation to all sea passages, depending on the clause and evidence.

Shipowners Defending Ship Underperformance

Shipowners Defending Ship Underperformance may rely on several arguments:

1- Charterers supplied poor-quality bunkers. This defence requires strong proof, including proper fuel sampling, laboratory analysis, manifold drip samples, bunker delivery notes, and engine records.

2- The voyage encountered adverse weather. Expected weather from a routeing plan is not enough; actual weather must be proved. Ship logs, noon reports, weather routeing evidence, satellite data, and expert analysis may all be relevant.

3- “About” should be applied to speed and, where appropriate, to fuel consumption.

4- Fuel savings should reduce damages where the claim is for breach of warranty rather than off-hire.

5- The master made a prudent navigation decision to avoid bad weather, danger, or risk to life and property. A safe navigation decision should not normally be treated as underperformance.

6- The alleged loss was caused by Charterer orders, long waiting in warm waters, slow steaming instructions, port congestion, hull fouling caused by employment, or other matters outside the Owners’ breach.

Ship Speed and Performance Cases

• In the EVDOXIA (1980) 2 Lloyd's Rep. 107 case, Ocean Routes evidence was preferred over log entries because the logs did not record a suitable reduction in RPM during alleged heavy weather and contained questionable soundings.
• In the RIJN (1981) 2 Lloyd's Rep. 267 case, reduced speed caused by hull growth resulting from Charterers’ own instructions during an abnormally long stay in tropical waters could not support a damages claim against Charterers.
• In London Arbitration (1983) LMLN 98, log evidence concerning weather was preferred over Ocean Routes evidence. An allowance of 1 knot was made for bad weather up to Force 5/6. “Good weather and smooth water” in Baltime was treated similarly to “good weather conditions” in NYPE.
• In the IOANNA (1985) 2 Lloyd's Rep. 164 case, fouling on the hull at delivery was treated as a “defect in the hull,” allowing Charterers to put the ship off hire. Owners could not claim credit for bunkers saved because the claim was framed as off-hire.
• In London Arbitration 12/1985 LMLN 158, Owners were allowed benefit from “about” for both speed and consumption, with 0.5 knot for speed and 4% for consumption. “Good weather and smooth water” included conditions up to and including Beaufort Force 4.
• In London Arbitration 2/1978 LMLN 188, where the ship description was preceded by “Description: all about,” Owners were allowed a 5% consumption allowance. Owners were also entitled to credit for bunkers saved because the claim was damages, not off-hire.
• In DIDYMI (1988) 1 Lloyd's Rep. 108, the charterparty was for five years and provided for guaranteed average speed in good weather. Charterers’ speed claim was calculated by applying the good-weather average to the full charterparty period.
• In GAS ENTERPRISE (1993) 1 Lloyd's Rep. 352, the Court of Appeal held that Charterers could apply good-weather performance to the whole period under review because a ship that underperforms in good weather is likely to underperform in bad weather as well.
• In AL BIDA (1987) 1 Lloyd's Rep. 124, the Court of Appeal held that Charterers could claim for under-performance on certain voyages without Owners setting off over-performance on others, depending on the clause. The case also confirmed that the “about” allowance must be assessed according to ship configuration, size, draft, trim, and other circumstances.

Drafting Practical Speed Warranty Clauses

A practical speed warranty clause should define the ship’s speed, consumption, weather threshold, sea state, swell, current treatment, distance tables, routeing company role, data sources, and calculation method. It should state whether the warranty is assessed voyage by voyage, annually, over the whole charter period, or by each sea passage.

The clause should also state whether Charterers may deduct from hire, when claims must be submitted, what documents are required, whether over-performance can be set off against under-performance, and whether bunker savings are credited. It should clarify whether WOG, ADAWOG, “about,” or exact figures apply.

Evidence Needed for a Speed Warranty Claim

Evidence is decisive in speed warranty disputes. Useful documents include deck logbooks, engine logbooks, noon reports, weather reports, AIS data, routeing company reports, bunker soundings, fuel analysis, RPM records, shaft power data, draft records, trim data, cargo condition, master’s protests, Charterer’s instructions, and correspondence.

Charterers must prove the breach and the loss. Shipowners must preserve evidence that explains performance, including weather, currents, fuel quality, fouling, engine condition, routeing decisions, and Charterer instructions. Poor records can turn a defensible claim into an expensive loss.

Conclusion: Time Charter Breach of the Speed Warranty

Time Charter Breach of the Speed Warranty is a technical and legal subject that affects hire, bunkers, voyage duration, commercial planning, and charterparty remedies. Speed and consumption warranties are central to the time charter bargain because the Charterer pays for time and fuel while relying on the ship’s described capability.

The main issues are whether the ship met the warranted speed and consumption, whether the relevant periods were good weather, whether “about” allowances apply, whether currents or swell should be considered, whether the claim is damages or off-hire, and whether the charterparty permits deductions from hire. NYPE, BALTIME, and other time charter forms may produce different results depending on their wording.

For Charterers, a successful claim requires accurate evidence, careful calculations, and correct legal classification. For Shipowners, the best defence is accurate description, proper maintenance, reliable logs, fuel records, and clear contractual wording. Both parties can reduce disputes by drafting precise speed and consumption clauses before the fixture is concluded.