Timing

It is important that offers and counter-offers not only state the time by which a reply is due, but also the place where any reply must be made within that time limitation. Failure to follow this procedure may mean, for example, that a Principal replies in good time in, say London, with the other principals based in Singapore unaware of the valid counter-offer, and thus negotiating and perhaps fixing elsewhere. The time and place for reply to an offer must be quite explicit – e.g. “for reply in Singapore latest by 1500 hours local time 23rd June”. Any counter-offer made in London to meet this deadline will have to be in sufficient time reasonably to permit it to be relayed to Singapore prior to 1500 hours local time thereat. Beware of imprecise expressions such as ‘For prompt reply’ or ‘For immediate reply’. The latter does not mean what it at first seems to say. An offer made through broker(s) for immediate reply in fact means that time has to be allowed for contact to be made with the principal. He has to reply straight away but even using the ‘most expedient means of communication available’ it may take quite a while for the message to travel all the way there and back. Charterers’ offers and counter-offers are almost always made with ‘subjects’ e.g. ‘subject stem’; ‘subject receiver’s approval’ or whatever. In practice even so-called firm offers have subjects contained in them, although strictly speaking they cannot then be firm offers. A true firm offer is one which is capable of being accepted by a simple affirmative with no further negotiation or clarification needed. ‘Subject stem’ is an expression about which there has often been debate as to its origin even its precise meaning. It can best be defined by example. Supposing a charterer has a contract to buy a million tons of coal over a period in ships of around 50,000 tonnes. One cannot have such a quantity sitting on a quay waiting for a ship to be chartered and so the charterer needs to verify that the cargo can be brought down to the port to coincide with the proposed ship. If it is in order the shipper will tell the charterer that the ‘stem’ is confirmed thus enabling the charterer to lift that ‘subject’.