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Hi. I am a shipping company director, transport academic, author, family man and all round nice guy. I have worked as shipbroker, shipowner, freight trader and bulk charterer, in senior positions, with some of the largest and most disrespected (joke) companies in the world. Ask my advice on all things shipping and you will receive my blunt and always honest answer. Hang around to learn more about chartering and ship broker salaries, chartering and ship broker jobs, chartering and shipbroker recruitment agencies, cheap freight, maritime education, chartering and ship broker qualifications, become a ship broker, tips on how to be a successful bulk shipping executive, philosophy, Zen and the art of shipbroking, and much more. Yours The Virtual Shipbroker (recently proclaimed the guru of shipbroking) Copyright © 2009-17 by Virtualshipbroker

Sunday, September 18, 2011

Answer to the question on previous post - can a shipowners cancel?

Once again thanks for the great question and thank you to the many contributors who pretty much answered the question perfectly.

Note that im not a lawyer and without knowing the exact circumstances and charterparty clauses.

I do however offer the general opinion that -  a shipowner cannot cancel a contract under these circumstances but fortulately is protected by way of demurage / detention clauses (in the cp).

Legally speaking demurrage or detention constitutes DAMAGES awarded against a charterer for taking longer than stipulated to load or discharge a ship.

The question of whether the damages fall under 'demurrage" or "detention" probably depends on the circumstances and also on the cp.

There is a great lesson here for shipowners. This is a story about delays but it is also a story about sound ship trading practice.

Although a shipowner cannot be expected to premeditate every move in the market, a shipowner / ship operator when fixing a cargo with say a laycan 3 weeks away needs to consider many things

1. The current voyage he is undertaking and the likelihood for delays

2. The charterparties for both the current and next voyage and whether there is flexibility or even scope to cancel the contract. What kind of laycan cancelling clause have you used is another example of smart cp negotiations skills that can help you before a problem arises.

3. Current market conditions......if the market is about to explode best to fix a cargo that you are certain will run smoothly and quickly so you are set to take advantage of the next opportunity

To name a few..........

If the market were to drop (instead of rise during the voyage period) the shipower would be very happy with any delays locking in a damages claim at higher than current market levels. So it goes both ways.

In a game of poker - sometime you win, sometimes you lose. Advice to the shipowner is "limit the damage and move on"!



  1. So talking of contracts...where's the free beer? :)

  2. the virtual shipbrokerOctober 3, 2011 at 5:00 AM

    cmon over. i have spare ribs on the bbq aswell