UK: Court Rules On Liability For Damage Caused By Breach Of An Unsafe Port Warranty

In Gard Marine & Energy Ltd v China National Chartering Co Ltd (The "Ocean Victory") [2013] EWHC 2199 (Comm), the Claimant Underwriters claimed damages from the Defendant Time Charterers where the vessel was lost on departing Kashima port.

Facts

Charterers ordered the vessel, a Capesize bulk carrier, to discharge at Kashima. The vessel sought to leave the port during a severe gale on the advice of Charterers' representative at the port, a local experienced mariner, that she should leave. The concern was that  there was a risk that she could not be restrained by her moorings and/or tugs. As she was leaving, she encountered strong winds and heavy seas in the fairway, ran aground and broke apart.

The Claimants submitted that the port was prospectively unsafe, as there was a risk that vessels moored there might be advised to leave when there were gales in the fairway, such that safe navigation required more than good navigation and seamanship. In addition, they argued, there was no system in place to ensure that vessels left in conditions which did not threaten safe navigation, or that they did not attempt to depart in conditions which posed a threat.

Charterers argued that the port was safe, and that the cause of the casualty was the master's misunderstanding that the vessel had been ordered to leave the port and/or his negligent navigation when leaving. They also submitted that the emphasis must be on reasonable safety and taking reasonably precautions, and that a port cannot be unsafe because its systems fail to guard against every conceivable hazard.

Judgment

The claim succeeded. Charterers were found liable in damages for breach of the safe port warranty.

On the safety of the port, The Eastern City [1958] 2 Lloyd's Rep. 127 was followed. To interpret the safe port warranty as Charterers' submitted, with an emphasis on "reasonable safety", was to introduce an inappropriate level of uncertainty. Safety is not absolute, but the measure is not what is "reasonable" but whether any dangers can be avoided by good navigation and seamanship. A port could be safe even if the vessel might be required to leave in certain circumstances, but departure had to be capable of being safely performed.

The Court noted that the enquiry in an unsafe port case is not into the conduct of the port authority, for example in taking precautions designed to protect vessels against danger but which in fact did not protect the vessel. It is into the prospective exposure of the vessel, when arriving at and leaving the port, to a danger which could not be avoided by good navigation and seamanship.

As regards the system in place at the port, the Claimants did not have to identify a system which, had it been in place, would have enabled the master (in possession of ordinary skills of seamanship and navigation) to avoid the danger of leaving the port when it was unsafe to do so. If they established that the port was prospectively unsafe because the vessel may have had to leave her berth because of long waves or bad weather at a time when the weather conditions were such that it was unsafe for the vessel to leave, then they had established a breach of the safe port warranty. The remaining question was whether that breach caused the casualty.

It was Charterers' advice to leave the port which was the effective cause of the casualty. The advice was given without considering whether it was safe to leave, and so it reflected the unsafety of the port.

As such, the casualty was caused by the unsafety of the port. The Court stated that even if the Master's navigation had been found to be negligent, it would still have concluded that the port's unsafety remained the real and effective cause of the casualty.

Finally, the judge also commented on whether the Claimants, as assignees of the demise charterers, could claim the loss of the vessel from the head time charterers. Assuming a breach of the safe port warranty, this depended on whether the demise charterer was liable to the registered owner in respect of the loss of the vessel. The judge found that this was the case. If it had not been, then the demise charterer would have suffered no loss to pass on to the head time charterers.

Comment

This case follows the established law on unsafe port cases, and reinforces both the test for determining whether a port is unsafe and the factors which must be taken into account in doing so. The key is whether the vessel was prospectively exposed to a danger which could not be avoided by good navigation and seamanship. Charterers' attempt to impose a standard of reasonableness on the safety of the port was unsuccessful.

Causation is also crucial. Charterers cannot necessarily rely on the Master's alleged negligence to relieve themselves of liability. Even if a Master's navigation is negligent, this is not necessarily sufficient to break the chain of causation between the unsafety of the port and the damage suffered.

Those of you planning calls to Kashima with a capesize bulk carrier will be pleased to note that this incident took place in 2006 and the judgment refers to changes implemented in the port's systems after this incident to rectify the safety issued identified.

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