UK: Voyage Charterparties: Court Of Appeal Clarifies Strike Exceptions To Laytime

Last Updated: 7 August 2012
Article by Elizabeth Turnbull and Leon Alexander

On 19 June, the Court of Appeal handed down judgment in the case of "Carboex v Louis Dreyfus Commodities Suisse" [2012]. The case considered whether the laytime exception in case of strikes contained in clause 9 of the AMWELSH form extended to delays caused by congestion following a strike.

The relevant clause stated " case of strikes, lockouts, civil commotions or any other cause ... beyond the control of the Charterers which prevent or delay the discharging, such time is not to count unless the vessel is already on demurrage".

The relevant charter was a berth charter, which meant that the vessel would not be an "arrived ship" until she arrived at the berth. This meant that a Notice of Readiness ("NOR") could not be tendered until the vessel berthed and laytime would not start to run.

However, one of the rider clauses, clause 40, stated that an NOR could be tendered whether the vessel was in berth or not ("WIBON") and laytime would commence 12 hours thereafter.

Carboex chartered four vessels to carry coal from Indonesia to Ferrol, Spain, as part of a 10-voyage contract of affreightment. Between 9 and 16 June 2008, there was a nationwide haulage strike in Spain, during which no coal was removed from the terminal. When the strike ended, there was a large amount of coal stockpiled at the terminal which took some time to clear.

Four of the Carboex vessels arrived at Ferrol and were affected by the strike. Two of the vessels arrived during the strike and were placed in the queues for the relevant berths, the third and fourth vessels arrived after the strike, where three vessels were ahead of them in the relevant queue.

Carboex alleged (and for present purposes it was assumed) that an unofficial stoppage by some lorry drivers took place between 23 and 24 June 2008. No discharging took place on either day, but some cargo was removed from the stock pile on 25 June.

For the purpose of the preliminary issues, it was assumed that the congestion at Ferrol was entirely due to the haulage strike and the interruption to discharging caused by the later unofficial stoppage.

The dispute had been referred to arbitration and the tribunal ruled in Owners' favour. Charterers successfully appealed and the award was set aside. The Owners then appealed to the Court of Appeal where, essentially, the question was: "does the strike exception in Clause 9 apply to a vessel which is unable to berth due to berth congestion caused by a strike?"

In this regard, Owners' argument was twofold: (1) that Clause 40 had the effect of transferring all the risk of congestion at the port onto Charterers and, therefore, that the exceptions to the running of laytime in Clause 9 should be narrowly construed to when the vessel was at berth; and (2) that Clause 9 operated only during the continuation of the strike and did not extend to delay caused by congestion which was in itself a consequence or after effect of the strike.

(1) Did the WIBON provision in clause 40 of this berth charter transfer all risk of delay onto Charterers up until the vessel berthed?

The Court of Appeal found in Charterers' favour. Moore- Bick LJ surmised:

"It is quite true to say that the purpose of including those words in a berth charter is to transfer the general risk of congestion from the Owner to the Charterer, but it is equally true to say that its function is to start the laytime clock running... the instance of the risk of congestion is essentially a matter to be determined by reference to the commercial considerations, including demurrage rates, and the parties are free to decide for themselves how to allocate that risk under different circumstances. In my view, Clause 40 does not point to a narrower construction of Clause 9 than it would naturally bear..."

The judge went on to find that there was nothing within Clause 9 to suggest that its application should be restricted to periods when the vessel was alongside, ready to work. If the parties had intended to confine the Charterers' protection more narrowly, they would have used clearer language.

(2) Did the strike exception cover congestion after the strike?

The Court of Appeal also considered that, on its natural meaning, the wording of Clause 9 covered the consequences of the strike and not just the duration, which is the position in some charters such as the Centrocon clause, where the relevant clause states that laytime does not count "during the continuation" of the strike.

However, the Court also considered the relevant authorities, as the arbitrators had relied upon Central Argentine Railway Ltd v Marwood [1915] as authority for the proposition that time spent waiting to berth was not covered by the exception. Marwood was a House of Lords decision involving an identical strike exception clause. In Marwood, demurrage was incurred due to a strike of engine drivers at the discharge port.

The vessel arrived during a strike which ended on 15 February 1912. The vessel berthed on 1 March, but between 27 January and 15 February 1912, some 6 and ¼ days' work was done. Owners had conceded the time between the vessel's arrival and 27 January did not count, but they argued that in respect of the period between 27 January and 15 February, 6 and ¼ days should count against laytime because, to that extent, discharging had not been prevented or delayed.

The House of Lords accepted the Owners' construction and held that they were entitled to count 6 and ¼ days against laytime. Their Lordships were of the view that the words "such time" meant the time for which the discharging was actually prevented or delayed by the strike, but some of the speeches seemed to go further and supported the Owners' argument that the exception only applied where the vessel was at berth.

The Court of Appeal disagreed with Owners' interpretation of Marwood and ruled that it was authority for two things:

  1. That "such time" meant time lost by reason of one of the excepted causes
  2. That the Charterer must prove that the excepted event was the "effective cause" of delay to the vessel

Accordingly, the Court of Appeal did not consider that Clause 9 only operated where the vessel was at berth or prevented from berthing, but held that it would also cover congestion preventing berthing.

However, the Charterer would need to establish that the congestion would not otherwise have been there. For example, if a vessel arrived at the disport and was sixth in the terminal queue before a strike started, then five vessels would have had to be loaded first, irrespective of the strike, and the only waiting time for Owners' account would be the time when those five vessels were prevented from discharging.

What are the practical implications of the Carboex v Louis Dreyfus Commodities Suisse decision?

The decision applies to 'net loss of time' laytime strike exception clauses like clause 9 of the AMWELSH form. It will not apply to "duration" laytime strike exception clauses such as CENTROCON or NORGRAIN clauses.

This means that delays during a strike are not analogous to the net loss of time position under NYPE clause 15 (where the vessel is only off-hire when she is not at the charterers' disposal) and, depending on the terms of the charter, owners may bear the risk of any delay that post-dates the excepted event.

This decision appears to strike a fair balance of the risk associated with delays caused by strikes at discharge ports and the allocation of such risk under voyage charters in general. However, some sympathy will be with owners in circumstances where they bear a significant amount of the exposure for time lost due to strikes which arises as a result of following charterers' orders.

Ultimately, it is a question of commercial negotiation and an owner who includes a provision allowing tendering of NOR WIBON, or even outside of port limits at a customary waiting place, may just as easily include a term that laytime will only be excepted for time lost in the duration of any strike.

Consequently, owners frequenting Spain or South American ports in particular may be well advised to consider closely the relationship between their commencement of laytime and laytime exception clauses.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Elizabeth Turnbull
Leon Alexander
In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.