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Covid-19 and off hire

During Covid, there were several instances where the vessels suffered delays until they could provide evidence to the authorities showing there is no Covid infection onboard. The costs for such delays would naturally have to be borne either by owners or charterers depending on the C/P provisions. London Arbitration 13/23 provides some insight into how certain provisions could be interpreted in such instances.

Master passed away due to an illness 3 days before the scheduled Panama Canal transit. He had however sent the pre-arrival information to the Canal authorities before he became ill and the agent had confirmed in return that the vessel was booked for transit. Owners subsequently diverted the vessel to Puerto Rico to land the Master and also got a confirmation from authorities there that this unfortunate event was not Covid related. The agent in Panama advised that the PCR tests would have to be done for all crew members and until then the vessel would be put on hold by the Canal authorities and local health dept. The vessel was finally able to transit the Canal three days after the original schedule following negative PCR test results. Charterers claimed the vessel was off-hire for that period, and were relying on a number of different provisions.

-- Panama Canal transit clause. This clause dealt with the fittings of the vessel and its suitability for transit. As per the Arbitrators, this clause did not encompass issues related to Covid-19 requirements imposed by the authorities.

-- Certificates & Vaccinations clause. Besides other things, it required the crew to comply with all local vaccination & sanitary regulations. Arbitrators held that this clause was not worded to deal with the transitory PCR test certificates which were required here following the unfortunate incident during the voyage.

-- Off-hire provision. This clause stated that vessel was off hire if there was any loss of time by any cause (the word ‘whatsoever’ was however missing) preventing the full working of the vessel, or if the vessel was detained by authorities. It was held that the vessel was not detained, and any administrative restrictions placed on the vessel by the authorities did not fit in ‘…by any other cause…”

Charterers thus could not bring themselves within any of the provisions in the C/P to justify placing the vessel off-hire.


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