top of page

Demurrage, time bars and time zones

An interesting one for those in commercial operations. What time zone should be used to determine whether a demurrage claim is time barred? In The Maria [2021] there was a dispute between owners and charterers as to which of the following was to be the reference time zone - (i) local time where discharge took place; (ii) time zone of the places where owners and charterers were based (same in this case); or (iii) GMT since the contract applied English law?

The vessel completed discharge in Long Beach, US on 24th Dec 2019. The date was 25th Dec 2019 in Europe, given the time difference. Demurrage amount was close to $0.5m and C/P required owners to notify charterers 30 days after completion of discharge if demurrage had been incurred. Notification to charterers was sent on 24th Jan 2020. As per charterers, 25th Dec was ‘day 1’ and the last day for notification was 23rd January 2020 and therefore owners’ claim was time barred. Owners on the other hand said that 26th Dec was ‘day 1’ and demurrage invoice was sent on time. They were going with options ‘ii’ or ‘iii’ (above). So the completion of discharge was on 24th Dec or 25th?


The court started off by mentioning the general provisions which were not controversial between the parties – first, the date of completion of discharge was ‘day 0’ and secondly, a day means a calendar day, i.e. midnight to midnight. Coming to the main question – which date did the discharge complete on (24th or 25th), it said that time is a local concept to be determined using the time zone of the place where the event in question occurs. Discharge of cargo is a tangible event for which the times are recorded in local time in logbooks and various other documents. It would therefore be illogical to refer to different time zones for different purposes (unless of course specified in the charterparty). In court’s own words “the use of local time at the place of discharge gives rise to a single, clear and easily ascertainable date and time of completion of discharge. It tends to promote certainty and reduce the risk of confusion”.



5 views0 comments

Comments


Recent posts

bottom of page