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Quarantine due to COVID & Off-hire

Updated: Aug 20, 2022

If a vessel is quarantined due to a COVID positive case onboard then who bears the risk? Charterers would want to put the vessel off-hire whereas owners would want the opposite. It is a tussle but at the end the loss has to fall somewhere and it all depends on the charterparty provisions. London Arbitration 27/22 helps shed light on how the contractual provisions might play out.

3 Eng was suffering from dry cough for weeks before arrival. In the pre-arrival health declaration, the Master declared that there were no sick persons onboard. When requested by health authorities, he did inform them of 3 Eng’s health condition and stressed that he was not showing any other respiratory symptoms. Authorities tested all crew using rapid antibody tests to detect IgM and IgG antibodies. All crew incl. 3/E tested negative except Bosun who tested positive for IgM antibodies. Vessel was quarantined. Bosun’s subsequent PCR test was negative, but the health authorities refused to release the vessel from quarantine. Charterers’ contention was that loss of time was on owner's account as per Clause A and B, and even if reliance is to be placed solely on Clause C then since the event arose as a consequence of the vessel’s or crew’s history prior to delivery (i.e. before vessel coming on charter) owners had to bear the loss.

  • Clause A: That in the event of the loss of time from … deficiency of men … by any other cause preventing the full working of the vessel, the payment of hire shall cease for the time thereby lost …

  • Clause B: Quarantine time…. If due to illness of the crew shall be for Owners’ account … if quarantine detention is due to the vessel having been sent by Charterers to an infected port, such detention time and expenses shall be for Charterers’ account.

  • Clause C: Notwithstanding anything in this charter to the contrary, in the event that the vessel suffers any loss of time in connection with procedures imposed on the vessel … by any port authority … in order to combat avian influenza (or other similar disease), the vessel shall not be off hire … The vessel shall be off hire for all influenza procedure costs which arise solely as a consequence of the vessel’s or officers/crew’s history prior to delivery under this charter …

As per the Tribunal, Clause C took precedence over other provisions in C/P due to the words ‘Notwithstanding anything to the contrary…”. Their interpretation was that if there was loss of time due to quarantine to combat influenza or similar then vessel will not be off-hire except when it was the result of crew’s history prior to delivery. Looking at the facts, the Tribunal was of the opinion that the quarantine orders were not because of 3/E’s symptoms but were a result of Bosun’s positive test and hence unrelated to vessel’s history prior delivery. As per the C/P, charterers had agreed not to put the vessel off-hire under such circumstances.

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