Singapore Arbitration 03/19 recently addressed a seemingly straightforward question on 'subject' clause (in relation to vessel's fixture). The relevant clause was: “SUB shippers/receivers 24h after…receiving all supporting docs”. Owners sent the supporting documentation which contained an expired P&I cert. Charterers requested for a copy of the valid cert but owners in their second submission sent the same docs . Not having heard from charterers for 3 days, owners withdrew the vessel. Charterers alleged wrongful withdrawal.
Charterers’ case was that owners had to provide all supporting docs (i.e. every valid document) for the 24h clock to start, and time would not start to run if expired docs are sent. As per them, owners were also under an implied obligation to check with charterers before withdrawing the vessel.
Tribunal first explained the purpose of mentioning time in the sub clause - charterers to seek shippers' approval and send the confirmation to owners, and if not done within stipulated time then owners can withdraw the vsl. The clock starts “EACH” time the documents are presented and if owners inadvertently send expired docs then charterers had to respond within 24 hrs. Also time runs continuously irrespective of whether it is outside office hours.
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