top of page

Vessel captured by pirates - is hire suspended? (hint: it depends on the wording of the clause)

Once a vessel is hijacked by pirates, there are bound to be many commercial disputes. Hire payment is one of them, as seen recently in The Eleni P [2019], where owners were claiming $4.5m from charterers.

Capture, seizure and arrest clause (CSA) stated “should the vessel be captured or seized or detained or arrested by any authority hire shall be suspended”; and piracy clause said “charterers are allowed to transit Gulf of Aden…in case vessel is kidnapped...then hire shall be suspended…”

As for CSA cl, owners argued that there must be a capture by authorities, whereas charterers contended that ‘captured’ was a free-standing provision, encompassing capture by any cause.

Court preferred reasoning of the owners based on syntactical analysis and language of the clause Piracy clause however dealt a fatal blow to owners’ case. Their argument was that this cl. only caters to incidents occurring within Gulf of Aden and Eleni P was hijacked in Arabian Sea. Court held that GoA cannot be defined geographically. They understood this cl. to carve a different risk regime to facilitate passage through Red Sea and to allocate piracy risk. Risk of delay/detention due to piracy fell on owners. Court found this cl. to be quite different from Conwartime cl. (which was also a part of this C/P).

5 views0 comments


Recent posts

bottom of page