The Eurus

The Notice of Readiness (NOR) has for years been an integral part of voyage charterparty construction. The law reports are rife with disputes contesting the validity of a notice of readiness.1 These disputes revolve around what may be considered the primary function of a NOR, that is, to establish temporal anchorage for commencement of laytime. Noted authors2 on voyage charters suggest that there are three particular issues arising from a discussion on a notice of readiness: (1) the place where the vessel should be before a valid notice of readiness can be tendered, (2) the vessel’s ability to load or discharge, and (3) the conduct of the charterer. Recently, in the rather innocuous case of The Eurus,3 another potential function of the NOR was argued successfully at the arbitration level and may well gain support by charterers and ultimately the courts. This new function is that, in a voyage charterparty, a vessel cannot berth and commence loading prior to tendering a NOR. If such interpretation gains further and wider juridical acceptance, then ships’ masters and shipowners are placed in a very awkward position at the arrival port. Furthermore, this function is most certainly contrary to a crucial implied tenet of a voyage charter, that of despatch. Perhaps the arbitrators’ decision could support cogent arguments for new implied indemnifications in voyage charterparties. Evidence that the judiciary is warming to such a notion is shown in the recent seminal case of The Island Archon.4 In light of the arbitrators’ decision, it is advisable for shipowners either to re-draft standard NOR clauses or to insert clarification riders into voyage charters. The decision of the arbitrators is certainly most unwelcome. Rix, J., did not take the opportunity to comment on this issue directly, having to address counsel’s arguments of indemnification and causation instead.5 Fortunately in The Eurus commercial realities prevailed. However, this new expanded function of a NOR remains inchoate and awaits testing in a court of law.