Owners chartered their bulk carrier to Charterers for a time trip charter from India to China on an amended NYPE 1993 form. The Charter provided for hire to be paid every five days in advance. A provision in clause 11 (“line 146”) stipulated that “no deductions from hire may be made for any reason under Clause 17 or otherwise” without the express written agreement of Owners. Clause 17 was an off-hire clause providing (in common terms) that, in the event of loss of time from causes preventing the full working of the vessel, hire should cease for the time thereby lost. Additional clause 67 of the Charter provided that all time lost, delays and expenses where the Vessel was infected with an infectious or contagious disease were to be for Owners’ account and the Vessel was to be off hire.

The Vessel arrived off Lanqiao in China for discharge in May 2021 but could not obtain a berth through to August 2021, when she was redelivered by Charterers without having discharged her cargo. Charterers alleged the Vessel was off-hire for that period by operation of clause 67. Owners commenced arbitration. Relying on line 146, they applied for a partial final award for unpaid hire. The arbitrators found in Owners’ favour. Charterers appealed. They argued that line 146 only applied to preclude them from offsetting sums due to them from instalments of hire that had fallen due, and not to the non-payment of hire where the vessel was off-hire and the obligation to pay hire had not accrued.

Decision: Appeal dismissed.

Held: (1) Under a time charter, the risk of delay is fundamentally on the charterer, who remains absolutely liable to pay unless relieved of the obligation under an off-hire provision, even if it is obvious that hire payable in advance will never be earned.

(2) An off-hire provision is an exception clause. The burden lies on the charterer to bring itself within the plain words of the clause. Ordinarily, a charterer can make deductions from hire only where they are made in good faith and on reasonable grounds.

(3) The effect of line 146 was that Charterers were liable to pay. Line 146 was embedded in the hire payment clause, clause 11, which signified its importance in the hire provisions.