Voyage Charters

Timothy Young KC; Michael Ashcroft; Julian Cooke; Andrew Taylor; John Kimball; LeRoy Lambert; David Martowski; Michael Sturley

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Chapter 2 Parties to the Charter

[clause 1 continued]
… between the party mentioned in Box 3 as Owners …	1
… and the party mentioned as Charterers in Box 4	6
[clause 1 is continued below]

2.1 The persons whose names are inserted in the appropriate boxes or places in the charterparty or fixture recap are those who, as principals,1 assume the rights and obligations of, respectively, owners and charterers under the contract embodied in the charterparty. As Megaw L.J. said in The Virgo,2 this is the place where one would normally expect to find the parties to the charterparty contract defined. The fact that most modern fixtures are concluded by email (and frequently never embodied in a signed charterparty) does not alter the force of this observation since email fixtures will designate the parties and the intended pro form charterparty. There are, however, several reasons why the designation of a person as “owners” or “charterers” in such boxes in the charter is not necessarily conclusive of the question of who are the contracting parties. First, it may be clear from the other terms of the charter, or from the manner in which it is signed (or the email is signed), that some other person is intended to be a party, either in addition to, or instead of,3 the person designated. Second, the principal of the person who enters into the charter can normally sue and be sued upon it as a contracting party, whether or not the name or even the existence of the principal has been disclosed to the other party;4

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and third the broker or agent who enters into the charter purporting to act for a principal may lack authority to contract on behalf of the principal. These situations are examined below.

1. The basic rule: the identity of the parties depends on construction of the charter as a whole

2.2 The ordinary rules of the construction of contracts extend to the identification of the contracting parties; that is to say that the court will seek to give effect to the intention of the parties ascertained from the nature and terms of the contract as a whole,5 construed against its commercial background.6 It sometimes happens that a charterer may be described as “X or his nominee Y with X always to remain responsible for the performance”; X remains liable as principal when he nominates Y and he does so as principal not as guarantor.7 In The Swan,8 Brandon J. described the correct approach as follows:

The intention for which the Court looks is an objective intention of both parties, based on what two reasonable businessmen making a contract of that nature, in those terms and in those surrounding circumstances, must be taken to have intended.

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