CHARTER PARTIES

Time Charter Party

Description of the Vessel

Under a time charter, the description of the vessel is of the utmost importance, both with regard to the physical condition as with regard to the operating possibilities (or operating limitations) of the vessel by the Charterer. The description of the vessel is more important under a time charter than under a voyage charter; hence, it will be more detailed and more precise.

The Name of the Vessel

The Owner must deliver the named ship and not another one.

The Flag of the Vessel

The flag of the vessel can be important, especially with regard to flags of convenience, excluded areas, declaration of war, and the like.

The Class of the Vessel

The vessel must be delivered to the Charterer in a perfect seaworthy condition. The Owner must maintain her in a seaworthy condition during the entire chartering period. The Owner is and remains thus uninterruptedly responsible for the seaworthiness of his vessel. In every time charter party, this condition is clearly specified. (See also: BALTIME, Clause 3, Owners’ Obligations and GENTIME, Clause 11, Owners’ Obligations.)

The documents which determine the vessel’s seaworthiness are:

the Certificate of Seaworthiness delivered by the national Maritime Inspectorate;
the Classification Certificate delivered by the Classification Society.

In most countries the Certificate of Seaworthiness does not exist or is not recognized as such and the seaworthiness of the vessel has to be demonstrated by the International Certificates implemented by SOLAS such as the Passenger Ship Safety Certificate, the Cargo Ship Safety Construction Certificate, etc. and the Classification Certificates. (See also Ship’s Documents and Certificates and in particular the paragraphs Classification Certificates and Certificates Required by Law.)

If a ship has sustained damage in a foreign country, the consul of the flag State of the ship will withdraw the Class Certificate and the Certificate of Seaworthiness or possibly any SOLAS Certificate. The Consul will return the certificates to the master, only after the ship has been repaired and the Class Certificate duly endorsed by the class surveyor.

GT/NT

The GT and the NT are only important to the Charterer for the determination of the harbour dues.

Cubic Feet Grain/Bale Capacity Available for Cargo

With regard to the loading, the time charter agreement must indicate the deadweight and the volumetric capacity (V.C.) of the vessel.

The deadweight of the vessel is always given in relation to the summer freeboard (or summer deadweight - SDWT) inclusive of bunkers, lubricating oil (L.O.), fresh water (F.W.), stores and the ship’s constant. The tonnage is always preceded by the word “about” which is in the Owner’s advantage.

Example

BALTIME: “….. carrying about …..”

NYPE: "Deadweight ……. long/metric tons (cargo and bunkers, including fresh water and stores not exceeding …… long/metric tons) on a salt water draft of .... on summer freeboard".

The time charter agreement must also indicate the volumetric capacity (V.C.) of both the “grain space” and the “bale space” of the vessel. These volumetric capacities must correspond with the figure shown on the plans of the vessel ("... as per builder's plan .... cubic feet grain/bale capacity....").

Some charter parties do not mention anything with about the draft of the vessel. The maximum draft on the different load lines (Plimsoll Marks) can always be found on the deadweight scales and other documents.

Engine Power

The power of an engine is expressed in horsepower (hp) or in kilowatt (kW). 1 hp = ¾ kW.

The power of an engine can be expressed in different ways:

In effective horsepower (ehp).
In shaft horsepower (shp);
In nominal horsepower nhp).
In Indicated horsepower (ipk).
In brake horsepower (bhp).

Time charter parties usually mention the indicated horsepower.

Speed capability in knots and fuel consumption

Since the Charterer pays the hire in units of time, the speed and fuel consumption are of paramount importance for the correct determination of the operation feasibilities of the vessel. The speed and fuel consumption indicated in the charter party are usually in function of certain weather conditions ("...in good weather and smooth water...") and towards a given draft. Often two speeds are given: one for the vessel in ballast and one for the laden ship.

Generally, the speed and fuel consumption are preceded by the word “about” which should allow for a reasonable margin. A better description of the speed and fuel consumption, for instance, is “….. speed 15-16 knots and consumption 25-26 tons diesel oil”. In that case the vessel may not run less than 15 knots but must not run more than 16 knots and the fuel consumption may not be higher than 26 tons.

More and more, the average cruising speed of the vessel is given. In the STB Tanker Charter Party the following description is given:

"8. The Owner warrants that the Vessel is capable of maintaining and shall maintain throughout the period of this Charterparty on all sea passages from Seabuoy to Seabuoy guaranteed average speed under all weather conditions of .... knots in a laden condition and.... knots in ballast (speed will be determined by taking the total miles at sea divided by the total hours at sea as shown in the log books excluding stops at sea and any sea passage covered by an off-hire calculation) on a guaranteed daily consumption of ....tons (of 2.240 lbs) of Diesel/Bunker C/High Viscosity Fuel Oil maximum .... seconds Redwood No.1 at 100° E F. for main engine, and .... tons (of 2.240 lbs) of Diesel for auxiliaries for propulsion".

If the speed and fuel consumption don’t correspond to the indicated specifications in the charter party, then the Charterer has the right to demand a compensation or an adjustment of hire.

The Owner guarantees the minimum speed and the maximum fuel consumption on condition that the fuel which is used, corresponds to the specified quality which is usually indicated by its viscosity.

The viscosity of a fluid is the friction power which occurs in a flowing fluid. It is the resistance which the fluid exerts against its flowing so that the viscosity indicates the degree of fluidity. A high viscosity indicates that the fluid is like a syrup. The viscosity of a fluid decreases when it is heated and it then becomes more processable and suitable to be pumped or vaporized.

The viscosity of a fluid is measured by means of a viscometer which measures the time that a given quantity of fluid needs to flow through a standard capillary tube at a given temperature.

In theory, a distinction is made between the dynamic viscosity η expressed in poises (p) or in centipoises (cp) and the kinetic viscosity γ expressed in Stokes (St) or in centiStokes (cSt).

The dynamic viscosity is the coefficient of internal friction.

The kinetic viscosity is the coefficient of fluidity which is obtained by the quotient of the dynamic viscosity and the density of the fluid, thus γ = η / density.

In some countries the viscosity is expressed in a different unit:

W-Germany: in degrees Engler (°E). The viscosity is measured in the viscometer of Engler.
England: in seconds Redwood I (sec Redw I or RI). This is the time necessary for a fluid of 50 cm³ to flow through the viscometer.
U.S.: in seconds Saybolt Universal (SSU) or seconds Saybolt Fural (SSF).

Since some time, the centiStoke has become the universal unit of viscosity and has totally replaced the seconds Redwood I, by 100° F.

Following table gives the viscosity conversions for “Gas and Diesel Oils” and for “Fuel Oils”.

Example

Fuel oil with a viscosity of e.g. 1250 seconds Redwood I at 100°F has a viscosity of 150 Cst at 50° C.

See also Ewart W., Bunkers, A guide for the Ship Operator, London, Fairplay Publications, 1982, 5.

The greater the viscosity of fuel, the poorer its quality. If, for instance, fuel of max 400 seconds Redwood I at 100°F (60 cSt at 50°C) has been agreed on and the Charterer supplies fuel of e.g. 950 seconds Redwood I at 100°F (120 cSt at 50°C), the Owner will be entitled to file a complain against the Charterer and demand a compensation if the engines get damaged. If he supplies fuel of a lower viscosity (thus of a better quality), then the Owner will simply accept it. The Owner will nonetheless inform the Charterer that he will not agree to pay any refund on the hire for the use of fuel of a better quality.

Notwithstanding the fact that fuel was used of the correct viscosity, at the termination of the time charter the engines may anyway show an abnormal wear or even be damaged. This may be due to the fact that the fuel used was impure or had too much sediment, water, sulpher and/or vanadium.

Therefore, since a number of years, the “Bunker Fuel Quality Clause for Time Charters”, drawn up by BIMCO and ICS, has been included in the time charter agreements:

“Bunker Quality Control Clause for Time Chartering

(1) The Charterers shall supply bunkers of a quality suitable for burning in the Vessel's engines and auxiliaries and which conform to the specification(s) mutually agreed under this Charter.

(2) At the time of delivery of the Vessel the Owners shall place at the disposal of the Charterers, the bunker delivery note(s) and any samples relating to the fuels existing on board.

(3) During the currency of the Charter the Charterers shall ensure that bunker delivery notes are presented to the Vessel on the delivery of fuel(s) and that during bunkering representative samples of the fuel(s) supplied shall be taken at the Vessel's bunkering manifold and sealed in the presence of competent representatives of the Charterers and the Vessel.

(4) The fuel samples shall be retained by the Vessel for 90 (ninety) days after the date of delivery or for whatever period necessary in the case of a prior dispute and any dispute as to whether the bunker fuels conform to the agreed specification(s) shall be settled by analysis of the sample(s) by (...) or by another mutually agreed fuels analyst whose findings shall be conclusive evidence as to conformity or otherwise with the bunker fuels specification(s).

(5) The Owners reserve their right to make a claim against the Charterers for any damage to the main engines or the auxiliaries caused by the use of unsuitable fuels or fuels not complying with the agreed specification(s). Additionally, if bunker fuels supplied do not conform with the mutually agreed specification(s) or otherwise prove unsuitable for burning in the ship's engines or auxiliaries the Owners shall not be held responsible for any reduction in the Vessel's speed performance and/or increased bunker consumption nor for any time lost and any other consequences.”

According to paragraph 2 of the “Bunker Quality Control Clause”, a “Bunker Delivery Note” must be presented, when fuel is delivered, specifying the quantity and the agreed specifications of the fuel (see below). At the same time, samples shall be taken at the manifold which shall be sealed and retained by the vessel and the Charterer for 90 days. According to the “Bunker Delivery Note”, the fuel may only contain a certain quantity of carbon, sediment, water, sulpher and vanadium.

If the viscosity of the fuel delivered does not correspond to the viscosity specified in the charter party, the master may refuse this fuel. If the Charterer is unable to obtain fuel of a better quality, then the ship will be obliged to accept this fuel and the Owner must immediately declare the Charterer in default. The Owner will not be able to further guarantee that his ship will sail at the specified speed or that the fuel consumption will not be higher. The Charterer will also be held responsible in case of damage to the engines. If possible, the agent will inform the Charterer of this situation.

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