| Archives: September 2018

Award 1240 – C/P Synacomex – Cargo of wheat – FIO freight – Clauses 5 et 23 – Handling risks – Brussels Convention.

The unloading in Tunisia of a wheat cargo loaded in Black Sea was carried out by a suction device and a grab bucket. The grab being leaky, the Master notified it in writing to the Receiver. At the end of discharging, a shortage was ascertained by the silo. In order to avoid the vessel’s arrest, the Owner P&I Club delivered a letter of undertaking and then indemnified the Receiver. Afterwards it deputed the Owner to turn on the Charterer in order to recover the indemnified amount as the freight rate on F.I.O. basis and the clause 5 of the C/P put the discharging risk on the Charterer. The latter refused in opposing the clause 23 referring to the Brussels Convention which provides that the Carrier is liable for the handling operations.

The arbitral Tribunal reminded the concept of F.I.O. is not limited to the financial aspects and is sufficient in itself to set aside the Owner’s liability, except if he is at fault, for the consequences arising from the cargo handling. Besides, the clause 5 lays down clearly that these are taken upon by the Charterer. Their contradiction with the Brussels Convention is apparent only and is explained easily by the fact the Convention must apply except for the terms of the C/P which are unambiguous and freely negotiated. Consequently, the Tribunal decided the Charterer had to reimburse the amount paid to the Receiver.