chapter three section 5

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SECTION 5 LAYTIME1. DURATION OF LAYTIME 2. COMMENCEMENT OF LAYTIME 3. INTERRUPTIONS

4. CALCULATION5. LAYTIME CLAUSE

Laytime

Laytime shall mean the period of time agreed between the parties during which the shipowner will make and keep the vessel available for loading or discharging without payment additional to the freight. Laytime calculating is not an activity to be undertaken lightly. There may be considerable sums of money at stake, which will have a noticeable effect on a ships profitability or on a charterers income.In this section we mainly deal with laytime as well as the calculation of laytime , demurrage and despatch.

1 DURATION OF LAYTIMEDuration of laytime can be sub-divided into three categories:

1.1 Definite laytime 1.2 Calculable laytime 1.3 Indefinite laytime

1.1 Definite Laytime

The simplest of the categories, specifies how many days/hours are allowed, whether for loading or for discharging or for both activities, the latter sometimes being known as for all purposes. Terms might be: Cargo to be loaded within 5 weather working days of 24 consecutive hours or 7 working days of 24 consecutive hours, weather permitting, for all purposes. The use of definite laytime is the standard practice in the tanker trades and is almost always fixed at 72 hours being allowed for the combined loading and discharging, regardless of the size of vessel.

1.2 Calculable Laytime1.2.1 Tonnage Calculations

Tonnage calculations are the most common types of calculable laytime. A contract will state that a vessel is to load and/or discharge at a set rate of tons/tonnes per day/hour. Thus, for a ship loading 40,000 metric tones of cargo, minimum/maximum, at a rate of 10,000 tones daily, there will be 4 days of laytime available to her charterers. However, it might be that the ships master has a margin within which to load - e.g. 40,000 tones (5% more or less). Thus, if the ship eventually loaded 41,258 tonnes of cargo, available laytime can be assessed as follows: 41,258 tonnes 10,000 tonnes daily = 4.1258 days

1.2.2 Hatch Calculations

Hatch calculations are more complicated than tonnage calculations but occasionally need to be performed, nonetheless, there are well-established procedures to assist. Let us assume that general cargo vessel HERON is discharging bagged wheat flour on the basis of: A discharge rate of 175 tonnes per hatch daily, total cargo of 7,000 tonnes, 1575 tonnes cargo in the largest cargo compartment and vessel has five (5) hatches.

1.2.2.1 Per Hatch Daily

PER HATCH PER DAY shall mean that the laytime is to be calculated by dividing (A), the quantity of cargo, by (B), the result of multiplying the agreed daily rate per hatch by the number of the vessels hatches. Thus: Laytime = (Quantity of cargo)/(Daily Rate Number of Hatches) = Days Each pair of parallel twin hatches shall count as one hatch. Nevertheless, a hatch that is capable of being worked by two gangs simultaneously shall be counted as two hatches. The vessel is to be discharged at 175 tonnes per hatch daily. Thus 5 (hatches) x 175 tones = 875 tonnes daily, Thus 7,000 tones cargo 875 = 8 days permitted laytime.

1.2.2.2 Per Workable Hatch Ddaily

PER WORKING HATCH PER DAY (WHD) or PER WORKABLE HATCH PER DAY (WHD) shall mean that the laytime is to be calculated by dividing (A), the quantity of cargo in the hold with the largest quantity, by (B), the result of multiplying the agreed daily rate per working or workable hatch by the number of hatches serving that hold, Thus: Laytime = (Largest Quantity in one Hold)/(Daily Rate per Hatch Number of Hatches serving that Hold.) = Days Each pair of parallel twin hatches shall count as one hatch. Nevertheless, a hatch that is capable of being worked by two gangs simultaneously shall be counted as two hatches.

Taking the above example of the HERON, first it is necessary to establish the largest unit of cargo in the vessel. Reference to the stowage plan shows that 1,575 tones contained in No. 3 hold and tweendeck beneath No. 3 hatch constitutes the largest unit. Thus 1,575 tones 175 daily = 9 days laytime overall. However, where two or more hatches serve the largest unit of cargo, the unit tonnage must be sub-divided. Assuming two hatches served No. 3 hold and tweendeck, for example, 1,575 tonnes would first be divided by 2 before applying the factor of 175 tonnes daily. In that case, the largest indivisible cargo unit would become the 1,500 tonnes contained in No. 2 hold and tweendeck and the laytime duration calculation would then be: 1,500 tones 175 daily = 8.571428 days laytime.

1.3 Indefinite Laytime

Occasionally, an shipowner or operator will agree for his ship to be loaded or discharged as per custom of the port (COP); customary despatch (CD); customary quick despatch (CQD) or fast as can (FAC) terms.The risk of bad weather, port congestion and such like are all for the Shipowner / operator to bear.

2 COMMENCEMENT OF LAYTIME2.1 The vessel must have arrived at the place where cargo operations are to be performed; 2.2 The vessel must in all respects be ready to load or discharge the relevant cargo; 2.3 The notice of readiness must be tendered.

2.1 Arrived ship

In general, laytime commences when a vessel is an arrived ship. Simply put it could be considered the time that the vessel arrives at the agreed place. Therefore, the more detailed the description of that place the more careful the shipowner must be to reach that place. Whether a ship is an arrived ship will depend on whether the charter party is a port charter party or a berth charter party. The vessel shall proceed to Ras Tanura is less onerous than The vessel shall proceed to No.2 berth Tas Tanura. The former is known as a port charter and the latter a berth charter. If the vessel berths on arrival without delay there can be no disagreement as to when the vessel is ready and the clock starts but if there is a delay the situation is less clear.

2.1.1 Berth charter parties

BERTH shall mean the specific place within a port where the vessel is to load or discharge. If the word BERTH is not used, but the specific place is (or is to be) identified by its name, this definition shall still apply. Where the charter parties expressly reserve to the charterer the right to name a particular dock or berth, the laytime do not begin until the ship has arrived at that dock or berth. The duty to reach this agreed point or place for loading or discharging is very tough on the shipowners. Even if the vessel has to wait at the immediate vicinity for the particular berth agreed in the charter party, the vessel is not considered to have arrived. Therefore any loss of time in waiting for the berth to become vacant will fall on the shipowners.

WIBON

Nowadays it is more common to find port charter parties. Admittedly many charter parties are agreed on the basis of one safe berth, one safe port, and that technically is still a berth charter party. But there is the usual provision of whether in berth or not inserted in the charter parties and that will effectively expand a berth charter party into a port charter party. WHETHER IN BERTH OR NOT (WIBON) shall mean that if no loading or discharging berth is available on her arrival the vessel, on reaching any usual waiting-place at or off the port, shall be entitled to ender notice of readiness from it and laytime shall commence in accordance with the charterparty. Laytime or time on demurrage shall cease to count once the berth becomes available and shall resume when the vessel is ready to load or discharge at the berth.

2.1.2 Port charter parties

PORT shall mean an area, within which vessels load or discharge cargo whether at berths, anchorages, buoys, or the like, and shall also include the usual places where vessels wait for their turn or are ordered or obliged to wait for their turn no matter the distance from that area. If the word PORT is not used, but the port is (or is to be) identified by its name, this definition shall still apply. The English courts once held that the vessel must be within the commercial area of the port and this had been amended to mean the normal waiting area for a port. The importance, of course, being as to who will pay for the time waiting for a berth or the commencement of the cargo operation.

Rule and case

The rule is that the charter party names a port simply, without further particularity or qualification, the ship is an arrived ship when, if she cannot proceed immediately to a berth, she has reached a position within the port where she is at the immediate and effective disposition of the charterer. If she is at the place where waiting ships usually lie, she is in such a position unless there are some extraordinary circumstances, proof of which lies on the charterer. A vessel carrying grain under a port charter party anchored at the Bar anchorage at Liverpool. The anchorage was 17 miles from the usual discharging berth, but was the usual place where grain vessels lay while awaiting a berth. Held by the House of Lords that she was an arrived ship when she reached the anchorage, for she was then at the immediate and effective disposition of the charterer.

2.1.3 Port Congestion

Port congestion is now commonplace and brings with it a further worry for shipowners in that it is the reason for most cases of lengthy delay and the accruing of huge demurrage. Who must bear the financial risk of delay in a congested port will depend on what is stated in the charter party. Contracts usually specify that notices of readiness can be tendered from a normal waiting place, whether in port or not (WIPON), whether in berth or not (WIBON), whether in free pratique or not (WIFPON) and whether customs cleared or not (WCCON). The above terms are often com

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