ukdc bunkerdisputes web

7/28/2019 UKDC BunkerDisputes Web

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Bunkers: a guide to qualityand quantity claims

UKDC

IS MANAGED

BY THOMASMILLER



Engine damage and resultant lost time

caused by bunker quality problemsoccur all too requently.



The quality o bunker uel continues to be asource o concern to shipowners and charterers.Over the last 30 years or so, enhanced reningtechniques have resulted in a decline in the qualityo residual uel and the renery side streams usedas blend components. Added to this the demandor low sulphur uel has resulted in heavy blendingand the use o inappropriate blend components.

Unortunately some marine uels have also beenused as a dumping ground or waste chemicalsand organic substances that have caused seriousoperating problems. Engine damage and resultantlost time caused by bunker quality problems occurall too requently.

Claims arising rom these problems are in generalcomplicated and they are oten rustrated by lack o

evidence, including representative samples, storageand consumption documentation and uel analysisreports. In some cases the uel quality appears tohave met the relevant uel specication but urtherextensive testing reveals the presence o unusualcontaminants. Linking these to engine damagehas proved dicult and it has been necessary toundertake metallurgical examination o worn ordamaged components to determine causation.Preservation o damaged parts has become asimportant as preserving representative uel samples.

In this publication we set out some importantprocedures that should be adopted in orderto reduce the chances o uel related enginedamage and ship down time and provide valuableevidence should a bunker quality claim occur.We also highlight steps that can be taken tominimise the likelihood o bunker quantity claims

and review some o the key legal principlesrelating to the supply o bunkers.

Introduction



Deliveryprocedures

Pre - delivery checks

The ship’s crew need to be instructed to check thequality o the uel to be supplied according to thebunker delivery receipt. Although this documentdoes not provide a ull analysis o the uel, it shouldcontain at least the viscosity, density and sulphurcontent. The Chie Engineer needs to check thatthese meet with his requirements.

Most suppliers’ terms and conditions o sale providethat sampling will be carried out on the barge

and that such samples will be used to determinequality in case o dispute. Not all barges are ttedwith drip sampling devices and, even where theyare tted, it is important that the ship’s crew veriythat they are correctly installed and operatedthroughout the entire delivery. I the barge has nodrip sampling device and samples are drawn romthe barge’s tanks then, where possible, the ChieEngineer should establish that the uel is suppliedrom the tanks that the samples are taken rom. Ithe Chie Engineer is not satised he should issuea note o protest and make an entry in his log book.

Photographs o any irregularities would provideuseul evidence should a claim arise.

A competent member o the ship’s crew shouldattend on the barge beore and ater the delivery tomeasure and record the contents o all the bargetanks. This involves sounding or ullaging the tanks,taking temperatures, establishing the barge trim andusing the calibration tables to determine volumes.I possible the sounding should include the useo water nding paste to establish the amount oree water at the bottom o the tank. The densityo the uel provided on the bunker receipt may be

used to nd the correct conversions or volume atstandard temperature and weight. I this processis carried out correctly there should be no disputeon the quantity o uel discharged rom the barge.I the Chie Engineer has any concerns that the

Purchasingconsiderations

When purchasing bunkers it is important that thecorrect grade is specied and that the sale andpurchase agreement includes the appropriatedescription o the uel to be supplied. This is bestdone by reerence to the International Standard ISO8217 and identication o the required grade withinthis standard e.g. ISO 8217:2010 - RMG 380.

Buyers need to be ully aware o the terms andconditions o the supplier. These tend to be verymuch in avour o the supplier with short time barsand limited liability clauses. They may also reer tothe validity o samples and procedures or handlingdisputes on quality.



barge calibration tables are not correct or that thebarge may have tanks that he has not been able tomeasure he needs to issue a letter o protest at thetime and, i necessary, call an independent surveyorto examine the barge.

All shipowners are advised to use the services oa bunker testing company and to take continuousdrip samples at the ship’s receiving maniold andhave these tested or every delivery. The barge crewshould be invited in writing to witness this samplingand be oered a part o this sample on completiono the bunkering. I the supplier reuses to witnessthis sampling or to receive a sample the ChieEngineer should again issue a note o protestand make an appropriate record in his log book.

The Chie Engineer should whenever possibleavoid mixing uels rom dierent supplies. Newbunkers should be loaded into empty tanks. Ithis is not possible then he should try to avoid50/50 mixing o old uel with new as this is theworst combination i the uels are not compatible.Segregation will also prevent pre-existing uel

becoming contaminated with an o-specicationnew uel. Prior to loading the Chie Engineer needsto measure and record the contents o all bunkertanks and, at the end o the delivery operation,repeat this process.

Procedures during the delivery

Throughout the delivery the sampling on the bargeand the ship should be constantly monitored. It maybe necessary to adjust the drip sampling to ensurethat about 5 litres o bulk sample is collected bythe end o the bunkering. Frequent checks o theloading rate and receiving tank contents need tobe made to avoid spillage.

It is not unknown or a barge to deliver a slug ocontaminated uel in the hope that this will not be

picked up by the drip sample, especially where thedelivery is short and the barge then makes up themissing amount at the end o the delivery. The ChieEngineer should note any stops/start and then payparticular attention to the uel delivered in that period.

Post-delivery procedures

All the barge tanks and ship’s tanks need to bere-measured and the quantity discharged bythe barge, and received by the ship, calculatedand recorded.

The barge outturn gure (mt) should be recordedon the bunker delivery receipt as this will providethe inormation or the invoice. I the Chie Engineerdoes not agree with this gure he must issue anote o protest and make a record in the log book or the oil record book. The oil record book shouldalso state the contents o all the ship’s bunkertanks beore and ater the delivery.

One representative sample should be despatchedimmediately to the testing company.

The supplier has a duty to provide the ship with a“Marpol” sample and the seal number o this mustbe recorded on the bunker delivery receipt alongwith the seal numbers o any other samples issuedby the supplier. Some shipowners take their ownMarpol sample but under the Marpol regulationsthe ocial Marpol sample is that issued to the shipby the supplier. I the Chie Engineer is not satisedthat the Marpol sample was taken properly heshould issue a note o protest.

All the samples and documentation rom thebunkering operation must be kept in a saelocation on board as it may be needed by a PortState Control ocer and would provide valuableevidence in case o a dispute on quality.



The ability to properly pursue or deend bunkerquality or quantity claims depends on the qualityo the evidence. Good record keeping is essential.I the ship maintains detailed records, log book entries and samples and the Member involves theAssociation in good time to allow statements tobe taken, and a proper investigation conducted,then the Member will be in the best position.The prompt appointment o the right expert isparticularly important and the Association canassist in this. There is a risk that vital evidencewill not be secured i an inappropriate person isappointed to visit the ship.

Typical documentation in a bunker dispute wouldinclude, ship’s log books (deck, engine and scraplogs books), oil record books, maintenance records,pre-arrival checklist, bunker start up and completiontimes, bunker tank contents records, consumptionrecords (which uel used when), bunker receipts,historic sample results, photographs o damagedparts, survey reports, class records, statementso engineers, invoices or spare parts, other costsdocuments and correspondence.

The preservationo evidence

Shipowners and charterers need to ensurethat uels supplied and consumed comply withMarpol and other regional regulations concerningsulphur content.

Port State Control ocers may board ships in portand ask to see documentation showing that shipsare compliant. This would include bunker deliveryreceipts, records o Marpol samples and log booksshowing when compliant uels were put into use.In some ports, ocers have obtained samples rom

ships’ bunker tanks and tested these or sulphurcontent and compliance. Ships can be detainedand/or ned or non-compliance.

The current situation is set out below.

• Maximumsulphurcontentoffuelsusedoutside restricted areas (global cap) 4.5%

• Maximumsulphurcontentinrestrictedareas(ECAs) 1.0% (Baltic Sea, North Seaand English Channel)

• Maximumsulphurcontentforshipsin EU ports 0.1%

• Californiahasitsownregulationsrequiringocean-going ships transiting to or rom Caliorniato use either marine gas oil o 0.3% to 1.5%sulphur content or marine diesel oil with a sulphurcontent o 0.5% or less in all main engines,auxiliary engines and auxiliary boilers rom 24 nmrom shore. The sulphur limits are scheduled todecrease to 0.1% in January, 2012.

Compliance with Marpol Annex V1, EU sulphurregulations and otherregional restrictions.



I there are aspects o the delivery that areunsatisactory, a note o protest must be issuedto the barge Master. The note o protest shouldgive details o the problem and a copy should beretained on board or reerence and submissionto the bunker supplier.

A situation may arise where uel has to be usedbeore the analysis results have been received orperhaps no analysis has been carried out. Ship’ssta may experience problems treating and/orburning the uel and engine damage may occur.In this case, it is important to document everything,with dates and times o occurrences, includingwhen the uels were rst used and or how longthey were used, which tanks have been usedand when problems rst occurred. Damagedcomponents must be retained onboard and

photographic/video evidence taken o any blockedlters and separators. Samples should be takenrom the uel system at various locations includingbeore and ater the separators, inlet to the mainengine and ater the transer pump. Samples o anysludge or sediment rom lters and separators, aswell as exhaust valve and turbo charger deposits,should also be taken and sent or analysis.

The quality o the evidence and the decisions takenat the time a bunker problem arises will be crucialto a party’s success in prosecuting or deending a

claim at a later stage.

Notes o protest

Evidence iproblems arise

Most bunker quality disputes will centre on thesamples taken during and ater delivery. In regard tosample evidence, the sampling container should besecurity sealed in the presence o the Chie Engineer.The seal should provide security against tamperingand contamination during the entire bunkeringprocess. The seal number should be recorded bythe parties involved in the tank measurement.

Sample containers should be sealed in thepresence o the Chie Engineer with uniquelynumbered security seals. The seal numbers oall samples taken during bunkering should berecorded in the respective sample labels andbunker delivery note.

The importance o correct labelling o bunkersamples cannot be overstated. Without correctlabelling and an ability to trace samples andanalysis reports, ghting a bunker dispute can bevery dicult. Each sample must be allocated asample number and the bottle label should containthe ship name, barge or installation name, type ouel, date o loading/date o sample, signature o

supplier’s representative, signature o receiver’srepresentative, sampling method and seal number.It is also crucial to careully record who is givencustody o samples sent ashore or testing, wherethey are stored and how they are transported.

The Chie Engineer should reuse to sign samplelabels submitted prior to the completion o bunkeringand i the bunker supplier oers another sample,which the ship has not witnessed, then this shouldbe accepted by the Chie Engineer but when signingor this sample he should state or “Receipt only,

source unknown”.

I sampling, labelling and recording is not doneproperly then it is always open to an opponentto challenge the authenticity o any test results.

Sample evidence



Legal issues

Charterparty considerationsUnder most time charterparties, the supply o bunkersis the responsibility o the charterer. The relevantprovisions o the NYPE (both the 1946 and 1993versions) and Shelltime 4 are very similar and providethat the charterer shall “provide and pay or all uel”.



Property in the bunkers

In most cases, bunkers become the property othe charterer upon delivery o the ship. During the

currency o the charterparty, the owner simply hasthe possession o the bunkers as bailee until theyare purchased back by the owner upon redelivery,which transers ownership back to the owner.

Quantity o bunkers

On delivery, i the ship has less bunkers on boardthan the minimum quantity required under thecharterparty this will not entitle the charterer toreuse delivery. This is provided it does not makethe ship unt or service and that it has sucientbunkers to sail saely to the next port. When the

charterparty term qualies the quantity o bunkerson board on delivery with the word “about”, it isthe owner’s obligation to provide an honestestimate based on reasonable grounds.

With regard to the quantity o bunkers the charterershould supply, the owner is under a general dutyto co-operate and to provide the charterer withall relevant inormation. This should includethe previous and current consumption and anyparticular characteristics o the ship in order toallow the charterer to supply the required bunkers.

The charterer, on the other hand, will not be allowedto order quantities which are not required or theperormance o the chartered service in order, orexample, to make a trading prot on bunker priceson redelivery.

When the charterparty makes no provision or thebunker prices to be paid on delivery or re-delivery,the market price will apply without regard to the priceactually paid, although certain charterparty ormseither speciy the price or provide a mechanismor establishing the price. By way o example, theShelltime 4 orm (line 290) provides that: “Suchprices are to be supported by paid invoices.”

The charterer has the right to select the port at whichthe ship is to take bunkers. I the charterer directsthe ship to an unsae bunkering place either directlyor indirectly through its agent (including the bunkersupplier) and this results in damage to the ship, thecharterer is likely to be held liable or the losses.

Quality o bunkers

In terms o quality, it is generally accepted that the

charterer is under an absolute obligation to provide

bunkers o a reasonable quality which are suitableor the ship in question. I the charterparty includesexpress requirements regarding the type and gradeo bunkers, the charterer will have to comply. Clause9 (b) o the NYPE 1943 orm, or example, expresslyrequires the charterer to supply bunkers o a qualitysuitable or the ship’s engines and auxiliaries andconorming to agreed specications. Should thecharterer ail to comply with the charterparty termsit may be responsible or any damage to the mainengine directly caused by the use o such bunkers.

Fit or purpose

It is also important to note that as well ascomplying with contractual specications, under

English law, the act the bunkers may comply withthe basic specications is not enough. Under theSale o Goods Act 1979, as amended by the Saleand Supply o Goods Act 1994, the bunkers mustbe “t or purpose”.

So what does ‘t or purpose’ mean? This arosein an unreported arbitration decision in 2004,concerning a case in which bunkers had beenound within specication by DNV, but had poorignition qualities due to the nes content. Thetribunal ound that in addition to an express term

in the charterparty there was also an implied termthat the bunkers had to be t or the purposeintended and that the poor ignition qualities inthe uel caused the damage to the engine and socould not have been t or purpose. The tribunalaccordingly ound the charterer in breach andliable or the engine damage.

In that case, the engine was not unusual, in that ithad no particular characteristics or requirements.However, where the engine is unusual or hasparticular requirements the charterer will only beliable or any damage caused i the charterer has

been advised o the unusual characteristics o theengine prior to the supply o the bunkers.

Causation

In bunker dispute cases, it must be establishedwhether the damage complained o to the ship wascaused by the poor quality o bunkers or some otherextraneous cause. The burden o proo is on theowner to establish causation and that there is a link between the bunker quality and the damage sustainedto the engine. It is a high burden which, i not met,

is likely to mean that an owner’s claim will ail.

The charterer has the right to select the port at which the ship is to take bunkers.



Even i bunkers are o

specifcation and may havecaused damage to the engine,the ship’s crew will be undera duty to mitigate any loss.

Mitigation

Even i bunkers are o specication and may havecaused damage to the engine, the ship’s crewwill be under a duty to mitigate any loss. This willinclude de-bunkering any contaminated bunkers ithey cannot be blended and used. The owner willinvariably seek to have the charterer arrange andpay or the de-bunkering. However, i the chartererdenies liability and reuses, the owner should inmitigation consider paying the de-bunkering costsand claiming them rom the charterer at a later date.This is especially important where the ship may bedelayed waiting or the charterer to reach a decisionon de-bunkering. In the event the owner decides tode-bunker and sell the contaminated uel, possiblyas slops or or rening, it is important to involve anappropriate expert to assist in achieving the bestprice or the sale.

The chain o causation may also be broken i thecrew continue to burn the bunkers (which are, orare suspected to be, o specication) and thiscauses or exacerbates any engine damage.

Bunker supply contracts

Where the ship is employed under a voyagecharterparty, the owner remains responsibleor the provision o bunkers and will thereoreenter into a direct contract with a bunker supplier.There are nearly as many dierent orms o terms andconditions as there are suppliers in the market placebut a common thread is that the terms and conditionsare heavily weighted in avour o the supplier.

In terms o quantity, a typical bunker contract will tryto make the quantity recorded by the supplier prevail,meaning that the supplier’s gures are conclusive.

With regard to quality, a supplier’s conditions maytry to exclude any implied terms or warranties.However, i the supply contract is governed byEnglish law the Sale and Supply o Goods Act1994 will still apply.

As or samples, supply contracts requently seek tomake the supplier’s samples binding and conclusive.

The supplier’s terms may also seek to imposestrict terms as regards the notication o claimsand have very short time bars (oten 7 days romdelivery). Suppliers may attempt to limit theirliability to the value o the bunkers and excludeany other consequential losses. Where possiblean owner should obtain the supplier’s terms andconditions in advance in order to be aware o any

restrictive clauses.

Whether the bunkers are ordered by the ownerunder a voyage charter or by the time charterer,the ship may be exposed to an arrest by the bunker



supplier i the bunkers have not been paid or.The bunker contract will invariably contain a lienclause or a Romalpa/retention o title clause.The legal position may vary dependant uponthe jurisdiction.

In the case o the Saetta [1993] 2 Lloyds Rep

268, the charterparty provided that the chartererwould pay or all bunkers on board at the timeo delivery and the owner would on redeliveryaccept and pay or all bunkers remaining on board.Bunkers were supplied to the ship at the request othe charterer, who did not pay or them. The bunkersupply contract contained a retention o titleclause, whereby property in the bunkers was notto pass to the buyer until they had been paid or.The ship was subsequently withdrawn rom thecharterer’s service or non payment o hire.The bunker supplier sued the owner or the price

o the bunkers. The owner claimed it had acquiredtitle in the bunkers when the ship was withdrawn.The court held that it was the owner’s obligationon termination to accept and pay or all bunkersremaining on board. Accordingly, the transer tothe owner was not voluntary under the Sale oGoods Act, and the owner was guilty o conversiono the bunkers when it assumed ownership onwithdrawal o the ship and consumed the bunkers.

This can be contrasted to the recent case o theFesco Angara [2010] EWHC 619 (QB), wherethe supplier sued the owner or the price obunkers which had not been paid by the timecharterer. The charterparty had been terminatedby mutual agreement and the owner had osetthe unpaid hire against the value o the bunkersremaining on board. The Court held that titlein the bunkers transerred to the owner uponredelivery by reason o the oset notwithstandingthe retention o title clause in the bunker supplycontract. The bunker supplier was unable to obtainpayment rom the owner. However, this decision was based on the act that

the owner had no knowledge o the lien clause in thebunker contract or that the bunkers had not beenpaid or and that the agreed delivery o the bunkersto the owner was a voluntary transer o possessionby the charterer under the Sale o Goods Act.

In the BIMCO Standard Bunker Contract, an attempthas been made to strike a air balance betweenthe interests o buyers and sellers. For example,the sampling is to be carried out in the presence oboth parties and at a mutually agreed point. Underthis contract, the Master is also allowed to make

reservations on the bunker receipt or in a letter oprotest regarding quantity or quality. Furthermore, itsets a more generous time limit o 30 days rom thedate o delivery or any claim the owner or the timecharterer may have against the supplier.



Bunker claims tend to relate either to claims madeby suppliers or unpaid bunkers or between anowner and a time charterer or engine damagecaused by the use o o specication bunkers.In addition, underperormance claims can arise.These types o claims generally all within the scopeo the Association’s cover.

The Association has considerable experience andexpertise in the handling o bunker related disputesand a Member should contact the Association as

soon as it becomes aware o a claim or potentialclaim. The Association’s legally qualied stacan then assist in the early appointment o anappropriate expert to ensure the preservation oevidence, including log books, documents andsamples, and the taking o statements rom theship’s crew. Even i the bunkers are ound to beo specication, it is still necessary to establisha causal link between the use o the bunkersand the engine damage. This will oten involvedetailed analysis o all relevant records, includingengine logs and maintenance records and bunkerstorage records.

In addition, the Association oers guidance toMembers as to the appropriate steps to takethroughout the bunkering process includingthe ollowing:

1. Compliance with the uel specifcationscontained in the charter party or usedwhen ordering uel. Members are advised to use a recognised uelstandard such as ISO 8217 and to endeavour tomake a specic reerence to elements such as

aluminium and silicone. Reerence should also bemade to stability and to the need to prohibit theblending o spent lubricants with uel oils.

2. Ensuring, insoar as possible, that the termsand conditions covering the purchase o ueldo not unduly avour the supplier.

3. To have in place proper sampling procedures. As samples rom tanks may be claimed to havebeen mixed with previous bunkers or residues,Members are advised to arrange or drip samplesto be taken throughout bunkering. Proceduresshould cover the exchange, witnessing andstorage o samples.

4. The entering o a ship in a uel analysisscheme (such as FOBAS) and ollowingrecommendations made under that scheme.

Bunker claims and therole o the Association



The Association regularly assists Members in the handling o bunkerquality and quantity claims and some common problems and issuescan be identied. The ollowing examples give a favour o some othe diculties that can arise when the procedures highlighted earlierare not ollowed.

Bunker quality disputes can be complex and costly

The Association supported a time charterer Member in pursuing itsclaim or damages in the approximate sum o $2 million against itssub-charterer ollowing a supply o contaminated bunkers. In thatcase, analysis by DNV ound the bunkers to be o specication ina number o respects. In order to complete the voyage the ship hadto deviate to take on replacement bunkers and then, upon completiono the voyage, the o specication bunkers had to be removed andthe ship’s tanks had to be cleaned. The sub-charterer denied liability,put the ship o hire during the deviation and reused to pay or urtherbunkers or any cleaning costs. In mitigation the Member incurred thecosts and expenses and continued to pay the owner hire.

Lawyers and experts were retained at an early stage to attend theship, collect evidence and generally protect the Member’s position.Several bunker samples were taken and analysed, all o which wereound to be o specication except one sample taken rom the ship’s

maniold and retained by the bunker supplier. In view o that onesample analysis result (the authenticity o which was disputed) thesub-charterer denied liability and when aced with the Member’sclaim, passed it onto the bunker supplier.

The Member’s claim against the sub-charterer was pursued in Londonarbitration whereas the proceedings between the sub-charterer andthe bunker brokers/supplier were in New York and were not initiateduntil the London proceedings were well advanced. This resulted inlengthy delays in the London proceedings whilst the sub-charterercollected evidence rom the bunker suppliers in the New York arbitration.Ultimately, the matter was settled at a mediation held in London

between all the parties. The costs incurred by the Association onbehal o the Member in that claim were in the region o $200,000.

Short time bars can cause difculties

In another case the owner Member’s ship sustained damage tothe main and auxillary engines rom contaminated bunkers. TheMember’s claim against the time charterer under the charterpartywas or the repair costs and other losses sustained, including de-bunkering costs and loss o time. The costs o pursuing the claimwere apportioned between this Association and the Member’s hulland machinery underwriters. The charterer denied liability on thegrounds that the Member did not notiy it or the bunker supplier in

writing o any bunker quality issue within 30 days o the supply o thebunkers, in accordance with the Singapore bunkering procedure.

The Association’sexperience



The Member’s lawyers advised that there was no similar term in thecharterparty requiring written notice to be provided to the chartereror the supplier within a specied time and thereore the Member wasnot under an obligation to do so. Although the case ultimately settled,it does highlight the exposure a charterer can ace when it receivesa bunker claim rom an owner ater the time bar in the bunker supplycontract has expired.

Importance o measurement o quantity o bunkers

The Association regularly assists Members in disputes concerning the

quantity o bunkers provided to a ship. In one particular case the crewo the bunker barge persuaded the ship’s sta that they only neededto measure the oil content o those tanks on board the bunker bargerom which the bunkers were to be supplied. On completion therewas a 40 mt discrepancy between the barge tank measurements andthe quantity measured in the ship’s tank. The Master requested theassistance o the Association, but the barge had sailed away beorea surveyor could reach the ship. The bunker supplier relied on a termin the supply contract that provided that the barge gures were naland binding and pursued the shipowner or payment or the 40 mtwhich the ship never received.

Witnessing o samples is essentialThe Association was involved in pursuing a bunker quality claim oran owner Member with the Member’s case relying on sealed samplesbearing the Chie Engineer’s signature and ship’s stamp. Whenthe Chie Engineer went on vacation, a junior engineer advised theMember that the Chie Engineer had signed the labels in his oce,and that nobody on the ship had witnessed the taking o the sealedsamples or knew where the samples, veried by the Chie Engineer’ssignature, had been drawn rom.

Bunkers should be loaded in to empty tanks

where possibleA time charterer supplied low sulphur uel oil to the owner Member’sship, but the Chie Engineer arranged to take the low sulphur uel into abunker tank which still had a residue o previous high sulphur uel. PortState Control attended on board at the next port and a sample drawnrom the tank was ound to exceed the 1% sulphur limit. The ship wasdetained or some days while the uel tank was emptied, cleaned andnew low sulphur uel oil supplied, at the owner’s expense. The shipalso missed the cancelling date or her next employment.



Damage caused to ship’s engines rompoor quality bunkers can be very costly,not only in terms o repair costs, but alsode-bunkering costs and the loss o timeincurred in dealing with the problem.

There are a number o practical steps whichcan be taken, as highlighted above, to tryto minimise the problems that can arise.

In the event a bunker claim arises, the earlyinvolvement o the Association is crucial.This is in order that an appropriate expertcan be appointed to preserve all availableevidence and so that the Member canbeneft rom the considerable experienceand expertise that the Association has tooer in dealing with bunker related claims.

Conclusion

This publication was produced with theassistance o Mr Chris Fisher o Brookes Bell.



Bunker Checklist*

Some key points to consider:

1. Charterparty clauses:

(i) Detailed uel specication requirements should be set outin clause including:

- recognised uel standard eg latest version o ISO 8217

- sulphur requirements – bunkers to comply with Marpol AnnexVI, EU Sulphur Regulations

(ii) Bunkers to be suitable or ship’s engines/auxiliaries

(iii) Bunker quality, escalation, sulphur content clause

(iv) Bunkers to be tested by recognised uel analysis scheme

2. Bunker supply contracts:

(i) Check terms o contract – are there onerous time bars anddo seller’s supply gures prevail

(ii) When does title in bunkers pass

3. Lien avoidance:

I the Master is asked to acknowledge receipt or bunkerson charterer’s behal then wherever possible invoices shouldbe stamped:

“ The goods and/or services being hereby acknowledged, receiptedor, and/or ordered are being accepts and/or ordered solely orthe account o the charterers [insert name] and not or account osaid ship or her owners. Accordingly no lien or other claim againstsaid ship can arise thererom”

4. Sampling:

(i) Drip samples to be taken throughout bunkering process atship’s maniold

(ii) Sample containers to be sealed in presence o Chie Engineer.Seal numbers o all samples should be recorded in therespective sample labels and bunker delivery notes

(iii) Samples including Marpol sample) to be retained in saeplace on-board

(iv) One representative sample to be despatched to testing company

5. Claims

(i) Place charterer supplier, or underwriters(hull, charterer’s liability) on notice

(ii) Note o protest to be issued

(iii) Sampling to take place by independent testing company

(iv) O-specication bunkers to be discharged(by charterer i liability is established)

(v) Damaged engine parts to be retained, photographic andwritten records should be taken

* This is only a summary guide and is not an exhaustive analysis o all issues that need to be considered.



Engine damage claims or malunction claimsin particular can be difcult to pursue and thepreservation o evidence, including log books,documents and samples is crucial, as is theearly appointment o an expert.



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