What is a demurrage time bar Charterparties almost invariably contain a time bar clause — a strict deadline within which the shipowner must present its demurrage claim. Missing this deadline results in the total loss of the right to recover, even if the claim is well-founded and fully documented. Courts and arbitrators apply these clauses strictly, without exception. A typical clause reads: Demurrage, if any, shall be paid by Charterers upon receipt of Owner’s invoice,…
In grain trading, shipment disruptions are routine. Export embargoes, strikes, war, natural disasters — any of these can make loading impossible. Standard GAFTA contracts include a specific mechanism for this: the Prevention of Shipment clause. In this article, I’ll explain how it works, what events it covers, what procedures must be followed, and what happens if a seller gets it wrong. Why Prevention of Shipment Exists Under English law, a contract for sale creates strict…
Letter of indemnity (LOI) is a written undertaking by one party to compensate another for losses arising from a specific risk. In shipping, LOIs are used in two main situations: when a shipper asks the carrier to issue a clean bill of lading despite reservations about the cargo, and when a receiver asks the carrier to release cargo without presentation of the original bill of lading. Both situations expose the carrier to serious legal risk…
A clean bill of lading is a bill of lading that contains no clauses or notations regarding defects in the cargo or its packaging. For a seller under a CIF or FOB contract, for a bank financing the transaction through a letter of credit, and for a buyer accepting documents — the question “is the bill of lading clean?” — can determine the fate of the entire transaction. Bill of Lading as a Receipt for…
Notice of Appropriation is the seller’s notification linking a specific cargo to the contract. In grain trading, it’s typically an email, not a formal sealed document — but GAFTA proformas strictly regulate what must be in it. Miss the deadline or get it wrong, and the buyer can reject the goods and terminate the contract, even if the cargo is already loaded on the vessel. One day late = contract terminated. Appropriation applies to CIF…
Default clause is a damages compensation mechanism built into standard GAFTA contracts. When one party commits a material breach (breach of condition), the injured party may declare default and demand compensation equal to the difference between the contract price and the market price of the goods on the date of default. The fundamental difference from the general rules for damages recovery under English law: the GAFTA default clause locks in a specific formula for calculating…
The phrase ‘payment before breaking bulk’ has long been used in contracts for the supply of grain and other bulk commodities. However, despite its apparent simplicity, there are still many contradictory and outright mistaken interpretations. If one tries to find an explanation in open sources, one will see that there is still no unified and precise understanding of this term. Let us examine a specific example from a typical contract clause: Payment: 100% net cash…
Business owners frequently allocate substantial resources toward employee development, simultaneously granting personnel access to proprietary data, customer records and intellectual property. It stands to reason that organisations seek to safeguard such investments and avoid scenarios where departing senior staff members transition directly to rival firms or launch competing ventures leveraging expertise and connections acquired during their tenure.This protective mechanism takes the form of non-compete provisions (alternatively termed restrictive covenants) incorporated into employment agreements. Nevertheless, English…
The English approach to contractual penalties stands in marked contrast to that prevailing across continental European jurisdictions. Where many legal systems permit parties broad latitude in specifying monetary consequences for non-performance, the courts of England and Wales will strike down stipulations whose primary purpose is punitive rather than compensatory. For practitioners operating in the sphere of cross-border commerce — particularly those advising on commodity supply agreements governed by GAFTA or FOSFA terms — a working…
The London Maritime Arbitrators Association (LMAA) has developed several frameworks to resolve maritime disputes. Its flagship LMAA Terms provide a comprehensive set of rules for large and technically complex cases. The Intermediate Claims Procedure (ICP) fills the gap for claims up to around USD 400 000, while the Small Claims Procedure (SCP) is designed to handle more modest cases quickly and economically. This article concentrates on the SCP, reviewing when it applies, how arbitrators are appointed,…
