Shipowners entered into crew management agreements on the Crewman B forms. On 30 January 2015 owners gave notice to terminate under cl 14, which provided for a 3-month notice period and that crewing fees were payable for the entirety of that period.
The 3 months were due to expire on 30 April 2015, but before that date the owners sold the vessel. Cl 15 provided for automatic termination if owners sold the vessel, and for payment of a 2-month lump sum once the crew had left the vessel. Crew managers invoiced owners for that lump sum, and owners paid. Owners then claimed repayment of that lump sum, on the basis that it had been paid by mistake.
The arbitral tribunal held that crew managers were not entitled to the lump sum payable under cl 15, as termination had been under cl 14. Cl 15 had no application as the contract had already been terminated. The crew managers appealed.
Held (Cockerill J):
The appeal was allowed.
The issue was whether the contracts were terminated pursuant to cl 14 or cl 15. Cl 14 provided that termination would occur 3 months after the notice. That made it clear that the contract continued until that period expired. Reading the clauses together it was implausible that cl 15 rights were taken away where notice to terminate was given under cl 14. The balance of uncommerciality changed as the notice period proceeded: for example, if notice to terminate was given under cl 14 and the vessel was sold on the following day, then crew managers would receive 2 months' fees instead of 3 months'.
(Uniteam Marine Shipping v MS "United Tenorio" Schiffahrtsgesellschaft, unreported, 23 March 2018, Cockerill J)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
