Singapore: The Chem Orchid: Proper Termination Of A Bareboat Charter Party

Last Updated: 17 February 2016
Article by Probin Dass

The recent decision of Justice Steven Chong addresses certain important issues which are of practical significance to ship-owners and bareboat charterers alike. Briefly, the facts are as follows:

1. The Facts

Four separate in rem actions were commenced against the Chem Orchid (the "Vessel") pursuant to separate claims by the plaintiffs against the demise charterer of the Vessel (the "Defendant"). The owner of the Vessel then applied to set aside the in rem writs on the basis that the demise charter had been terminated before the writs were issued. If this was the case, the in rem jurisdiction of the Singapore High Court was wrongly invoked because it is a requirement that the Vessel had to be owned by the Defendant or at least demise chartered by the Defendant at the time the writs were issued. Justice Chong held that the purported notice of termination issued by the owner to the Defendant was invalid and, therefore, the Defendant was still the demise charterer when the writs were issued. Therefore, the plaintiffs were entitled to invoke the court's in rem jurisdiction against the Vessel and the owner's application to set aside the writs failed. Nevertheless, Justice Chong went on to consider two important questions that were raised.

2. The Issues

(a) The Physical Redelivery Issue

First, the physical redelivery issue – assuming the purported notice of termination was valid, was this sufficient to terminate the demise charter or was the Defendant also required to physically redeliver the Vessel to bring the demise charter to an end? Justice Chong affirmed the general rule that physical redelivery to the vessel's owner is necessary to bring a demise charter to an end. This is because of the distinctive nature of a demise charter.

Justice Chong explained: "the complete transfer of possession and control from the ship-owner to the charterer is the very quintessence of a bareboat charter. Thus, physical redelivery (which effects a reversion of the transfer of possession and control) is necessary for its termination."

Counsel for the Vessel's owner argued that the parties had effectively contracted out of this requirement in the terms of the demise charter. However, Justice Chong disagreed with this argument as the facts of the case pointed otherwise. He further expressed serious doubt that parties to a demise charter could contract out of the requirement for physical redelivery. This is because of the principle just expressed that, by its very nature, a demise charter cannot in fact be terminated until the demise charterer returns possession and control to the owner. Additionally, because of the fact that the demise charterer retains possession and control until physical redelivery of the vessel to the owner, third parties dealing with the demise charterer, who would reasonably assume that the demise charterer is the owner of the vessel, should be protected by being allowed to arrest the vessel to secure any claim such third parties may have against the demise charterer. If an owner could terminate a demise charter simply by giving the charterer a notice of termination, third parties would be prejudiced. Justice Chong observed, "If they [i.e. third parties] deal with the vessel after contractual termination but before redelivery, it is possible that they may have in fact dealt with neither – the owner certainly does not have control and possession of the vessel during this curious period where she is in 'limbo' whereas the party in full possession and control is no longer the bareboat charterer following contractual termination. In that event, the third party will have no basis for arresting the vessel and is thus left without security for its claim."

Therefore, Justice Chong reiterated the general rule that a bareboat charter party is terminated only upon physical delivery of the vessel back to the owners. Further, he doubted that it would be right to allow parties the freedom to contract out of this general rule.

(b) The Constructive Redelivery Issue

Another related question Justice Chong addressed was whether the Vessel had been constructively redelivered, thereby terminating the demise charter before the writs were issued. The owner's argument that this had been the case was rejected by Justice Chong. On the facts, Justice Chong was not able to find that the Vessel had been constructively redelivered. However, of significance is Justice Chong's firm view that he did not think the doctrine of constructive redelivery should have any place in Singapore law. He saw no need for it and further expressed concerns that third parties could be unduly prejudiced by the acceptance of the doctrine. Therefore, for the same reasons he gave for rejecting the notion that parties to a bareboat charter party could contract out of the requirement for physical redelivery, he rejected the doctrine of constructive redelivery.

3. Comment

The balance Justice Chong struck between the competing interests of ship-owners and third parties dealing with the bareboat charterers and the ship is clearly a fair one. If a bareboat charter party could be terminated by a private notice from the owner to the charterer, third parties providing services to, or utilising the services of, the vessel after the notice had been sent could be left with no security for any claim they may have against the bareboat charterer. The ship-owner, on the other hand, is fully aware of and accepts the risk that his ship may be arrested by a third party while she is in the possession and control of the charterer. That is a normal incident of a bareboat charter party. In Justice Chong's words, "... an owner who lets his vessel out on bareboat charter does so with his eyes wide open: he knows the risks attendant to such an arrangement and has made a considered commercial decision to proceed. By contrast, a third party has little way of knowing whether the vessel he is dealing with is on bareboat charter, let alone that the bareboat charter has been terminated."

The position in Singapore is therefore clear. A bareboat charter party can only be terminated by the actual (as opposed to constructive) physical redelivery of the vessel by the charterers to the owners.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions