Over the past years many vessels have been detained by Indonesian or Malaysian navies for anchoring in their waters without permission. Where should the commercial losses fall in such an event? On the charterers’ side for ordering vessels to drift/anchor in Singapore OPL to avoid port dues and taxes, or on owners? The Afra Oak [2023] provides much needed guidance.
In this case the charterer ordered the vessel to "proceed to Spore EOPL for further orders”. Master decided to drop anchor within Indonesian archipelagic waters at a distance of 6nm from the land. Owners were claiming for breach of safe port warranty. Charterers were counter claiming for unseaworthiness basis a defective passage plan and Master’s disabling lack of knowledge. C/P incorporated the US Hague Rules, and the owners were relying on the immunity in IV(2)(a) which states owners are not responsible for losses due to “Act, neglect, default of the master… in the navigation or in the management of the ship” for claim by the charterer.
As per the Arbitration Tribunal, the gist of the order by charterer’s was to anchor wherever it is safe to do so in EOPL, using good navigation and seamanship. There was no breach of the safe port warranty as the danger could be avoided by good navigation and seamanship. The vessel was not deemed to be unseaworthy, and owners could rely on the defence in IV(2)(a) of Hague Rules for the losses being claimed by the charterer. Charterer was now appealing this part of the Tribunal’s decision.
The English High Court agreed with the decision of the Tribunal. They construed the Master’s decision to drop anchor in Indonesian waters in contravention of local laws as an error of judgment in navigating the vessel, and owners were allowed to benefit from IV(2)(a) of the Hague rules.
Note: Singapore OPL as a term can be defined loosely at best, has no geographical extent, and was probably introduced for commercial convenience. Contractual clauses will determine where the commercial losses fall, but they will not offer any protection to the seafarers when under arrest or detention. With the navies of both Malaysia and Indonesia cracking down on ships and crew for anchoring without permission in their waters, is it time to re-evaluate both issuing and following such orders?
Link to judgement: https://www.bailii.org/ew/cases/EWHC/Comm/2023/2978.html
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