Notwithstanding that a time charterer has little or no say in the way a vessel is technically managed, can it be found liable for negligence for (in)actions of the owner, manager or ship’s crew? In The Yochow [2021] such a claim was being brought against the time charterer for damage done to the dock.
In brief what happened was, the helmsman was ordered to put the wheel to starboard, but he turned it to port instead (fatigue was the reason cited) as a result of which the vessel collided with a barge and also caused damage to a nearby dock in Houston ship channel. The dock owner decided to bring a negligence claim against, besides other parties, the time charterer (TC) who they contended were the de facto owners of the vessel for reasons such as:
TC had renamed the vessel and painted the funnel with their logo;
TC had installed a software onboard to monitor the vessel’s movements;
Lloyd's Register List of Ship Owners & Managers listed TC as the ‘manager’ of the vessel; and
TC listed the ship as one that they "operated" in one of their Sustainability Reports.
Dock owner also argued that time charterers were negligent cause they chartered the ship without 'vetting' the head owners’ finances or ship’s safety protocols.
The court said 'no'. A time charterer's duties are limited to traditional spheres of activity and exercising control over a ship’s management & navigation is not one of them. For ‘a’ the court said that outward appearance of the vessel was immaterial; for ‘b’, TC was simply tracking the vessel because it had supplied fuel to the ship; for ‘c’, it found that Lloyd’s was an independent entity and its perception did not matter; for ‘d’, a one-word descriptor in a report has no bearing on TC's practical control over the ship. As for the last point on vetting, the Court found that a time charter simply had no duty to vet the vessel or head owners.
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