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SECOND NUALS NATIONAL M OOT COURT COMPETITION 2015

IN THE HIGH COURT OF JUDICATURE AT SCINDIA


ADMIRALTY JURISDICTION
Zeus & Co. .............................................................................................Applicant
v.
YA MAVLAYA...................................................................................Respondent
With
NAND APARAJITHA & INDIAN GRACE... .....................................Applicant
v.
ALIAKMON........................................................................................Respondent
With
Xiang Ship Building Yard.....................................................................Applicant
v.
ALIAKMON........................................................................................Respondent

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

TABLE OF CONTENTS

LIST OF ABBREVIATIONS................................................................................................ 4
INDEX OF AUTHORITIES ................................................................................................. 6
CASES:............................................................................................................................. 6
BOOKS AND ARTICLES: ............................................................................................... 7
STATUTES, CONVENTIONS, ETC.: .............................................................................. 7
STATEMENT OF JURISDICTION ...................................................................................... 9
STATEMENT OF FACTS .................................................................................................. 10
STATEMENT OF ISSUES ................................................................................................. 10
SUMMARY OF ARGUMENTS ......................................................................................... 13
ARGUMENTS ADVANCED ............................................................................................. 15
I. The High Court of Scindia does not have jurisdiction over the case. ......................... 15
II. Blue Star Lines is not responsible for violation of charter party terms. .................... 16
III.Blue Star Lines is entitled to demurrage and dead freight to be paid by Zeus and Co.
.................................................................................................................................... 19
IV. Blue Star Lines is not liable to compensate Zeus and Co. for the loss of goods. ..... 21
NAND APARAJITHA & INDIAN GRACE v. ALIAKMON ......................................... 22
V. NAND APARAJITHA and INDIAN GRACE do not have a valid claim to recover
remuneration. .............................................................................................................. 22
Xiang Ship Building Yard v. ALIAKMON ..................................................................... 24

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VI. The present case does not fall within the admiralty jurisdiction of the High Court of
Scindia. ....................................................................................................................... 24
VII. The ownership of ALIAKMON had passed to Blue Star Lines before the trials. ... 26
VIII. Blue Star Lines is not liable to pay the outstanding construction charges of
ALIAKMON until the vessel is freed of all defects and delivered finally. .................... 27
IX. Xiang Ship Building Yard is liable for breach of the ship building contract for which
Blue Star Lines is entitled to the damages. ................................................................... 28
PRAYER ............................................................................................................................ 30
Zeus & Co. v. YA MAVLAYA ....................................................................................... 30
NAND APARAJITHA & INDIAN GRACE v. ALIAKMON ......................................... 30
Xiang Ship Building Yard v. ALIAKMON ..................................................................... 31

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

LIST OF ABBREVIATIONS
A.I.R.: All India Reporter
A.C.: Appeals Cases
B.S.L.: Blue Star Lines
BOM.: BOMBAY
Honble: Honourable
K.B.: Kings Bench
L.J.: Lord Justice
Ltd.: Limited
N.S.A.: Norwegian Shipowners Association
N.S.C.: Norwegian Supreme court
N.S.G.: Norwegian Sale of Goods
Ors.: Others
LMCLQ: Lloyd's Maritime and Commercial Law Quarterly
Ltd: Limited
p.: page
Pvt.: Private
Q.B.: Queens Bench

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Rep: Reports
S.C.: Supreme Court
SCC: Supreme Court Reporter
UKSTC: UK Standard Conditions For Towage And Other
v.:versus

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

INDEX OF AUTHORITIES
CASES:
Alexander Knox Mcentire and John Arthur Maconchy v. Crossley Brothers, Limited,[1895]
AC 457 [26]
Athamas (Owners) v. Dig Vijay Cement Company, Ltd (The Athamas)[1963] 1 Lloyd's Rep.
287 [19]
Evera SA Commercial v North Shipping Co Ltd [1956] 2 Lloyd'sRep. 367[17]
J. Samuel White & Co. Ltd v. Coombes, Marshall & Co. Ltd [1922] 13 Lloyds Rep. 122 [29]
Kish v. Taylor [1912] A.C. 604 [22]
Madgavkars Salvage and Towage Company Pvt ltd. v United India Insurance Company
Ltd1996 (4) BomCR 50 [23]
Oldendorff(EL) & Co GmbH v. Tradax Export SA (The Johanna Oldendorff) [1973] 2
Lloyds Rep. 285[16,18]
strem et al v. Byggerservice,Rt 773 (NSC 1991) [24]
Peoples Ferry Company of Boston v. Beers61 U.S. 393 (1857) [25]
Primera Maritime Limited v. Jiangsu Eastern Heavy Industry Co Ltd, No 09-0642-cv (2d Cir.
Dec. 4, 2009) [25]
Reardon Smith Line Ltd. v. Ministry of Agriculture, Fisheries and Food [1962] 1 Q.B. 42[17]
TheArchimidis[2008] 1 Lloyds Rep. 597[20]
TheEvia (No. 2) [1983] 1 A.C. 736 [21]

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Total Transport Corpn.v Amoco Trading Co (The Altus)[1985] 1 Lloyds Rep. 423 [20]
Union of India v. CompaniaNaviera Aeolus SA (The Spalmatori)[1964] A.C. 868 [20]
Wallemsv. Muller[1927] 2 K.B. 99 [22]
World Tanker Carrier Corporation v. SNP Shipping Services Pvt. Ltd. AIR 1998 SC 2330
[15,16]
BOOKS AND ARTICLES:
AlekaSheppardMandaraka, Modern Maritime Law, Volume 2: Managing Risks and
Liabilities, Informa Law from Routledge, 2013 [27]
JamesGosling, Rebecca Warder (Editors), The Shipping Law Review, Law Business
Research Ltd, July 2014[25]
JenssenTrum and KvaleAdvokatfirma DA, Incorporation of Arbitration Clauses:
Norwegian Law Perspective, PLC Cross-border Arbitration Handbook, 2010/11[23]
John Schofield, Laytime and Demurrage, Informa Law from Routledge, 2011[18]
JulianCooke, &Ors.,Voyage charters, Informa Law from Routledge, 2014[16]
Kurer Martin, &Ors, Warranties and Disclaimers: Limitations of Liability in ConsumerRelated Transactions, Kluwer Law International, 2002 [29]
Simon Baughen, Shipping law, Routledge-Cavendish, 2009[19,20]
Vickey L. Quinn , Hard Aground: A Primer on the Salvage of Recreational Vessels, U.S.F.
Maritime Law Journal, Vol. 19, No. 2, 2006-07[21]
STATUTES, CONVENTIONS, ETC.:

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Gencon charter cargo clause [19]
Norwegian Sale of Goods Act, 1988 [14, 25, 28]
Norwegian Shipowners Association Form [14, 24, 25, 26, 27]
UNIDROIT principles of International Commercial Contracts, 2010[26]
Voyage CharterpartyLaytime Interpretation Rules, 1993 [18]
Voylayrules 1993 [18, 20]

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

STATEMENT OF JURISDICTION
The Honble High Court of Judicature at Scindia may exercise its admiralty jurisdiction
under S. 2 of the [The] Colonial Courts of Admiralty(India) Act, 1891 whereby the High
Court of Judicature at Scindia has been declared as a Colonial Court of Admiralty, read with
S. 20 of the Supreme Court Act, 1981 which provides the extent of the admiralty jurisdiction
of the High Court.
The Respondents most humbly and respectfully submit to the jurisdiction of this
HonorableHigh court of Judicature at Scindia.

The present memorandum sets forth the facts, contentions and arguments in the present
case.

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STATEMENT OF FACTS
I. Blue Star Lines, a Company registered in the Republic of Sparta, placed orders for
construction of a bulk carrier vessel with Xiang Ship Building Yard, a public sector
undertaking of the Republic of Aaron. The contract dated 1 st October, 2011 was in the
Norwegian Ship Owners Association Form. The contract provided that the vessel would
become the absolute property of the buyer on the payment of first instalment and that best
endeavours would be made for completing the construction by 1 st September 2013.
II. During August 2013, Blue Star Lines entered into a charter party agreement with Zeus and
Co., a public sector enterprise of Republic of Aaron, for chartering out their bulk carrier YA
MAVLAYA a vessel flying the flag of Republic of Liberia for transportation of 10,000 MT
coal from the port of Minsk in Eastern Europe to Shangze in the Republic of Aaron during
September 2013 to October 2014. The officers employed on board YA MAVLAYA,
appointed by Blue Star Lines were to be paid by Zeus and Co. during the charter period. Blue
Star Lines will make available YA MAVLAYA at the port of Minsk or so near thereto as
she can safely get on or before 1st September 2013.
III. YA MAVLAYA was already performing a voyage under an earlier charter. Entry to the
Minsk port depended on the water draught available in River Tista which in turn depended on
tides. Zeus and Co. had transported 8000 MT of coal to the wharf at the Port of Minsk &
waited for the arrival of YA MAVLAYA. On 29th August, 2013, she reached Petra, &
missed the tide. She waited there for the next tide. A notice of arrival was issued to the agents
of Zeus and Co. on behalf of YA MAVLAYA. When cargo was loaded into her holds, lay
time as agreed to in charter party had expired. After loading, Zeus and Co. instructed Captain
of YA MAVLAYA was to proceed to Port of Kripsto and take in cargo of ammunition in
her empty hold. YA MAVLAYA laden with full cargo, got into rough weather. The Captain

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sought refuge in Republic of Catonia. There, news papers reported ammunition carried by
vessel as contraband goods liable to seizure. The authorities directed Captain to facilitate
inspection by the authorities, who ignored it & proceeded to the high seas. While crossing the
Exclusive Economic Zone of Republic of Catonia, a hot pursuit allegedly ensued & she was
brought back. Pursuant to a Prompt Release action initiated by the Republic of Liberia, the
vessel and its crew were later released. However, the cargo was forfeited. YA MAVLAYA
later docked in the port of Neva in Scindia State of Republic of Sparta.
IV. Republic of Aaron through Zeus and Co, initiated an in rem action in High Court of
Scindia for compensating the loss of goods and for violation of charter party terms. The
claims were defended by Blue Star Lines. A counter claim for demurrages and dead freight
was raised against Zeus and Co.
V. While so, Xiang Ship Building Yard informed Blue Star Lines of the part completion of
construction of the vessel in its yard. The new vessel was christened ALIAKMON. Upon
the insistence of Blue Star Lines, work was speeded through and on 1st September 2013
Engineers of Blue Star Lines boarded the vessel for trial. While on trial run, vessel started
taking in water. Assistance was sought by ALIAKMON from vessels in vicinity. A hauser
was connected and NAND APARAJITHA, a container carrier proceeded to tow
ALIAKMON to safety. While within the territorial waters of Republic of Sparta,
apprehending her own safety, NAND APARAJITHA abandoned ALIAKMON.
ALIAKMON was finally towed into the port of Neva by INDIAN GRACE.
VI. Xiang Ship Building Yard invoked the Admiralty Jurisdiction of the High Court of
Scindia claiming ownership over the vessel and towards the outstanding construction charges
from Blue Star Lines. NAND APARAJITHA and INDIAN GRACE moved the High
Court of Scindia in the Republic of Sparta seeking to recover remuneration for salvage
assistance rendered to ALIAKMON.

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STATEMENT OF ISSUES

Zeus & Co. v. YA MAVLAYA


I.
II.
III.

Whether High Court of Scindia has jurisdiction to try the case?


Whether Blue Star Lines is responsible for violation of charter party terms?
Whether Blue Star Lines has a claim for demurrages and dead freight upon Zeus
& Co.?

IV.

Whether Zeus & Co. is entitled for compensation from Blue Star Lines for the
loss of goods?
NAND APARAJITHA & INDIAN GRACE v. ALIAKMON

V.

Whether NAND APARAJITHA and INDIAN GRACE are entitled to recover


remuneration for salvage assistance?
Xiang Ship Building Yard v. ALIAKMON

VI.

Whether the case falls within the admiralty jurisdiction of High court of
Scindia?

VII.

Whether Xiang Ship Building Yard is entitled to the ownership of ALIAKMON?

VIII.

Whether Blue Star Lines is liable to pay the outstanding construction charges to
Xiang Ship Building Yard?

IX.

Whether Xiang Ship Building Yard is liable for breach of the ship building
contract?

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SUMMARY OF ARGUMENTS
I. The High Court of Scindia does not have jurisdiction over the case.
A separate suit has already been filed by the applicant in the Republic of Aaron As the
principle of Forum Non Conveniens goes the applicants claim should not be entertained.
YA MAWLAYA and Zeus and Co both the parties being foreign to this jurisdiction, cannot
be sued in this court because High Court of Scindia has no jurisdiction for foreign parties.
II. Blue Star Lines is not responsible for violation of charter party terms.
Petra was the usual place of waiting for the vessels plying to Minsk. Thus, she can be said to
be at the disposal of charterers. Near clause acts by providing an alternative specified
destination.
III.Blue Star Lines is entitled to demurrage and dead freight to be paid by Zeus and Co.
The charterers failed to make available the agreed amount of coal at the wharf at the port of
Minsk. The laytime had commenced as soon as notice of arrival was given and had expired
by the time cargo was made available. So, BSL is entitled to demurrage & dead freight.
IV. Blue Star Lines is not liable to compensate Zeus and Co. for the loss of goods.
The charterparty had been entered into for transportation of coal only. The Captain was
instructed by the applicant to proceed to port of Kripsto and take in cargo of ammunition as
one of her holds were lying empty. The respondent cannot be made liable for that.
V. NAND APARAJITHA and INDIAN GRACE do not have a valid claim to recover
remuneration.
The no cure, no pay theory denies remuneration to a failed salvage service or in which the
ship was not saved.Owing to failure of NAND APARAJITHA to save the ship, no

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remuneration is outstanding. The service rendered by INDIAN GRACE was in nature of
towage, not salvage.
VI.The case does not fall within the admiralty jurisdiction of the High Court of Scindia.
The matter has not been referred to arbitration in view of the arbitration clause which was accepted by both the
parties to the contract. Moreover, issues arising out of a shipbuilding contract are non-maritime
claims which do not fall within the admiralty jurisdiction of the court.
VII.The ownership of ALIAKMON had passed to Blue Star Lines before the trials.
In view of the contractual terms, which had been agreed to between both the parties, the
ownership had passed to the respondent before the trials, with the first instalment of contract
price being paid. Certificate of registry was also issued in the name of Blue Star Lines.
VIII. Blue Star Lines is not liable to pay the outstanding construction charges of
ALIAKMON until the vessel is freed of all defects and delivered finally.
As per Norwegian Ship Owners Association Form, the final instalment of the contract price
is to be paid on the delivery and acceptance of the completed vessel which has not yet
occurred. The construction of the vessel was found to be wanting in many respects during the
trial run.
IX. Xiang Ship Building Yard is liable for breach of the ship building contract for
which Blue Star Lines is entitled to the damages.
S. 40 of the Norwegian Sale of Goods Act provides for the damages to be paid to buyer in
case of lack of conformity of goods. During the trial run of ALIAKMON, serious design
and mechanical defects were noted by the engineers of Blue Star Lines. The vessel went in
distress.

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ARGUMENTS ADVANCED
Zeus & Co. v. YA MAVLAYA
I. The High Court of Scindia does not havejurisdiction over the case.
[A] Action is barred because a separate suit has already been filed: A separate suit has
already been filed by the applicant in the Republic of Aaron before a subordinate judges
court in the port of Shangze and the same is pending. The applicant has already submitted to
the jurisdiction of Republic of Aaron and now by invoking the jurisdiction of High Court of
Scindia, it has invoked the jurisdiction of two Courts in two different States for the purpose
of same relief. As the principle of Forum Non Conveniens goes the applicant claim should
not be entertained in this forum and should be outrightly rejected.
[B] High Court of Scindia has no jurisdiction because both the parties are foreigners: In the
present case vessel YA MAWLAYA, a vessel flying Liberian Flag and the other party is
Zeus and Co. which is also a foreign party and because of both the parties being foreigner,
High Court of Scindia has no jurisdiction as it is already established in the case of
World Tanker Carrier Corporation v SNP Shipping Services Pvt ltd.1 wherein both the parties
were not from India and already they had initiated proceedings in different countries. In the
same case the collision which gave rise to the owner's liability had occurred on the high-seas
off the coast of Portugal. Neither of the vessel involved in the collision was an Indian vessel.
The owners of both these vessels were also foreigners. Only one out of several managers/submanagers of YaMawlaya was an Indian Company. And the only act of management in
Bombay is said to be the recruitment of the crew. Court held that these factors alone will not
confer jurisdiction. Taking the facts and circumstances of present case into account, it can be
concluded that the present court has no jurisdiction in this issue and applicant should
1

A.I.R. 1998 S.C. 2330.

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approach proper forum. Further, in the case of World Tanker Carrier Corporation2 court
observed that, only the presence of a foreign vessel in the territorial waters will not give the
Court jurisdiction to entertain a limitation action by its owner unless the presence of the
foreign vessel has given rise to an admiralty action. Going by the observation of court just
because the ship is in the geographical limits of the state it does not give rise to cause of
action unless any admiralty action arises.
II. Blue Star Lines is not responsible for violation of charter party terms.
It is humbly submitted before the Honble Court that the charter party agreement entered into
between the applicant and respondent was that of a voyage charter.InOldendorff (EL) & Co
GmbH v. Tradax Export SA (The Johanna Oldendorff)3, Lord Diplock divided the adventure
contemplated by a voyage charter into four successive stages:
(1)The loading or approach voyage, viz. the voyage of the vessel from wherever she is at the
date of the charter party or the conclusion of her previous fixture, if that is later, to the place
specified as the place of loading i.e., there should be a Nomination of port of loading:An
approach voyage is defined as The preliminary voyage made from the vessels discharging
port under a previous charter party to the loading port or berth under a voyage charter. At
the time when the charter party was entered into, YA MAVLAYA was already performing
a voyage from Shebriniska to Kieve as envisaged under an earlier charter. As for nomination
of the port, in principle, the obligation to make the required nomination of a port or berth lies
on the charterer, but he is not obliged, when so doing, to consider either the convenience of
the owner or the expense of complying with the nomination. 4In The Vancouver Strike

A.I.R. 1998 S.C. 2330.

[1973] 2 Lloyds Rep. 285,at p.305.

Cooke Julian&Ors.,Voyage charters, Informa Law from Routledge, 2014, p.117.

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Cases, 5Willmer L.J. said: it is well established that where a charterparty provides a choice
of named places for loading or discharge, the charterer is free to exercise his option as he
chooses, and in doing so is in no way bound to consult the convenience of the
shipowners.The charterers in this case, nominated Minsk as the port of preliminary voyage.
(2)The loading operation, viz. the delivery of the cargo to the vessel at the place of loading
and its stowage on board:In Evera SA Commercial v North Shipping Co Ltd6 Devlin J.
pointed out that A charterer manifestly wants, if he can get it, a fixed date for the arrival of
the ship at the port of loading. He has to make arrangements to bring down the cargo and to
have it ready to load when the ship arrives, and he wants to know, as near as he can, what
that date is going to be. The date of arrival for the ship was fixed on or before 1st Sept.2013.
The cargo of coal was transferred at the port of Minsk in accordance with this term of the
charter party. The cargo made available was also loaded into her holds at the port of Minsk.
(3)The carrying or loaded voyage, viz. the voyage of the vessel from the place of loading to
the place specified in the charter as the place of delivery: The ordinary rule goes that once
the ship is loaded with the quantity of goods required under the terms of the charter party, the
owners are obliged to dispatch her promptly upon the voyage. 7 After following the order
from the charterer, the ship ultimately proceeded on her voyage to the port of Shangze.
(4)The discharging operation, viz. the delivery of the cargo from the vessel at the place of
delivery and its receipt there by the charterer or other consignee: The fact sheet states that
ship was en route Shangze, where the discharging operation was to be performed, though the
discharging operation could not be completed as the ship was arrested at the port of
5

Reardon Smith Line Ltd. v. Ministry of Agriculture, Fisheries and Food [1962] 1 Q.B. 42, at

p.110.
6

[1956] 2 Lloyd's Rep. 367.

Supra 4, p.213.

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Catoniawhere she took the port of refugee to save the ship from facing any damages due to
rough weather. But still, such an operation was stipulated in the charter party.
Now, in the category of voyage charters, it is a port charter. The Voylayrules 1993 define
Port as an area, within which vessels load or discharge cargo whether at berths,
anchorages, buoys or the like, and shall also include the usual places where vessels wait for
their turn or are ordered or obliged to wait for their turn no matter the distance from that
area. If the word PORT is not used, but the port is (or is to be) identified by its name, this
definition shall still apply.8
In The Johanna Oldendorff9Lord Reid stated:Before a ship can be said to have arrived at a
port she must, if she cannot proceed immediately to a berth, have reached a position within
the port where she is at the immediate and effective disposition of the charterer. If she is at a
place where waiting ships usually lie, she will be in such a position unless in some
extraordinary circumstances proof of which would lie in the charterer. It is submitted that
Petra was the usual place of waiting for the vessels plying to Minsk. Thus, she can be said to
be at the disposal of charterers.Hence, the notice of arrival was valid which resulted in the
beginning of laytime. Thus, there was no violation of the charterparty terms with regard to
the non arrival of ship on the decided time. Even if it is contended that Petra is not a port, the
presence of near clause in the charter party agreement saves the case for the respondent.
The near clause acts by providing an alternative specified destination, which may take
effect if certain conditions are met if the vessel concerned is unable to proceed to its primary
destination. 10To rely on the clause, the alternative port must be within the ambit of the
named port. In Athamas (Owners) v. Dig Vijay Cement Company, Ltd (The
8

Voyage CharterpartyLaytime Interpretation Rules, 1993.

Supra 3.

10

Schofield John, Laytime and Demurrage, Informa Law from Routledge, 2011, p.182.

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Athamas),11Campbell CJ said:...the meaning of the charterparty must be that the vessel is to
get within the ambit of the port, though she may not reach the actual harbor. In The Athamas,
in the High Court, McNair J said: in considering whether a substitute discharging place
or port is within the phrase so near thereto as she may safely get, the court should apply
the conception of reasonableness in relation to distance What is a reasonable distance
clearly has to be determined in the light of all the circumstances and of the particular
adventure.In this case, thirty miles can be considered to be a reasonable distance keeping in
mind the fact that Petra was the usual waiting place for the vessels plying to Minsk.It comes
within the ambit of the port. Hence, the respondent cannot be held liable for violation of
charterparty terms. The vessel was made to available at designated port in designated time.
III.Blue Star Lines is entitled to demurrage and dead freight to be paid by Zeus and Co.
Cargo clause under the Gencon Charterdefines the following condition: The charterer has
an obligation to provide a cargo for loading on board the vessel. It is common practice that a
charterer will specify a range of cargoes that could be loaded on board the vessel on arrival,
for example wheat or maize or rye. As the amount of cargo is the shipowner's entitlement to
freight, any failure to provide cargo on the part of the charterer will amount to a breach of
contract. When the charterer contracts to provide a 'full and complete cargo' this creates a
duty to provide cargo for the whole of the vessel; in the event of a failure to do so the
charterer will be liable to pay the owner deadfreight.12Deadfreight is thus, compensation
due from a charterer for failing to load the minimumquantity of cargo specified in the charter.
The shortfall in cargo loaded will give rise to liability assessed at the freight rate.13In the

11

[1963] 1 Lloyd's Rep. 287.

12

Gencon charter cargo clause.

13

Baughen Simon, Shipping law, Routledge-Cavendish, 2009, p.7.

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TheArchimidis,14the owners were held to be entitled to claim deadfreight in respect of the
difference between the minimum contractual quantity under the charterparty and addenda
thereto and the quantity of cargo loaded on the voyage. It is humbly submitted that there was
no default from the side of the shipowners. The charterers themselves failed to make
available the agreed amount of coal at the wharf at the port of Minsk.InTotal Transport
Corpn. v Amoco Trading Co (The Altus) 15,as per Webster J. at 435-436:Where a charterer
commits any breach, even if it is only one breach, of his obligation either to provide the
minimum contractual load or to detain the vessel for no longer than the stipulated period, the
owner is entitledin the first case, to the damages flowing indirectly or consequentially from
any detention of the vessel (if it occurs) and, in the second case, to damages flowing
indirectly or consequentially from any failure to load a complete cargo if there is such
failure it follows that the plaintiffs are entitled, in addition to the dead freight which they
have already received, to the difference between the demurrage rates as damages for the loss
of demurrage consequent upon the defendants failure to load the minimum agreed cargo.
According to Voylayrules 1993, DEMURRAGE shall mean an agreed amount payable to
the owner in respect of delay to the vessel beyond the laytime, for which the owner is not
responsible. Demurrage shall not be subject to laytimeexceptions.Wherein LAYTIME
shall mean the period of time agreed between the parties during which the owner will make
and keep the vessel available for loading or discharging without payment additional to the
freight.16InUnion of India v. CompaniaNaviera Aeolus SA (The Spalmatori), 17 Lord Guest
said:Laydays are the days which parties have stipulated for the loading or discharge of the

14

[2008] 1 Lloyds Rep. 597.

15

[1985] 1 Lloyds Rep. 423.

16

Voylayrules 1993;See Appendix and the similar definition in Baltic Code 2007.

17

[1964] A.C. 868, at p.899.

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cargo, and if they are exceeded the charterers are in breach; demurrage is the agreed
damages to be paid for delay if the ship is delayed in loading or discharging beyond the
agreed period.It is humbly submitted that the laytime had commenced as soon as the notice
of arrival was given as can be seen in the light of earlier arguments and had expired by the
time cargo was made available. Therefore, BSL is entitled to demurrages &deadfreight.
IV. Blue Star Lines is not liable to compensate Zeus and Co. for the loss of goods.
As a general rule, if there is a single loading or discharging port named in the voyage
charterparty then, unless the charterparty specifically otherwise provides, a voyage charterer
may not be able to order that ship elsewhere. If there is a range of loading or discharging
ports named, once the voyage charterer has selected the contractual port or ports of loading
or discharge, the voyage charterparty usually operates as if that port or those ports had
originally been written into the charterparty, and the charterer then has no further right of
nomination or re-nomination.18It is humbly submitted before the Courtthat the charterparty
had been entered for transportation of coal only. The Captain was instructed by the applicant
to proceed to port of Kripsto and take in cargo of ammunition as one of her holds were lying
empty.Respondent cannot be made liable for that.
In principle, the obligation to make the required nomination of a port or berth lies on the
charterer. All things being equal, the charterer has no contractual right, or obligation, to
change a nomination once made. For this reason it is common to provide ...or so near thereto
as she may safely get... in order to prevent frustration of the charter if the parties fail to
agree on an alternative port.19Where the deviation is necessary for the safety of the ship or
cargo the carrier is justified in deviating from the contract voyage, and may be obliged to do

18

Per Lord Roskill, TheEvia (No. 2) [1983] 1 A.C. 736, at p. 763.

19

Supra 4, p.122.

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so in fulfilment of his implied duty to take reasonable care of the cargo. 20Where the contract
of affreightment provides that the charterer shall load a full cargo, or a minimum quantity,
and the charterer fails to provide the quantity of cargo contracted for, a deviation to obtain a
fill-up cargo, in mitigation of the shipowners claim for deadfreight, is justifiable. 21Thus, to
save itself from the charges of deadfreight and demurrages arising from the inefficiency to
provide cargo as promised, the Captain was instructed by the charterers to proceed to the
nearby port of Kripsto, for loading ammunition intended for use by Army of Republic of
Aaron.Had there been no ammunition loaded into the holds of YA MAVALAYA, the cargo
on board would never have been seized. This deviation would not violate the terms of
charterparty due to the presence of near clause. At the same time, it does not make BSL liable
to compensate for the lost goods.
NAND APARAJITHA & INDIAN GRACE v. ALIAKMON
V. NAND APARAJITHA and INDIAN GRACE do not have a valid claim to recover
remuneration.
[A] When there is no cure, no pay is there: Article 12 of The International Convention on
Salvage 1989, which states the Conditions for reward, reads as Except as otherwise
provided, no payment is due under this Convention if the salvage operations have had no
useful result. From this convention a new concept of no cure, no pay was evolved. This
concept can be explained as The would be salvors services must, to some extent, be
successful if they are to form the basis of a salvage award. If the assisted vessel is lost, there
can be no claim for salvage. 22This concept of no cure, no pay is internationally accepted
by maritime industry and also judiciary. In Indian jurisdiction this concept is also acceptable
20

Supra 4, p.279; See Kish v. Taylor [1912] A.C. 604.

21

Wallemsv. Muller [1927] 2 K.B. 99.

22

Baughen Simon, Shipping Law, Routledge-Cavendish, 2009, p. 302.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

23
as it is clear from the judgement ofMadgavkars Salvage and Towage Company Pvt ltd. v
United India Insurance Company Ltd.23, In this judgement of Bombay High Court, court
expressly accepted this concept and the appellant was denied the claim of salvage.
In the present case also, the NAND APARAJITHA came to assistance but its assistance
was not fruitful and failed to help the distressed ship and further assistance was required by
other ship.The cause of action of salvage is a quantum meruit claim which means "what one
has earned" and in the present case in the light of facts and circumstances it is clear that the
ship NAND APARAJITHA has failed in salvage operation and it is humbly submitted that
in the light of above facts the claim for remuneration should out rightly be rejected.
[B] Service rendered by Indian Grace is not Salvage rather it is Towage:Definition of
Towing under the UKSTC 1986 Clause 1(b) is: (i) towing as any operation in connection
with the holding, pushing, pulling, moving, escorting or guiding of or standing by the hirers
vessel and the expressions to tow, being towed and towage shall be defined likewise.
Towage and salvage are frequently confused because salvage oftenincludes the physical act
of towing a distressed vessel out of danger or backto shore for repairs. The main difference is
that salvage always requires an unanticipated peril at the time of rescue and towing is a
propulsionservice rendered without such peril. 24It is humbly submitted before the Honble
Court that when INDIAN GRACE approached ALIAKMON, the vessel was already in
the waters of Republic of Sparta and no help was sought by it as such. The service rendered
by INDIAN GRACE was merely in the nature of towage and remuneration for salvage
assistance cannot be claimed for that.

23

1996 (4) Bom.C.R. 50.

24

Quinn L. Vickey, Hard Aground: A Primer on the Salvage of Recreational Vessels,

U.S.F. Maritime Law Journal, Vol. 19, No. 2, 2006-07, p.331.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

24
Xiang Ship Building Yard v. ALIAKMON
VI. The present case does not fall within the admiralty jurisdiction of the High Court of
Scindia.
The ship building contract entered into between the applicant and respondent was in the
Norwegian Ship Owners Association Form. Article XIX clause (1) of this Standard
Norwegian Shipbuilding Contract Form provides that the validity and interpretation of the Contract is
to be governed by the laws of the Kingdom of Norway. And clause (2) provides that any dispute between the
parties concerning the Contract shall be settled with final and binding effect for both parties by Arbitration in
Norway. The parties will jointly appoint three arbitrators of which at least one shall be a lawyer admitted to
practice in Norway. If the parties fail to agree on the choice of arbitrators within 14 days from presentation by
either party of a written demand for arbitration, each party shall appoint one arbitrator, and the
two so appointed shall appoint a third arbitrator who shall act as the chairman of the arbitration panel. If a
party fails to appoint an arbitrator within 14 days after he has been requested to do so by the other party, the
Chief Justice of the Appeal Court in the district where the Builder has its venue shall at the request of either
party appoint the arbitrator(s).
It is humbly submitted before the Honble Court that the matter in the present case has not been referred to
arbitration which the proper procedure should have been in view of the arbitration clause which was accepted
by both the parties to the contract.In strem et al v. Byggerservice25, the Norwegian Supreme
Court stated that when assessing whether an arbitration clause is agreed between the parties,
the following factors should be considered: (a) How the agreement was entered into. (b) The
parties relative positions. (c)Whether standard contract referred to is widely known and used.

25

strem among others v ByggserviceRt 773 (NSC 1991), in TrumJenssen, and

KvaleAdvokatfirma

DA,

Incorporation of

Arbitration

Clauses:

Norwegian Law

Perspective, PLC Cross-border Arbitration Handbook, 2010/11, p.10.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

25
In this case, the standard contract referred to was very widely used in construction contracts
and there were no other circumstances to justify disregarding the arbitration clause. The
contract had been entered into after genuine negotiations between the parties. Hence, the
parties challenging the validity of incorporation had constructive knowledge of the clauses
and had a chance to get acquainted with the form of standard terms if they wanted to. The
fact that parties had a due notice of the standard terms was sufficient to uphold incorporation.
In our case, the parties to the contract include a Company who is the charterer and another, a
Ship building yard, a public sector undertaking, both of which being continually dealing in
shipbuilding, can very well be assumed to know as to what standard terms constitute a
Norwegian Ship Owners Association Form. So, in that case, it is humbly submitted that the
parties which agreed to treat arbitration as the final dispute settling authority in the particular
contract cannot escape that clause and move the court for that matter.
Moreover, issues arising out of a shipbuilding contract are non-maritime claims which do not
fall within the admiralty jurisdiction of the court. A shipbuilding contract is in principle a
contract of sale with the effect that the Norwegian Sale of Goods Act of 13 May 1988 (SA)
applies to the contractual relationship between the shipyard as seller and the customer as
buyer. 26By Summary Order dated December 4, 2009, the Second Circuit Court of Appeals
has affirmed the long-standing U.S. rule that a dispute arising from a contract to build a ship
does not fall within the federal courts' admiralty jurisdiction. 27 Back in 1857, when the US
Supreme Court decided Peoples Ferry Company of Boston v. Beers28 said this about a
shipbuilding contract: So far from the contract being purely maritime, and touching the
26

Gosling James, Rebecca Warder (Editors), The Shipping Law Review, Law Business

Research Ltd, July 2014, p.404.


27

Primera Maritime Limited v Jiangsu Eastern Heavy Industry Co Ltd No 09-0642-cv (2d

Cir. Dec. 4, 2009) (Summary Order).


28

61 U.S. 393 (1857).

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

26
rights and duties appertaining to navigation, (on the ocean or elsewhere,) it was a contract
made on land, to be performed on land. Thus, the counsel pleads that the case does not fall
within the admiralty jurisdiction of the court.
VII. The ownership of ALIAKMON had passed to Blue Star Lines before the trials.
It is humbly submitted before the Honble Court that the ship construction contract dated 1 st
October, 2011, entered into between the plaintiff and the defendant, provided that the vessel
would become the absolute property of the buyer along with machinery, fittings and
equipments earmarked for construction, upon the first instalment of the purchase price being
paid. But, Article XI clause (1) of the Norwegian Ship Owners Association Form provides
that: The Buyer shall become the owner of the Vessel upon Delivery and Acceptance
thereof. Article 2.1.21 of UNIDROIT principles of International Commercial Contracts,
2010 provides that In case of conflict between a standard term and a term which is not a
standard term the latter prevails.
In Alexander Knox Mcentire and John Arthur Maconchy v. Crossley Brothers, Limited, 29Lord
Herschell, L.C., observed, with regard to the intention of parties in the terms expressed in a
particular contract, that: Upon an agreement to sell it depends upon the intention of the
parties whether the property passes or does not pass. Here the parties have in terms
expressed their intention, and said that the property shall not pass till the full purchasemoney is paid. I know of no reason to prevent that being a perfectly lawful agreement. If that
was really the intention of the parties, I know of no rule or principle of law which prevents its
being given effect to. Thus, having such a term in the contract indicates that the parties
intended to make the buyer the owner of the vessel once the first instalment had been paid.
Article III clause (3) of the Norwegian Ship Owners Association form provides that the first
instalment of the contract price is to be paid 3 Banking Days after the Date of the Contract.
29

[1895] A.C. 457.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

27
The contract in the instant case came into effect on 1 st October, 2011. The vessel,
ALIAKMON was boarded for trial on 1 st September, 2013 and even before that, certificate of
registry of the vessel had been issued in the name of Blue Star Lines. The fact that orders for
engines and materials were placed by Xiang Ship Building Yard with different suppliers and
the certificate of registry was also issued in the name of Blue Star Lines implies that the first
instalment had been duly paid by the respondent. And in accordance with the terms of the
contract thus, the ownership of the vessel lies with the respondent.Evidence of ownership
rests in the documents of registration of a ship, to be found in the relevant ships registry.
However, registration provides only prima facie evidence of the registered owner being the
true owner and it is not conclusive evidence of ownership. The burden of proof shifts to the
person alleging to be the owner. 30 Therefore, it is humbly submitted that since the ship is
registered in the name of the respondent, it is upon the applicant to prove the ownership of
the ship otherwise. In view of the contractual terms which had been agreed to between both
the parties, the ownership had passed to the respondent before the trials.
VIII. Blue Star Lines is not liable to pay the outstanding construction charges of
ALIAKMON until the vessel is freed of all defects and delivered finally.
As per Article III clause (3) of the Norwegian Ship Owners Association Form, the final
instalment of the contract price is to be paid on the delivery and acceptance of the completed
vessel. It is humbly submitted before the court that the final delivery and acceptance of
ALIAKMON has not yet occurred.The construction of the vessel was found to be wanting in
many respects during the trial run. Serious design and mechanical defects were noted by the
Engineers of Blue Star Lines who were onboard during the trial run. The defects were best
manifested in how the vessel started taking in water and ultimately, went in distress.

30

Mandaraka-Sheppard Aleka, Modern Maritime Law, Volume 2: Managing Risks and

Liabilities, Informa Law from Routledge, 2013, p.135.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

28
As per the contract entered to in between the applicant and respondent, any defective
workmanship or defect in materials, if discovered by the respondent within 12 months after
the acceptance trials, had to be made good by the applicant or alternatively, the applicant
were to be pay to the respondent a sum equal to reasonable cost of repair.Therefore, it is
humbly submitted before the Honble Court that Blue Star Lines is not liable to pay any
amount of money to the respondent until the respondent make good to the applicant all
defects in the vessel and the final delivery and acceptance takes place.
IX. Xiang Ship Building Yard is liable for breach of the ship building contract for
which Blue Star Lines is entitled to the damages.
Chapter V of the Norwegian Sale of Goods Act, 1988 incorporates the buyers rights
following the sellers breach of contract. S. 30 in this chapter provides the options available
to the buyer in the event of lack of conformity of goods. S. 40 makes the provision for the
claim of damages. Clause (1) of the particular provision states that: The buyer may claim
damages for the loss he sustains as a consequence of the lack of conformity of the goods,
unless the seller proves that the lack of conformity of the delivery is due to an impediment as
mentioned in s. 27 above. The other rules of ss. 27 and 28 will similarly apply.
It is humbly submitted before the Honble Court that during the trial run of ALIAKMON,
serious design and mechanical defects were noted by the engineers of Blue Star Lines. The
construction was found to be wanting in many respects because of which the vessel in its very
first trial run, even started taking in water and went in distress.
Coming to the principles of evidence, according to Norwegian Law, the party claiming
compensation for damages must prove that the other party has acted neglectfully.
Accordingly, when liability is based on fault, the buyer has the burden of proof with respect
to breach of warranties. However, if control-liability is pleaded according to SGA, Sections
27 or 40, the burden of proof lies with the seller(reversed onus of proof). Accordingly, the
MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

29
seller must show that the lack of conformity was due to an impediment beyond its control. 31
It is pleaded that the lack of conformity in the goods is indeed due to the negligence of the
applicant. There was no case of any sort of impediment in the ship building process.
Moreover, the contract also had terms providing that any defective workmanship or defect in
the materials, if discovered by the buyer within 12 months after the acceptance trials, was to
be made good by the builders or alternatively, the builders were to pay to the buyer a sum
equal to reasonable cost of repair. Thus, the contract itself created an obligation upon the
builder to deliver a vessel that would be seaworthy and meet the general standards of a bulk
carrier vessel. The applicant committed breach by delivering goods which were below the
adequate standards. In J. Samuel White & Co. Ltd v. Coombes, Marshall & Co. Ltd
(1922),32the purchasers claim for the costs of rectifying defects in the vessels boilers was
settled. This was however, not strictly a warranty claim. The purchasers sought damages for
breach of the implied obligation to deliver a seaworthy vessel.
Therefore, it is humbly submitted that the respondent is entitled to the damages to be paid by
Xiang Ship Building Yard for the breach of contract that it has committed.

31

KurerMartin &Ors, Warranties and Disclaimers: Limitations of Liability in Consumer-

Related Transactions, Kluwer Law International, 2002, p. 411.


32

[1922] 13 Lloyds Rep. 122.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

30

PRAYER
Zeus & Co. v. YA MAVLAYA
Wherefore, in the lights of facts stated, issues raised, arguments advanced and authorities
cited, it is most humbly prayed and submitted before the High Court of Judicature at Scindia
that it may be graciously pleased to adjudge and declare that:
a) The action is barred before the High Court of Scindia.
b) Blue Star Lines is not liable to compensate Zeus & Co. for the loss of goods.
c) Blue Star Lines has not violated the charter party terms.
d) Zeus & Co. is liable to pay demurrage and dead freight to Blue Star Lines.
And pass any other order that it may deem fit against the respondent in ends of equity, justice
& good conscience.
All of which is most humbly and respectfully submitted.
Place: High Court of Judicature at Scindia
Date: -- /-- /20--

S/d
COUNSEL FOR THE RESPONDENT

NAND APARAJITHA & INDIAN GRACE v. ALIAKMON


Wherefore, in the lights of facts stated, issues raised, arguments advanced and authorities
cited, it is most humbly prayed and submitted before the High Court of Judicature at Scindia
that it may be graciously pleased to adjudge and declare that:
a) NAND APARAJITHA and INDIAN GRACE are not entitled to remuneration for
assistance rendered to ALIAKMON.

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS

31
And pass any other order that it may deem fit against the respondent in ends of equity, justice
& good conscience.
All of which is most humbly and respectfully submitted.
Place: High Court of Judicature at Scindia
Date: -- /-- /20--

S/d
COUNSEL FOR THE RESPONDENT

Xiang Ship Building Yard v. ALIAKMON


Wherefore, in the lights of facts stated, issues raised, arguments advanced and authorities
cited, it is most humbly prayed and submitted before the High Court of Judicature at Scindia
that it may be graciously pleased to exercise jurisdiction over the matter, and adjudge and
declare that:
a) The ownership of ALIAKMON had passed on to the Blue Star Lines before the
trials.
b) Blue Star Lines is not liable to pay the outstanding construction charges of
ALIAKMON to Xiang Ship Building Yard.
c) Xiang ship Building Yard has committed breach of contract and is thus, liable to pay
damages for the same.
And pass any other order that it may deem fit against the respondent in ends of equity, justice
& good conscience.
All of which is most humbly and respectfully submitted.
Place: High Court of Judicature at Scindia
Date: -- /-- /20--

S/d
COUNSEL FOR THE RESPONDENT

MEMORANDUM FILED ON BEHALF OF THE RESPONDENTS