That’s got to SMART – The story of the M/V SMART and Owners’ right to demand freight under a bill of lading | Case by Case (Ep. 1)

In this episode, Calum and Luke look at the recent decision of Alpha Marine Corp. v. Minmetals Logistics Zhejiang Co. Ltd., [2021] EWHC 1157 (Comm).

Owners claimed against charterers for a series of losses arising under a time charterparty. Owners demanded payment of freight directly from shippers, in order to satisfy the alleged debt. Shippers didn’t know who to pay: Owners under the bill, or charterers under the voyage charterparty? Ultimately, Shippers made partial payment into escrow before going insolvent.

Owners’ claims against Charterers largely failed. Charterers claimed that owners’ demands for the freight (against Shippers) were unlawful and were the cause of the delayed/reduced payment.

Owners said they were entitled to take the freight. Charterers argued that a time charterparty contains an implied term that owners could only exercise this right where they were owed money by charterers.

The High Court found no such implied term – reinforcing an owners’ right to demand freight directly.

Judgment available here:

Listen in for the analysis.