Japan Earthquake

March 2011

Last updated 7 April 2011

 

Members will be aware of the devastation caused by the recent earthquake, tsunami and ongoing nuclear incidents affecting Japan. Skuld extends its deepest sympathy to our colleagues and friends who are touched by these tragic events, and indeed to all the people of Japan.

Many enquires have been received from members and this webpage seeks to provide some guidance. As the situation is extremely volatile, it is essential that members obtain up to date information from their agents, ports authorities and official sources. A list of websites which members may find useful is provided at the end of this page.

The situation in Japan is changing rapidly and requires careful monitoring. As of now, we are able to provide the following guidance:

 

LEGAL POSITION

It is not possible to provide detailed advice as that would depend on the specific facts of each case. However, as a general matter, solicitors have advised as follows:

Whilst the situation in Japan remains subject to rapid and unpredictable change, the following considerations may arise in respect of Charterparties or Contracts of Affreightment involving trading to Japan:

Safe Port / Berth

  1. In general terms, a Master is not obliged to comply with an order to proceed to an unsafe berth or port.
     
  2. A port or berth will only be safe if the vessel can proceed to, use and leave the berth without suffering damage through the exercise of good seamanship and/or navigation by the Master.
     
  3. A port or berth will generally not be made unsafe due to temporary dangers. Consequently, if a particular berth or port in Japan is currently unsafe, consideration should be given to the question as to whether it may nevertheless become safe in the foreseeable future.

Frustration

  1. A Charterparty will only be frustrated if the event said to frustrate the Charterparty is outside the control of both parties and makes performance of the Charterparty impossible, illegal or something radically different from the obligations undertaken by the parties at the time of contracting.
     
  2. In principle, delay to a vessel may be a frustrating event in the case of a time or voyage Charterparty if the delay is such as to radically alter the obligations of the parties. Delay in this sense can be actual or anticipated delay. Consequently, if it appears unsafe or impossible for a vessel to call at a Japanese port for the foreseeable future, the Charterparty may be frustrated at this stage.

Force Majeure

  1. Whilst there is no general doctrine of force majeure in English law, a Charterparty or other contract may contain a force majeure clause (for example, exempting responsibility for non-performance).
     
  2. A general force majeure clause will not generally be applicable to interrupt laytime or demurrage.
     
  3. A force majeure clause which refers expressly to laytime but not to demurrage will generally not be effective to interrupt time spent on demurrage.
     
  4. Whether a party can rely on the force majeure clause in general terms depends heavily on the exact wording of the clause and the precise facts of each case.

These comments are for general guidance in respect of English contract law only. Members should carefully review the governing law provisions of their contract and approach their Skuld Syndicate with any specific queries that they may have regarding calling at a Japanese port. Members should whenever possible discuss their options with their charterers and with other interested parties (such as cargo interests) and seek to reach agreement. Naturally each case will depend heavily on the particular facts and Members’ contacts at Skuld will be able to assist with specific queries that Members may have.

Deviation
If members deviate from their planned route, they will need to consider whether this is a lawful deviation or not. This will depend on the circumstances of each case, the terms of the contract of carriage and what is reasonable. If the deviation is lawful, it will not affect cover. However if it is unlawful, it will amount to a breach of contract which may prejudice cover. In case of doubt, members should contact the Association. Additional cover can be arranged if necessary.

General Guidance
We recommend generally that members in all cases make enquiries of the Flag State, and the state of the nationality of the crew to see what their recommendations are, and whether they advise to steer clear only of ports in affected zones or whether they advise to avoid all ports. If members have relevant overseas branches they too may need to make enquiries from the Government authorities in their locations if, for example, they have responsibility for vessel operation and crew operations relating specifically to vessels calling in Japan.

In the end, members will have to take their own operational decisions in light of the facts available at the time.

As is known, some ports are open and functioning. This may change quickly. We recommend that members, when considering a call, make enquiries from relevant local agents (assuming these are not located in the immediately affected zone exclusion) to ascertain whether a port is open. Members should furthermore obtain confirmation from the port authority that the port is safe for the vessel to call there, and determine whether the port or Japanese Government have any specific conditions for vessels such as medical precautions and or practical measures that can be taken by crew.

As the situation in Japan is changing every hour, it is not possible to give definitive advice as to whether members’ ships should avoid Japanese ports. However, we would anticipate that should members wish to take some time to monitor the matter before committing vessels to ports in Japan, arbitration tribunals would be sympathetic to an Owner or manager who wished to take some time to assess whether a particular port was safe at the time. That could mean that members might find it prudent to slow steam or wait at a safe location (this will be an operational matter for members to determine) while they make the relevant enquiries.

To show that members have exercised due diligence and have acted reasonably, we recommend they document carefully all enquiries made.

Cover
The cover provided by the Association is subject to an exclusion for nuclear risks.

Members should be aware that Club Rules exclude nuclear risks including damage/harm caused by radiation. This is a standard exclusion which applies to Owners (Rule 30.4 2), Charterers (T&C 24.1.5) and Offshore Operators (T&C 14.16) and is defined in the Appendix 1 of the Rules and Terms & Conditions.

Cover is available as normal for claims arising out of the earthquake and tsunami.

Our correspondent details in Japan are as follows:
SCUA Far East Co. Ltd.
Sannomiya Kokusai Bldg 5th Floor
2-1-30, Hamabe-dori, Chuo-ku
KOBE 651-0083
Japan
 
Emergency phone: +81 90 3274 8816
Office phone: +81 78 272 1771
Office fax: +81 78 272 1781
Business email: office@scua.co.jp

 

INFORMATION SOURCES

News

Find the latest news on the Pacific Ocean Earthquake from Japan Ministry of Land, Infrastructure, Transport and Tourism here: http://www.mlit.go.jp/page/kanbo01_hy_001411.html.
For daily port and infrastructure updates, go to the section named “Recovery of Transportation” within this site.

 

Radiation Concerns off Japan

Brazil

UK

US

 

Other useful sites may be:

 

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