Charter Party Agreements

Different charter parties impose different obligations, exclusions, and limitations between each entity. For this reason, both shipowners and charterers should be keenly aware of their legal exposures and contractual liabilities, especially during a contentious charter party dispute. Shipowners and charterers should also consider seeking sound and practical legal advice before amending or complementing any standard time charter, voyage charter, or bareboat charter party.  Need help drafting or understanding your legal rights in a charter party contract?  IMG can help.

Time Charters

Time chartering is a complex business. The shipowners give the time charterers substantial control over the commercial operation of the vessel in exchange for the regular payment of hire. While this arrangement suggests that the shipowners have transferred much of the potential operational risk to the charterers and that the charterers can do more or less what they like with the ship, such an initial impression is both deceptive and dangerous. Your rights and liabilities in your time charter may not be obvious.

Voyage Charters

Voyage charters are the most commonly used charter party agreement. Under a voyage charter, a ship owner and a charterer enter into a contract whereby the vessel will carry cargo between two points. The voyage can be a single trip or multiple trips, provided that the charterer has absolutely no operational control over the vessel while it is being operated. Any delays during the loading and unloading of the cargo, as well as any delays during the seagoing part of a voyage, generally fall onto the vessel owner. Many charterers prefer this allocation of risk.

Bareboat Charters

A bareboat charter is the simplest type of charter party agreement. Under a bareboat charter (a.k.a. “demise charter”), the charterer effectively becomes the owner of the vessel for all operational and trading purposes, and thus, is responsible for the navigation, operation, repair, maintenance, insurance, and crew of the vessel. Despite an appearance of simplicity, bareboat charters are complex agreements, and numerous problems can arise during their use. Owners and charterers should seek sound legal advice before drafting or amending a bareboat charter.

Charter Party Terms and Conditions

IMG is prepared to answer multifarious questions about terms and conditions in your charter party agreement: risk allocation, indemnity agreements, cargo liability, trading limits, delivery and redelivery, safe ports and berths, bunkers, computation of time, charter hire, unlawful withdrawal, upmost despatch, bills of lading, cancelling clauses, off-hire clauses, frustration of the charter, force majeure, arbitration provisions, liens, laytime and demurrage, deviation and delay, ice clauses, and governing law clause.

Knowledge and Experience

What We Do

IMG is one of the only law firms in the Pacific Northwest that focuses on the transactional side of charter party agreements and the litigation side of charter party agreements.

The nature of the fishing industry often requires that matters be dealt with on an urgent basis and our legal practitioners travel widely and at short notice. We also advise on fishing company start-ups and business entity formation.

Many disasters, both at sea and on land, unfortunately involve either death and/or personal injury. At IMG, we have the necessary experience in defending and prosecuting companies and insurers in maritime and offshore energy cases.

IMG has experience in dealing with the legal issues connected with shipping casualties and salvage operations. IMG is prepared to act for salvors during and in the aftermath of shipping casualties and ensuing operations.

We frequently advise on the drafting and review of contracts, together with associated documents such as performance and refund guarantees, as well as the financing and insurance of new builds.

IMG’s team is involved in all aspects of selling and purchasing vessels including the negotiations between the buyers and the sellers. We regularly advise a diverse range of international clients including owners and operators.

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