BG Gas AS v JAS Shipping Ltd

BG Gas AS v JAS Shipping Ltd

The head charterer was not obliged under the sub charter to supply the paragraph 14 owner's supply items unless it chose to do so. Article XVII of the building contract made supply of such items discretionary, not mandatory, and delivery of the vessel without them was still delivery in accordance with the contract. There was no basis for implying terms to require supply of such items, and any overlap with paragraph 5 did not create liability. The appeal was dismissed and the head charterer's cross-appeal allowed, confirming no obligation to supply the items in question.

Parties
Appellant / Claimant: BW Gas AS; Respondent / Defendant: JAS Shipping Ltd
Jurisdiction
England and Wales
Judgment Date
11 February 2010
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From Queen’s Bench Division, Commercial Court
Outcome
Appeal dismissed; cross-appeal allowed.
Legal Topics
Bareboat Charter, Contract Construction, Obligations Under Shipbuilding Contracts, Implied Terms, Seaworthiness
Contract Law Maritime Law Bareboat Charter Contract Construction Obligations Under Shipbuilding Contracts Implied Terms Seaworthiness

Case Brief

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Parties

BW Gas AS

Appellant / Claimant

JAS Shipping Ltd

Respondent / Defendant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From Queen’s Bench Division, Commercial Court

Legal Issues

  1. 1 Whether the head charterer was obliged under the sub charter to supply the vessel with 'owner's supply' (paragraph 14) items as specified in the shipbuilding contract and specifications
  2. 2 Whether the obligation to supply such items was mandatory or discretionary under the contract structure
  3. 3 Whether implied terms could or should be read into the contract to require supply of such items

Ratio Decidendi

The head charterer was not obliged under the sub charter to supply the paragraph 14 owner's supply items unless it chose to do so. Article XVII of the building contract made supply of such items discretionary, not mandatory, and delivery of the vessel without them was still delivery in accordance with the contract. There was no basis for implying terms to require supply of such items, and any overlap with paragraph 5 did not create liability. The appeal was dismissed and the head charterer's cross-appeal allowed, confirming no obligation to supply the items in question.

Court Disposition

Appeal dismissed; cross-appeal allowed.

Orders

  • Issues 1.1, 1.2, 2.3 and 2.4 answered 'No'.
  • Issue 2.1: 'The Defendant was not obliged to supply the Buyer’s supplies as alleged, and was not in breach of its charter by failing to provide such supplies.'