This is an extract of our The Alaskan Trader document, which we sell as part of our Commercial Remedies BCL Notes collection written by the top tier of Oxford students.
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THE ALASKAN TRADER FACTS On 19 October 1979 the Alaskan Trader was chartered by the respondents as disponent owners to the claimants for a period of 24 months, 15 days more or less. She was an old vessel, having been built in Sweden in 1954. She was acquired by her head owners in September 1979, only a few weeks before the date of the charter. She was delivered under the charter on 20 December 1979, and thereafter performed services on short Mediterranean voyages carrying gas oil from Haifa. On 19 October 1980, after she had been in service for nearly a year, the vessel suffered a serious engine breakdown. It was clear that the repairs would take many months. The charterers indicated that they had no further use for the vessel. The market had turned against them. At the time of the charter the market rate was $13-$14 per ton. By October 1980 it had declined to $8-$9 per ton. Nevertheless, the owners went ahead with the repairs at a cost of $800,000. Throughout the period of the repairs the vessel was, of course, off-hire. The repairs were completed on 7 April 1981. The owners thereupon informed the charterers that the vessel was again at their disposal. But the charterers declined to give the master any orders. They regarded the charterparty as having come to an end. The owners could have treated the charterers' conduct as a repudiation of the charterparty. But they did not do so. They anchored the vessel off Piraeus, where she remained with a full crew on board, ready to sail, but idle, until the time-charter expired on 5 December 1981. She was then sold for scrap. But the principal claim related to the hire for the period from 8 April to 5 December 1981. The owners argued that they were entitled to retain the hire, since they had kept the vessel at the disposal of the charterers throughout the period. HOLDING It seems to me that the arbitrator is here distinguishing clearly between the two observations or limitations on the general principle to which Lord Reid had drawn attention in his speech. He is saying that a time charter is more analogous to a contract between master and servant than a simple debt, ie that it is a contract which calls for co-operation between both parties. He is also saying ('The charterers were also able to satisfy me ... ') that the owners had no legitimate interest in pursuing their claim for hire as distinct from damages. Legitimate Interest point (Unreasonable and Wholly Unreasonable)
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