Contracts Of Affreightment are used when a shipowner or operator agrees to transport a given quantity over a fixed period of time. Unlike other charter parties. COA (Contract of Affreightment). Originally, contracts for the carriage of goods by sea, such as voyage charters and time charters, were termed “contracts of. In the context of Maritime law, a contract of affreightment is an agreement for carriage of goods by water. A contract of affreightment shall employ a bill of lading.

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The bill of lading sometimes contains a clause as to the shipowner’s lien. Another clause specifies that the master must sign bills of lading for the cargo, either at the same rate payable under the charter-party, or commonly at any rate of freight with a stipulation that, if the total bill of lading freight is less than the total freight payable under the charter-party, the charterers pay the difference to the master before the vessel sails.

There is usually also a clause that requires that the merchant bear the risk and expense to bring the cargo to the ship and collect it on delivery. However a difficulty often arises from an improvident clause in the charter-party that requires him to sign bills of lading as presented.

Example- Iran is one of the major exporters of crude oil to India. Why do some cargo ships have more than one set of load lines marked, i. Learn how and when to remove these template messages. Beaufort wind scale Force 5. The meaning of words in the contract, or—in other words—its construction, when a dispute arises about it, are determined by a judge or court. This is done either by statutory enactment, as by Part VIII of the Merchant Shipping Actwhich deals with the liability of ship-owners—or by established rules of common lawas, for instance, the rule that the common carrier is absolutely responsible for the safe delivery of the goods carried, [1] unless prevented by an act of God or enemies of the Queen.

An emergency may require that the master, without waiting for authority or instructions, incur expense or make sacrifices as agent—not just for his employer, the shipowner, but also for the cargo-owner. If the ship could carry out consecutive voyages it would most probably have to return to the loading place in ballast and this would increase the freight the owner would have to charge to make an acceptable return on his investment.

COA (Contract of Affreightment)

affreightmeht However, if the notice is given after business hours on the Monday, the usual presumption is that the notice is treated as having been received the following day Rightside Properties v Gray []. He must also bear all losses that arise from accidental damage to the ship. The law that regulates the rights of the parties in regard to such contribution is called the law of general average.


Though not strictly contractual, these are well established by the customs of merchants, and recognized by law. The charterer agrees conntract pay a specified price, called freightfor the carriage of the goods or the use of the ship.

As with many of the issues that arise under COAs, there is little direct case law and the answers always turn on the particular facts and circumstances of each case. Affreithtment care is taken in drafting the COA to suit the parties commercial interests, this is one area where the commercial relationship between the parties to the COA is often a good incentive for both sides to find an acceptable commercial solution to any disputes.

There it may be necessary to repair the ship, and to land and affreigutment, and afterwards re-ship the cargo.

Or is it the case that once a vessel is nominated, the contract becomes one for the charter of the vessel nominated and there is no scope for a further nomination? Subject to licence being granted. For these purposes the master is obliged to incur expense, of which some, such as the cost of ship repairs, is for affrrightment benefit of the shipowner.

Nomination procedure and potential problems Some individual contracts have very detailed and complicated provisions concerning nomination procedure. Ordinamenta et consuetudo maris Amalfian Laws Hanseatic League. Admiralty court Vice admiralty court. When you have completed the review, replace this notice with a simple note on this article’s talk page. The effect of the clause is that by the charterers shipping a full cargo, they fulfill all their obligations. When there is no written contractual agreement, the rights of the parties depend on the rules of law, or on the warranties or promises that, though not expressed, are implied affreighmtent part of the relationship between the shipper and carrier.

Other expenses, such as warehousing fees, are for the benefit of the cargo-owner. Please help contracf improve this article by introducing more precise citations.

This article outlines the important obligations of shipper and shipowner, where no terms of carriage have been agreed, except as to the freight and destination of the goods, are such as have been described above.

The ports of loading and discharging do not have to be specified but it is most likely that the cargo movement would be between agreed ports. The shipowner is further secured by the stipulation that if the total freight payable under afreightment bills of lading is less than the full chartered freight, the difference is paid to the shipowner before the vessel sails.


The charterers agree to indemnify the owners from all liability they may be exposed to by the master signing bills of lading or otherwise complying with the charterers’ orders. This article includes a afcreightment of referencesbut its sources remain unclear because it has insufficient inline citations. Further, afreightment shipowner is not liable for damage to or loss of goods or merchandise beyond an aggregate amount that does not exceeding eight pounds per ton for each ton of the ship’s tonnage.

Usually the circumstances of a COA are such that timely acceptance of the vessel nominated is essential in order that the parties know where they stand. This in affreihtment leads to further questions. Please help improve it or discuss these issues on the talk page. Browse the definition and meaning of more terms similar to Contract of Affreightment.

contract of affreightment

Nomination clauses will invariably set out the nomination procedure, ranging from who is to initiate the procedure to which party is to have a final say on the vessels required arrival date. The owner almost always pays the wages of the master and crew, and the charterers provide coals and pay port charges. The result is that certain more-or-less common clauses in affreightment contracts have come before the courts, and decisions in these cases are treated practically [1] —though perhaps not logically—as rules of law that determine the meaning of certain common expressions in shipping contracts.

This means that the holder of a bill of lading signed by the master without knowledge of the terms of the time charter-party may hold the owner responsible for the contract the master signed as an employee of the shipowner—though, in fact, in signing the bill of lading the master acted as an agent for and at the direction of the time charterer.

In such a case the master, acting for the shipowner or cargo-owner, as the case may be, sacrifices part of the ship or part of the cargo to save the rest of the ship and cargo from a common danger. The lien is the right of the shipowner to retain the goods carried until paid the freight charges, demurrage, or other charge for which a lien has been given.

Exporters in Iran can sign such contracts with shipping company.