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ARTICLE · 09 JANUARY 2017

Demurrage clauses and their enforceability under English Law

Colin Biggers & Paisley
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This judgment points to the advisability of cargo interests being proactive in dealing with container demurrage claims.

AustraliaInsurance
Robert Tuck
Robert Tuck

MSC Mediterranean Shipping Company SA v Cottonex Anstalt [2016] EWCA Civ 789

The England and Wales Court of Appeal (Civil Division) in its 27 July 2016 judgment in MSC Mediterranean Shipping Company SA v Cottonex Anstalt [2016] EWCA Civ 789, commented on several matters relating to container demurrage clauses in bills of lading. This case provides some useful insights for carriers and shippers.

Containers stuck in Port of Chittagong following dispute between shipper and consignee

The facts were that MSC (the carrier) contracted with Cottonex Anstalt (the shipper) to carry raw cotton by sea to Bangladesh in containers. Each of the bills of lading provided for a period of free time for the use of containers at their destination after which container demurrage became payable to MSC at a daily rate.

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