What's the ETA?

The High Court has established that an estimated time of arrival can be implied into a shipping contract where the ETAs of unrelated intermediate voyages are provided, even if an ETA for the voyage in question is not stipulated.

Previous authority had held that where a charterparty gives an ETA (or a date which can be interpreted as an ETA), there is an absolute obligation on the owner to start the voyage by a date when it is reasonably certain that the vessel will arrive at the loading port on or around the ETA: Monroe Brothers v Ryan [1935] 2 KB 28.

In the present case, CSSA v Mitsui, the vessel hit a submerged object during an intermediate voyage and, as a result, missed the latest arrival time stipulated in the contract. CSSA, the charterers, exercised their contractual right to cancel the fixture. They sustained substantial losses, and asserted a breach of charter which would entitle them to claim damages flowing from that breach.

The court held that there was an absolute obligation on the owners, Mitsui, to start the approach voyage within a "reasonable" time (as opposed to a less onerous due diligence obligation). This was determined by reference to the ETAs and final discharge given in relation to the previous voyage. As the owners did not comply with the obligation to commence the approach voyage by this time, they were in breach of contract and the charterers were entitled to damages.

Update November 2018: This decision was upheld on appeal.