London Calling: The Hidden Rule Every Charterparty Should Know!

 ⚖️ London Calling: The Hidden Rule Every Charterparty Should Know!

By ShipOps Insights with Dattaram

Ahoy ShipOps Champions! 🚢
Ever heard this saying? “The devil is in the details.” In shipping contracts—especially charterparties governed by English Law—this rings louder than a ship’s foghorn in the Channel! 📢🌫️

Let me share a powerful case that shows why understanding your legal ground is non-negotiable when dealing with interest claims under English jurisdiction.

 

⚓ Story From The Shore: The Martrade Case That Changed The Tide

In Martrade Shipping & Transport GmbH v United Enterprises Corp [2014], a crucial question was raised:

Can just agreeing to London arbitration give you the right to claim statutory interest under the UK's Late Payment of Commercial Debts (Interest) Act?

Turns out, NO—it’s not enough. Judge Popplewell ruled that:

A London arbitration clause alone doesn’t create a “significant connection” to England.

So what does count? Let’s dive in! 🏊‍♂️⚖️

 

🧭 1. Where’s The Money Going? – Place of Performance Matters

If England is the place where obligations under your charterparty are to be performed, especially payment obligations, that builds your case for claiming interest under UK law.

💡 Example: If hire or demurrage is payable to a UK bank account, it strengthens the “significant connection.”

🔖 #ShippingContracts #PlaceOfPerformance #MaritimeLaw

 

🇬🇧 2. The British Connection – Nationality of Parties

If either party is British, boom—you’ve added another strong link to England.
Nationality isn’t just a formality in law. It shows legal, business, and economic roots.

💡 Example: Even if the ship is flagged elsewhere, if one party is a UK company, it tilts the case toward English law applying.

🔖 #UKShipping #ContractLaw #EnglishLawMatters

 

🏢 3. Business in the UK – Show You’re Active There

Does your company—or your counterparty—do any part of their shipping operations or commercial dealings in England? If yes, that creates the vital "economic footprint" the law wants to see.

💡 Example: Chartering department or legal office based in London? It helps your interest claim!

🔖 #MaritimeBusiness #LegalFootprint #LondonShipping

 

📉 4. Economic Impact – Does Delay Hurt UK Interests?

Even if you’re not UK-based, if delayed payments impact UK-based stakeholders, agents, or banks, then the court may accept the connection.

💡 Example: Payments not reaching a UK financier or P&I club on time = economic consequence in the UK.

🔖 #DelayedPayments #InterestClaims #ShippingFinance

 

 

💬 Final Wake-Up Call For My Shipping Fraternity

Dear captains, operators, and owners—don’t sleepwalk into arbitration.
Just because your CP says "London arbitration" doesn’t mean you’re entitled to interest under UK law.
Make sure your case has at least one anchor point in the UK to claim what’s yours. ⚓✅

🗨️ Share your experiences.
💡 Got similar cases?
👇 Drop your thoughts below, and don’t forget to...

✅ LIKE
✅ COMMENT
✅ FOLLOW @ShipOpsInsights with Dattaram for more such real-world, practical shipping lessons that keep your operations smooth and your contracts tighter than a hatch in a storm! 🌊✍️💼