With US east and Gulf coast ports inaccessible and carriers unable to fulfil contracts, contract provisions have cushioned the blow for box lines, but leaving shippers to swallow the extra costs, reports The Loadstar.
Matthew Gore, partner at law firm HFW, told The Loadstar: “If carriers are unable to fulfil their contracts… there will typically be provisions which will excuse them from performance where this is due to matters which are outside of their control.”
Force majeure generally refers to an unforeseen event preventing a party from fulfilling a contract, like earthquakes, floods or fires, and human-inspired events like wars and strikes.
Provisions
The provisions listed in bills of lading might grant carriers liberty on routings and discharges at alternative ports – but this is not currently an option given the scope of the strike. Carriers are also able to suspend carriage and store the goods ashore, afloat or even abandon carriage and deliver the goods to a safe and convenient place at their discretion.
Mr Gore noted that invoking force majeure quashed a shipper’s chance of a refund and could also mean they had to pay any additional costs of carriage, storage and delivery, unless these were “suspended or waived by the carrier”.
Silver lining
But that silver lining is a thin one – with the Q4 holiday season fast approaching, it would be difficult to find a shipper struggling to fulfil minimum volume, and the initiative to declare force majeure lies solely with the carrier.
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Source: The Loadstar
