At the end of a three-year bareboat charter, a tug operator in French Guiana redelivers a vessel whose propeller shaft is bent and on which two class surveys have been postponed. The owner puts a figure on the reinstatement costs; the charterer speaks of fair wear and tear and an original defect. Meanwhile, the vessel was redelivered three weeks late.
What the owner owes, and what the charterer owes
The French Transport Code allocates the burdens clearly. The owner undertakes to deliver the vessel, at the agreed date and place, in a seaworthy condition and fit for its intended service (Article R. 5423-4). It bears the cost of repairs and replacements due to an inherent defect of the vessel (Article R. 5423-5).
Everything else falls on the charterer: maintenance, repairs and replacements other than those due to inherent defect, the crew, operating costs and insurance of the vessel (Article R. 5423-7). It may use the vessel for any purpose consistent with its normal employment and must return, at the end of the charter, the equipment and gear on board in the same quantity and quality (Article R. 5423-6).
Condition on redelivery
The charterer must redeliver the vessel in the condition in which it received it, save for fair wear and tear of the vessel and its machinery (Article R. 5423-8). The dispute therefore turns on two findings: condition on delivery and condition on redelivery. Without a joint survey report at both dates, each side puts forward its own version. BARECON forms provide for these inspections; they still have to have been carried out.
The distinction between inherent defect (for the owner’s account) and lack of maintenance (for the charterer’s account) lies at the heart of the dispute. Classification society reports, maintenance logs and damage histories are the decisive documents.
Late redelivery
The Code provides for liquidated compensation: for the first fifteen days of delay, it is calculated on the basis of the hire rate; beyond that, on twice that rate, unless the owner proves a greater loss (Article R. 5423-9). This default rule may be varied by the charterparty. It has a clear deterrent effect beyond two weeks.
One year to bring a claim
Claims arising from the charterparty are time-barred after one year (Article L. 5423-4 of the Transport Code). Time runs quickly after redelivery: the claim for repairs must be quantified and brought without delay.
What the firm checks first
- The condition reports on delivery and on redelivery.
- The class and maintenance history.
- The characterisation of each item of damage: inherent defect, lack of maintenance, fair wear and tear.
- The scheduled and actual redelivery dates.
- The arbitration clause and the one-year time limit.
For the firm’s involvement, see Charterparties and demurrage.
Further reading
- Off-hire: when a time charterer may stop paying hire
- Unpaid hire: can the owner withdraw a time-chartered vessel?
- Hull insurance: challenging a refusal of cover
This analysis is part of the firm’s work in maritime law.
Frequently asked questions
Who pays for an engine breakdown during a bareboat charter?
The charterer, unless it results from an inherent defect of the vessel, which remains for the owner’s account (Articles R. 5423-5 and R. 5423-7 of the Transport Code).
What does the charterer owe in the event of late redelivery?
Compensation calculated on the hire rate for fifteen days, then on twice that rate, unless a greater loss is proved (Article R. 5423-9).
Is fair wear and tear for the charterer’s account?
No: the vessel is redelivered in the condition in which it was received, save for fair wear and tear (Article R. 5423-8).