ELLI

The ELLI was chartered out a on a long term basis. During the course of the charter the MARPOL accelerated single hull phase out regulations came into force. The ship was a partially, but not fully double sided oil tanker, and under these regulations, was no longer legally able to carry fuel oil. As a result, the charterer paid a reduced rate of hire for the balance of the charter period, and brought a claim for lost profits.

The English High Court and subsequently the Court of Appeal found in favour of the charterer and ruled that once the regulations came into force the owner was obliged to restore the ship to a condition in which she could carry fuel oil. The judgment establishes that an owner rather than a charterer bears the risk of changes in international regulations and the costs of continuing compliance with those regulations.

The Club supported the owner's costs of the proceedings in the English High Court as well as the Court of Appeal. The case is reported here.