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In commercial shipping, laytime is the amount of time allowed, measured in days (or portions thereof), hours, or even tides, within a voyage charter for the loading and unloading of cargo. Maritime knowhow website: Gencon, clause 6 Maritime knowhow website: Notice of Readiness
Under a voyage charter or time charter, the shipowner is responsible for operating the vessel, and the master and crew are the employees of the shipowner, not the charterer. However, once the vessel has "arrived" at a port the charterer then assumes responsibility for the loading and unloading of cargo and has a period of laytime in which to carry that out. The actual loading may be performed by a third-party stevedore.
The moment that laytime commences is determined by a Notice of Readiness (or "NOR"), which the master or agent of the ship must give to the port when the ship has arrived at the port of loading or discharge. The charterparty contract determines the precise meaning of "arrival". Usually, "arrival" is when the ship has arrived at the port and is ready in all respects to load or discharge; but it may be, say, when the ship has passed buoy #2 in the approach channel, or once the vessel has pass through lock gates. Maritime knowhow website: Gencon, clause 9
If the charterer does not comply with the NOR, the carrier may cancel the contract and seek damages. The Mihalis Angelos If the charterer's delay means that laytime is exceeded, a predetermined penalty (i.e. liquidated damages) called "demurrage" is incurred. The Suisse Atlantique Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd If the whole period of laytime is not needed, a refund called "despatch" may be payable by the shipowner to the charterer. Despatch is normally paid at 50% of the demurrage rate, but that depends on the terms of the charter party. The ship may thus be able to leave port early. Despatch does not normally apply to tanker charters.
Another case in 2011, Suek AG v Glencore International AG (The "Hang Ta"),2011 EWHC 1361 (Comm) addressed a difference of interpretation between the parties to the contract as to giving of a NOR at "a usual waiting place" instead of at the intended discharge berth. The intended berth was occupied, and also access was affected by inclement weather conditions, so there were two contending reasons for the delayed berthing. Glencore argued that the NOR was given too early and was therefore invalid, because the berth's occupation by another vessel was not the sole reason operating to affect berthing, but the court rejected their argument and supported SUEK.Nowak, S., Competing Causes - Agreeing the Risk of Delay, Steamship Mutual, published 1 September 2011, accessed 2 February 2024
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