The charterer had prematurely terminated the charter by four years. However when the case went to arbitration three years later on the assessment of damages, the Gulf War had intervened. This would have allowed the charter (if it was still operational) to be terminated. The issue was whether damages should be calculated over the remaining charter period of four years, or the much shorter period of just over one year, when the war broke out and the termination clause was invoked.
Following changes to MARPOL regulations, the two ships potentially became non-compliant due to a small area of single-hull. The issue arose whether the ships, which had been fully described in the charter, were now non-contractual. The Court of Appeal held that the owners had a continuing obligation to ensure the ships complied with all legal and regulatory matters affecting the ships’ ability to perform the services required of them...