Should I Stay or Should I Go? Court of Appeal guidance for charterers when owners nominate a port or place convenient for repossession5 November 2025

Clause 29 tackles the potentially tricky issue of repossession of a vessel following a charter’s termination under clause 28.

The dispute concerned whether clause 29 entitled the owners to require the charterers to sail to Trogir. That question of law can be summarised by the following two questions:

1. are owners required to repossess a vessel as soon as practicable, so long as the location of the vessel is objectively convenient for such repossession? (i.e. the owners can put an authorised representative and crew onboard in the usual way); or
2. are charterers obliged to sail to a location nominated by owners on the basis that place is considered more convenient for owners to repossess the vessel?

First instance decision

The judge at first instance found in favour of charterers on appeal and made the following key observations:

1. clauses 28 and 29 of the BIMCO Barecon 2001 standard form bareboat charter should be read together. Clause 28 deals with termination of a charter and clause 29 deals with repossession. Clause 28 deals with scenarios where an owner terminates the charter and scenarios where a charterer terminates. Therefore, the judge at first instance did not consider it probable that clause 29 was intended to always require delivery to an owner at a port of their choice in circumstances where it could have feasibly been the owner who terminated the charter;
2. because a charterer delivering a vessel for repossession is a gratuitous bailee pending repossession (i.e. is required to take good care of the vessel until she is delivered), charterers will inevitably incur costs doing so. The judge at first instance found that it could not have been the parties’ intention that the owner would have an unqualified entitlement to choose where to repossess the vessel in circumstances where the charterer was bearing the costs of her operation and maintenance until she was delivered to owners for repossession; and
3. clause 29 requires an owner to “arrange for an authorised representative to board the vessel as soon as reasonably practicable following the termination of the Charter”, and the vessel would be deemed repossessed upon the boarding of that representative. The judge at first instance said that, as a matter of construction of the words of clause 29, if the owner’s authorised representative was able to board at her current port of call, that was “as soon as reasonably practicable” and therefore they should have boarded at Stockton and repossessed the vessel there.

That latter point was the one which was deemed decisive by the first instance judge.

Court of Appeal’s decision

The owners then appealed that decision to the Court of Appeal. The Court of Appeal reaffirmed the decision of the first instance judge, deciding in favour of the charterers. The Court of Appeal found in favour of the charterers for five key reasons.

1. No Express wording: if clause 29 was intended to give owners a right to nominate a location for repossession, the parties could have included such wording. The clause did not do this, but expressly referred to delivery at “her current or next port”.
2. Commercial common sense: the words “her current or next port” reflect the fact that the vessel might have been in port (her current port) or at sea (heading for her next port) at the time of termination. The Court of Appeal said it did not make legal or commercial sense for the wording to require charterers to sail to a port of the owners’ election when the vessel was already in port because, upon termination of the charter, there was no longer any “next port” and because the owners would not have had any involvement in where her “next port” was. That latter point is because charterers under a bareboat charter have full operational control of a vessel and therefore determine its employment with no/limited reference to owners. This is also ties in with the Court of Appeal’s comment that the repossession provisions in clause 29 must be considered in the context of the legal and commercial nature of a bareboat charter.
3. Swift and practical repossession: the sentences in clause 29 should be read together to determine what any other sentence in the clause means. The right of owners to repossess the vessel should be read considering the obligation imposed on them to place a representative on board “as soon as reasonably practicable”.
4. Obvious fall-back: the additional words “or at a port or place convenient to [Owners]” are clearly intended to be a fall-back where a vessel’s “current or next port” is not convenient for taking possession.
5. No implied obligation to sail: clause 29 does not impose an express obligation on charterers to sail the vessel to another port. Implying such an obligation would require charterers to undertake an additional voyage at their own expense, at the risk of owners being unable or unwilling to indemnify them.