The Inter-Club Agreement (ICA) first came into force on 20 February It was revised in , in. and again in See 24 August , Standard. Under the Inter-Club NYPE Agreement , it was possible for a party to a Exchange Agreement (as amended September ). raised regarding common Inter-Club Agreement (ICA) incorporation clauses. The recent decision of the Commercial Court in the “Genius Star 1” [].

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Industry News Up-to-date information about topical issues is provided by the Industry News service. You are currently offline. Head owners chartered their vessel to the claimant disponent owners who, in turn, chartered to the respondent charterers.

Commentary This is a significant decision perhaps more so because leave interclug appeal was refused which may have considerable consequences.

In turn, the disponent owners provided counter security to the head owners on the basis of Clause interlcub of the ICA which provides a reciprocal obligation for provision of security by a party to a charterparty once security in respect of a cargo claim is provided by its counter-party. Under this new provision once one of the parties to a charterparty has put up security in respect of a cargo claim, provided the time limits set out in clause 6 of the agreement have been complied with, there is an entitlement to security on the basis of reciprocity.

Members who need to advise the Club of updates to their recorded ships’ details should advise their usual underwriting contact. The arbitrators arrived to the conclusion that specific words of incorporation would be required to incorporate the entire Intfrclub in the charterparty and that in the absence of such words, certain provisions of the ICA would not be applicable.

Apportionment of liability under the Inter Club Agreement: secure to be secured? It depends

Our Club, in common with the other Group clubs is issuing a circular to inform Members of this change. The first in was to meet one particular shortcoming relating to the time limit for making claims.

The second inwhilst not deviating from the fundamental nature of the ICA, was more substantial and was introduced in particular to meet the needs of the container trade.

The charterers refused to provide security to owners on the basis that the wording of the charterparty clause restricted the application of the ICA to address only liabilityapportionment and settlement of cargo claims, not provision of security. However, one of the main purposes of the ICA revision was to ensure the parties to a cargo claim would be able to secure themselves against their contractual counterparts without unnecessary difficulty.


The purpose behind the development of the ICA was to avoid costly and protracted litigation. The Group has therefore taken a decision to incorporate a new provision into the Agreement, which creates an entitlement to security on the basis of reciprocity, once one of the parties to a charterparty has put up security in respect of a Cargo Claim, provided that the time limits set out in clause 6 of the Agreement have been complied with the Security Provision. The disponent owners commenced arbitration proceedings against the charterers and made an application under Section 48 5 b of the Arbitration Act asking the tribunal to order the charterers to put up security interckub to the relevant section of the ICA.

Both the ICA and the Agreement have worked well, been widely adopted by the maritime industry and have achieved their purpose.

Instead, only the provisions relating to the apportionment of liability were effectively incorporated. This clause shall take precedence over any other clause or clauses in this charterparty purporting to incorporate any other version of the Inter-Club New York Produce Exchange Agreement into this charterparty”. The Group believes that this situation is unsatisfactory and has led to unnecessary, wasteful and costly disputes between Clubs.

If you continue to use our site without changing your settings, we will assume that you are consenting to our use of cookies. This may therefore lead to some uncertainty which will however be limited to clauses of the same or similar wording.

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New charterparty clause promoting the use of the Inter-Club Agreement

The tribunal found that a commonly used clause in charterparties interdlub provided that liability in respect of cargo claims was to be apportioned as specified by the ICA was not sufficient to also incorporate the provisions of the ICA relating to the provision of security and counter-security.

The purpose of iinterclub ICA is to encourage reasonable settlement and save costs by avoiding expensive legal disputes when dealing with cargo claims. This is because the relevant wording is commonly used in fixtures and some parties including their liability insurers may be caught by surprise if they realise that there is a risk that some provisions inerclub the ICA are not applicable. Owners and operators should review the wording of their existing charterparties after a recent LMAA arbitration tribunal found that the Inter-Club Agreement in its entirety was not properly incorporated in an NYPE charterparty.


Web design agency – Liquid Light. As the new agreement takes effect from 1st Septemberwe recommend its incorporation into all NYPE and Asbatime charterparties going forward.

New charterparty clause promoting the use of the Inter-Club Agreement – Skuld

The amended clause for recommendation is as follows: Some pages or content may fail to load. If the latter, it would be recommended that explicit reference to the relevant provisions is made for the avoidance of confusion and caution is also paid as to the interaction of those provisions with other provisions of the charterparty relating to liability.

If you need to call our offices ijterclub of hours and at weekends, click After Office hours for a up to date list of the names of the Duty Executives and agrewment mobile phone numbers. The relevant facts were quite straightforward.

Inter-Club Agreement as amended 1 September The information is timely, helpful and easy to navigate. It can also apply to contracts of carriage authorised under such charterparties. On the other hand, the disponent owners argued that the relevant clause made it clear that the full terms of the ICA interclu in respect of liability for cargo claims and therefore the entire relevant provisions were incorporated including those wgreement to provision of security. A agreementt is a small piece of data that websites store on your computer and we use them to provide you with a better user experience on our website.

Although this conclusion was reached in arbitration and is therefore not a legally binding precedent, this may prompt others to challenge inyerclub requests on similar grounds. Gard therefore recommends Members and clients to review charterparty cargo handling clauses carefully, to ensure the ICA is clearly incorporated in its entirety.

Both charterparties included the following wording: The above recent arbitration decision calls for caution on the wording of clauses which owners and charterers include in their charterparties when they aim to incorporate the provisions of the Inter Club Agreement ICA.

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The Group has taken the view, which Counsel has confirmed, that this provision makes payment agreemnt a Cargo Claim as defined under clause 3 of the Agreement a condition precedent to a right to indemnity.

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