The charter for the Afovos was on the New York Produce form with an added anti-technicality clause (Clause 31) which provided:” when hire is due and not received the Owners, before exercising the option of withdrawing the vessel from the Charter-Party, will give Charterers forty-eight hours notice, Saturdays, Sundays and Holidays excluded and will not withdraw the vessel if the hire is paid within these forty-eight hours”. Hire was due on 14 June. The charterers’ bank in Italy intended to remit the funds in good time by telex transfer to the owners’ bank in London. Due to an un-notified change of telex number by the owners’ bank and a failure by the charterers’ bank to check the answerback, the telex transfer did not reach the owners’ bank. At 16 40 hours on 14 June the owners’ agent telexed the charterers:” owners have instructed us that in case we do not receive the hire which is due today, to give charterers notice as per cl.31 of the charterparty for withdrawal of the vessel from their service.” It was held by the Court of Appeal that:
(1) There was no default in payment of hire by the charterers until after midnight on the due date;
(2) On a true construction of Clause 31, the 48 hours notice could not be given until after the last moment for payment;
(3) In any event, the notice was not a good notice because it was conditional in terms.
The decision of the Court of Appeal was affirmed by the House of Lords.
The Afovos [1982] 1 Lloyd’s Rep. 562 (C.A.) and [1983] 1 Lloyd’s Ref. 335 (H.L.)
