In Metvale Ltd and another v Monsanto International Sarl and others – Lawtel 16.12.08 the Chancery court was required to determine as preliminary issues (1) whether slot charterers were shipowners for the purposes of the Limitation Convention 1976 art.1 and were entitled to limit their liability under the Convention and under the Merchant Shipping Act 1995, and (2) whether the limitation fund constituted in the instant action was deemed to be constituted by the slot charterers under and for the purpose of the Convention and under the Act.
It was found that the slot charter agreements in the instant case had some features in common with a time charter. They lasted for a period of time and hire was paid for the use of cargo carrying capacity. The agreements were not however comparable to a time charter in that the charterer did not direct the vessel where to go. The implementing agreement, to which the slot charterparty was annexed, provided that the itinerary of each voyage would be as mutually agreed. In that respect it was more akin to a voyage charter or consecutive voyage charter. A time charterer was a charterer for the purposes of art.1(2) of the Convention, CMA CGM SA v Classica Shipping Co Ltd (The CMA Djakarta) (2004) EWCA Civ 114.
The Court of Appeal in the CMA Djakarta case expressly left open the question of whether "charterer" included a slot charterer. The ordinary meaning of the word charterer was apt to include any type of charterer, whether demise, time or voyage charterer. There was no reason why it should not also include a slot charterer. There was good reason for a slot charterer being within the definition. A slot charterer's inability to limit liability would not encourage the provision of international trade by way of sea carriage, which was the object and purpose of the Convention. There was nothing absurd in a slot charterer being able to limit by reference to a limit calculated by reference to the whole tonnage of the vessel: the limit of liability was a limit in respect of the aggregate of all the liabilities of those within the definition of shipowner arising on a distinct occasion. There might therefore be several persons seeking the benefit of that single limit, for example the registered owner, the time charterer and several slot charterers. A literal reading of the phrase "charterer of a... ship" might suggest that the definition did not include the charterer of a part of a ship, but a literal reading had to give way to a purposive construction; and the latter construction pointed to a slot charterer being within the definition of a charterer. It had been held that a slot charterer was within the phrase "charterer of... the ship" in s.21(4)(b) Supreme Court Act 1981 relating to the arrest of ships, The Tychy (No1) (1999) 1 All ER (Comm) 819.
It also held that, pursuant to art.11(3) of the Convention, a fund constituted by one of the persons mentioned in art.9 or his insurer was deemed to be constituted by all persons mentioned in art.9. The fund was constituted by the Claimants, as the owner of a seagoing ship and a person mentioned in art.1(2) and in art.9. The slot charterers, as charterers, were persons mentioned in art.1(2) and accordingly persons mentioned in art.9. It followed that the fund was deemed to be constituted by the slot charterers.