Examining a Notice of Readiness (NOR)

NOR is a key to the commencement of laytime, since it determines when it actually starts.

The ambiguity around acceptance of a valid NOR and its unilateral agreement has a direct impact on the commencement of laytime, which has been an area of debate in the English courts in several cases and can cause substantial amounts of money to change hands.

A valid NOR is determined after several factors have been satisfied. However, charterparties contain different parameters of what constitutes to be a legal and fully acceptable requirements for a valid NOR to be served:

1) The vessel is an “Arrived” vessel at the “designated” charterparty port;

2) The NOR is tendered by clear channels of communication, ie. sent to all the nominated email addresses;

3) The vessel tendering NOR is prepared in all respects to load or transfer or discharge the cargo;

4) NOR is tendered as stipulated in the charterparty (with details of Port Name, Product Grade(s), Quantity(s), if any;

5) The vessel tenders NOR as per the time acceptable in the charterparty.

There are in effect, two types of charter party contracts – Berth Charter party and Port Charter party.

Berth Charterparty

If the charterparty agreed between shipowners and charterers is based on a Berth charterparty, the vessel can tender NOR only when she is alongside the berth nominated under the charterparty.

If the vessel is fixed under a Berth charterparty, it will have details about the name of the berth that will be nominated by the charterers for the loading or discharging operation.

Charterers or their representatives, ie supplier, buyer, agent, etc are under contract to berth the vessel at the nominated berth.

Time does not commence until the vessel has tendered a valid NOR at the nominated berth specified in the charterparty.

Port Charterparty

Under a Port charterparty, the vessel becomes an ‘arrived’ ship for calculating laytime once she arrives within the port confines rather than the berth.

In this case, the deciding test is whether the vessel is at such a place within port and that she is at the ‘Immediate and Effective Disposition of the Charterers’. When the vessel arrives at a place within the port, she is considered to have arrived, which means she can tender a valid NOR, unless specifically mentioned in the charterparty.

In the Port charterparty, if a vessel tenders NOR and the berth is available, the vessel will only be an ‘arrived’ ship when she is all fast at the berth. This is where it differs from the Berth charterparty.

The reasons are - if a vessel is unable to proceed directly to the berth because of congestion, tides, bad weather, the lack of availability unavailability of tugs, etc. she will still have arrived at her agreed destination under a port charterparty if she has satisfied the Lord Reid test above: ie, she has reached a position within the port and at that position she is at the immediate and effective disposition of the charterers.

Charterparties may specify the NOR’s format to display how, addressee and time and NOR. Failure to comply may not render the tender to become invalid, however, close attention needs to be paid to whom the NOR is being sent.

NOR’s validity and the acceptability is a complicated topic in discussions between vessel owners and charterers. In every case, owners will always issue another NOR or re-tender a NOR to protect the start time.

Clause samples include -

• For the NOR to be considered valid, vessel owners or operators should have obtained all requisite governmental approvals, inspections and clearances, including, but not limited to, those required by the US Customs Service and the Immigration and Naturalisation Service.

• NOR is to be tendered in writing by the vessel’s Master to the agent at the discharge port at any time during in normal office hours after the vessel has received free pratique and customs clearance. If the NOR is issued on a Sunday or a public holiday, it shall be treated as a notice at the start of the next working day.

• At the load port a NOR is to be tendered for each parcel that the vessel can load. At the discharge port, the NOR to be tendered, should include the amount of the cargo according to the Bill of Lading.

US port NOR

For the loading or discharge of foreign vessels at US ports, NOR shall not be tendered until all information and/or documentation (ie tank vessel examination) required for importation, exportation or vessel cargo operations has been sent to the terminal and/or appropriate governmental agencies, including but not limited to US Customs and US Coast Guard.

Delays associated with the securing and providing the required information and/or documentation shall not count as used laytime or as time on demurrage.

It is not uncommon for charterers or owners to find themselves caught up in delays faced by the vessel complying with financial or credit responsibilities by any party. Such time shall not count as used laytime or as time on demurrage.