Key takeaways
- Use a neutral event chronology before assigning a contractual label.
- Document the service required and the actual effect of the interruption.
- Keep incident review, hire accounting and settlement authority distinct.
Identify the provisions that may apply
Obtain the complete time charter, recap and riders. Review the off-hire wording together with any specific provisions addressing the event in question. Do not rely on a generic summary of the base form when amendments may alter the relevant test or consequences.
BIMCO's time charter training distinguishes different off-hire clause structures and the effect of specific wording. That supports a practical preparation rule: identify the actual provision before categorising the event. BIMCO time charter programme.
Prepare a reference sheet listing the relevant clauses and the questions for the authorised reviewer. These may concern the event, its duration, its effect on service and the proposed account treatment. The preparer supplies the evidence; a checklist should not present a universal legal test that every charter supposedly shares.
Keep related but distinct claims separate. An operational problem may lead to discussions about expenses, performance or cargo consequences as well as hire. Combining everything under a single “off-hire” heading can obscure which agreement provision and evidence support each proposed adjustment.
Describe the event without prejudging its effect
Begin the chronology with observable facts and attributed reports. Record when the issue was first reported, what the vessel was doing, what instructions were in place and what changed. Use the terminology supplied by competent personnel for technical matters rather than translating a short report into an unsupported diagnosis.
Preserve the difference between an initial report and a later explanation. The first message may describe symptoms while the technical investigation later identifies a cause. Both belong in the record, clearly dated. Replacing the initial account with the final explanation can conceal what the parties knew when they made operational decisions.
Record recovery in stages where the evidence supports it. Repair completion, readiness to resume a task and actual resumption may occur at different times. Do not merge them into a single end timestamp because it makes the account easier to prepare.
Document the service and competing causes
Ask what service was required during the relevant period and identify the instructions or voyage plan supporting that description. A vessel's technical condition is only part of the factual picture. The review may also need to understand terminal availability, cargo readiness, weather or other contemporaneous circumstances.
Gather evidence of overlapping events without deciding their legal significance. If cargo work was already stopped for a shore reason when a vessel issue arose, preserve both timelines. The authorised reviewer can assess how the actual wording applies. Removing one timeline because it complicates the calculation weakens the analysis.
Keep any comparison with an unaffected operation transparent. If the review asks what would have occurred without the incident, state the assumptions and evidence supporting that analysis. A counterfactual estimate should not be presented as an observed event. Technical and operational specialists may need to explain the practical constraints.
Use an off-hire evidence checklist
| Review area | Preparation question | Record to retain |
|---|---|---|
| Contract | Which provisions address this event? | Approved form, riders and recap |
| Required service | What task or employment was expected? | Orders and contemporaneous voyage plan |
| Incident | What was reported and by whom? | Original reports and technical findings |
| Effect | What activity was interrupted or restricted? | Ship, cargo and terminal records |
| Recovery | When did each relevant stage occur? | Completion and resumption reports |
| Accounting | Who may approve the proposed treatment? | Review decision and payment instruction |
The checklist should expose gaps rather than produce a percentage score. A missing instruction record may matter more than several available photographs. Ask the reviewer which unresolved facts are material so the team can focus retrieval efforts on evidence capable of changing the assessment.
Maintain a document index linking reports to chronology entries. This allows the technical reviewer and claims analyst to work from the same facts while applying their different expertise. It also reduces repeated requests to the vessel for records already held elsewhere in the organisation.
Prepare the account without creating an accidental concession
Keep the operational estimate and proposed hire adjustment in separate fields. State whether the adjustment is under review, asserted by one party, agreed or settled. Finance should receive a clear authorisation rather than an incident email with “please adjust” added by someone outside the approval chain.
If several treatments remain possible, prepare labelled alternatives using the same factual chronology. Explain which contractual or factual assumption changes between them. This is more useful than circulating competing totals whose underlying intervals are not visible.
Preserve payment and reservation correspondence in the claim file. A reviewer may need to understand what was communicated when accounts were issued or paid. The preparation team should not improvise legal reservations; it should obtain approved wording where such communication is required.
Close the review with a decision record identifying the approved account treatment and any matters left open. A commercial compromise should be recorded as such rather than incorporated into the technical incident report. This avoids turning a settlement choice into a supposedly established fact about the event.
Fictional case: a crane defect during a shore stoppage
In this fictional case, a geared vessel reports a crane defect while discharge is already interrupted by a shore conveyor problem. An early internal message calls the entire period off hire. The preparer instead assembles separate timelines for the crane condition, shore stoppage and cargo operations.
Technical personnel explain the crane's reported availability and repair sequence. The agent supplies terminal records showing when the shore interruption ended. The contractual reviewer considers those facts alongside the charter and the service required during the period.
Finance receives the approved treatment only after that review. The chronology remains factual and retains both causes. The preparation process does not assume that overlap defeats or establishes an off-hire position; it ensures the decision is made with the relevant evidence visible.
Common mistakes
Labelling every breakdown or delay “off hire” in the event log can prejudge the question before the charter is reviewed. Use neutral descriptions and reserve contractual labels for the reviewed position. Another error is treating repair completion as the only possible endpoint without examining service and resumption evidence.
Avoid combining off-hire, performance and expense adjustments into an unexplained lump sum. Keep their bases distinct. Finally, do not let an operational report become a payment deduction instruction merely because finance is copied on the email.
Where Zeaclub fits
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Educational information only; not legal, financial or trading advice. Contract wording and applicable rules control. Verify current requirements and obtain qualified advice before acting.
Frequently asked questions
Does a breakdown automatically stop hire?
The actual charter and circumstances require review. Preparation should identify the event, the service affected and the relevant provisions. A technical failure report alone does not establish the contractual or accounting consequence for every time charter.
Why record other delays occurring at the same time?
They may be relevant to understanding the vessel's service and the event's practical effect. Preserve the overlapping chronology and supporting records. The authorised reviewer can then assess its significance without relying on an incomplete account that isolates one cause from the operational context.
Can finance use the incident duration directly?
Only after the appropriate review and authorisation establish the account treatment. The duration of an incident, repair work and affected service may differ. Finance needs the approved basis and supporting calculation, not merely the first and last timestamps in a technical report.
What if the cause remains uncertain?
Keep the uncertainty explicit and preserve the available evidence. Ask the competent technical team what further investigation is possible and the contractual reviewer what facts are material. Do not fill the gap with a confident diagnosis derived from informal operational shorthand.