Trans Trade RK SA v Sebat Shipping and Trading Company

An invalid notice of readiness cannot start laytime. Laytime will begin only if the parties agree to treat the notice as valid, or if the charterers’ conduct establishes an effective waiver or estoppel. Waiver by election requires unequivocal conduct and knowledge of both the relevant facts and the right being waived. There is no separate, less rigorous principle of deemed waiver. On an appeal under section 69 of the Arbitration Act 1996, the court reads the award reasonably and commercially, but may intervene where the tribunal’s legal conclusion is necessarily inconsistent with the correct law. Remission is inappropriate where the relevant legal case was not advanced before the tribunal and the court can determine the consequence of the established facts.

The claimant charterers challenged under section 69 of the Arbitration Act 1996 an arbitral award which upheld the defendant owners’ claim for discharge-port demurrage under a voyage charterparty. The tribunal found that the notice of readiness tendered at Brake was invalid because it was given before the vessel became an arrived ship. Nevertheless, it held that laytime commenced when the hatches were opened, later clarifying that this was because cargo operations triggered time as if a valid notice had then been served.

The appeal concerned whether laytime could commence despite the invalid notice and, if so, when. The owners contended that the tribunal had found a deemed waiver based on The Happy Day. The charterers contended that no waiver case had been advanced or found. The second question became academic because the owners accepted that the tribunal had calculated the contractual commencement time incorrectly.

1. The appeal succeeded on the discharge-port demurrage issue. The tribunal had held that laytime commenced upon the opening of the hatches notwithstanding the invalidity of the notice of readiness. That was an error of law.

2. The award, read reasonably and commercially, did not determine the issue on the basis of waiver. It contained no reference to waiver, no findings that the charterers knew of the premature notice, and no finding of the circumstances necessary to support waiver. The tribunal’s amended paragraph 63 stated an unconditional rule that cargo operations triggered laytime.

3. The governing rule, stated in The Mexico I and The Happy Day, is that an invalid notice cannot commence laytime. The position may be altered by contrary agreement, effective waiver or estoppel. A notice must be valid in all respects when tendered.

4. Waiver by election requires unequivocal conduct inconsistent with reliance on the right, together with actual knowledge of the facts giving rise to the right and knowledge of the right itself. The same requirements apply where the alleged waiver concerns an invalid notice of readiness. An agent may waive the requirement only if authorised to do so.

5. There is no independent principle of deemed waiver based on a less rigorous test. The passage in The Happy Day concerning deemed waiver did not dispense with the orthodox requirements of waiver. It was to be understood consistently with the earlier reasoning in that judgment.

6. The court therefore varied the award so that the owners recovered only the undisputed load-port demurrage and discharge-port expenses. The issue of arbitration costs was remitted to the tribunal. The question whether the alternative clause 11 claim should be remitted was reserved for a consequential hearing.

The judgment concerned an appeal under section 69 of the Arbitration Act 1996 from an arbitral award dated 24 March 2025, amended on 16 May 2025. Dias J granted permission to appeal on 13 October 2025. The appeal was allowed in respect of discharge-port demurrage; the award was varied and arbitration costs were remitted to the tribunal.