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England and Wales Court of Appeal (Civil Division) Decisions


You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Chinese Maritime Transport Ltd v A/S Vestmar [1998] EWCA Civ 290 (19 February 1998)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/1998/290.html
Cite as: [1998] EWCA Civ 290

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IN THE SUPREME COURT OF JUDICATURE CCRTF 97/0262 CMS2
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM CENTRAL LONDON COUNTY COURT
(HIS HONOUR JUDGE HALLGARTEN QC )
Royal Courts of Justice
Strand
London WC2

Thursday, 19 February 1998

B e f o r e:

LORD JUSTICE HOBHOUSE
LORD JUSTICE CHADWICK
SIR JOHN BALCOMBE

- - - - - -

CHINESE MARITIME TRANSPORT LIMITED
PLAINTIFF/APPELLANT
- v -

A/S VESTMAR
DEFENDANT/RESPONDENT
- - - - - -
(Computer Aided Transcript of the Palantype Notes of
Smith Bernal Reporting Limited, 180 Fleet Street,
London EC4A 2HD
Tel: 0171 421 4040
Official Shorthand Writers to the Court)
- - - - - -
MR C HANCOCK (Instructed by Messrs Ince & Co, London EC3R 5EN) appeared on behalf of the Appellant

MR N JACOBS (Instructed by Messrs Holmes Hardingham Walser Johnston Winter, London EC3R 5AQ) appeared on behalf of the Respondent

- - - - - -

J U D G M E N T
(As approved by the Court )

- - - - - -
©Crown Copyright
Thursday, 19 February 1998

J U D G M E N T

LORD JUSTICE HOBHOUSE: This is an appeal from a decision of Judge Hallgarten sitting at the Central London County Court. The claim made in the action was for the payment of hire which it was alleged had been underpaid owing to a deduction of alleged off-hire. The dispute between the parties raised two points. One was what might be described as the merits, namely whether the vessel had been off-hire at the times in question; the second was whether there had been a settled account between the parties which had precluded the plaintiffs from reopening that account and claiming the sum claimed in the action.

His Honour Judge Hallgarten decided the first point in favour of the plaintiffs and the second point in favour of the defendants. The plaintiffs needed to succeed on both points in order to win. Therefore, they were unsuccessful and their claim was dismissed. The plaintiffs have now appealed to this Court.

The parties are, respectively, the plaintiffs, who were at the material times in 1993 and 1994 (and indeed at other times as well) the disponent owners pursuant to a time charter from the head owners of a vessel called The China Pride. She was a bulk carrier having some 65000 tons dead weight capacity. She was being used at the material times in the coal and iron ore trade between Australia and Japan. She was registered under what I shall call the Burmese flag, and she was manned by the employees of the head owners, Trans Pacific.

The charter between Chinese Maritime (the plaintiffs) and the defendants (Vestmar) was dated 26 July 1993. It too was on the New York produce exchange form. Vestmar are a chartering company who carry on business in Bergen in Norway. They were using the vessel for the purposes of chartering it out to others who were more directly concerned in the trade in question.

The charterparty between Chinese Maritime and Vestmar was, as I have said, dated July 1993. It was for a period of 11 to 13 months. Therefore, it was expected to come to an end (as was in fact was the case) in August 1994, or during the preceding two months. In fact the charterparty was continued up to the end of the available period. The hire under the charterparty was payable semi-monthly in advance in the usual way. That means that every half month it is the obligation of the charterers, Vestmar, to pay an appropriate sum by way of hire to the disponent owners, Chinese Maritime, to cover the next fifteen or so days. When the charterparty comes to an end, both the normal practice and the provisions of this charterparty are to make an appropriately reduced penultimate payment to cover what is expected to be the period between the last instalment date and the end of the charterparty period.

Matters appear to have continued without relevant complication during most of the life of the charterparty, but in July 1994 there was a problem. The vessel was at that time sub-chartered to a company called Goldbeam on time charter trip terms. Pursuant to that charterparty she was ordered to Port Dampier in Western Australia. She arrived there on 6 July, but she did not get into berth until the 13th. It was said by Goldbeam (and this view of the situation was adopted by the charterers) that this was all due to her labour and union difficulties arising out of the flag of the vessel or the manner in which she was crewed. In Australia there are trade unions which are affiliated to the ITF, and they do, on occasions, adopt a very belligerent attitude towards what they call "flag of convenience ships" manned by crews from third world countries.

Whether or not the charterers and Goldbeam were entitled to the view that it was the disponent owner's responsibility that this delay took place, was disputed. As I have indicated, the judge (as the first point he had to decide when the matter was before him) concluded that the charterers were not entitled to put the vessel off-hire during the period she was waiting to go into berth. There were broadly two reasons why he arrived at that conclusion. First, there was no actual boycott threatened by the trade unions and therefore there was no actual situation which gave rise to a relevant problem. The second was that the vessel was waiting for berth because at least part of the time there was congestion in the port.

However, at that time charterers considered they had a good claim to treat the vessel as being off-hire, and indeed they so told the disponent owners promptly on 14 July. The disponent owners did not accept that view, indeed, they contested it. When the next payment of hire fell due (which was the hire to cover the period 27 July to 11 August) the charterers made a deduction from the hire they paid to cover the off-hire that they said had accrued from the previous charter period. The sum involved was US$73,970.80, the sum eventually claimed in the action before Judge Hallgarten.

That deduction from hire was protested against by the disponent owners and an immediate request for the remission of the balance was made. The dispute thereafter continued. It appears also that it involved dealings with the head owners. On 11 August a further payment was due and paid in an acceptable sum, disregarding the fact that there was the outstanding dispute from the previous period. The owners acknowledged the payment, which was a reduced payment to take account of the fact that it was the last payment of the currency of the charter in the sum of US $2,385, as they said (the charterers are treating it as a payment of US $2,400, but nothing turns on that difference). The owners, when acknowledging it with thanks said, "final hire to be adjusted after re-delivery". That communication was dated 15 August.

The same day there was a communication from disponent owners to charterers through their usual channel of communication which referred to the dispute about the off-hire arising from the visit to Port Dampier in the preceding month. It referred to the fact that disponent owners had, what they described as a "back-to-back" charterparty with the head owners. They told the charterers that, under their terms of contract with the head owners, just as in the contention of disponent owners, there was no clause which justified the charterers as treating the vessel off-hire. They expressed disappointment about the position. They further said:

"CMT [themselves] as reasonable and responsible operators have acknowledged the situation and are not withholding monies from Lasco [the head owners]. They consequently feel extremely disappointed and frankly very upset that Vestmar have made what amounts to an unwarranted deduction from hire."

It appears from that that the disponent owners were making common cause with the head owners on this issue, and in fact that they had already paid the head owners. They further threatened proceedings to recover the debt if it was not paid within the next 24 hours.

It appears that nothing further happened to follow that up. On 16 August the 7 days re-delivery notice was given for the re-delivery of the vessel under the charterparty. On 17 August there was a solicitor's letter written on behalf of the charterers to the disponent owner's representatives setting out the arguments which charterers relied upon to demonstrate that they were entitled to treat the vessel as having been off-hire. That was responded to on the following day with rebutting arguments from the disponent owners and saying that arbitration might be necessary and, furthermore, calling for payment of the sum which had been deducted.

On 19 August, a three day re-delivery notice was given in accordance with the scheme provided for in the charterparty. There were further exchanges of views between the solicitors on 21st and 22nd, solicitors for the disponent owners at that point coming on the scene and taking part in the furthering of the dispute. In that context, Ince & Co (on behalf of disponent owners) wrote a letter refuting the arguments which had been advanced by Holmes Hardingham on behalf of the charterers, and saying that there would be arbitration and indicating to Vestmar (the charterers) that they might not wish to incur the costs of arbitration over what was described as a "small sum".

That, of course, was a legitimate negotiating ploy and might have proved fruitful, but it is an argument which could be used against Ince & Co's clients, were it the other way round. Costs affect both parties when they are liable to be disproportionate to the sum at issue.

The correspondence then continued on the following day the 23rd, Holmes Hardingham advancing further arguments, but they also sent a copy of a statement of facts which apparently Ince & Co had not previously seen, but they recognised in the same communication that they might be making further inquiries themselves as well.

Ince & Co were not happy about the copy of the statement of facts which they had been sent, which was quite understandable (it is a very poor copy indeed). They asked for a better copy, which was sent to them on the 25th. However, on the 24th, the vessel had been re-delivered at Sakata in Japan on the island of Honshu.

The cargo she was then carrying had been unloaded. The bunkers remaining on board were measured, and agreement reached about that. Of course, under the scheme of a time charter, the bunkers that are on board at the commencement of the charterparty are treated as if they had been bought by the charterers and are paid for at that stage. Thereafter, the bunkers necessary for the employment of the vessel are purchased and paid for by the charterer, and when the vessel is re-delivered, the bunkers remaining on board are, so to speak, sold back to the disponent owner. That is what happened in this respect.

Matters did not lead to further communications between the solicitors at that point but, as was indicated and foreshadowed by the earlier statement when the last instalment of hire was paid, final adjustments had to be made. Two documents were despatched. One was a document sent by the disponent owners on 30 August through the usual channels to the charterers. It described itself as a "Final Hire Statement". It referred to the re-delivery and the bunkers remaining on board. It then referred to a period 11 August 1994 to 24 August 1994, being the last period under the charterparty. It then debited a quantity of hire and it then dealt with other matters, commission, brokerage, cleaning of holds, various other expenses, and then ended up with the amount which had been paid by the charterers (that is the amount which was referred to in the communication of 15 August, from which I have already quoted) and they put it in at their figure of US $2,385. They therefore drew a line and said "balance in owner's favour US $5,492.44." It ended:

"Please teleremit the above amount to our owners bank and with us be advised of charterers remitting details for trading."


The judge commented in his judgment that this made no reference to the off-hire dispute or any claim being made in the account in respect of the off-hire deduction. Although it is later in date, it is easy to see what the character of the document would have been which did make such a reservation or additional claim. At page 184 of the bundle we have a document dated 13 September which, in all material respects, is the same as the previous one, except that it ends up "plus refund of charterers unlegal deducted hire" (then some telex references) "USD 73,972.00". Therefore it produces a different balance. It would (and it must be accepted that it would) have been possible for such a claim to have been made in that final hire statement.

After that had been sent, but before it was received, Mr Stiegler, who was the relevant person in the office of the charterers, himself prepared a final hire statement. He sent it to his brokers for onward transmission to the disponent owners. It is addressed to the disponent charterers; it gives the name of the vessel and the charterparty date and says:

"We are faxing our Final Hire Statement for the above charter. When we have owners agreement we will remit the outstanding usd 5.641,50."



The document attached to it runs to two pages. It is headed "Final Hire Statement". It deals with the whole currency of the charter period (from September 1993 through to August 1994) and delivery and re-delivery accordingly. It calculates a total time between those two points and then deducts off-hire at Dampier between July 6th and July 13th. It then produces a net time on hire of 336 days, plus an odd number of hours and minutes. That is then used to calculate the hire which was due under the charterparty. It makes deductions for commissions and other items to produce a net hire amount. It then gives credit to the disponent owners for bunkers on delivery and certain other matters, including hold cleaning. It then deducts from the sum that it has so far produced bunkers on re-delivery, and the various items, owners' expenses. That must be matters which have been paid by the charterers but which are recovered from the account of the disponent owners. Finally, it sets out in a long list all payments made on account of hire between September 1993 and August 1994. Whether it treats those figures as gross figures is difficult to be sure. The discrepancies are only very small between what appears to be the equivalent figures used by the disponent owners. Nothing turns upon it. The result of that calculation, taking items both ways, is to give a sum due to disponent owners of US $5,641.50.

When Mr Stiegler had received the document to which I have previously referred from disponent owners, he decided that, even though it appeared the disponent owners were claiming a smaller sum than was derived from his account, his account should nevertheless be sent because he considered it to be the accurate account. It was signed August 29, 1994 with an appropriate initial and sent off to the disponent owners. The disponent owners promptly replied on 31 August by telex saying the following:

"Regarding subject vessel's final hire noted.

We agree with charterers final hire statement please ask charterers to TT the balance amount in owners favour USD5,641,50 to owners bank with charterers remitting detail for tracing."



It is that acceptance of the account which is said to give rise to the account stated between the charterers and the disponent owners. The sum shown on that account was then promptly paid by the charterers to disponent owners. They sent a responding telex on 31 August 1994 thanking the disponent owners for their "quick reaction to our final hire statement. We are remitting [the sum] as per instruction in charterparty".

It appears Ince & Co were unaware of what occurred. On 1 September they sent a further letter in respect of the hire point and commenting on the statement of facts. That was responded to by Holmes Hardingham on the 2nd saying:

"Following redelivery of the vessel, the matter has been fully resolved. Both our clients have put forward their final version of the Final Hire Account."



It then quotes from the relevant documents. It continued:

"Our clients have remitted the agreed figure to your clients' bank and the accounting position under the charter has therefore been concluded by agreement and the matter finally settled."



The response of Ince & Co was prompt and to the point. They disputed that the matter had been settled by those final accounts.

The situation, therefore, is one which requires a consideration of what is the effect of what passed between the parties when the charterers rendered an account, invited the disponent owners to agree it, the disponent owners did agree it, and charterers paid the sum shown in the account.

It appears to fall within the classic description of an account stated properly so-called as referred at page 1493 of Chitty on Contracts, Volume 1, General Principles. It there says:

"'A real account stated' is one in which the account includes items on both sides and the parties have agreed that there shall be a set-off and only the balance shall be payable. The '...several items of claim are brought into account on either side, and, being set against one another, a balance is struck and the consideration for the payment of the balance is the discharge of the items on each side.' Though such an arrangement is frequently regarded as quasi-contractual, it is more properly described as 'a promise for good consideration to pay the balance'; and the consideration is valid and the settlement is binding even though some of the debts may be statute-barred, or otherwise unenforceable. Fraud, however, will permit the questioning of an account stated."


The authors then quoted from a Privy Council decision:

"The essence of an account stated ... is not the character of the items on one side or the other, but the fact that there are cross items of account and that the parties mutually agree the several amounts of each and, by treating the items so agreed on the one side as discharging the items on the other side pro tanto, go on to agree that the balance only is payable..."



The authors then comment that once there has been a settled account in that sense, then a new cause of action comes into existence for the balance.

It appears to me clear that what happened was within the structure of such settled account. But the argument which is advanced by the disponent owners is that that is not the whole picture. They say that what passed must be construed having regard to the surrounding circumstances, and what had been passing between the parties immediately before the rendering of the Final Hire Statement and its agreement, and the invitation to the owners to agree the Final Hire Statement must be read implicitly as including its being subject to the outstanding off-hire dispute and, by parity of reasoning, the agreement that the disponent owners then gave must be read as being subject to a similar qualification. That is the nub of the point that was argued before the judge and was argued before us in this Court.

No separate point arises on consideration, in my judgment, because, if the point to which I earlier referred is resolved (as the judge did resolve it in favour of the charterers) then there is adequate consideration in settlement of the account for that being a legally binding situation. It is not suggested that the surrounding circumstances showed that there was no intent to enter into legal relations. It is really a point of construction which is raised. Similarly, although earlier various points were made about the subjective intention of one of the senders of the relevant telexes or the other, again no sustained argument on those points has been urged before us today.

Therefore, one comes back to the question of construction. Mr Hancock, who has argued this matter on behalf of the appellants, said that the following factors should be taken into account. First, the terms of the relevant charterparties. He pointed out that the argument of charterers on the charterparty between the charterers and the disponent owners was a weak one and, furthermore, because the charter with the head owners was back-to-back and charterers had been told that in the telex of 15 August (from which I have already quoted) that would have been appreciated by both parties. Similarly, he relied upon the length of time that the dispute had been going on, and that there had never been any abandonment of the contentions of the disponent owners in the correspondence, indeed, matters had gone the other way. The disponent owners had brought solicitors into the correspondence, Messrs Ince & Co, and that threats of proceeding to arbitration had been made.

Thirdly, he relied upon the fact that Mr Stiegler, the person concerned at Vestmar, simply wanted an end to matters so far as he, Mr Stiegler, was concerned because he was handing over the management of the relevant account to other people at the end of the month. It may be commented that this really verges upon the subjective views of Mr Stiegler and, in any event, is as broad as it is long. He may have wanted to put an end to the whole of it, just as much as he wanted to put an end to part of it.

Fourthly, it was said that hire statements are needed in any event at the end of a charterparty. Therefore, they are necessary communications which come into existence at that stage and no inference that it is intended to settle outstanding disputes should be drawn. Finally, he submitted that neither the letter from the charterers to the disponent owners nor the response of the disponent owners made any mention of settling the dispute about off-hire. He submits that that, therefore, leads objectively to the reasonable expectation that that matter would still be being handled by the solicitors.

Those arguments were among those that were considered by the judge. They did not persuade the judge. It must be recognised at this stage that Judge Hallgarten is an experienced commercial judge sitting in the Central London County Court, which fulfils for central London the same role as Mercantile Courts provide elsewhere in the country. He is an experienced judge sitting in a Court which is experienced in the evaluation of this type of dispute. It is a type of dispute which is liable to arise every now and then on the evaluation of communications between commercial parties in relation to commercial transactions of this kind.

He treated, as the relevant surrounding circumstances, apart from the history of the dispute, the fact that, although there had the communication fifteen days earlier telling charterers what the attitude of head owners was, at the material time (that is at the end of the month) the charterers would not know what the attitude of head owners was, and it might be that there had been some change of view.

The judge has been criticised for that. It is very much a matter of evaluation, but he has a good point that there had been a lapse of time between 15 August and the material time. Further considerations had been brought into play, including the delivery of the statement of facts. Further, there had obviously been development in the relationship between the disponent owners and the head owners which had led to discussions regarding the vessel and any other alterations. Indeed, charterers were aware of that.

Therefore it is, in my judgment, a valid point for the judge to make that this was a dispute between two people in the middle of a chain which might or might not be affected by the attitude of people at the ends of the chain.

Furthermore, the judge pointed out that the sum of money involved was not, in the context of this type of transaction, a large one, and the parties might well believe that it was not worth going to arbitration on a sum of that size. He referred to the fact that the plaintiffs' solicitors had hinted that that was the case as part of the pressure that they were trying to bring upon the charterers. That was a reference to the communication of 22 August.

He put out of his mind all questions of subjective motivation. He recognised that, whatever else might be said about the communications, they did not amount to an overt offer or acceptance of a compromise agreement, such as would be appropriate to the compromise of a pending arbitration. However, he did go on to say that the final hire statement did represent a calculation of hire, and he said that the one rendered by the disponent owners was not expressed, having regard to what had gone before, so as to include any reservation in relation to the withheld Dampier hire. He said (he must have been drawing on his experience of these matters) that it would be expected that such a reservation would be made, either in the statement of account that had been sent by the disponent owners to the charterers, or in the agreement to the charterers' statement that there would be such a reservation. He commented strongly that there was no such reservation.

He referred to the fact that the agreement given by charterers was unqualified, and he applied objective criteria to see what was the correct understanding of the exchange that had taken place. He concluded by saying:

"The conclusion reached above was my first impression on reading the documents prior to coming into Court, and I have to say that, despite Mr Hancock's very skilful arguments, that first impression is one which also represented my final one."



I find myself in a similar situation to the judge. In my judgment, the purpose of accounts such as this is to achieve finality. These accounts were not drawn in equivocal terms, nor were the communications in equivocal terms. Back on 15 August it was said by disponent owners, against the background that then existed, "final hire to be adjusted after re-delivery". The hire statement that had been sent by the disponent owners did not include any reservation in respect of the off-hire claim, although it would have been expected to contain that. The communication of 13 August from charterers to disponent owners expressly referred to the documents as a "final hire statement", and asked for owners' agreement of it, and said that, having received owners' agreement, they would remit the outstanding amount. The final hire statement expressly dealt with the question of off-hire, and treated it as an allowable deduction from hire in the calculation of the hire that was due. Therefore, it was not a document which was silent on the relevant point; it was a document which made an express and specific statement about the relevant point, and treated it in the way it did in the account.

Finally, the response of the disponent owners was "we agree with charterers' final hire statement. Please ask charterers to telegraphically transfer the balance amount in owners' favour". That correspondence, in my judgment, is too clear to admit of the qualification which is being asked for by the disponent owners in this case. It purports to be a final agreement; in its terms it is a final agreement. If there was anything equivocal about it, then there might be scope for arriving at a different conclusion. But in view of the clarity of the express language used and the potentially equivocal character of the background which is relied upon to rebut the impression given by the clear language, I do not consider that this appeal could be supported. Indeed, as I have indicated, this matter has already been before a judge who is experienced in this class of litigation and this type of transaction, and I would be, in any event, reluctant to disagree with the conclusion at which he had arrived.

According, I would dismiss this appeal.

LORD JUSTICE CHADWICK: I agree that this appeal should be dismissed. It is because that conclusion differs from the provisional view which I had formed as a matter of first impression on reading these papers that I think it appropriate to give my own reasons, albeit as shortly as may be.

The final hire statement sent by the charterers on 30 August 1994 deducts, in terms, the period of six and three quarter days during which the charterers claimed the vessel was off-hire at Dampier in Australia in the computation of the total time on charter. On the basis of that computation of total time on hire, the final hire statement then sets out a statement of the amounts due and the amounts paid or deductible, sets off the one against the other and strikes a balance of US $5,641.50 in favour of the owners. The letter which accompanies that final hire statement invites the owners' agreement to it, whereupon (as is said in the letter) the outstanding amount of US $5,641 will be remitted.

The response to that letter on 31 August 1994 contained these words, "we agree with the charterers' final hire statement". It requests the charterers to remit the balance to the owners' bank account. The short question for the judge (and for us) is whether, in the light of the dispute as to the claim to treat the six and three quarter days at Dampier as off-hire, the statement in the owners' response of 31 August 1994 that "we agree with charterers' final hire statement" should be taken to mean: (a) "we agree that, on the premise that the six and three quarter days is to be treated as off-hire, the arithmetical computations of amounts due and amounts paid or deductible are correct, but we continue to reserve our position as to the correctness of that premise and the computation of total time on hire which follows from it"; or should be taken to mean (b) "we now agree with everything in the final hire statement, including the computation of total time on hire, notwithstanding our previous rejection of the charterers' claim to deduct the six and three quarter days spent at Dampier as being off-hire".

That, as it seems to me, is a question of construction to be answered by construing the words used in those documents in the light of the facts known to both parties at the time. The relevant facts included the following. First, the deduction was first made by the charterers when making a payment of hire on 24 July 1994 that being, as it turned out, the penultimate payment to be made under the charter. Second, the charterers' right to make that deduction was rejected in strong terms by the owners on 11 August 1994. Third, that by 22 August 1994 solicitors had become involved on both sides and the parties seemed to be moving towards an arbitration on a point of dispute which could be argued either way on grounds which were not insubstantial. Fourth, by 30 August 1994, the owners' solicitors were awaiting a further response from the charterers' solicitors.

In those circumstances it had seemed to me that there was considerable force in the submission made on behalf of the owners that the proper construction of the charterers' letter of 30 August 1994, to which the charterers' final account was attached, was that it was an invitation to agree the arithmetical calculations only on the basis that the dispute as to the six and three quarter day period of off-hire was to be treated as unresolved until at least the charterers' solicitors had provided the further response which they had indicated that they would provide.

But I am persuaded that that submission cannot succeed in the light of the owners' own approach to the position as it appears from two documents sent by the owners to the charterers. Those documents are, first, the fax by the owners to the charterers' agents on or about 15 August 1994 in which the owners acknowledge a payment of US $2,385 on account in respect of the final period of the charter and state in terms that the final hire is to be adjusted after re-delivery. Second, the owners' own final hire statement sent by fax to the charterers on 30 August 1994, and received by the charterers before the charterers' final hire account was submitted to owners under cover of the letter dated 30 August 1994.

The payment on account to which the fax of 15 August 1994 refers was plainly computed after taking credit for an estimate of the adjustments, such as bunkers, which would fall to be taken into account following re-delivery. The acceptance of the payment contemplated that there would be a further adjustment to be made by the owners, in the nature of fine tuning, once re-delivery had actually taken place. The fax of 15 August 1994 makes no reference to the dispute as to the six and three quarter day period of off-hire. The owners' final hire statement of 30 August 1994 is prima facie the final adjustment which was to be expected in the light of the earlier fax of 15 August 1994. It contains no reference to the outstanding dispute, or to the additional hire which would be payable if the six and three quarter day period was included in the total time on hire. It shows a balance in the owners' favour of US $5,492.44.

I agree with the judge that, if that issue as to off-hire was still alive, it would have been reasonable to expect that a final statement submitted by the owners in the circumstances in which that statement was submitted on 30 August 1994, would refer to the sum claimed in respect of the six and three quarter days which remained outstanding.

I am not persuaded that, on a true appreciation of the owners' final hire statement, it was intended only to be a statement of charges due in respect of the final period of hire. It is, as it seems to me and as was foreshadowed by the fax of 15 August, intended to be a statement of what was outstanding after all adjustments had been taken into account.

Having received the owners' final hire statement on 30 August 1994 in a form which contained no reference to the outstanding matter in dispute, the charterers were entitled to submit their own final hire statement on the basis that the claim to deduct six and three quarter days of off-hire was no longer challenged. It may be that they did so more in hope than in expectation; perhaps expecting that a challenge would be asserted in response to their letter of 30 August 1994. But as things stood on 30 August 1994, the charterers' final hire statement can be seen to have been prepared on a basis which was wholly consistent with the basis on which the owners had prepared their own final hire statement of the same date, which was already in the charterers' hands. I do not, myself, regard the charterers as putting forward their final hire statement by way of compromise. There is no element of compromise in the basis of computation of the total time on hire which is advanced. As it seems to me, the computation is not advanced as a compromise, but on the basis that there is no longer a dispute about the claim to deduct six and three quarter days off-hire.

In those circumstances, when the owners accepted without qualification the charterers' final hire statement by their fax on 31 August 1994, the charterers were, in my view, entitled to take that unqualified acceptance as confirmation of the position as it had appeared from the owners' own final hire statement of 30 August 1994 (that is to say, as confirmation that the owners were content to accept the computation of total time on hire on the basis that the six and three quarter day period in Dampier was to be treated as off-hire).

The charterers made their payment of the amount shown in their own final hire statement on that basis. It follows that I agree that the charterers' defence of settled account based on acceptance of the net figure in their final hire statement of 30 August 1994 was entitled to succeed before the judge, and that this appeal should be dismissed.

SIR JOHN BALCOMBE: I agree that this appeal should be dismissed. It seems to me that His Honour Judge Hallgarten was right, and there is no reason for this Court to interfere with his decision.

ORDER: Appeal dismissed with costs.


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