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Whether it’s algebra or shipping law – always double check the little details

Whether it’s algebra or shipping law – always double check the little details

Waiting on our food at our Italian-American diner of choice, my son’s attention turned to the entertainment on his placemat. The dot-to-dot and spot the difference passing without incident, he enlisted my help with the maths challenge. The problem was as follows:

X + X + X = 30
X + Y + Y = 20
Y + X + X + Z + Z = 29
X + Y x Z = ?

“I’ve got this, son,” I confidently asserted. But I didn’t. Realising my initial answer differed from that on the placemat (both answers can be found at the bottom of this blog) I began composing an email to the diner’s HQ pointing out the error. If it was not grumpy and a touch sarcastic, it was close. Pausing before sending it, I sought a second opinion. My answer was wrong and the draft email was quickly deleted.

How does this lesson apply to my work in shipping disputes, or indeed to any business working with commercial contracts?

  • My error was not reading the “applicable law” clause on the placemat. It specifically referred to the BODMAS rule – which dictates which order the component parts of the calculation are carried out. In this case, multiplication before addition. In reviewing any contract it is important to identify which law applies. Shipping contracts are usually written under English law, but not always. The law of Scotland can produce different results when used to interpret some contractual terms.

  • I had wrongly placed significance on the lack of brackets enclosing “Y x Z”. When interpreting any contract the precise wording and punctuation can have great significance if there is any ambiguity. In Osmium Shipping v Cargill International (“The Captain Stefanos”) the English Commercial Court held that the correct interpretation of a charterparty contract as to whether a hijacking by Somali pirates rendered a vessel off-hire depended on the significance that a reasonable reader would attach to the comma after the words “capture/seizure”. 

  • Most shipping contracts are in standard forms. The precise wording of the contract has been subject to consultation with industry and experts, and then interpretation by the courts. The standard forms are often amended for a particular contract, with varying degrees of care. What the person making the amendment wants the contract to mean might differ from how the courts or the reasonable reader would interpret it. A second opinion from someone with the appropriate skills can be a good idea when standard form terms are being revised or interpreted. In my case the second opinion came from my early-teens nephew.

  • Finally, take a breath before sending a grumpy email.

For those keen to know – the correct answer is 20. My first attempt was 30 (I promise I’m a better lawyer than I am mathematician!).  

By Andrew Forsyth,
Partner

Burness admin