Terms of Sale for Marine Fuels
1. Applicability
Except as otherwise agreed to in writing the following terms and conditions
shall apply to all sales of Marine Fuels by FG Ship Bunkers Limited and/or
Falzon Fuel Services Limited and/or any other related entity; any reference
made to supplies effected by barge shall be construed as to refer also to
supplies effected by road tankers, and any reference to the master of the
delivery barge shall be construed as to refer also to the operator / driver of
the road tanker.
2. Prices
(a) The price to be paid for Marine Fuels shall be Seller’s spot or posted
price offered for a specific delivery. Spot prices offered are for
deliveries made on, before or within three (3) days subsequent
to vessel’s specified ETA as advised by Buyer, if accepted by Seller
at time of nomination; prices for delivery beyond this range are
subject to amendment at Seller’s option.
(b) Barge charges for the supply of bunkers shall be charged at rates
determined by the Seller and are subject to alteration by Seller
without prior notice to Buyer.
(c) All applicable taxes, duties, levies, port dues, berthing charges, jetty
dues and other costs are for account of Buyer. Seller reserves the
right to pass on to Buyer any increase imposed on Seller by any
government authority subsequent to date price is offered or
delivery is made whether retroactive or not and for this purpose
Buyer expressly waives any applicable statute of limitations or
prescriptive period.
3. Parties Obligated
(a) Should Marine Fuels be ordered by an agent or broker, then such agent or
broker, as well as the Buyer, shall be bound by and liable for all
obligations as fully and as completely as if the agent or broker were
themselves the Buyer, whether such Buyer be disclosed or undisclosed,
and whether or not such agent or broker purports to contract as agent or
broker only, as the case may be. In all such cases the said agent or broker
shall not have any right against the Seller.
(b) The Owner and / or manager/s of the vessel, and the vessel receiving
delivery of Marine Fuels under these terms of sale, shall be responsible for
the performance of all of Buyer’s obligations hereunder. If delivery of
Marine Fuels is contracted for by an agent or manager of the owner, or by
the operator or charterer of the vessel, then such agent, manager,
operator or charterer, as well as the owner, shall be fully liable for the
obligations of the Buyer.
(c) Deliveries of Marine Fuels made hereunder, if sold on credit basis, are
delivered not only on the credit of the Buyer but also on credit of the
vessel receiving delivery of Marine Fuel, and it is agreed and Buyer
warrants that Seller will have and may assert a lien or special privilege
against the receiving vessel for the amount of the purchase of said
Marine Fuel.
4. Stems
Bunker stems are valid for seven (7) days following date of stemming by the
Seller.
5. Quality and Warranty
(a) The Marine Fuels to be delivered hereunder shall be Seller’s
commercial grades of Marine Fuels generally offered to Seller’s
customers at time and place of delivery, and as indicated to Buyer by
Seller in writing, but Seller otherwise makes no warranties of quality,
merchantability or fitness for any particular purpose and any implied
warranties or conditions whether statutory, legal or otherwise are
expressly excluded.
(b) Buyer shall have the sole responsibility for the selection of proper
Marine Fuels for use in the vessel being supplied.
(c) Notwithstanding 5(a) it is the duty of the Buyer to take all
reasonable actions, including retention and burning of fuel to
eliminate or minimise any costs associated with an off-specification or
suspected off-specification supply. To this end Buyer shall
cooperate with the Seller in achieving the most cost-effective
solution. In any event Seller’s obligation hereunder shall not exceed
direct expenses incurred for removal and replacement of fuel and
shall not include any consequential or indirect damages, including
without limitations demurrage claims, loss of contract or loss of
profit. If Buyer removes such fuel without the consent of the Seller
then all such costs shall be for Buyer’s account.
(d) Without prejudice to the previous paragraphs of this Clause 5, Buyer
represents that it and its agent have superior knowledge of the
receiving vessel’s fuel requirements than Seller and Buyer shall be
responsible for purchasing product with appropriate specifications.
In the event that the product sold herein is commingled with any
other product on the receiving vessel, Seller does not warrant or
represent that the product sold hereunder can be used, without
complication, in the specific engines, boilers and/or generators of
the receiving vessel, or that the product will be compatible with the
products already existing in the receiving vessel’s tanks.
6. Nominations and Deliveries
(a) Buyer shall nominate vessel at least five (5) working days in advance
of expected date of arrival, specifying loading port, ETA, grades and
quantities. When such nomination is accepted by Seller, indicated
date of arrival shall become the accepted delivery date, and Seller
binds himself to deliver within the day which has been accepted as the
delivery date. Seller reserves the right to cancel any nomination
without liability on the part of Seller and without prejudice to any
rights Seller may have against Buyer if vessel does not arrive at
delivery port and present itself for delivery within three (3) days of the
accepted delivery date.
(b) Buyer or vessel’s local agent shall give Seller at least forty-eight (48)
hours advance notice, excluding Sundays and holidays, of each
delivery, confirming product and quantities and other delivery
details. Where such delivery date is different from original delivery
date, then acceptance must be in writing by Seller. Where 48 hours
advance notice is not given, or where Seller does not accept
different delivery date in writing, Seller shall in normal
circumstances use reasonable efforts to make delivery in a timely
manner.
(c) Where delivery is required during other than regular business hours,
and is permitted by applicable regulations, Buyer shall pay all
overtime and extra expenses incurred.
(d) Where lighterage is employed, all lighterage charges including
overtime and other associated charges shall be for the account
of the Buyer.
(e) In the event that Buyer fails to take delivery, in whole or in part, of the
quantities nominated, Buyer shall be responsible for any costs
resulting from Buyer’s failure to take delivery as well as for any
losses incurred by Seller to downgrade the fuels, without prejudice to
Seller’s rights for damages under these terms of sale or
otherwise.
(f) Seller shall always use reasonable efforts to adjust to changes in
Buyer’s schedule; however, Seller or Seller’s supplier shall not be
liable for demurrage paid or incurred by Buyer due to delays in
furnishing berth or to any delay in delivery of Marine Fuels where:
(i) Seller did not accept delivery date as outlined in sections 6
(a) and 6 (b).
(ii) 48-hour notice as defined in section 6 (b) was not properly
given.
(iii) Delivery barge arrived on accepted delivery date and
performed properly.
(iv) Conditions beyond the control of Seller exist including
but not limited to harbour congestion and dredging
operations.
(v) Adverse weather conditions exist, which are determined to
be such by the Master of the delivery barge.
(vi) Delays were not the result of Seller’s inability to perform.
(g) Notwithstanding anything to the contrary contained in these terms of
sale, Seller reserves the right to reduce quantities of product to be
supplied to Buyer where, on the basis of internal logistics and/or size
of bunker barge available due to prior engagement, Seller in its sole
discretion so determines. This clause shall override any previous
exchange of written confirmation of bunker supply between
Seller and Buyer so long as written notice of the reduced quantity is
given to Buyer not less than 24 hours prior to vessel’s estimated
time of arrival.
7. Risk and Title
Delivery shall be deemed completed and risk shall pass to Buyer as the
Marine Fuels pass the flange of the receiving vessel’s permanent hose
connections. If delivery is made to barge, truck or coastal tanker nominated by
Buyer, delivery shall be deemed completed and risk shall pass to Buyer at the
last flange on Seller’s or Seller’s supplier’s terminal property. Buyer shall be
responsible for connection to intake of Buyer’s vessel, barge or truck, and
pumping shall be performed under the direction of the receiving vessel,
barge or truck. Title to the product shall only pass onto Buyer on full
payment of the price, and until such full payment Seller shall have the right to
recall the product or to indicate its place of delivery; in the event that the
product perishes or is destroyed or is lost after delivery without the price
having been paid in full, Buyer shall still be responsible towards the Seller for
the payment of the price or any unpaid portion thereof.
8. Inspection and Determination of Quantity and Quality
(a) The quantity of fuels delivered shall be determined by
measurements in accordance with the ASTM Petroleum
measurement tables of shore tanks and lighters, or meters at
Seller’s option, and Buyer will be charged on the basis of these
measurements. Buyer has a right to have its representative or, at his
own expense, an independent inspector present during
measurement, but determination of quantity shall be made solely
by the Master of the delivery barge, and such determination shall be
conclusive.
(b) All quantities referred to in the contract of sale are understood to be
approximate with a margin of 10% more or less at Seller’s option.
(c) Sampling by Seller or Seller’s supplier shall be done prior to product
leaving shore tanks, tank trucks or barges. Buyer, at his own
expense, shall have the right to appoint an approved petroleum
inspector to witness the drawing of the sample and perform
subsequent testing of product. Seller or Seller’s supplier shall take
three (3) representative samples of each grade of Marine Fuel(s) to be
delivered. One sample shall be given to the Master of the vessel
receiving the Marine Fuel; the Seller or Seller’s supplier shall retain the
other two samples for at least thirty (30) days from date of
delivery in a safe place for verification of the quality thereof, if
required. If buyer makes a claim or complaint within fifteen (15)
days of date of delivery, one of the two remaining samples along
with any other Seller’s and Seller’s supplier’s relevant and
representative samples shall be submitted for analysis to an
independent laboratory. The analysis from the independent
laboratory shall manifest the quality of the product delivered. The
costs of analysis shall be borne by Buyer, unless the complaint as to
the quality is shown to be justified.
9. Claims
Any claim as to shortage in quantity must be noted on the appropriate
Notification of Bunker Supply form and signed by the Buyer or his
representative/s at the time of delivery and presented by Buyer in writing to
Seller within ten (10) days thereafter. Any other claims by Buyer including
deficiency in quality of Marine Fuels delivered by Seller must be made
as soon as possible, and in no event shall Seller be responsible for claims more
than fifteen (15) days from date of delivery. Buyer must furnish necessary
details required by Seller to satisfactorily evaluate claim. Seller shall not be
responsible for any claim arising in circumstances where there is or has been
commingling of fuel delivered by Seller with other fuel aboard Buyer’s
vessel. Seller agrees to respond promptly to any complaint or claim by Buyer
with intent to settle any such claim within forty-five days of receipt of such
claim. Where Buyer and Seller cannot come to an agreement on such claims
within sixty days, Buyer or Seller can invoke arbitration as provided for
in clause 18. Such arbitration shall apply to disputes arising under this clause
only. Any recourse to refer the matter to Arbitration under this article shall be
made by either party within sixty days after delivery, otherwise the
ordinary courts shall have jurisdiction to decide on claims under this article.
10. Payment
(a) Payment shall be made by Buyer in United States Dollars, unless
otherwise agreed beforehand, without discount, setoff or
deduction, upon receipt by Buyer of written or other notification of
quantities delivered and amounts due. Subsequent adjustments,
if any, will be made upon receipt by Seller of Marine Fuel delivery
receipt; a scanned copy of which shall be deemed sufficient evidence
of the amounts due. Any deduction for claims related to such delivery
shall be a breach of Buyer’s obligation hereunder and all reviews /
discussions / settlements on such claims shall be suspended until
Buyer make payment in full for the quantity delivered as notified by
Seller. Seller may immediately recover any amount withheld
from the full payment and Buyer agrees that any claims related to
the delivery do not constitute a valid defence against Seller’s claim to
the withheld amount.
(b) Payment shall be made by Buyer by means of an electronic or
telegraphic transfer to a bank designated by Seller in the individual
Contract of Sale for Marine Fuels concluded between Seller and
Buyer.
(c) Payment shall be considered overdue if not received by Seller within
thirty (30) days from the date on which the delivery commences.
Overdue payments shall be subject, at Seller’s sole discretion, to
interest of 1.5% per month, or to the maximum rate of interest
permitted under applicable law, whichever is the less.
(d) If at any time Seller considers Buyer’s financial condition inadequate
to meet Buyer’s obligation hereunder, cash payment in advance or
security acceptable to Seller may be required before delivery and
Seller may declare any amount then outstanding from Buyer to be
immediately due and payable.
(e) If it has been agreed that payment shall be made by instalments,
and if Buyer falls into arrears, in whole or in part, in respect of two
consecutive instalments, the entire remaining balance shall become
immediately due and payable.
11. Safety and Environment Protection
(a) Buyer is familiar with the health effects related to the Marine Fuels
supplied hereunder and with appropriately protective safety and
health procedures for handling and use of such Marine Fuels. Buyer
shall adhere to such safety and health procedures while using or
handling Seller’s Marine Fuels. Buyer shall also facilitate the
dissemination of such health and safety information to all
employees, users and others potentially exposed to the Marine
Fuels sold hereunder. Buyer shall be responsible for compliance by its
employees, agents and other users with all health and safety
requirements or recommendations related to the Marine Fuels
supplied hereunder, and shall exert its best efforts to assure that
any of its employees or agents, users and others potentially exposed
avoid frequent or prolonged contact with or exposure to Marine
Fuel, both during and subsequent to delivery. Seller or Seller’s
supplier accepts no responsibility for any consequence from failure by
Buyer, its employees or agents, any users or other party to comply
with such health and safety requirements or
recommendations arising from such contact or exposure.
(b) In the event of a spill during fuelling, Buyer shall promptly take and /
or shall assist and co-operate with Seller or Seller’s supplier in taking
any necessary action to remedy or mitigate the consequences
thereof. Any of the measures taken by Seller or its designee shall be
deemed taken on Buyer’s authority, and shall be at Buyer’s expense
except to the extent that such escape or discharge was caused
or contributed to by Seller or Seller’s supplier, provided that if
Buyer considers that such measures should be discontinued, and
any governmental authorities having jurisdiction concur, Buyer shall
so notify Seller, and thereafter neither Seller nor its designee shall
have any right to continue such measures under the provisions of
this article.
(c) Buyer shall supply Seller with all such documents and information
concerning any escape or spillage or any programme for the
prevention thereof as are required by Seller or are required by law or
regulations applicable to the contract port.
(d) Buyer warrants that the Marine Fuel purchased hereunder is for the
operation of the nominated vessel, and that vessel only.
(e) Buyer warrants that the vessel nominated is in compliance with all
national regulations. Vessel to be bunkered is subject to Seller’s
acceptance and will not be moored at wharf or alongside other
marine loading facilities of Seller or Seller’s supplier unless free of all
conditions, difficulties, peculiarities, deficiencies or defects which
might impose hazard in connection with the mooring, unmooring or
bunkering of vessel. Seller has the right to refuse to effect delivery to
the vessel if, at Seller’s sole discretion, it is probable that such
delivery will result in adverse consequences of any kind whatsoever.
12. Cancellation
If Buyer purports to cancel or terminate the Contract or otherwise fails to take
delivery, in whole or in part, of the quantities of Marine Fuels as specified in the
Contract, Buyer shall be liable to the Seller for any and all direct or indirect or
consequential losses incurred by the Seller resulting from such purported
cancellation, termination or failure, including but not limited to:
(a) any difference in price between the Contract price and the market price at the
delivery location on the date of such purported cancellation, termination or
failure;
(b) losses, costs and damages associated with terminating, liquidating, obtaining or
re-establishing any hedging arrangement, derivative transactions or related
trading position;
(c) costs of selling any undelivered Marine Fuels;
(d) additional operational expenses including but not limited to pump-back fees,
barge costs, inspection charges and storage;
(e) demurrage; and
(f) any charges and expenses levied by a third party (including any Physical
Supplier)
Provided that Seller may instead, at his sole discretion, impose a cancellation fee
of five thousand United States Dollars ($5,000) or ten per cent (10%) of the total
Contract amount, whichever is greater, as liquidated damages, to be paid by
Buyer within 7 days from such purported cancellation, termination or failure.
13. Indemnity
Buyer shall indemnify and hold Seller and Seller’s supplier harmless from and
against any and all claims, demands, suits or liability for damage to property,
for injury or death of any person or for non-compliance with any
requirement of any government arising out of or in any way connected with
fault of Buyer or its agents or servants or third parties in receiving, using,
storing or transporting Marine Fuels delivered hereunder or due to exposure
thereto.
14. Force Majeure
Buyer and / or Seller will be excused from all its obligations herein to
the extent that performance is delayed or prevented by circumstances beyond
its control or force majeure including but not limited to acts of God, weather,
fire, explosions, mechanical breakdown, strikes, plant shutdowns, civil
disturbances and government regulations. Such force majeure shall not
excuse Buyer’s obligation to make payment for products received. Seller
shall not be liable for any demurrage or other costs resulting from any such
delay or failure to perform on part of the Buyer.
In case of force majeure Seller shall be released from its obligations under
contract. Seller shall be released during the time when the force majeure
lasts or shall be released forever, at Seller’s option.
15. Miscellaneous
In the event Seller’s capacity to perform becomes impracticable for any
reason, including but not limited to requests or suggestions by any official
body relating to supplies, priorities, rationing or allocations of any product,
Seller may reduce or stop deliveries in such a manner as it may in its sole
discretion determine and shall be relieved of its obligation and incur no
responsibility of whatsoever nature to perform hereunder. Seller’s right to
require strict performance by Buyer of any and / or all obligations imposed
upon Buyer by its agreement shall not in any way be affected by any
previous waiver, forbearance, or cause of delaying.
16. Duty-free Bunkers
Any duty-free bunker supplies shall only be used by the Buyer in strict
accordance with the current relevant Maltese Customs regulations.
17. Termination
Seller may terminate the contract of sale concluded by Buyer in whole or in
part, at its own discretion, upon the breach of any provision hereof by Buyer.
Seller reserves the right to recover from Buyer all damages and costs
resulting from any breach of these terms by Buyer, including but not limited
to loss of profit.
18. Changes in terms of sale
Seller reserves the right to review or otherwise change these terms of sale as
it deems necessary from time to time.
19. Jurisdiction
This agreement shall be governed and construed in all particulars by the laws
of Malta. Any claim arising in terms of article 9 shall be referred to
arbitration through the offices and methods contemplated by the Malta
International Arbitration Centre in terms of Cap.387 of the Laws of Malta-
Arbitration Act 1996, as subsequently amemded. Each party undertakes to
nominate an Arbiter within two weeks from request and the Arbiters shall
nominate an independent Chairman, being a person of legal qualifications
and experience. The Arbiters shall decide according to law and equity.
Any other dispute arising from any matter connected with or ancillary to this
agreement between Buyer and Seller shall be referred to the Maltese courts
for settlement.
