10/01/2025

No treble damages regime for commercial port charges

At the start of the new year, a key decision on charges by harbour authorities was handed down: Port of Sheerness Ltd v Swire Shipping Pte Ltd [2025] EWHC 7 (Admlty). Josephine Davies KC and Fiona Petersen represented the successful defendant charterers of the vessel, Swire Shipping Pte Ltd.

In short, the court:

• Rejected the demand by the claimant port for a “period toll” of some £250,000, on the basis that the port had no entitlement to such a payment under the relevant contractual provisions.
• Held that the provisions of s.64 of the Medway Ports Authority Act 1973 for recovery of a trebled sum (£750,000) would not have applied in any event, being limited to charges made under an enactment. This is the first judgment on this or any similar port statute.

In relation to the period toll, the court held that the contract did not entitle the port to make a charge that was said to “became payable after the expiry of the time objectively necessary to perform the cargo operation assuming the cargo complied with the conditions of the contract” [25]. Instead, on the correct interpretation of the relevant clauses, the port was only entitled to an additional charge if the vessel remained alongside after discharge had (in fact) been completed [26].

On the facts, the vessel had not remained alongside for longer than necessary to discharge the cargo. It did not matter whether the cargo was stowed as expected or not.

Albeit obiter, the point of overarching importance relates to the Medway Ports Authority Act 1973 trebling claim, which was “[a]n eye-catching feature of this case”. The judge held that “charges” within the meaning of section 64 includes only those that are “payable under any enactment” and do not, therefore, include contractual liabilities: “There could be no proper justification for a commercial organization claiming a commercial debt being entitled to triple it” [49].

The same reasoning would also apply to s.43 of the Harbour, Docks and Piers Clauses Act 1874, which is in similar terms and commonly applicable at other ports. A Westlaw search suggests that there are over two dozen orders or acts which incorporate this provision. The case of Port of Sheerness v Swire Shipping therefore provides welcome clarification of what could otherwise be a draconian provision.

Josephine Davies KC and Fiona Petersen were instructed for the defendant by Dolly Brown of Preston Turnbull LLP.