Citgo Asphalt Refining Co. v. Frescati Shipping Co. (Athos I), 140 S. Ct. 1081 (2020)

SCOTUS concludes that a charter party’s safe-berth clause constituted an absolute safety warranty.

The United States Supreme Court recently held that a safe-berth clause in a voyage charter party created an express warranty of a vessel’s safety, not simply a duty of due diligence, on the part of a charterer. The Court analyzed the plain language of the clause, which stated that “[t]he vessel shall load and discharge at any safe place or wharf,…which shall be designated and procured by the Charterer, provided the Vessel can proceed thereto, lie at, and depart therefrom always safely afloat, any lighterage being at the expense, risk and peril of the Charterer.” Upon analysis, the Court’s majority found that the plain meaning of the clause imposed an absolute duty upon the charterer to select a safe berth, not simply a duty to use due diligence in the selection of a berth. In so holding, the Supreme Court affirmed the Second and Third Circuits’ reading of the clause and rejected the Fifth Circuit’s reading, resolving the circuit split.



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