Bimco SupplyTime 2017 – failure to challenge an invoice on time leads to an obligation to pay

Judgment dated 14 May 2019 of Sir Ross Cranston sitting as High Court Judge (the “ATLANTIC TONJER”).

N.J. Margetson

Clause 12(e) of the Bimco SupplyTime 2017 provides inter alia:

“(…) If the Charterers reasonably believe an incorrect invoice has been issued, they shall notify the Owners promptly, but in no event no later than the due date, specifying the reason for disputing the invoice. The Charterers shall pay the undisputed portion of the invoice but shall be entitled to withhold payment of the disputed amount”

Sir Ross Cranston held that Charterers are barred from disputing the payment of invoices unless done so before the contractually agreed due date.

The effect of this judgment means that Charterers will be liable to pay incorrect invoices if they do not dispute them before the due date.

It is therefore hugely important for Charterers to promptly upon receipt check Owners invoices and directly protest if they see anything that they do not agree with.

The charterers can always bring a counterclaim if they have paid sums which they later believe were not properly payable. Counterclaims in this context would include a claim for breach of contract or one for unjust enrichment.