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Safe-Berth Clauses as an Absolute Warranty: What You Need to Know

The U.S. Supreme Court recently found in a 7-2 decision that the safe-berth clause at issue in the long-litigated ATHOS I oil spill constituted an absolute warranty in which the charterer promised the owner that the discharge port would be safe. The opinion affirmed the decision of the Third Circuit Court of Appeals and resolved the long-standing circuit court split between the Second Circuit, which has also read such clauses to impose a warranty, and the Fifth Circuit, which has interpreted these types of clauses as only imposing upon charterers a duty of due diligence to select to a safe berth. For more information, click here: Update – Citgo Asphalt Refining Co. et al. v. Frescati Shipping Co., Ltd.