Stowage factor warranty. When a ship is chartered to load a “full and complete cargo” or a “Min/Max” quantity, the owner is interested in the actual quantity being loaded by the Charterer, especially if his freight revenue is based on the quantity.
One method of calculating the possible freight is to base the tonnage to be loaded on the volume available for the cargo. This is done by using the stowage factor, that a charterer can be required to give. If the cargo is described as “stowing about 55 cubic feet” and the voyage charter is for, say 50,000 tonnes 10 per cent MOLOO, the owner will be able to calculate the weight he should advise the master’ to load basing the calculation on the “warranted stowage factor” given by the charterer, the master having given an appropriate Notice of Readiness stating the quantity he is prepared to load.
If the cargo fills the cargo compartment despite careful trimming and stowage, but the vessel does not reach the expected draught, the SF is obviously greater than that stated (warranted) by the Charterer. The shipowner can claim deadfreight from the Charterer because of a possible loss of freight based on tonnage loaded. The deadfreight would be similar to damages or compensation for “misrepresentation” by the Charterer. (See Misrepresentation.)
A dispute could also arise if the circumstances were reversed and the SF was lower than that represented by the Charterer. This occurred in a case that came before arbitrators in London in 1989. The owners of a small ship alleged that the SF was only 51 when the Charterers had represented the cargo as being “about” 54/55. The owners claimed that there was a breach of the voyage charter because the cargo had not filled the cargo spaces. Owing to this, the ship would be unsafe at sea because one hold had slack space at the top of the bulk grain. (Slack grain can shift because of a vessel’s movement in a seaway, thus affecting the ship’s stability.) This cargo had to be secured by bagged grain; the securing was time consuming and expensive.
The arbitrators decided that the charterers were liable for not providing cargo of the promised stowage factor. Had the owners known the actual SF they would have required the cargo to be loaded in such a manner as to safeguard the vessel’s stability. The owners were able to obtain damages.