Cargo Description Warranty

What it does

The cargo description is the part of the charter that defines what the charterer is entitled to load: the commodity, often its grade or specification, and sometimes its condition or packing. It sets the boundary of the cargo the owner has agreed to carry, and it underpins the freight, the stowage plan, and the ship's suitability for the particular goods in question.

A description carries with it, expressly or by implication, a degree of assurance that the cargo presented will match it. If the charterer ships something materially different, heavier, more hazardous, or in worse condition than described, that can be a breach and can also undermine the safety assumptions on which the voyage was planned, which is why the description is more than a mere label.

Commercial effect

An accurate cargo description lets the owner plan stowage, assess the ship's suitability, and price the freight on a sound footing. If the cargo turns out to differ from the description in a way that matters, the consequences range from a freight adjustment to a damages claim, and in serious cases to the cargo being dangerous to carry, so the description has both commercial and safety dimensions.

The breadth of the description is itself a commercial lever. A charterer wants enough latitude to load the range of goods it trades; an owner wants the description tight enough that it knows what it is carrying and is not exposed to cargoes its ship is unsuited to. Where the line is drawn shapes the owner's risk and the charterer's flexibility, and it interacts with the dangerous-cargo and stowage provisions.

Owner's perspective

The owner wants the cargo accurately and not too loosely described, so that it can satisfy itself the ship is suitable and can plan loading and stowage with confidence. A precise description protects the owner against being presented with a heavier, more hazardous, or otherwise different cargo that the vessel cannot safely or lawfully carry on the terms agreed.

Where the cargo presented does not match the description, the owner looks to the charter and to the dangerous-cargo provisions for a remedy, whether a freight adjustment, a right to refuse, or damages. The owner therefore wants the description backed by clear consequences for misdescription, so that the assurance the description gives is worth something if the charterer departs from it.

Charterer's perspective

The charterer wants the cargo description broad enough to cover the range of goods it realistically expects to ship under the charter, since too narrow a description can leave it unable to load a cargo it has bought or sold. It seeks latitude on grade, specification, and quantity range so that ordinary trading variation does not put it in breach of the charter.

The charterer is mindful, though, that breadth has limits, because a description that sweeps in genuinely dangerous or unsuitable cargoes can trigger the owner's right to refuse and expose the charterer to liability. It therefore aims for a description that matches its trade while keeping clear of cargoes that would engage the dangerous-cargo regime, and it aligns the description with its sale contracts.

Negotiation points

• The breadth of the description — single commodity, a defined range, or a general cargo clause.
• The grade, specification, and condition assurances the description carries.
• The consequences of presenting cargo that does not match the description.
• How the description interacts with the dangerous-cargo and stowage provisions.

Common variations

• A single named commodity of a stated grade or specification.
• A defined range of commodities the charterer may elect among.
• A general cargo description with stated exclusions (for example no dangerous goods).
• A description tied to the charterer's sale contract specification.