General Exceptions Clause

What it does

A general exceptions clause sets out a list of perils and events for which a party, most often the owner, is excused from liability if they cause loss, damage, or delay. Typical excepted perils include acts of God, perils of the sea, fire, strikes, and other matters outside the party's control, and the clause operates to relieve that party of responsibility when one of the listed causes is the effective cause of the loss.

The clause allocates risk by drawing a line around what the excepting party answers for. It is read alongside the party's positive obligations, such as the duty of seaworthiness and care of cargo, and alongside any applicable carriage regime, so that the exceptions operate within, and subject to, those overriding duties rather than displacing them entirely.

Commercial effect

The exceptions clause is a core risk-allocation tool, determining who bears the consequences of a wide range of mishaps that are nobody's fault or are outside the excepting party's control. By relieving the owner of liability for listed perils, it shifts those risks to the cargo or charterer side, which typically looks to insurance, and it shapes the overall balance of responsibility in the contract.

The breadth and drafting of the list are commercially important, since an exception only protects against a peril it actually covers and is generally construed against the party relying on it. The clause therefore interacts with the seaworthiness and care-of-cargo obligations and with any paramount clause, which together determine how far the exceptions truly protect the excepting party.

Owner's perspective

The owner wants a comprehensive exceptions clause covering the perils and events outside its control that could cause loss or delay, so that it is not held liable for matters it could not prevent. It relies on the clause to confine its responsibility to its core duties, leaving risks such as weather, strikes, and similar perils with the cargo and charterer side.

The owner is mindful that exceptions are read strictly against the party invoking them and do not excuse a breach of an overriding duty such as seaworthiness. It therefore wants the list clear and the relationship with its positive obligations well understood, so that the exceptions provide real protection for genuinely external causes rather than being defeated by a finding of fault on its part.

Charterer's perspective

The charterer accepts that the owner should not answer for genuinely external perils but wants the exceptions confined to real, defined causes, so that the clause is not used to escape liability for matters within the owner's responsibility. It is conscious that a broad exceptions list shifts substantial risk onto its side, which it must cover by insurance.

The charterer therefore focuses on the interaction with the owner's core duties, ensuring that seaworthiness and care of cargo are not undermined by the exceptions, and that an excepted peril only protects the owner where it is genuinely the cause of the loss. It negotiates the list and its limits so that risk is allocated as the deal intended rather than tilted entirely toward the owner.

Negotiation points

• The perils and events included in the exceptions list.
• How the exceptions interact with the owner's seaworthiness and care-of-cargo duties.
• Whether the exceptions are mutual or protect the owner alone.
• The strict construction of exceptions against the party relying on them.

Common variations

• A mutual exceptions clause protecting both parties for listed perils.
• An owner-focused exceptions list covering perils of the sea, fire, and similar causes.
• An exceptions clause expressly subject to the seaworthiness obligation.
• A clause incorporating the exceptions of an applicable carriage regime.