UK insurer International Transport Intermediaries Club (ITIC) has reminded members of the importance of terms and conditions in contracts after a draft mix-up resulted in a pay-out.

The warning comes after a case involving an agent at a discharge port which advised a shipper with cargo on board an inbound vessel that the maximum draft was 40 feet.

Since the vessel’s draft was just under 41 feet, it made an interim call to unload some cargo.

The agent subsequently received a claim from the shipper alleging that the information it had provided was incorrect, and that vessels with drafts in excess of 40 feet could still call at the port, but with two pilots on board, rather than one.

It claimed $250,000 in respect of the costs of the wasted call and transporting the excess cargo.

The agent could not find the relevant provision relating to vessel draft on the website of the local pilots’ association, but was subsequently advised by the shipper that there was a link on the agent’s own website to an article explaining that vessels over 40 feet could call at the port, providing there were two pilots on board.

The agent contacted the local pilots’ association, which confirmed this.

Luckily, the agent had incorporated standard trading conditions which limited its liability to ten times its agency fee.

This amounted to $36,500, which sum was accepted by the shipper and reimbursed to the agent by ITIC.

"The claim demonstrates the importance of businesses incorporating their terms and conditions into all their business dealings," ITIC said.