Duhaime's Law Dictionary

Charterparty Definition:

A transportation contract which includes the full and exclusive use of the airplane, vehicle or vessel for the duration of the transportation of either goods or persons.

Related Terms: Affreightment, Bill of Lading

Some jurisdictions spell the term as two words as in "charter party".

In United States v Hvoslef 237 U.S. 1, (1915), the US Supreme Court referred to a charterparty contract as follows:

"A charter party may be a contract for the lease of the vessel or for a special service to be rendered by the owner of the vessel."

The person entitled to the exclusive use of the airplane, vehicle or vessel called the charterer.

For the duration of the charterparty contract, the airplane, vehicle or vessel is said to be under charter. The consideration is called freight.

A distinction is usually made between contracts of affreightment, which are basic transportation contracts, and charterparties, which vest in the charterer much more control over the vessel and the details of transportation. But, although originally intended to be distinguished from a charterparty, the Courts now refer to a charterparty as a species of contracts of affreightment.

A charterparty can be to a specific destination (voyage charter) or for a specified period of time (time charter).

In the sea transportation industry, most charterparty contracts leave the ship under the care and control of the owner or operator, the charterer only choosing what goods or persons are carried and where the vessel stops.

References and Further Reading:

  • Scrutton on Charterparties and Bills of Lading, 20th Edition, London: Sweet & Maxwell, 1996.


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