What Is a Statement of Facts and How Does It Drive Laytime and Demurrage?

Formats vary between ports and agents, but the events recorded are broadly similar. Each event is entered with start and finish times, and every stoppage should carry a stated reason.

Laytime is the time allowed to the charterer under the charter party for loading or discharging. It may be expressed as a daily rate of cargo handled or as a fixed number of days. When laytime commences, which days count and which events interrupt it are also defined by the contract.

If the operation exceeds the time allowed, the charterer pays demurrage to the owner. Where the contract provides for it, the owner pays despatch to the charterer for time saved. Because both are calculated from SOF times, a discrepancy of a few hours can translate into a significant sum.

Charter parties rely on standard abbreviations. WWD (weather working day) means only days on which weather permits work are counted; SHINC means Sundays and holidays are included, while SHEX means they are excepted.

For this reason the SOF must record not just the duration of a stoppage but its true cause. Hatches closed because of rain and a breakdown of terminal equipment may be treated quite differently under the same contract.

Typical weaknesses include vague stoppage descriptions, partial stoppages that are not recorded at all (for example, one hold idle while others work) and times that do not match across documents. Omitting facts that could affect the validity of the notice of readiness, such as holds failing inspection, also leads to disputes.

These gaps usually surface months later, when a demurrage claim is presented. By then it is rarely possible to reconstruct what was not written down at the time.

Time zone and date errors are another trap. Failing to state whether ship's time or local time is used, or booking a stoppage that runs past midnight to the wrong day, creates deviations that are easy to miss in the calculation.

Before signing, SOF times should be cross-checked against independent records kept on site. Where a party disagrees with an entry, signing the document under protest or attaching a separate letter of protest is common trade practice.

How a protest should be made and what effect it has depends on the contract and the facts, and the parties should take their own advice on it. What matters in practice is that the protest is made during or immediately after the operation and supported by concrete records.

Laytime generally cannot start until the vessel is an arrived ship and ready in all respects to load or discharge. At that point the master or agent tenders the notice of readiness (NOR). The charter party may provide for laytime to commence after a set period following tender or acceptance.

Whether the vessel must reach the berth or merely the port to count as arrived depends on whether it is a berth or a port charter. Wording such as WIBON (whether in berth or not) allows notice to be tendered even when no berth is free. The times of tender and acceptance are therefore among the most critical entries in any SOF.

During loading and discharge supervision, the surveyor logs commencement, stoppages and completion together with their causes. These logs form an independent data set that can be compared line by line with the agent's SOF.

Karan Gözetim, based in Gemlik, keeps this type of time log as part of its loading and discharge supervision; the level of detail is agreed at the quotation stage.