Songa Product and Chemical Tankers IV AS v Gardsea Shipping Inc [2026]
The decision clarifies how payment deadlines should be assessed where banking days are defined by reference to multiple jurisdictions. Songa confirms that, absent clear wording to the contrary, the timing of performance is determined according to the local time at the place where the payment obligation is to be performed. Factual background Under the memorandum ...
In the legal case of Songa Product and Chemical Tankers IV AS v Gardsea Shipping Inc, the arbitration tribunal determined that the definition of "Banking Days" in the memorandum of agreement (MOA) was determinative in assessing payment deadlines. The parties agreed that the three Banking Days identified in clause 3 of the MOA expired at the end of September 8, 2022, in Hawaii, the most westerly jurisdiction listed.
The buyers argued that the sellers' cancellation notice was premature because the payment deadline had not been met by midnight Norwegian time on September 8. However, the tribunal held that the MOA's definition displaced the presumption that an obligation in a particular place must be performed by midnight there, as the definition simply identified which calendar days qualified as Banking Days, without specifying when a day began or ended.
The court ultimately ruled that the sellers' cancellation notice was valid, as the payment deadline had been assessed based on the midnight time in Hawaii.
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