On behalf of shipowners, a considerable amount of criticism has been directed at the terms of the OWB supply contract (which is largely based on the 2015 standard form produced by the Baltic and International Maritime Council (BIMCO)). It was argued that the supply contract should have been a more straightforward document, to which SOGA applied, and under which title to the bunkers passed to the buyer. Those arguments are somewhat perverse, in commercial terms, because key provisions in the contract exist only because buyers evidently prefer credit terms to cash payment. If the bunker market operated on a “cash on delivery” basis, ROT clauses and licences to consume bunkers belonging to the seller, would all be unnecessary. Likewise, the involvement of the Lenders probably also resulted from these credit arrangements. If OWB sold an average of US$20m of bunkers each day and gave buyers a credit period of up to 60 days, the volume of bunker debt outstanding at any one time could amount to about US$1.2 billion. It is not surprising, therefore, that OWB needed, first, to retain title to unconsumed bunkers and, secondly, to grant security over its receivables as part of the arrangements for financing the credit it extended to buyers.
Shipowners’ case was that OWB were in breach of the supply contracts, because OWB had failed to pass title in the bunkers. As stated above, this argument depended upon the premise that SOGA applied to the supply contracts. However, parties are free to contract upon terms other than these provided for in SOGA. Further, there have presumably been thousands of bunker supply contracts entered into, and performed, on OWB’s terms, or similar terms, within the past 10 or 15 years. It always seemed unlikely that many, or most, of those contracts would be found, belatedly, to have been flawed and that SOGA would often have prevented a supplier from recovering the price from the buyer, even in cases where the buyer had consumed all the bunkers and had no cause for complaint.