Employment and indemnity clause
The time charterer's right to direct the ship's employment and the owner's implied indemnity for following those orders.
The employment and indemnity clause in a time charter gives the charterer the right to direct the commercial employment of the ship, and gives the owner an indemnity, usually implied and often expressed, for the consequences of complying with those orders.
The clause is the hinge of the time charter bargain: the charterer buys commercial control while the owner keeps possession, navigation and the crew, so the owner needs protection against loss caused by orders it did not choose. The indemnity does not cover risks the owner accepted under the charter, and the causal link between the order and the loss is the usual battleground, particularly where the master retains a discretion on safety or navigation.
The full article will cover the scope of the employment right and its navigational limits, the express and implied indemnity and the difference between them, causation and the intervening exercise of the master’s judgment, orders the master may refuse, and the interaction with the safe port warranty and the signing of bills of lading.