No set-off against freight
The rule in The Aries, why a cargo claim cannot be deducted from voyage freight, and how it differs from hire.
A charterer or receiver cannot deduct a cargo claim from voyage freight. Freight must be paid in full and the cross-claim pursued separately, unless the charter expressly permits deduction.
The rule was settled in The Aries [1977] 1 WLR 185, where the House of Lords also held that the one-year period in Hague-Visby Article III rule 6 extinguishes the claim rather than barring the remedy, so an expired cargo claim cannot even be used defensively. The rule does not extend to time charter hire, against which equitable set-off is available, and that asymmetry catches operators moving between the two structures.
The full article will cover the rationale for the rule, its recognised exceptions, express deduction clauses in tanker forms, the contrasting position on hire, and how the rule operates in a charter chain.