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Passenger Aircraft Charter Agreement – between Charterer and Broker (Intermediary)

(For sole use cargo aircraft charter – between Charterer and Broker acting as Agent of Carrier)

 

The Baltic Air Charter Association (“BACA”) has produced the attached specimen draft agreement as a guide to its members and others as to the often-used contractual terms involved in agreements that may cover the business they undertake. The attached specimen draft is produced for reference purposes and by way of example only and is not exhaustive or definitive, as all transactions are different. BACA gives no representation or warranty as to the efficacy or applicability of this draft or its contents and BACA shall have no liability to any person who may rely upon them. Any persons seeking to use this draft should take their own separate legal advice.

 

 

BALTIC AIR CHARTER ASSOCIATION

 

CARGO AIRCRAFT CHARTER AGREEMENT

 

BETWEEN:-

 

  1. [name of Agent and Address]

(“the Agent”)

 

and

 

  1. [name of Charterer and Address]

(“the Charterer”)

 

 

 

NOW IT IS HEREBY AGREED as follows:-

 

The Agent, as agent for the Carrier (as hereinafter defined), shall make available to the Charterer the Aircraft as specified in the Schedule below and the Charterer shall take the Aircraft on charter from the Agent upon the terms and conditions set out in the Schedule below and subject to the terms and conditions set out in the General Conditions attached to and forming part of this Agreement.

 

 

THE SCHEDULE

 

Base Date:

 

Aircraft Type and Model:

 

Aircraft Registration:

 

The Carrier:

 

Payload and Capacity chartered:                          Kilos and/or volumetric equivalent:                       [             ] Cubic Metres.

 

Final Payloads are subject to the WAT limits at the time of the Flight and are also subject to the Captain’s final discretion. Flights are also subject to all over-flight and landing permits being in place, weather, slots, airport opening times and the loadability of the cargo shall be subject to the volume and dimensions of the Aircraft.

 

Air waybill Number:

 

Flight Number(s):

 

Routing and Schedule (GMT):

 

Place of Cargo Delivery:

 

Charter Price:   US Dollars [                  ].  The Charter Price includes all normal operational costs, but excludes royalties and non-objection fees, warehouse 512b charges, and other charges (including cargo taxes, and any other fees as provided in the Carrier’s General Conditions of Carriage.)  The Charter Price also excludes the cost of any special equipment required for on or off loading due to large bulky or heavy cargo.

 

The Charter Price also excludes:

  1. a) Security charges levied by airport authorities or any other security fees;
  2. b) Storage fees at the site of departure or arrival;
  3. c) Charges for certificates, customs documentation or inspection charges which are

caused by the carriage of the Cargo;

  1. d) De-icing charges including those incurred on any positioning, de-positioning or ferry flights; and
  2. e) Any war risk and allied perils insurance premium surcharges or any similar or other insurance premium surcharges required from time to time.

 

Cancellation:   If the Charterer wishes to cancel any Flight or Flights the subject of this Agreement the following rates will be paid forthwith by the Charterer to the Agent as agreed compensation:

 

25% of the Charter Price if cancelled after contract exchange;

50% of the Charter Price if cancelled within 72 hours prior to STD;

75% of the Charter Price if cancelled 48 hours prior to STD;

100% of the Charter Price if cancelled within 12 hours of STD.

 

Demurrage/Standing Charge:

At the rate of US Dollars [               ] per day or part thereof, the time of which commences [   ] hours after STD should the delay be directly caused by the shipper or its consignor.

 

Non-Payment:

If for any reason payment of the Charter Price or any instalment thereof shall not be made on the due date then the Charterer shall pay to the Agent interest on the amount unpaid at the rate of

[  ] % per annum above the base rate for the time being of [name of bank] calculated on a daily basis from the due date until the date of payment (both before and after judgment), compounded monthly.

 

Description of Cargo:

 

Loading:           Cargo to be available [       ] hours prior to scheduled departure.

 

Handling Agent:

 

 

Payment Terms:

Payment of the Charter Price shall be made directly to the Agent by telegraphic transfer to:

[name of bank]

[address of bank]

[Account Name]

Account No:     [             ]

Sort Code:       [             ]

 

and received in cleared funds in such account, no later than [                           ].

 

Special Conditions:

Flights can only be confirmed once written acceptance of the terms and conditions of this Agreement is received not later than 1200 GMT on [date], and that financial conditions can be met.

 

GENERAL CONDITIONS

 

  1. DEFINITIONS

 

In this Agreement unless the context otherwise requires:-

 

“Agreement”                   means this Cargo Aircraft Charter Agreement including the Schedule and any appendices or attachments thereto;

 

“Aircraft”                       means any aircraft for the time being operated in connection with any Flight;

 

“Base Date”                   means the base date stated in the Schedule;

 

“Cargo”                         means anything carried or to be carried in the Aircraft except mail, or baggage carried under a passenger ticket and baggage check, but includes baggage moving under an air waybill or shipment record.

 

“the Carrier”                   means the operator of the Aircraft as specified in the Schedule;

 

“Charter Price”     means the amount set out in the Schedule;

 

“Flight”              means a flight described in the Schedule;

 

“Schedule”                     means the schedule to this Agreement; and

 

“STD”                                   means the scheduled departure time of any Flight.

 

  1. CHARTER PRICE AND PAYMENT

 

2.1        The Charterer shall pay to the Agent the Charter Price at the time, in the currency, in the amounts and to the address specified in accordance with the provisions set out therefor in the Schedule.

 

2.2        The Charter Price specified in the Schedule is based on aviation fuel costs calculated on the Base Date. If for any reason whatsoever there shall be any increase in the cost of aviation fuel between the Base Date and the date of operation of any Flight, then the Charterer shall pay to the Agent on demand such amount as shall fully compensate the Carrier for such increase.

 

2.3       Time of payment of the Charter Price shall be of the essence of this Agreement.

 

2.4        No set-off or counterclaim (whether arising in respect of this Agreement or any other carriage) shall entitle the Charterer to withhold payment of any sums whatsoever payable to the Agent under or by reason of this Agreement.  In the event that the Charterer is required to withhold any part of any payment payable by it to the Agent hereunder or to make any deduction therefrom, it shall pay such additional amount as may be necessary so that, after making such withholding or deduction, the Agent shall receive from the Charterer the full amount of such payment.

 

  1. AIRCRAFT AND CREW

 

3.1        The Carrier shall be responsible for providing the Aircraft at the commencement of the Flight properly manned and equipped fuelled and airworthy in accordance with the laws and regulations of the state of registration of the Aircraft and the Aircraft shall be operated in accordance with all applicable laws and regulations during the period of the Flight(s).

 

3.2        The times set out in the Schedule are approximate and not guaranteed and the Carrier is entitled to deviate from the Flight schedule and/or the duration of the Flight and/or to reduce the maximum payload. The captain of the Aircraft shall have complete discretion concerning preparation of the load carried and its distribution and of the Aircraft for flight, whether or not a Flight shall be undertaken or abandoned once undertaken, any deviation from proposed route, where landing shall be made and all such other matters relating to the operation of the Aircraft and the Charterer shall accept all such decisions as final and binding. In the event that any Flight is delayed through the fault of the Charterer, the shipper or the consignor the Charterer shall pay to The Agent demurrage at the rate set out in the Schedule.

 

3.3        All ground and operating personnel including cabin staff are authorised to take orders only from the Carrier unless specific written agreement shall first have been obtained from the Carrier whereby certain defined instructions may be accepted by such personnel from the Charterer.

 

  1. TRAFFIC DOCUMENTS

 

The Carrier shall be responsible for supplying or procuring the supply of air waybills and all other necessary documents relating to the carriage of the Cargo and the Charterer shall give to the Agent all necessary information and assistance to complete such documents as soon as possible after the making of this Agreement and, in any event, in sufficient time to be completed for issue to consignors.

 

  1. ACCEPTABILITY OF CARGO

 

5.1        The Charterer shall deliver the Cargo at the place nominated in the Schedule properly packaged to the satisfaction of the Carrier.

 

5.2        The Carrier reserves the right without assuming any liability to refuse carriage of the Cargo in any circumstances whatsoever including, but not limited to, where:-

 

5.2.1     The transportation, or the exportation or importation of the Cargo is prohibited by the laws of any country from, to or over which the Aircraft is to be flown;

 

5.2.2    the Cargo is packed in a manner unsuitable for carriage by aircraft;

 

5.2.3    the Cargo is not accompanied by the requisite shipping documents;

 

5.2.4    the Cargo is likely to endanger aircraft, persons or property, or cause             annoyance to passengers;

 

5.2.5     the carriage of Cargo is excluded by the Carrier’s General Conditions of Carriage.

 

5.3        Any Cargo to be carried pursuant to this Agreement shall be deemed to have been accepted for transportation without a declaration of value or without an interest in delivery irrespective of any statement of value indicated on the air waybill or otherwise.

 

5.4        The Charterer shall be solely responsible for ensuring that the Cargo is packed in an appropriate way for air carriage so as to ensure that it can be carried safely on the Flights with ordinary care in handling and so as not to injure or damage any persons, goods or property.

 

5.5        Dangerous goods, live animals, perishables, fragile goods, human remains, and other special Cargo are acceptable only under the conditions set forth in the Carrier’s General Conditions of Carriage applicable to the carriage of such Cargo.

 

5.6       Loading and unloading shall be at the risk of the Charterer.

 

5.7        The Charterer shall indemnify and keep indemnified the Agent and its officers, employees, agents and sub-contractors against any and all costs or expense whatsoever incurred by the Agent in respect of the carriage of any cargo.  The indemnity contained in this clause 5.7 shall survive the termination of this Agreement.

 

5.8        Without prejudice to the generality of Clause 5.7 above, the Charterer shall pay to the Agent on demand any costs incurred by the Carrier in returning or transporting any Cargo to the point of origin of the Flight or to any other point pursuant to the direction of any competent authority in any country to, from or over which the Aircraft is flown.

 

  1. CARRIER DEFAULT

 

6.1       In the event that:

 

6.1.1     any Aircraft required for the operation of any Flight is detained (whether lawfully or not) by any third party (including but not limited to detention by any aviation or airport authority, overflight authority or by way of lien or requisition for hire or otherwise); or

 

6.1.2     if the Carrier has an administrator, receiver, administrative receiver, trustee or other like person appointed over a part or all of its assets or business and as a result the Carrier is unable to perform the Flights at the same cost to the Carrier; or

 

  • if the Carrier becomes insolvent, enters into voluntary liquidation or is compulsorily wound up

 

then the Agent shall use its reasonable endeavours to find an alternative carrier to operate such Flights as may be affected by the occurrence of any of the above events (“the Affected Flights”), at the same cost to the Charterer.

 

6.2        In the event that the Agent is unable so to do, the Agent shall (subject to the provisions of Clause 11 hereof and provided that the Charterer has duly fulfilled its obligations hereunder) refund to the Charterer such part of the Charter Price previously paid by the Charterer to the Agent as relates to the Affected Flight(s) provided always that the Agent has not previously forwarded such amounts to the Carrier or such amounts have been repaid to the Agent by or on behalf of the Carrier.  In the event that the Agent is able to arrange an alternative carrier to operate the Affected Flight(s), but only at an additional cost, the Agent shall notify the Charterer forthwith and the Charterer shall have the option to charter the aircraft operated by the alternative carrier provided that, if it so elects, it shall pay to the Agent such additional costs upon demand.  If the Charterer does not so elect, the Agent shall, (subject to the provisions of Clause 11 hereof and provided that the Charterer has duly fulfilled its obligations hereunder), refund to the Charterer such part of the Charter Price previously paid by the Charterer to the Agent as relates to the Affected Flights (provided always that the Agent has not previously forwarded such amounts to the Carrier or such amounts have been repaid to the Agent by or on behalf of the Carrier) and the Agent shall thereupon be under no further obligation to the Charterer in relation to the Affected Flights.

 

 

  1. OBLIGATIONS OF THE CHARTERER

 

7.1        The Charterer shall comply with all the requirements of the Agent in relation to the performance of all of the Charterer’s obligations as set out in this Agreement.

 

7.2        The Charterer shall hold harmless and indemnify the Agent from and against all claims, demands, liabilities, actions, proceedings and costs of any kind whatsoever arising from any default on the part of the Charterer in complying with any of the provisions of this Agreement.

 

7.3        The Charterer shall be responsible for the issue and delivery of all air waybills and other necessary documents to all consignors of the Cargo.

 

7.4        The Charterer shall comply in all respects with the conditions of all permits, licences and authorities granted for the Flights.

 

7.5        The Charterer shall comply and will procure compliance on the part of all owners or other persons interested in the Cargo with all applicable laws, customs and other government regulations of any country to, from or over which the Cargo may be carried including those relating to the packaging, carriage or delivery of the Cargo and shall furnish such information and deliver such documents as may be necessary to comply with such laws and regulations.

 

7.6        The Carrier and the Agent shall be under no liability whatsoever to the Charterer or to any other person for loss or expense due to the Charterer’s failure to comply with the provisions of Clauses 7.4 and/or 7.5 hereof.  The Charterer shall be liable to the Carrier and the Agent for any damage suffered by the Carrier and/or the Agent occasioned by the failure of the Charterer to comply with these provisions.

 

7.7        The Carrier and the Agent shall not be liable for the refusal by the Carrier to carry any Cargo if the Carrier reasonably determines in good faith that such a refusal is required by any applicable law, government regulation, demand, order or requirement.

 

7.8        The Charterer shall be solely responsible for the correctness of the particulars and statements relating to the Cargo in any shipping documents and the Charterer shall indemnify and keep indemnified the Carrier and the Agent against all damage suffered by the Carrier or, by any other person to whom the Carrier is liable, by reason of the irregularity, incorrectness or incompleteness of any particulars and statements in any shipping documents relating to the Cargo.

 

7.9        The indemnities contained in this Clause 7 shall survive the termination of this Agreement.

 

  1. EXCLUSION OF LIABILITY/INDEMNITY

 

8.1        The Agent shall be under no liability to the Charterer for any failure by it or the Carrier to perform their respective obligations under this Agreement arising from force majeure, labour disputes, strikes or lock-outs or any other cause beyond the control of the Agent and/or the Carrier including accidents to or failure of the Aircraft, its engines or any other part thereof or any machinery or apparatus used in connection therewith.

 

8.2        The Agent shall be under no liability to the Charterer or to the owners of or other persons having an interest in the Cargo in respect of any delay or variation to or cancellation of any Flight which results from the acts or omissions of the Carrier, or for any failure by the Carrier to perform any Flight and the Charterer hereby acknowledges to the Agent that in any such event the Charterer shall only have recourse against the Carrier.

 

8.3        The Charterer shall indemnify the Agent against any claim by any person arising out of any such variation, cancellation, non-availability or failure to perform referred to in Clause 8.2.

 

8.4        The Charterer shall indemnify the Agent against any loss, damage, liabilities, costs or expenses of whatsoever nature caused to be suffered or incurred by the Carrier and its officers, employees agents or subcontractors arising out of any act or omission of the Charterer or its officers, employees or agents whether arising in contract or tort (including negligence) or otherwise.

 

8.5        The Carrier shall not be deemed to undertake any carriage to which this Agreement relates as a common carrier.

 

  • Carriage of the Cargo shall be subject to the conditions of carriage contained or referred to in the traffic documents of the Carrier including its General Conditions of Carriage.

 

  • The Charterer hereby acknowledges to the Agent that it recognises that the Agent acts only as agent for the Carrier and that the Agent is not in any way responsible for the acts, omissions or defaults of the Carrier or the failure of the Carrier to perform its obligations contemplated hereunder and the Charterer hereby agrees to indemnify the Agent against any and all liabilities, claims, demands, suits, judgments, damages and losses, including reasonable expenses, costs and legal fees in connection therewith or incidental thereto arising directly or indirectly out of any act or omission of the Carrier.

 

8.8        The indemnities contained in this Clause 8 shall survive the termination of this Agreement.

 

8.9        The carriage of the Cargo on international flights shall be governed by the rules and limitations established by the Convention for the Unification of Certain Rules Relating to International Carriage by Air, signed at Warsaw, Poland, on October 12, 1929, as amended by the Protocol signed at The Hague, Netherlands, on September 28, 1955 (herein collectively called the “Warsaw Convention”) and/or by the rules and regulations established by the Montreal Convention on the Unification of Certain Rules for International Carriage signed in Montreal on 28th May 1999 (“the Montreal Convention”) which rules and limitations shall, to the extent such Warsaw Convention and/or the Montreal Convention is/are applicable, apply to the Flight(s) hereunder.

 

  1. TERMINATION

 

This Agreement may be terminated immediately upon notice from the Agent to the Charterer upon the occurrence of any of the events specified below:-

 

9.1       the Charterer defaults in the payment of any amount payable hereunder on due date; or

 

9.2        the Charterer is in breach of any of its other obligations hereunder which if capable of remedy has not been remedied within 14 days of receipt of written notice from the Carrier requiring remedy of such breach; or

 

9.3        the Charterer admits in writing its inability to pay or becomes unable to pay its debts (within the meaning of section 123 of the Insolvency Act 1996; or

 

9.4       a petition is presented for an administration order to be made up in relation to the             Charterer; or

 

9.5       proceedings are started or any steps are taken for the winding-up or dissolution of             the Charterer or for the appointment or a receiver, administrative receiver,             trustee, supervisor or similar officer of the Charterer or any or all of its revenues and             assets; or

 

9.6        an encumbrancer takes possession of any of the Charterer’s revenues or assets, or any security created by the Charterer becomes enforceable and the mortgagee or chargee takes steps to enforce the same (including without limitation by appointing a receiver or administrative receiver to any of the assets of the Charterer); or

 

9.7        the Charterer convenes a meeting or takes any steps for the purpose of making or proposes to enter into or make any arrangement or composition for the benefit of its creditors; or

 

9.8        a distress or other execution is levied or enforced upon or against any part of the Charterer’s property; or

 

9.9        the Charterer suspends or ceases or threatens to suspend or cease to carry on its business or (expect in the ordinary course of business) it sells, leases, transfers or otherwise disposes of or threatens to dispose of all or any substantial part of its undertakings or assets (whether by a single transaction or by a series), or all or any substantial part of its assets are seized or appropriated by or on behalf of any governmental or other authority or are compulsory acquired; or if anything analogous to the events referred to in 9.3 to 9.8 above occurs in any jurisdiction in which the Charterer conducts its business; or

 

9.10      in the opinion of the Carrier a material adverse change occurs in the business, assets, condition, operations or prospects of the Charterer; or

 

9.11      any of the events specified in this Clause 9 occur in relation to any guarantor of the Charterer’s obligations hereunder.

 

  1. EFFECT OF DEFAULT

 

10.1      If this Agreement is terminated under Clause 9, then the Charterer shall (without prejudice to any other rights and remedies which the Agent may have) pay forthwith to the Agent all amounts then due and unpaid to the Agent hereunder, together with interest thereon (if any) at the rate specified in the Schedule and the Charterer shall indemnify and keep the Agent indemnified against all loss, damage, costs, expense, claim or liability incurred or sustained by the Agent as a result of such termination and the Agent shall be entitled to retain any initial deposit paid by the Charterer pursuant to any provisions therefor set out in the Schedule.

 

10.2      The indemnities contained in this Clause 10 shall survive the termination of this Agreement.

 

  1. SET-OFF AND APPLICATION OF MONEYS

 

The Agent may at any time without notice to the Charterer at its discretion set-off any amounts paid by the Charterer to the Agent or against any amount due at such time from the Charterer to the Agent.

 

  1. GENERAL

 

12.1      Any notice required to be given under this Agreement shall be in writing and shall be deemed duly given if left at or sent by first class post or facsimile message to the address herein stated of the party to whom it is to be given.  Any such notice shall be deemed to be served at the time when the same is handed to or left at the address of the party to be served and if served by post on the day (not being a Sunday or Public Holiday) next following the day of posting or if served by facsimile message upon the day such facsimile message is sent.

 

12.2      This Agreement sets out the entire agreement and understanding between the parties or any of them in connection with the charter of the Aircraft as described herein and supersedes any prior representations, agreements, conditions, negotiations and undertakings whether made orally or in writing in relation thereto.

 

12.3      No party has relied on any warranty or representation of any other party except as expressly stated or referred to in this Agreement.

 

12.4      No claims shall be made against the Broker in respect of any representation warranty indemnity or otherwise arising out of or in connection with the charter of the aircraft except where such representation, warranty or indemnity is expressly contained or incorporated in this Agreement.

 

12.5      No variation of this Agreement shall be effective unless made in writing and signed by both parties.

 

12.6      The Charter Price, payment terms and other commercial terms contained in this Agreement are confidential to the parties and may not be disclosed to third parties without prior approval.

 

12.7      No failure by the Agent to exercise and no delay by the Agent in exercising any right, power of privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  The rights and remedies herein provided are cumulative and are not exclusive of any rights or remedies provided by law.

 

12.8      The Charterer shall not be entitled to assign the benefit of this Agreement.

 

  1. CHOICE OF LAW, SUBMISSION TO JURISDICTION, MEDIATION

 

13.1      This Agreement shall be governed by and interpreted in accordance with English law and the parties hereto hereby submit to the non-exclusive jurisdiction of the English Courts.

 

13.2      The Baltic Air Charter Association provides a mediation service to which parties are able to obtain resolution of any dispute relating to this Agreement or any other aviation related Agreement.

 

Signed for and on behalf of the:

 

Agent:        ………………………………………………………..

 

Status:    ………………………………………………..

 

 

Signed for and on behalf of the:

 

Charterer:    ………………………………………………………

 

Status:     …………………………………………………

 

 

 

DATE:     ……..day of   …………………………………….year………………………………

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