Fisher Maritime's Fairleads

'Lessons Learned' Strategies & Ideas for the Marine Industry


Identifying All the Contract Deliverables

In ship conversion and construction contracts, the owner expects the shipyard/contractor to provide numerous “deliverables” in addition to the ship itself. Experience with “difficult” ship construction and conversion contracts has revealed that ship owners often do not adequately address all the expected deliverables, leading to conflicts or disputes with the shipyards/contractors.
Examples of such deliverables may include:
  • detail or working drawings
  • engineering analyses/reports
  • test agendas and reports
  • megger readings
  • condition-found reports
  • updated schedules
  • equipment selection reports
  • regulatory approvals
  • classification approvals
  • tonnage certificates
  • regulatory certifications
  • tank tables
  • trim and stability reports
  • equipment and/or system manuals
  • placards
  • as-built drawings
Owners have to appreciate that a shipyard incurs considerable costs to achieve the production of all those non-hardware deliverables. To avoid disputes, the necessity of the shipyard’s development of those deliverables has to be clearly addressed in the bid package. Absent clear requirements for those deliverables in the bid package, bidding shipyards may not create adequate budgetary allowance for their development. The owner then risks getting an incomplete or insufficient deliverable, or none at all in particular categories.
Both ship owners and shipyards should consider reviews of draft contracts (agreements, specifications, plans) by third parties for completeness and consistency as well as to cut ambiguities. One of the items that should be focused upon is the identification of all the deliverables.