Shipbuilding Law Blog

Contractual risks in any shipbuilding projects starts when the parties first make contact. Things that could go wrong at this stage may include disputes on whether a binding contract has been reached between the parties and issues related to the letter of intent.   Also, issues regarding option agreements for additional vessels, breach of confidentiality, and intellectual property rights could be a potential source of grief. The contract may include contingent conditions for the effective date of contract which could be contentious.  Prior to the effective date of contract, the parties may exchange refund and payment guarantees, which could turn out later to be unenforceable. The builder’s risk insurance provided by the shipbuilder may not cover all expected risks. Where insurances are in place, the parties may have to engage in litigation if knock-for-knock indemnity for property damage, personal injury, disease or death are not in place.  During the production phase, there will be