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SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK — COMMERCIAL DIVISION

NORTHWIND MARITIME CORPORATION,

Plaintiff,

-against-

THALASSA SHIPPING & LOGISTICS SA and AEGEAN FORTUNA SHIPHOLDING LTD.,

Defendants.

Index No. 655421/2023 Part 49 Hon. Lorraine K. Chen, J.S.C.

SCHEDULE OF AFFIRMATIVE DEFENSES OF DEFENDANTS THALASSA SHIPPING & LOGISTICS SA AND AEGEAN FORTUNA SHIPHOLDING LTD.

Filed: November 17, 2023

Defendants Thalassa Shipping & Logistics SA ("TSL"), a société anonyme organized under the laws of the Hellenic Republic with its principal place of business and headquarters at 42 Akti Miaouli, Piraeus 185 38, Greece, and Aegean Fortuna Shipholding Ltd. ("Aegean Fortuna Shipholding"), a limited liability company organized under the laws of the Republic of Liberia (Liberian Registration No. LR-C-20167845), with its registered office at 80 Broad Street, Monrovia, Liberia (collectively, "Defendants"), by and through their attorneys, Calderwood & Harkness LLP, One Liberty Plaza, 50th Floor, New York, New York 10006, hereby assert the following affirmative defenses to the Complaint filed by Northwind Maritime Corporation ("Northwind" or "Plaintiff") on October 2, 2023 (the "Complaint"), and for each and every affirmative defense set forth herein, state as follows:

These affirmative defenses are asserted without prejudice to any additional defenses that may become available through the course of discovery, further investigation, or otherwise, and Defendants expressly reserve the right to amend, modify, or supplement this Schedule of Affirmative Defenses at any time, as permitted by the Civil Practice Law and Rules of the State of New York and the rules and practices of this Court. The assertion of any affirmative defense herein shall not be construed as an admission that any burden of proof or persuasion rests upon Defendants with respect to any issue for which the burden properly falls upon Plaintiff.

The dispute arises out of and relates to a charter-party in the NYPE 2015 (New York Produce Exchange Form), as amended by Addendum Nos. 1 through 4, dated December 3, 2020, bearing Charter-Party Reference No. NW-TSL-CP-2020-1203 (the "Charter-Party"), for the vessel M/V Aegean Fortuna (IMO No. 9847231), a Supramax dry bulk carrier of approximately 58,200 deadweight tonnage ("DWT"), flagged in the Republic of Liberia, classified by the Global Maritime Classification Bureau ("GMCB"), and owned by Aegean Fortuna Shipholding. TSL acted as the disponent owner and operator of the vessel under a head charter arrangement with Aegean Fortuna Shipholding. The Charter-Party provided for a charter period of thirty-six (36) months, commencing on January 15, 2021 and expiring on January 14, 2024, at a daily hire rate of $14,750.00 (United States Dollars Fourteen Thousand Seven Hundred Fifty), payable semi-monthly in advance.

FIRST AFFIRMATIVE DEFENSE

Liquidated Damages Cap — Single-Cap Interpretation Under Clause 28

1. Clause 28 of the Charter-Party provides, in relevant part, that upon the Owner's material breach of its maintenance and seaworthiness obligations set forth in Clauses 2 and 6 of the Charter-Party, the Charterer shall be entitled to liquidated damages equal to one hundred and fifty percent (150%) of the aggregate off-hire days multiplied by the daily hire rate, "subject to a cap of $4,500,000 for any single continuous period of breach." The parties negotiated this liquidated damages provision during the formation of the Charter-Party as a mechanism to address and allocate the risk of vessel downtime arising from maintenance and seaworthiness deficiencies.

2. In its Complaint, Northwind claims aggregate liquidated damages of $13,500,000, asserting that each of the three mechanical incidents giving rise to off-hire periods during the charter term — specifically, Incident 1 (March 12, 2022 through April 2, 2022, approximately 22 days), Incident 2 (July 8, 2022 through July 29, 2022, approximately 21 days), and Incident 3 (November 15, 2022 through December 10, 2022, approximately 25 days) — constitutes a separate and distinct "single continuous period of breach," and that each such incident independently triggers its own $4,500,000 liquidated damages cap, resulting in three separate caps totaling $13,500,000 in claimed liquidated damages.

3. Defendants assert that Northwind's interpretation of Clause 28 is erroneous as a matter of law and contrary to the plain language, structure, and commercial purpose of the Charter-Party. Properly construed under New York contract law, the phrase "single continuous period of breach" refers to the entire charter period or, at a minimum, any uninterrupted pattern of alleged maintenance deficiency or seaworthiness failure during the charter term. The three incidents identified in the Complaint did not arise from three separate and independent breaches; rather, they arose, if at all, from a single alleged course of conduct — namely, the alleged failure to maintain the vessel in a seaworthy condition throughout the charter period. Accordingly, the $4,500,000 cap applies once to the aggregate of all claimed breaches during the charter term, not on a per-incident basis.

4. Moreover, even applying the mathematical formula set forth in Clause 28, the liquidated damages calculation yields a sum substantially below the $4,500,000 cap. Specifically, sixty-eight (68) total off-hire days (being the sum of 22 + 21 + 25 days across the three incidents) multiplied by the daily hire rate of $14,750, multiplied by 150%, equals $1,504,500.00. This figure represents the maximum liquidated damages recoverable under Clause 28, even assuming, arguendo, that all three incidents constituted material breaches of the Owner's maintenance and seaworthiness obligations — which Defendants deny for the reasons set forth herein. Even if the Court were to determine that the $4,500,000 cap applies, Defendants contend that no more than $4,500,000 in total liquidated damages may be recovered under the Charter-Party for all claimed breaches in the aggregate.

5. To the extent that Northwind seeks liquidated damages exceeding $4,500,000, such excess constitutes an unenforceable penalty under New York law, as it would bear no reasonable relationship to Northwind's anticipated or actual damages at the time of contracting. It is well established under New York law that a liquidated damages provision is enforceable only where (a) the amount liquidated bears a reasonable proportion to the probable loss, and (b) actual damages are difficult to ascertain. See Northpoint Holdings v. Purdy Corp., 41 N.Y.2d 354 (1977); JMD Holding Corp. v. Cong. Fin. Corp., 4 N.Y.3d 373 (2005). A reading of Clause 28 that permits cumulative application of the $4,500,000 cap to each separate incident would transform the liquidated damages provision into a penalty grossly disproportionate to any reasonably anticipated harm, and would therefore be unenforceable.

6. Defendants further reserve the right to challenge the enforceability of Clause 28 in its entirety on the ground that it constitutes a penalty rather than a reasonable pre-estimate of anticipated damages, should the evidence developed in discovery so warrant.

SECOND AFFIRMATIVE DEFENSE

Latent Defect — Incident 1 (Turbocharger Failure)

7. Incident 1 arose on or about March 12, 2022, when the main engine turbocharger of the M/V Aegean Fortuna suffered a catastrophic failure while the vessel was transiting the Indian Ocean en route from Paradip, India to Mombasa, Kenya, on a voyage undertaken at Northwind's direction and for Northwind's commercial benefit.

8. As a result of the turbocharger failure, the vessel was unable to maintain its service speed and was required to proceed to Colombo, Sri Lanka for emergency repair. The vessel was off-hire for approximately twenty-two (22) days, from March 12, 2022 through April 2, 2022, during which time the turbocharger assembly was repaired and the vessel was restored to full operational capability.

9. Defendants assert, as an affirmative defense, that the turbocharger failure was caused by a latent defect — specifically, a manufacturing or metallurgical defect in the turbocharger assembly, including but not limited to defects in the rotor shaft material composition, blade root stress concentration points, and/or bearing housing tolerances — that was not discoverable through the exercise of due diligence, routine inspection, or reasonable maintenance procedures available to the Owner or its agents at the time. The defect existed at the time of the turbocharger's manufacture or installation and was inherently undetectable through the inspection and maintenance protocols customarily employed in the maritime industry, including those required by GMCB classification society rules and guidelines.

10. At all relevant times, Defendants exercised due diligence in maintaining the M/V Aegean Fortuna in a thoroughly efficient state of hull, machinery, and equipment throughout the charter period, in full compliance with the Owner's obligations under Clause 6 of the Charter-Party and all applicable GMCB classification society requirements, International Maritime Organization ("IMO") conventions, and flag state regulations of the Republic of Liberia. The vessel's maintenance records, class survey reports, and condition reports confirm that all scheduled and recommended maintenance was performed in a timely and workmanlike manner, and that the turbocharger was inspected and serviced in accordance with the manufacturer's recommended maintenance intervals.

11. The M/V Aegean Fortuna was built in 2016 by Dalian Prosperity Shipyard Co., Ltd. at its facility in Dalian, People's Republic of China, and was delivered with a full suite of class certificates from GMCB. The vessel has been properly maintained, surveyed, and classed throughout its operational life, and has at all times held valid certificates of class, Safety Construction Certificates, Safety Equipment Certificates, and all other statutory and class certificates required for its trade.

12. Under established principles of New York maritime law, including the law governing charter-party disputes in this Court, and consistent with the NYPE 2015 form and prevailing industry practice, an owner is not liable for losses resulting from latent defects in the vessel's hull, machinery, or equipment, provided the owner exercised due diligence to make the vessel seaworthy and to maintain the vessel in good order and condition. See, e.g., Luckenbach v. McCahan Sugar Ref. Co., 248 U.S. 139 (1918); Complainant's Steam Nav. Co. v. San Juan Bautista Lumber Co., 2d Cir. (applying latent defect doctrine under time charter). Defendants exercised such due diligence, and the latent defect defense is therefore applicable and dispositive as to Incident 1.

13. Defendants accordingly deny liability for any and all off-hire, damages, losses, costs, or expenses arising from or related to Incident 1, including but not limited to the claimed liquidated damages, repair costs, delay damages, and any other consequential or incidental damages alleged by Northwind in connection therewith.

THIRD AFFIRMATIVE DEFENSE

Charterer Causation — Incident 2 (Ballast Water Treatment System and Auxiliary Boiler Failure)

14. Incident 2 arose on or about July 8, 2022, when the ballast water treatment system ("BWTS") of the M/V Aegean Fortuna malfunctioned and the vessel's auxiliary boiler simultaneously failed while the vessel was loading iron ore cargo at the port of Richards Bay, Republic of South Africa, under Northwind's commercial direction.

15. As a result of the BWTS malfunction and auxiliary boiler failure, the vessel was unable to complete loading operations and was off-hire for approximately twenty-one (21) days, from July 8, 2022 through July 29, 2022. During this period, the BWTS was repaired, the auxiliary boiler was restored to operational condition, and the vessel was subsequently cleared to resume commercial operations.

16. Defendants assert, as an affirmative defense, that the BWTS malfunction was directly and proximately caused by Northwind's agents, who, acting under Northwind's operational direction and control, loaded contaminated ballast water at a prior port of call — specifically, at the port of Tuticorin (V. O. Chidambaranar Port), India — thereby introducing harmful contaminants, including elevated concentrations of sulfates, sediment particulates, and biologically active organisms, into the BWTS that caused its filtration membranes and UV treatment units to malfunction. The contamination of the ballast water was a direct result of decisions made by Northwind's port agents regarding the source and handling of ballast water at Tuticorin, over which Defendants had no control and for which Defendants bear no responsibility.

17. Under the terms of the Charter-Party, Northwind, as Charterer, had full operational control over the vessel's trading pattern, employment, and loading operations, including the selection of ports of call, the engagement and supervision of port agents responsible for ballast exchange and cargo handling operations at such ports, and the issuance of voyage orders to the Master. Clause 8 of the Charter-Party expressly provides that the Charterer shall be responsible for the consequences of orders given by the Charterer or its agents regarding the employment, loading, and discharge of the vessel, including the selection of berths and ports.

18. The auxiliary boiler failure was a direct and consequential result of the BWTS malfunction. The auxiliary boiler's cooling water intake system shared certain piping and filtration components with the BWTS, and the contamination introduced through the BWTS propagated to the boiler's cooling system, causing scale buildup and thermal stress that led to the boiler's failure. The auxiliary boiler failure would not have occurred but for the contamination of the ballast water caused by Northwind's agents, as described above.

19. To the extent that Northwind's own acts or omissions, or those of its agents, servants, employees, or representatives, caused or contributed to Incident 2, Northwind is barred from recovering any damages arising therefrom under well-established principles of causation and contributory fault under New York law. A party may not recover damages for a breach that was caused by or materially contributed to by its own conduct. See Restatement (Second) of Contracts § 350; Bi-Economy Mkt., Inc. v. Harleysville Ins. Co. of N.Y., 10 N.Y.3d 187 (2008).

20. Defendants deny liability for any and all off-hire, damages, losses, costs, or expenses arising from or related to Incident 2, including but not limited to the $3,420,000 in cargo damage allegedly arising from iron ore oxidation during the period of off-hire at Richards Bay. To the extent Northwind seeks to recover such cargo damage as an element of charter-party breach damages, Defendants further assert the defenses set forth in the Fifth and Sixth Affirmative Defenses below.

FOURTH AFFIRMATIVE DEFENSE

Master's Reasonable Deviation — Maputo Call (September 2022)

21. In its Complaint, Northwind alleges that in or about September 2022, TSL improperly directed the M/V Aegean Fortuna to deviate from its agreed voyage from Durban, Republic of South Africa to Qingdao, People's Republic of China, in order to call at the port of Maputo, Republic of Mozambique, purportedly to load TSL's own cargo of chrome ore. Northwind alleges that this deviation added approximately four (4) days to the voyage and caused Northwind to miss a cargo laycan window at Qingdao (October 1–5, 2022), resulting in claimed demurrage, dead freight, and related costs of $1,230,000.

22. Defendants deny that the call at Maputo constituted an unauthorized or improper deviation from the vessel's agreed voyage. Defendants assert, as an affirmative defense, that the decision to call at Maputo was necessitated by prevailing weather conditions in the Mozambique Channel, including Tropical Cyclone Warning No. 2022-MC-17 issued by the South African Weather Service on or about September 14, 2022, and by routing considerations related to the vessel's safe navigation through the region. The decision to call at Maputo was made by the Master of the vessel, Captain Nikolaos Giannopoulos, in the exercise of his reasonable professional judgment and in fulfillment of his paramount duty to ensure the safety of the vessel, her crew, and her cargo.

23. Clause 5 of the Charter-Party permits worldwide trading of the vessel, excluding only (a) ports and territories subject to sanctions administered by the United States Office of Foreign Assets Control ("OFAC"), the European Union, or the United Nations Security Council; (b) war-risk zones as defined in the London Joint War Committee ("LJWC") Hull War Risks Listed Areas, as updated from time to time; and (c) ice-bound waters north of latitude 68°N. Maputo, Republic of Mozambique falls squarely within the permitted trading area under Clause 5 and is not subject to any of the foregoing exclusions. The Charter-Party does not contain any restriction on the vessel's calling at Maputo or any other port in the Republic of Mozambique.

24. The Master, Captain Nikolaos Giannopoulos, who holds a Master Mariner certificate issued by the Hellenic Republic and has over twenty-five (25) years of experience commanding dry bulk carriers in worldwide trade, exercised reasonable professional judgment in determining the vessel's route and in deciding to call at Maputo. The Master's authority to determine the vessel's route and to deviate for reasons of safety is well established under both the Charter-Party and applicable principles of maritime law. See Clause 8(b) of the Charter-Party (reserving to the Owner the authority over the vessel's navigation, including the Master's discretion in matters of safety); see also The Willdomino, 272 U.S. 718 (1927) (recognizing Master's discretion to deviate for safety).

25. The Maputo call does not constitute a breach of the Charter-Party, and Defendants deny liability for the alleged deviation, the missed Qingdao laycan window, or any resulting demurrage, dead freight, or other costs and damages claimed by Northwind in connection therewith.

FIFTH AFFIRMATIVE DEFENSE

Inter-Club Agreement — Bar to Cargo Damage Claims

26. In its Complaint, Northwind claims $3,420,000 in cargo damage arising from alleged oxidation and moisture damage to a cargo of iron ore loaded aboard the M/V Aegean Fortuna at Richards Bay, Republic of South Africa, which Northwind attributes to the BWTS malfunction and auxiliary boiler failure that occurred during Incident 2.

27. Defendants assert, as an affirmative defense, that as between Owner and Charterer under a time charter, cargo damage claims are properly governed by the Inter-Club New York Produce Exchange Agreement, as most recently amended (the "Inter-Club Agreement" or "ICA"), which establishes the framework for the allocation of liability for cargo claims as between owners and charterers under NYPE form time charters. The Charter-Party incorporates the Inter-Club Agreement by reference in Clause 27, which provides that "cargo claims as between Owners and Charterers shall be settled in accordance with the Inter-Club New York Produce Exchange Agreement."

28. Under the Inter-Club Agreement, cargo claims are allocated between owners and charterers based on the cause of the damage. Specifically, claims arising from the loading, stowage, lashing, discharge, or delivery of cargo, or caused by the acts or omissions of the Charterer or the Charterer's agents, stevedores, or representatives, are allocated one hundred percent (100%) to the Charterer's account. Claims arising from the unseaworthiness of the vessel are allocated one hundred percent (100%) to the Owner's account. Claims arising from a combination of causes, or where the cause cannot be determined, are allocated fifty percent (50%) to each party.

29. To the extent the iron ore oxidation and moisture damage was caused by or contributed to by the BWTS malfunction — which itself was caused by the introduction of contaminated ballast water by Northwind's agents, as set forth more fully in the Third Affirmative Defense above — the cargo damage claim is allocable, in whole or in substantial part, to the Charterer's account under the Inter-Club Agreement. The contamination of the ballast water was an act or omission of the Charterer's agents within the meaning of the Inter-Club Agreement, and the resulting cargo damage falls within the category of claims for which the Charterer bears responsibility.

30. Defendants further assert that Northwind may not recover cargo damage as a separate and independent head of charter-party breach damages outside the framework of the Inter-Club Agreement. The Charter-Party's incorporation of the Inter-Club Agreement establishes the exclusive mechanism for the allocation and settlement of cargo claims as between the parties, and Northwind's attempt to circumvent that framework by recasting cargo damage claims as general breach-of-charter damages should not be permitted by this Court.

SIXTH AFFIRMATIVE DEFENSE

Non-Recoverability of Third-Party Shipper Claims as Charter-Party Damages

31. In Count III of the Complaint, Northwind claims $5,634,400 in damages representing the aggregate amount of three separate cargo claims asserted against Northwind by third-party shippers whose cargo was carried aboard the M/V Aegean Fortuna during the charter period. Northwind seeks to pass through these third-party claims as an element of its charter-party breach damages against Defendants.

32. Defendants assert, as an affirmative defense, that third-party shipper cargo claims are not recoverable by Northwind as damages for breach of the Charter-Party. The contractual relationships giving rise to the third-party shipper claims are separate and distinct from the Charter-Party. Specifically, the third-party shippers' claims arise under bills of lading, booking notes, or other contracts of carriage entered into between Northwind (or its agents) and the respective third-party shippers, to which neither TSL nor Aegean Fortuna Shipholding is a party and under which neither TSL nor Aegean Fortuna Shipholding has any contractual obligation.

33. Northwind's liability to third-party shippers, if any, arises under the terms and conditions of those separate contracts of carriage and is governed by the applicable carriage-of-goods regime, including the Carriage of Goods by Sea Act, 46 U.S.C. § 30701 et seq. ("COGSA"), or the Hague-Visby Rules, as incorporated into the relevant bills of lading. Such liability is not a foreseeable, direct, or natural consequence of any alleged breach of the Charter-Party by Defendants, and the quantum and merits of such third-party claims are matters over which Defendants have no knowledge, control, or ability to contest.

34. To the extent Northwind seeks to pass through third-party shipper claims as a component of charter-party damages, such claims are too remote, speculative, derivative, and unforeseeable to be recoverable under New York contract law. Under the well-established rule of Hadley v. Baxendale, 9 Ex. 341 (1854), and its New York progeny, see Kenford Co. v. County of Erie, 67 N.Y.2d 257 (1986), consequential damages are recoverable only where they were within the contemplation of the parties at the time of contracting as the probable result of a breach. The specific terms, conditions, and damage exposure arising under Northwind's separate contracts with third-party shippers were not within the contemplation of the parties to the Charter-Party, nor were they disclosed to Defendants prior to or at the time of contracting.

35. Defendants note that this defense is the subject of Defendants' Motion to Dismiss Count III of the Complaint pursuant to CPLR 3211(a)(7), filed December 15, 2023, which is currently pending before this Court. Defendants respectfully incorporate by reference the arguments set forth in their memorandum of law in support of that motion.

SEVENTH AFFIRMATIVE DEFENSE

Failure to Mitigate Damages

36. Defendants assert, as an affirmative defense, that Northwind failed to take reasonable steps to mitigate its damages arising from the alleged charter-party breaches, as required under New York law. A party claiming damages for breach of contract has a duty to take reasonable steps to minimize the consequences of the breach, and may not recover damages that could have been avoided through the exercise of reasonable commercial diligence. See Vireo Trust Bank v. Marlowe Commerce Bank Asset Capital Corp., 424 F.3d 195, 208 (2d Cir. 2005); Wilmot v. State, 32 N.Y.2d 164 (1973).

37. With respect to the three mechanical incidents (Incidents 1, 2, and 3), Northwind failed to arrange timely substitute tonnage or alternative transportation to minimize off-hire losses, substitute charter costs, and cargo delays. The dry bulk carrier market during the relevant periods (March through December 2022) was characterized by adequate vessel availability in the Supramax and Handymax segments, and substitute tonnage was readily procurable at rates at or near the prevailing charter rate. Northwind's delay in procuring substitute tonnage exacerbated its off-hire losses and contributed to the cargo delays and damage that form the basis of its claims.

38. Northwind claims substitute charter costs of $471,600, calculated on the basis of seventy-two (72) days at a substitute charter rate of $21,300 per day, representing a premium of $6,550 per day over the Charter-Party rate of $14,750 per day. Defendants assert that Northwind did not exercise reasonable commercial diligence in procuring substitute tonnage at the most competitive rate available in the market at the relevant times. Industry market reports, including the Baltic Exchange Supramax Time Charter Average and fixture reports published by leading shipbrokers, indicate that lower-cost substitute vessels of comparable size and capability were available during the periods in question. Northwind's failure to procure substitute tonnage at a commercially reasonable rate inflated its claimed substitute charter costs, and any damages awarded must be reduced accordingly.

39. With respect to the alleged Qingdao laycan miss (October 1–5, 2022), Northwind failed to negotiate an extension of the laycan window with the Qingdao receivers, Harborview Group, or to arrange alternative discharge logistics at Qingdao or a nearby alternative port, notwithstanding that a four-day delay was commercially manageable and that laycan extensions are routinely granted in the dry bulk trade. Northwind's failure to pursue a laycan extension or alternative discharge arrangements was unreasonable and contributed to the demurrage and dead freight costs that it now claims.

40. With respect to the cargo damage claims arising from Incident 2, Northwind failed to take adequate protective measures for the iron ore cargo during the period of BWTS malfunction at Richards Bay. Specifically, Northwind failed to direct the deployment of hatch covers, moisture barrier sheeting, or other protective measures to prevent oxidation and moisture ingress into the cargo holds during the off-hire period, notwithstanding that such measures were available and customary in the dry bulk iron ore trade. Northwind's failure to protect the cargo contributed to the extent of the cargo damage and renders Northwind's cargo damage claims excessive.

41. Northwind's sub-charter with Eastbourne Bulk Carriers Ltd. ("Eastbourne"), entered into at a sub-charter rate of $17,200 per day, contained provisions for off-hire and force majeure that, if properly invoked, would have relieved Northwind of a portion of its hire obligations to Eastbourne during the periods of vessel off-hire. Northwind's failure to invoke those provisions to mitigate its exposure to Eastbourne constitutes a further failure to mitigate, and any damages claimed by Northwind that relate to its sub-charter obligations to Eastbourne must be reduced to the extent that Northwind could have avoided such damages by invoking the contractual protections available to it under its sub-charter.

42. Accordingly, any damages awarded to Northwind must be reduced to the extent that Northwind could have avoided or minimized such damages through the exercise of reasonable commercial diligence, prudent business judgment, and the invocation of contractual protections available to it.

RESERVATION OF RIGHTS

43. Defendants expressly reserve the right to assert any additional affirmative defenses that may become available through the course of discovery, investigation, or further legal analysis, including but not limited to defenses based on:

(a) waiver;

(b) estoppel, including equitable estoppel, promissory estoppel, and quasi-estoppel;

(d) laches;

(e) comparative or contributory fault;

(f) set-off and recoupment;

(g) statute of limitations and statute of repose;

(h) accord and satisfaction;

(i) release;

(j) ratification;

(k) election of remedies;

(l) forum non conveniens;

(m) failure to join a necessary party; and

(n) any other defenses available under New York law, federal maritime law, general maritime law, or applicable international conventions, including the United Nations Convention on Contracts for the International Sale of Goods (to the extent applicable) and the International Convention for the Unification of Certain Rules of Law Relating to Bills of Lading.

44. Defendants further reserve the right to assert their counterclaim for $1,620,000.00 in unpaid hire for the period of October 1, 2022 through December 31, 2022 (ninety-two (92) chargeable days at the daily hire rate of $14,750.00, after deduction of agreed off-hire periods, totaling 110 days × $14,750/day = $1,622,500, rounded by the parties to $1,620,000 pursuant to the parties' commercial settlement discussions), which counterclaim is set forth in full in the Verified Answer and Counterclaim filed contemporaneously herewith, as a set-off against any damages that may be awarded to Northwind. Defendants' right to assert such set-off is without prejudice to their right to recover the full amount of unpaid hire on their counterclaim in the event that Northwind's claims are dismissed or reduced to an amount less than the counterclaim.

Dated: November 17, 2023 New York, New York

CALDERWOOD & HARKNESS LLP

By: ________

Douglas Carmichael Responsible Partner

One Liberty Plaza, 50th Floor New York, New York 10006 Telephone: (212) 558-4000 Facsimile: (212) 558-3588

Email: dcarmichael@calderwoodharkness.com

Attorneys for Defendants Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd.

Of Counsel:

Francesca Morano, Billing Partner Carlos Espinoza, Lead Associate Hannah Brinkley, Working Associate

CERTIFICATE OF SERVICE

I, Carlos Espinoza, an attorney admitted to practice before the courts of the State of New York, hereby certify that on November 17, 2023, a true and correct copy of the foregoing Schedule of Affirmative Defenses of Defendants Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd. was served upon counsel for Plaintiff, Northwind Maritime Corporation, by filing same with the New York State Courts Electronic Filing System ("NYSCEF"), which system will automatically transmit notification of such filing to all registered users, and by transmitting a courtesy copy via electronic mail to the following:

Margaret Delacroix, Esq. Jason Trumbull, Esq. Priya Mehta, Esq. Hargrove, Delacroix & Stern LLP 600 Lexington Avenue, 28th Floor New York, New York 10022 Telephone: (212) 909-6000

Email: mdelacroix@hdslaw.com; jtrumbull@hdslaw.com; pmehta@hdslaw.com

Attorneys for Plaintiff Northwind Maritime Corporation

________________________________________

Carlos Espinoza

Dated: November 17, 2023

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK — COMMERCIAL DIVISION
NORTHWIND MARITIME CORPORATION,
Plaintiff,
-against-
THALASSA SHIPPING & LOGISTICS SA and AEGEAN FORTUNA SHIPHOLDING LTD.,
Defendants.
Index No. 655421/2023 Part 49 Hon. Lorraine K. Chen, J.S.C.
SCHEDULE OF AFFIRMATIVE DEFENSES OF DEFENDANTS THALASSA SHIPPING & LOGISTICS SA AND AEGEAN FORTUNA SHIPHOLDING LTD.
Filed: November 17, 2023
Defendants Thalassa Shipping & Logistics SA ("TSL"), a société anonyme organized under the laws of the Hellenic Republic with its principal place of business and headquarters at 42 Akti Miaouli, Piraeus 185 38, Greece, and Aegean Fortuna Shipholding Ltd. ("Aegean Fortuna Shipholding"), a limited liability company organized under the laws of the Republic of Liberia (Liberian Registration No. LR-C-20167845), with its registered office at 80 Broad Street, Monrovia, Liberia (collectively, "Defendants"), by and through their attorneys, Calderwood & Harkness LLP, One Liberty Plaza, 50th Floor, New York, New York 10006, hereby assert the following affirmative defenses to the Complaint filed by Northwind Maritime Corporation ("Northwind" or "Plaintiff") on October 2, 2023 (the "Complaint"), and for each and every affirmative defense set forth herein, state as follows:
These affirmative defenses are asserted without prejudice to any additional defenses that may become available through the course of discovery, further investigation, or otherwise, and Defendants expressly reserve the right to amend, modify, or supplement this Schedule of Affirmative Defenses at any time, as permitted by the Civil Practice Law and Rules of the State of New York and the rules and practices of this Court. The assertion of any affirmative defense herein shall not be construed as an admission that any burden of proof or persuasion rests upon Defendants with respect to any issue for which the burden properly falls upon Plaintiff.
The dispute arises out of and relates to a charter-party in the NYPE 2015 (New York Produce Exchange Form), as amended by Addendum Nos. 1 through 4, dated December 3, 2020, bearing Charter-Party Reference No. NW-TSL-CP-2020-1203 (the "Charter-Party"), for the vessel M/V Aegean Fortuna (IMO No. 9847231), a Supramax dry bulk carrier of approximately 58,200 deadweight tonnage ("DWT"), flagged in the Republic of Liberia, classified by the Global Maritime Classification Bureau ("GMCB"), and owned by Aegean Fortuna Shipholding. TSL acted as the disponent owner and operator of the vessel under a head charter arrangement with Aegean Fortuna Shipholding. The Charter-Party provided for a charter period of thirty-six (36) months, commencing on January 15, 2021 and expiring on January 14, 2024, at a daily hire rate of $14,750.00 (United States Dollars Fourteen Thousand Seven Hundred Fifty), payable semi-monthly in advance.
FIRST AFFIRMATIVE DEFENSE
Liquidated Damages Cap — Single-Cap Interpretation Under Clause 28
1. Clause 28 of the Charter-Party provides, in relevant part, that upon the Owner's material breach of its maintenance and seaworthiness obligations set forth in Clauses 2 and 6 of the Charter-Party, the Charterer shall be entitled to liquidated damages equal to one hundred and fifty percent (150%) of the aggregate off-hire days multiplied by the daily hire rate, "subject to a cap of $4,500,000 for any single continuous period of breach." The parties negotiated this liquidated damages provision during the formation of the Charter-Party as a mechanism to address and allocate the risk of vessel downtime arising from maintenance and seaworthiness deficiencies.
2. In its Complaint, Northwind claims aggregate liquidated damages of $13,500,000, asserting that each of the three mechanical incidents giving rise to off-hire periods during the charter term — specifically, Incident 1 (March 12, 2022 through April 2, 2022, approximately 22 days), Incident 2 (July 8, 2022 through July 29, 2022, approximately 21 days), and Incident 3 (November 15, 2022 through December 10, 2022, approximately 25 days) — constitutes a separate and distinct "single continuous period of breach," and that each such incident independently triggers its own $4,500,000 liquidated damages cap, resulting in three separate caps totaling $13,500,000 in claimed liquidated damages.
3. Defendants assert that Northwind's interpretation of Clause 28 is erroneous as a matter of law and contrary to the plain language, structure, and commercial purpose of the Charter-Party. Properly construed under New York contract law, the phrase "single continuous period of breach" refers to the entire charter period or, at a minimum, any uninterrupted pattern of alleged maintenance deficiency or seaworthiness failure during the charter term. The three incidents identified in the Complaint did not arise from three separate and independent breaches; rather, they arose, if at all, from a single alleged course of conduct — namely, the alleged failure to maintain the vessel in a seaworthy condition throughout the charter period. Accordingly, the $4,500,000 cap applies once to the aggregate of all claimed breaches during the charter term, not on a per-incident basis.
4. Moreover, even applying the mathematical formula set forth in Clause 28, the liquidated damages calculation yields a sum substantially below the $4,500,000 cap. Specifically, sixty-eight (68) total off-hire days (being the sum of 22 + 21 + 25 days across the three incidents) multiplied by the daily hire rate of $14,750, multiplied by 150%, equals $1,504,500.00. This figure represents the maximum liquidated damages recoverable under Clause 28, even assuming, arguendo, that all three incidents constituted material breaches of the Owner's maintenance and seaworthiness obligations — which Defendants deny for the reasons set forth herein. Even if the Court were to determine that the $4,500,000 cap applies, Defendants contend that no more than $4,500,000 in total liquidated damages may be recovered under the Charter-Party for all claimed breaches in the aggregate.
5. To the extent that Northwind seeks liquidated damages exceeding $4,500,000, such excess constitutes an unenforceable penalty under New York law, as it would bear no reasonable relationship to Northwind's anticipated or actual damages at the time of contracting. It is well established under New York law that a liquidated damages provision is enforceable only where (a) the amount liquidated bears a reasonable proportion to the probable loss, and (b) actual damages are difficult to ascertain. See Northpoint Holdings v. Purdy Corp., 41 N.Y.2d 354 (1977); JMD Holding Corp. v. Cong. Fin. Corp., 4 N.Y.3d 373 (2005). A reading of Clause 28 that permits cumulative application of the $4,500,000 cap to each separate incident would transform the liquidated damages provision into a penalty grossly disproportionate to any reasonably anticipated harm, and would therefore be unenforceable.
6. Defendants further reserve the right to challenge the enforceability of Clause 28 in its entirety on the ground that it constitutes a penalty rather than a reasonable pre-estimate of anticipated damages, should the evidence developed in discovery so warrant.
SECOND AFFIRMATIVE DEFENSE
Latent Defect — Incident 1 (Turbocharger Failure)
7. Incident 1 arose on or about March 12, 2022, when the main engine turbocharger of the M/V Aegean Fortuna suffered a catastrophic failure while the vessel was transiting the Indian Ocean en route from Paradip, India to Mombasa, Kenya, on a voyage undertaken at Northwind's direction and for Northwind's commercial benefit.
8. As a result of the turbocharger failure, the vessel was unable to maintain its service speed and was required to proceed to Colombo, Sri Lanka for emergency repair. The vessel was off-hire for approximately twenty-two (22) days, from March 12, 2022 through April 2, 2022, during which time the turbocharger assembly was repaired and the vessel was restored to full operational capability.
9. Defendants assert, as an affirmative defense, that the turbocharger failure was caused by a latent defect — specifically, a manufacturing or metallurgical defect in the turbocharger assembly, including but not limited to defects in the rotor shaft material composition, blade root stress concentration points, and/or bearing housing tolerances — that was not discoverable through the exercise of due diligence, routine inspection, or reasonable maintenance procedures available to the Owner or its agents at the time. The defect existed at the time of the turbocharger's manufacture or installation and was inherently undetectable through the inspection and maintenance protocols customarily employed in the maritime industry, including those required by GMCB classification society rules and guidelines.
10. At all relevant times, Defendants exercised due diligence in maintaining the M/V Aegean Fortuna in a thoroughly efficient state of hull, machinery, and equipment throughout the charter period, in full compliance with the Owner's obligations under Clause 6 of the Charter-Party and all applicable GMCB classification society requirements, International Maritime Organization ("IMO") conventions, and flag state regulations of the Republic of Liberia. The vessel's maintenance records, class survey reports, and condition reports confirm that all scheduled and recommended maintenance was performed in a timely and workmanlike manner, and that the turbocharger was inspected and serviced in accordance with the manufacturer's recommended maintenance intervals.
11. The M/V Aegean Fortuna was built in 2016 by Dalian Prosperity Shipyard Co., Ltd. at its facility in Dalian, People's Republic of China, and was delivered with a full suite of class certificates from GMCB. The vessel has been properly maintained, surveyed, and classed throughout its operational life, and has at all times held valid certificates of class, Safety Construction Certificates, Safety Equipment Certificates, and all other statutory and class certificates required for its trade.
12. Under established principles of New York maritime law, including the law governing charter-party disputes in this Court, and consistent with the NYPE 2015 form and prevailing industry practice, an owner is not liable for losses resulting from latent defects in the vessel's hull, machinery, or equipment, provided the owner exercised due diligence to make the vessel seaworthy and to maintain the vessel in good order and condition. See, e.g., Luckenbach v. McCahan Sugar Ref. Co., 248 U.S. 139 (1918); Complainant's Steam Nav. Co. v. San Juan Bautista Lumber Co., 2d Cir. (applying latent defect doctrine under time charter). Defendants exercised such due diligence, and the latent defect defense is therefore applicable and dispositive as to Incident 1.
13. Defendants accordingly deny liability for any and all off-hire, damages, losses, costs, or expenses arising from or related to Incident 1, including but not limited to the claimed liquidated damages, repair costs, delay damages, and any other consequential or incidental damages alleged by Northwind in connection therewith.
THIRD AFFIRMATIVE DEFENSE
Charterer Causation — Incident 2 (Ballast Water Treatment System and Auxiliary Boiler Failure)
14. Incident 2 arose on or about July 8, 2022, when the ballast water treatment system ("BWTS") of the M/V Aegean Fortuna malfunctioned and the vessel's auxiliary boiler simultaneously failed while the vessel was loading iron ore cargo at the port of Richards Bay, Republic of South Africa, under Northwind's commercial direction.
15. As a result of the BWTS malfunction and auxiliary boiler failure, the vessel was unable to complete loading operations and was off-hire for approximately twenty-one (21) days, from July 8, 2022 through July 29, 2022. During this period, the BWTS was repaired, the auxiliary boiler was restored to operational condition, and the vessel was subsequently cleared to resume commercial operations.
16. Defendants assert, as an affirmative defense, that the BWTS malfunction was directly and proximately caused by Northwind's agents, who, acting under Northwind's operational direction and control, loaded contaminated ballast water at a prior port of call — specifically, at the port of Tuticorin (V. O. Chidambaranar Port), India — thereby introducing harmful contaminants, including elevated concentrations of sulfates, sediment particulates, and biologically active organisms, into the BWTS that caused its filtration membranes and UV treatment units to malfunction. The contamination of the ballast water was a direct result of decisions made by Northwind's port agents regarding the source and handling of ballast water at Tuticorin, over which Defendants had no control and for which Defendants bear no responsibility.
17. Under the terms of the Charter-Party, Northwind, as Charterer, had full operational control over the vessel's trading pattern, employment, and loading operations, including the selection of ports of call, the engagement and supervision of port agents responsible for ballast exchange and cargo handling operations at such ports, and the issuance of voyage orders to the Master. Clause 8 of the Charter-Party expressly provides that the Charterer shall be responsible for the consequences of orders given by the Charterer or its agents regarding the employment, loading, and discharge of the vessel, including the selection of berths and ports.
18. The auxiliary boiler failure was a direct and consequential result of the BWTS malfunction. The auxiliary boiler's cooling water intake system shared certain piping and filtration components with the BWTS, and the contamination introduced through the BWTS propagated to the boiler's cooling system, causing scale buildup and thermal stress that led to the boiler's failure. The auxiliary boiler failure would not have occurred but for the contamination of the ballast water caused by Northwind's agents, as described above.
19. To the extent that Northwind's own acts or omissions, or those of its agents, servants, employees, or representatives, caused or contributed to Incident 2, Northwind is barred from recovering any damages arising therefrom under well-established principles of causation and contributory fault under New York law. A party may not recover damages for a breach that was caused by or materially contributed to by its own conduct. See Restatement (Second) of Contracts § 350; Bi-Economy Mkt., Inc. v. Harleysville Ins. Co. of N.Y., 10 N.Y.3d 187 (2008).
20. Defendants deny liability for any and all off-hire, damages, losses, costs, or expenses arising from or related to Incident 2, including but not limited to the $3,420,000 in cargo damage allegedly arising from iron ore oxidation during the period of off-hire at Richards Bay. To the extent Northwind seeks to recover such cargo damage as an element of charter-party breach damages, Defendants further assert the defenses set forth in the Fifth and Sixth Affirmative Defenses below.
FOURTH AFFIRMATIVE DEFENSE
Master's Reasonable Deviation — Maputo Call (September 2022)
21. In its Complaint, Northwind alleges that in or about September 2022, TSL improperly directed the M/V Aegean Fortuna to deviate from its agreed voyage from Durban, Republic of South Africa to Qingdao, People's Republic of China, in order to call at the port of Maputo, Republic of Mozambique, purportedly to load TSL's own cargo of chrome ore. Northwind alleges that this deviation added approximately four (4) days to the voyage and caused Northwind to miss a cargo laycan window at Qingdao (October 1–5, 2022), resulting in claimed demurrage, dead freight, and related costs of $1,230,000.
22. Defendants deny that the call at Maputo constituted an unauthorized or improper deviation from the vessel's agreed voyage. Defendants assert, as an affirmative defense, that the decision to call at Maputo was necessitated by prevailing weather conditions in the Mozambique Channel, including Tropical Cyclone Warning No. 2022-MC-17 issued by the South African Weather Service on or about September 14, 2022, and by routing considerations related to the vessel's safe navigation through the region. The decision to call at Maputo was made by the Master of the vessel, Captain Nikolaos Giannopoulos, in the exercise of his reasonable professional judgment and in fulfillment of his paramount duty to ensure the safety of the vessel, her crew, and her cargo.
23. Clause 5 of the Charter-Party permits worldwide trading of the vessel, excluding only (a) ports and territories subject to sanctions administered by the United States Office of Foreign Assets Control ("OFAC"), the European Union, or the United Nations Security Council; (b) war-risk zones as defined in the London Joint War Committee ("LJWC") Hull War Risks Listed Areas, as updated from time to time; and (c) ice-bound waters north of latitude 68°N. Maputo, Republic of Mozambique falls squarely within the permitted trading area under Clause 5 and is not subject to any of the foregoing exclusions. The Charter-Party does not contain any restriction on the vessel's calling at Maputo or any other port in the Republic of Mozambique.
24. The Master, Captain Nikolaos Giannopoulos, who holds a Master Mariner certificate issued by the Hellenic Republic and has over twenty-five (25) years of experience commanding dry bulk carriers in worldwide trade, exercised reasonable professional judgment in determining the vessel's route and in deciding to call at Maputo. The Master's authority to determine the vessel's route and to deviate for reasons of safety is well established under both the Charter-Party and applicable principles of maritime law. See Clause 8(b) of the Charter-Party (reserving to the Owner the authority over the vessel's navigation, including the Master's discretion in matters of safety); see also The Willdomino, 272 U.S. 718 (1927) (recognizing Master's discretion to deviate for safety).
25. The Maputo call does not constitute a breach of the Charter-Party, and Defendants deny liability for the alleged deviation, the missed Qingdao laycan window, or any resulting demurrage, dead freight, or other costs and damages claimed by Northwind in connection therewith.
FIFTH AFFIRMATIVE DEFENSE
Inter-Club Agreement — Bar to Cargo Damage Claims
26. In its Complaint, Northwind claims $3,420,000 in cargo damage arising from alleged oxidation and moisture damage to a cargo of iron ore loaded aboard the M/V Aegean Fortuna at Richards Bay, Republic of South Africa, which Northwind attributes to the BWTS malfunction and auxiliary boiler failure that occurred during Incident 2.
27. Defendants assert, as an affirmative defense, that as between Owner and Charterer under a time charter, cargo damage claims are properly governed by the Inter-Club New York Produce Exchange Agreement, as most recently amended (the "Inter-Club Agreement" or "ICA"), which establishes the framework for the allocation of liability for cargo claims as between owners and charterers under NYPE form time charters. The Charter-Party incorporates the Inter-Club Agreement by reference in Clause 27, which provides that "cargo claims as between Owners and Charterers shall be settled in accordance with the Inter-Club New York Produce Exchange Agreement."
28. Under the Inter-Club Agreement, cargo claims are allocated between owners and charterers based on the cause of the damage. Specifically, claims arising from the loading, stowage, lashing, discharge, or delivery of cargo, or caused by the acts or omissions of the Charterer or the Charterer's agents, stevedores, or representatives, are allocated one hundred percent (100%) to the Charterer's account. Claims arising from the unseaworthiness of the vessel are allocated one hundred percent (100%) to the Owner's account. Claims arising from a combination of causes, or where the cause cannot be determined, are allocated fifty percent (50%) to each party.
29. To the extent the iron ore oxidation and moisture damage was caused by or contributed to by the BWTS malfunction — which itself was caused by the introduction of contaminated ballast water by Northwind's agents, as set forth more fully in the Third Affirmative Defense above — the cargo damage claim is allocable, in whole or in substantial part, to the Charterer's account under the Inter-Club Agreement. The contamination of the ballast water was an act or omission of the Charterer's agents within the meaning of the Inter-Club Agreement, and the resulting cargo damage falls within the category of claims for which the Charterer bears responsibility.
30. Defendants further assert that Northwind may not recover cargo damage as a separate and independent head of charter-party breach damages outside the framework of the Inter-Club Agreement. The Charter-Party's incorporation of the Inter-Club Agreement establishes the exclusive mechanism for the allocation and settlement of cargo claims as between the parties, and Northwind's attempt to circumvent that framework by recasting cargo damage claims as general breach-of-charter damages should not be permitted by this Court.
SIXTH AFFIRMATIVE DEFENSE
Non-Recoverability of Third-Party Shipper Claims as Charter-Party Damages
31. In Count III of the Complaint, Northwind claims $5,634,400 in damages representing the aggregate amount of three separate cargo claims asserted against Northwind by third-party shippers whose cargo was carried aboard the M/V Aegean Fortuna during the charter period. Northwind seeks to pass through these third-party claims as an element of its charter-party breach damages against Defendants.
32. Defendants assert, as an affirmative defense, that third-party shipper cargo claims are not recoverable by Northwind as damages for breach of the Charter-Party. The contractual relationships giving rise to the third-party shipper claims are separate and distinct from the Charter-Party. Specifically, the third-party shippers' claims arise under bills of lading, booking notes, or other contracts of carriage entered into between Northwind (or its agents) and the respective third-party shippers, to which neither TSL nor Aegean Fortuna Shipholding is a party and under which neither TSL nor Aegean Fortuna Shipholding has any contractual obligation.
33. Northwind's liability to third-party shippers, if any, arises under the terms and conditions of those separate contracts of carriage and is governed by the applicable carriage-of-goods regime, including the Carriage of Goods by Sea Act, 46 U.S.C. § 30701 et seq. ("COGSA"), or the Hague-Visby Rules, as incorporated into the relevant bills of lading. Such liability is not a foreseeable, direct, or natural consequence of any alleged breach of the Charter-Party by Defendants, and the quantum and merits of such third-party claims are matters over which Defendants have no knowledge, control, or ability to contest.
34. To the extent Northwind seeks to pass through third-party shipper claims as a component of charter-party damages, such claims are too remote, speculative, derivative, and unforeseeable to be recoverable under New York contract law. Under the well-established rule of Hadley v. Baxendale, 9 Ex. 341 (1854), and its New York progeny, see Kenford Co. v. County of Erie, 67 N.Y.2d 257 (1986), consequential damages are recoverable only where they were within the contemplation of the parties at the time of contracting as the probable result of a breach. The specific terms, conditions, and damage exposure arising under Northwind's separate contracts with third-party shippers were not within the contemplation of the parties to the Charter-Party, nor were they disclosed to Defendants prior to or at the time of contracting.
35. Defendants note that this defense is the subject of Defendants' Motion to Dismiss Count III of the Complaint pursuant to CPLR 3211(a)(7), filed December 15, 2023, which is currently pending before this Court. Defendants respectfully incorporate by reference the arguments set forth in their memorandum of law in support of that motion.
SEVENTH AFFIRMATIVE DEFENSE
Failure to Mitigate Damages
36. Defendants assert, as an affirmative defense, that Northwind failed to take reasonable steps to mitigate its damages arising from the alleged charter-party breaches, as required under New York law. A party claiming damages for breach of contract has a duty to take reasonable steps to minimize the consequences of the breach, and may not recover damages that could have been avoided through the exercise of reasonable commercial diligence. See Vireo Trust Bank v. Marlowe Commerce Bank Asset Capital Corp., 424 F.3d 195, 208 (2d Cir. 2005); Wilmot v. State, 32 N.Y.2d 164 (1973).
37. With respect to the three mechanical incidents (Incidents 1, 2, and 3), Northwind failed to arrange timely substitute tonnage or alternative transportation to minimize off-hire losses, substitute charter costs, and cargo delays. The dry bulk carrier market during the relevant periods (March through December 2022) was characterized by adequate vessel availability in the Supramax and Handymax segments, and substitute tonnage was readily procurable at rates at or near the prevailing charter rate. Northwind's delay in procuring substitute tonnage exacerbated its off-hire losses and contributed to the cargo delays and damage that form the basis of its claims.
38. Northwind claims substitute charter costs of $471,600, calculated on the basis of seventy-two (72) days at a substitute charter rate of $21,300 per day, representing a premium of $6,550 per day over the Charter-Party rate of $14,750 per day. Defendants assert that Northwind did not exercise reasonable commercial diligence in procuring substitute tonnage at the most competitive rate available in the market at the relevant times. Industry market reports, including the Baltic Exchange Supramax Time Charter Average and fixture reports published by leading shipbrokers, indicate that lower-cost substitute vessels of comparable size and capability were available during the periods in question. Northwind's failure to procure substitute tonnage at a commercially reasonable rate inflated its claimed substitute charter costs, and any damages awarded must be reduced accordingly.
39. With respect to the alleged Qingdao laycan miss (October 1–5, 2022), Northwind failed to negotiate an extension of the laycan window with the Qingdao receivers, Harborview Group, or to arrange alternative discharge logistics at Qingdao or a nearby alternative port, notwithstanding that a four-day delay was commercially manageable and that laycan extensions are routinely granted in the dry bulk trade. Northwind's failure to pursue a laycan extension or alternative discharge arrangements was unreasonable and contributed to the demurrage and dead freight costs that it now claims.
40. With respect to the cargo damage claims arising from Incident 2, Northwind failed to take adequate protective measures for the iron ore cargo during the period of BWTS malfunction at Richards Bay. Specifically, Northwind failed to direct the deployment of hatch covers, moisture barrier sheeting, or other protective measures to prevent oxidation and moisture ingress into the cargo holds during the off-hire period, notwithstanding that such measures were available and customary in the dry bulk iron ore trade. Northwind's failure to protect the cargo contributed to the extent of the cargo damage and renders Northwind's cargo damage claims excessive.
41. Northwind's sub-charter with Eastbourne Bulk Carriers Ltd. ("Eastbourne"), entered into at a sub-charter rate of $17,200 per day, contained provisions for off-hire and force majeure that, if properly invoked, would have relieved Northwind of a portion of its hire obligations to Eastbourne during the periods of vessel off-hire. Northwind's failure to invoke those provisions to mitigate its exposure to Eastbourne constitutes a further failure to mitigate, and any damages claimed by Northwind that relate to its sub-charter obligations to Eastbourne must be reduced to the extent that Northwind could have avoided such damages by invoking the contractual protections available to it under its sub-charter.
42. Accordingly, any damages awarded to Northwind must be reduced to the extent that Northwind could have avoided or minimized such damages through the exercise of reasonable commercial diligence, prudent business judgment, and the invocation of contractual protections available to it.
RESERVATION OF RIGHTS
43. Defendants expressly reserve the right to assert any additional affirmative defenses that may become available through the course of discovery, investigation, or further legal analysis, including but not limited to defenses based on:
(a) waiver;
(b) estoppel, including equitable estoppel, promissory estoppel, and quasi-estoppel;
(c) unclean hands;
(d) laches;
(e) comparative or contributory fault;
(f) set-off and recoupment;
(g) statute of limitations and statute of repose;
(h) accord and satisfaction;
(i) release;
(j) ratification;
(k) election of remedies;
(l) forum non conveniens;
(m) failure to join a necessary party; and
(n) any other defenses available under New York law, federal maritime law, general maritime law, or applicable international conventions, including the United Nations Convention on Contracts for the International Sale of Goods (to the extent applicable) and the International Convention for the Unification of Certain Rules of Law Relating to Bills of Lading.
44. Defendants further reserve the right to assert their counterclaim for $1,620,000.00 in unpaid hire for the period of October 1, 2022 through December 31, 2022 (ninety-two (92) chargeable days at the daily hire rate of $14,750.00, after deduction of agreed off-hire periods, totaling 110 days × $14,750/day = $1,622,500, rounded by the parties to $1,620,000 pursuant to the parties' commercial settlement discussions), which counterclaim is set forth in full in the Verified Answer and Counterclaim filed contemporaneously herewith, as a set-off against any damages that may be awarded to Northwind. Defendants' right to assert such set-off is without prejudice to their right to recover the full amount of unpaid hire on their counterclaim in the event that Northwind's claims are dismissed or reduced to an amount less than the counterclaim.
Dated: November 17, 2023 New York, New York
CALDERWOOD & HARKNESS LLP
By: ________
Douglas Carmichael Responsible Partner
One Liberty Plaza, 50th Floor New York, New York 10006 Telephone: (212) 558-4000 Facsimile: (212) 558-3588
Email: dcarmichael@calderwoodharkness.com
Attorneys for Defendants Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd.
Of Counsel:
Francesca Morano, Billing Partner Carlos Espinoza, Lead Associate Hannah Brinkley, Working Associate
CERTIFICATE OF SERVICE
I, Carlos Espinoza, an attorney admitted to practice before the courts of the State of New York, hereby certify that on November 17, 2023, a true and correct copy of the foregoing Schedule of Affirmative Defenses of Defendants Thalassa Shipping & Logistics SA and Aegean Fortuna Shipholding Ltd. was served upon counsel for Plaintiff, Northwind Maritime Corporation, by filing same with the New York State Courts Electronic Filing System ("NYSCEF"), which system will automatically transmit notification of such filing to all registered users, and by transmitting a courtesy copy via electronic mail to the following:
Margaret Delacroix, Esq. Jason Trumbull, Esq. Priya Mehta, Esq. Hargrove, Delacroix & Stern LLP 600 Lexington Avenue, 28th Floor New York, New York 10022 Telephone: (212) 909-6000
Email: mdelacroix@hdslaw.com; jtrumbull@hdslaw.com; pmehta@hdslaw.com
Attorneys for Plaintiff Northwind Maritime Corporation
________________________________________
Carlos Espinoza
Dated: November 17, 2023