The appellant, who owns a ship, entered into an agreement to transport 5,000 mt of methanol from Libya to Türkiye. The charterparty was concluded by email correspondence on 26 July 2006 at the height of the Second Lebanon War. The appellant did not meet the timetable it had promised. After delays in Haifa, the ship reached the port of loading in Libya on 20 August 2006. However, it was ascertained that the ship was on the Libyan Arab boycott list and attempts to arrange its entry into the port were unsuccessful, so an alternative ship which arrived on 3 September 2006 took a smaller cargo, 3,651 mt, which was unloaded on 11 September 2006. The respondent claimed for breach of contract.

The appellant argued in the lower court that the delay in the arrival of the ship to the loading port was due to war, and prevention of the ship's entry into the port was covered by the customary exemption of 'arrest or restraint of princes, rulers or people'. In this case, the denial of entry was due to 'governmental obstruction'. According to the appellant, the ship had not been included in the Arab boycott list from Damascus, and had even visited Libya.

The lower court accepted the respondent's claim regarding the delay of the ship. The court ruled that when the charterparty was concluded at the height of the Second Lebanon War, the appellant knew about it, and the reservation that appeared in the wording of the agreement - 'all going well, weather and safe navigation permitting' - could not be interpreted as a reservation regarding war. On the other hand, the lower court accepted the appellant's argument regarding the prevention of entry to the port in Libya by the authorities. At the end of the day, the lower court determined the damage caused by the delay, and the appellant was awarded damages in the amount of USD 69,000 plus interest.

The appellant appealed to the Supreme Court, contending that it should be exempted from all liability. The respondent argued in its counter-appeal that the lower court should not have applied the exemption clause to the damage caused by prevention of the entry of the ship to the port in Libya. The respondent contended that the appellant's undertaking as to the ship's fitness encompassed a commitment to entry into the loading and discharge ports, and that the exemption clause should be narrowly interpreted. It further argued that the burden of proving the applicability or non-applicability of the exemption clause to the Libyan governmental order rested with the appellant shipowner.

Held: Appeal and counter-appeal dismissed.

Regarding the main appeal, the lower court was correct in the matter of the delay. The charterparty was terminated on 26 July 2006, when the Second Lebanon War was at its height.

As for the counter-appeal, the exemption clause that is the basis of the lower court's ruling is indeed very archaic, from the Age of Princes, terms that have almost disappeared from our world (it appears in art 4.2.g of the Schedule to the Carriage of Goods by Sea Ordinance, an old statute, in the language of 'arrest or restraint of princes, rulers or people, or seizure under legal process' - and perhaps the time has come for a new wording). Of course, such a provision should be examined on a case-by-case basis, and the risk that such an order would be given, as was apparently given here by the Libyan authorities - the circumstances are not clear - must be examined in its entirety. Even assuming a certain ambiguity, we have no reason to intervene in the lower court's determination, even in the contractual context. Indeed, there is no reason to make a determination as to who will bear the burden of proof in each and every case under the circumstances of one or another governmental provision, and sometimes the burden will be imposed on one side or the other and will sometimes be imposed on both sides reciprocally. We do not, therefore, accept the counter-appeal.