Salvage Convention

Under the old regime salvors got nothing for their pains in such circumstances since there was “no cure”, and this was clearly a highly unsatisfactory state of affairs.  At present, discussions are taking place with a view to introducing a new Salvage Convention extending this principle to cover not only laden oil tankers but also other types of pollution prevention activity.  A copy of Lloyds’ Open Form is in. Before leaving the subject of GA and salvage, some mention should be made of the question of seaworthiness. In these litigious days, it has become increasingly prevalent for Cargo Interests to raise objections when called upon for general average contributions.  Cargo owners (on behalf of their insurers) may, in some cases, engage lawyers and seek ways of proving unseaworthiness of the vessel at the commencement of the voyage, thereby obviating their obligation to contribute to General Average or Salvage.  Human error or misjudgment is a major factor in most accidents at sea and elsewhere, a fact fully recognised by insurers. Thus “crew negligence” and “faulty navigation” are both long standing and acceptable defences acknowledged by the Courts.  On the other hand, lack of due diligence on the part of owners is not.  Recent cases clearly place a heavy responsibility on the ship manager to select crew with utmost care and to supervise the operation of the vessel meticulously. In all insurance policies the assured has a duty to “sue and labour”; that is to say that the assured has to take all reasonable steps to minimise the costs for underwriters which includes the responsibility of the assured to try to recover from third parties wherever applicable. For instance, when a ship suffers damage at a berth to which she has been ordered by a Charterer who has warranted that is it safe, the costs incurred should be recoverable from the Charterer by reason of the safe berth clause in the Charter Party.  Similarly, repairs costs may be recovered from repairers due to negligent workmanship and cross liabilities must be pursued from the other party following a collision.  The underlying principle is that the shipowner ought to behave as a “prudent uninsured” and protect the underwriters’ interests at all times.