Lesson 12: Salvage and towage liabilities

Question 1

Why do we have salvage rules?

Answer 1

To encourage assistance of endangered vessels. Three elements

1. Entitles of salvage reward
2. The right of salvage reward arises of rendering assistance
3. This right is protected by salvage lien, and right to arrest the salved property

Question 2

If the salvor is successful in preventing further damage despite not being able to salvage the vessel or its
property, is he then entitled to a salvage reward?

Answer 2

Yes it is stated that Salvage operation means any act or activity undertaken to assist a vessel or any other property in danger

Danger of further liabilities, e.g. damage to a port, may be taken into account when considering degree of danger and quantum of award.

Question 3

No cure-no pay principle

Answer 3

Article 12(1): “Salvage operations which have had a useful result give right to a reward”

Question 4

Does saving a human life give a right to salvage?

Answer 4

No right to salvage award for saving a human life. However a salvor of human life is entitled to a fair share of the total salvage award for salving a vessel.

Question 5

Which objects are subject to salvage?

Answer 5

• Vessel, cargo, bunkers, property

Question 6

What kinds of activities / operations can be defined as salvage?

Answer 6

• Towage of a vessel
• Pumping water from a vessel
• Raising a sunken ship
• Navigating ship to safety
• Saving a captured ship
• Supplying provisions

Question 7

Do you need a separate salvage agreement in order to be entitled to a salvage reward?

Answer 7

The right to salvage reward arises independently of whether if there is a contract or not

Question 8

Who has authority to enter into a salvage agreement on behalf of property/vessel owners?

Answer 8

Usually between salvors and owners however The Master has authority to enter on behalf shipowners or cargo owners.

Question 9

Salvage reward amount

Answer 9

The salvage reward shall not exceed the salved value of the vessel or property

Question 10

Conditions for special compensation under Art. 14

Answer 10

• Must be salvage operations in respect of a vessel

- Must be environmental danger

Question 11

SCOPIC

Answer 11

• Special Compensation of Protection & Indemnity Clubs solves two concerns from salvors, is applicable in all geographical locations, in coastal and inland, is applicable even if there is threat to the environment and is required a safety payment of 2 millions usd.

Question 12

Is security required to be provided for a salvage operation? Who provides security for a salvage operation? Can a maritime lien be exercised when there is satisfactory security?

Answer 12

• Under Salvage Convention, security is provided
• Security is provided by the person liable of salvage reward
• Where satisfactory security is provided, maritime lien is not exercised

Question 13

Is a legal contract required for towage operations? When does a towage operation become a salvage operation? What are some of the key consequences of the distinction between towage and salvage?

Answer 13

• Remuneration of towage almost always based on contract, otherwise only remunerable of part of salvage operation
• Remuneration fixed under towage contract
• Towage creates a maritime claim, while salvage creates maritime lien

Question 14

Who has authority to enter into towage contracts?
What is the purpose of the “warranty of authority” clause in UKSTC?
Why might a hirer prefer to contract under TOWCON or TOWHIRE rather than UKSTC?

Answer 14

• The tug and the tow
• So after the 3 conditions giving are given they can pick up lines.
  
  • The situation is such that those on board expect the tow to give orders to the tug to pick up lines
  • The tug is ready
  • The tug is within Hailing distance
• They’re more balance, the hirer is the charterer not the owner of the ship

Question 15

TOWHIRE

Answer 15

• Is a daily hire of towage contract.

Question 16

TOWCON

Answer 16

• LUMP SUM payment

Question 17

Knock for Knock Agreement

Answer 17

Under this agreement, some liabilities are assigned to the tug or tow in connection with which they arose, regardless of whether the liability would normally rest with the owner of the tug or the tow, respectively.