Articles

Law of Salvate - An Outline for Rib Owners

You are in your 6 metre RIB off the South Coast of England. You had your engine serviced just before this trip which is the first trip of the Summer. About 1 mile off a rocky shoreline fuel starts to leak out of the engine, which then catches fire. Before you are able to put the fire out with your extinguisher, it causes substantial damage to the main outboard engine and electrics, with the result that there is no hope of restarting it to get you home. You try to use your 5HP donkey engine, but since you have never used it previously it won’t start either and you break the recoil starter cord in trying! A nearby fishing vessel returning to Ransom Harbour saw the smoke from your engine, came over to you and the skipper said it looked like you needed help to get back to port Since you had set out from your marina berth at Rib Haven, 4 miles further down the coast from Ransom Harbour, the wind and sea conditions have changed from being a pleasant early Summer’s evening to a steady Force 5 onshore, with a short and lumpy sea. After you had lost power, you noticed that you were drifting at a worrying rate shorewards and that the light is starting to fade. You therefore readily agree to accept and make fast the tow rope the skipper of the fishing vessel throws to you. An hour and a half later you are safely in Ransom Harbour astern of the fishing vessel when the skipper says he is sorry but he has lost fishing time in helping you and is claiming salvage. He also says he will keep possession of your RIB until his salvage reward has been sorted out.

This sort of nightmare scenario is not that uncommon!

There may be occasions when the boot is on the other foot and a large and powerful RIB is able to offer and claim salvage for assistance rendered to a small commercial vessel, such as a dive or charter vessel.

Although most of us will enjoy our boating without either situation ever arising, it is as well to have some basic understanding of the practicalities and consequences in the event that we are faced with either situation.

The essential elements of Salvage

Over the centuries Maritime Law has developed established definitions and the necessary requirements for salvage claims, some of which are:

Salvage – the right, under Maritime Law, to claim a monetary reward for services rendered which succeed in preserving maritime property in danger.

Maritime Property – a vessel, her equipment, cargo and freight, or wreck.

Danger – a real danger to the salved vessel or those on board such as due to the condition of the salved vessel or her crew; her position; the wind, sea and tide; that could result in the total loss of or damage to the vessel or a risk to the safety of those on board.

Services – probably the most common is towing but can include all manner of assistance such as standing by a vessel in danger until other assistance is available, placing persons on board to save the vessel from the danger.

Voluntary – those rendering salvage services must do so voluntarily and not under some existing contractual or public duty.

Success – some property must be saved for a salvage reward to be made. If life only is saved this will not give rise to a salvage reward although all persons at sea are by law required to render assistance to those whose lives are in danger at sea.


The Amount of Salvage Reward:

Either:
Agreed – verbally or in writing at the time the services are provided. Agreements for a salvage reward are usually on a “no cure-no fee” basis the most common form of which is Lloyds Open Form of Salvage Agreement (“LOF”) which leaves the amount of the reward to be determined at a later date by an independent Arbitrator who will be a Senior Admiralty Barrister appointed by Lloyds.

Or:
Fixed by the Court – as in the case of LOF the amount will be determined by the Court at a later date after proceedings for a salvage claim have been commenced by the salvors and after the Court is satisfied that the services amounted to salvage.

It is unlikely that the amount awarded for the salvage services will exceed 50% of the value of the vessel, valued after it has been salved (the “salved value”) and rewards of 50% of the salved value are fairly rare. Awards are much more likely to be a very substantially lower percentage of the salved value and will be fixed according to the circumstances of each case. The factors which are normally taken into account include the amount of danger to life and danger to property (both vessels); the salved value of the vessel to which the services have been rendered; the care, skill and knowledge of the salvors (and whether they are professional salvors); any misconduct or negligence of the salvors; the value of the salvors vessel and equipment and any particular responsibilities undertaken by them; the duration of the services and the expenses incurred by the salvors in providing the services.

Security – As security for their claim for salvage, after they have provided the services, the salvors have a right to retain possession of the salved vessel or to have the salved vessel placed under arrest by commencing proceedings in the Admiralty Court. Often the amount of security demanded by the salvors will be agreed and in some cases a guarantee may be provided by the insurers of the salved vessel which will avoid the need for it to be held by the salvors or arrested.

Receiving/Providing Assistance:

Towage – If there is no real danger to life or to your RIB and you simply need a tow into the nearest convenient port, then you may be able to negotiate with those offering to assist you a tow for a fixed sum. If so, and provided you can prove the agreement reached (preferably recorded in writing and signed), then those who provide the tow will not normally be able to claim salvage after the tow has been completed. These situations will almost certainly involve local coastguards and it may be worth advising the local coastguard of the towage arrangement you have reached and asking them to log it, so there is a record made at the time.

Salvage – If you and those on board your RIB and your RIB are in real danger, you should accept assistance irrespective of whether it will give rise to a claim for salvage. Policies of marine insurance normally cover the risk of a claim for salvage. You should not, of course, operate a RIB without adequate insurance for marine risks. Your insurers would far rather deal with a claim for salvage, rather than for the total or constructive total loss of your RIB, quite apart from considerations of preserving the lives of those on board.

Providers – Clearly, salvage will be claimed by professional salvors who operate salvage tugs etc. Salvage may also be claimed by operators of other commercial ships and fishing vessels. It is probably true to say that the majority of owners/operators of private pleasure craft tend not to claim salvage, although their status does not prevent them from doing so. Professional salvors tend to provide salvage services under agreement, using LOF.

As Salvor – Everyone on the water is obliged to provide assistance to save life. However, if you choose to go on to provide salvage services to property with a view to obtaining a salvage reward, you must bear in mind that you may receive no reward if your services are unsuccessful. If the salvage operation has not been successful, because of your misconduct or negligence, then you could face a claim by the owner of the vessel that was in distress for the loss of or damage caused to that vessel! There is also the risk that your vessel may be damaged in the course of providing salvage services. You might not be insured for these risks where property salvage is involved.

“Sea Lore”

There are many mythical “laws” that circulate among mariners, both professional and amateur alike, concerning salvage, which are often misleading and erroneous. Common examples are “I can avoid a salvage claim if I offer my tow rope instead of accepting the tow rope from the salving vessel” and “If I save a vessel when there is no-one on it, I can claim it for myself”. It would take a lot more space than is available here to answer all these types of questions. The answer has to be, do not act on this type of folklore and obtain professional advice when in doubt.

July 2002