LECTURE ON

MARITIME AND SHIPPING LAW

Kazi Murad Hossain
Assistant Professor, Law Discipline,
Khulna University, Khulna.
 TOPIC OF DISCUSSION

• Deviation of Voyage.
• Law of Salvage
• Maritime Perils.
• Documentation and procedure of recovery of damages from carriers
 DEVIATION OF VOYAGE IN MARINE
INSURANCE
• Deviation in marine insurance happens when the ship intentionally changes its
route or remains in port without cause, here, the new route or delay of the ship
would be called deviation.
• Unless the marine insurance states otherwise, there is a breach of the insurance
contract by the party which is responsible for the deviation.
 CIRCUMSTANCES UNDER WHICH DEVIATION
WOULD BE EXCUSED
• However, there would be no breach, if a ship deviates from the path on its own. Like in
case of unfavourable weather condition or to save the life, deviation would be covered
by the marine insurance policy.
• The following are the circumstances under which deviation would be excused=
• Where deviation happens due to circumstances which are beyond the control of the
policyholder
• Where deviation is necessary to ensure the safety of the ship or the insured items
 CIRCUMSTANCES UNDER WHICH
DEVIATION WOULD BE EXCUSED
• Where deviation is required for saving the human life
• Where deviation happens to obtain medical or surgical aid for the
person who is onboard the ship
• There could be other situations as well where deviation would be
permitted, and therefore, read your marine insurance policy document
for more information.
 LAW OF SALVAGE

• The law of salvage is a principle of maritime law whereby any person who helps
recover another person's ship or cargo in peril at sea is entitled to a reward
commensurate with the value of the property salved.
• Maritime law is inherently international, and although salvage laws vary from one
country to another, generally there are established conditions to be met to allow a
claim of salvage.
•
 LAW OF SALVAGE

• The vessel must be in peril, either immediate or forthcoming;

• the "salvor" must be acting voluntarily and under no pre-existing contract; and
• the salvor must be successful in their efforts, though payment for partial success may
be granted if the environment is protected.
 THE BASIS OF MARINE SALVAGE LAW

• With its origins in antiquity, the basis of salvage is that a person

helping another at sea is putting himself and his vessel at risk and
should be appropriately rewarded.
• A related consideration was to prevent piracy, since any vessel in peril
might well be abandoned to pirates if the owner did not reward an
honest salvor.
• Salvage law has been recognized for centuries in such documents as
the edicts of Rhodes and the Roman Digest of Justinian.
 THE BASIS OF MARINE SALVAGE LAW

• It is still a nearly universally recognized right, though conditions for awards of

salvage vary from country to country.

• The right to be rewarded for salvage at sea is based both on principles of

fairness and public policy; The law seeks to be fair both to the property
owners and to the salvors.
• The legal entitlement to a salvage reward arises when a person, acting as a volunteer
(that is, without any pre-existing contractual or other legal duty so to act) preserves
or contributes so to preserving at sea any vessel, cargo, freight, or other recognized
subject of salvage from danger.
 THE BASIS OF MARINE SALVAGE LAW

• A salvage situation arise when a shipowner accepts an offer of help from a salvor.
• To that extent, the arrangement is contractual, but it is not a contract for services with
a pre-arranged fee.
• Instead, the law provides that after the service is done a court or arbitrator will make
an award taking into account:
• the degree of success of the salvage venture
• the degree of danger of the salvage venture
• the value of the property salved
 THE BASIS OF MARINE SALVAGE LAW

• A formal contract is not strictly necessary, provided there is evidence that the owner
has acquiesced in the salvor's intervention.
• The assumption here is that when faced with the loss of his vessel and cargo, a
reasonable prudent owner would have accepted salvage terms offered, even if time
did not permit such negotiations.
• Even so, the shipowner is entitled to reject any offer of help, and would do so if the
shipping line had already made arrangements with a professional salvor of their
choice.
 THE BASIS OF MARINE SALVAGE LAW

• There is no equivalent to salvage when ashore: a person who assists another on land
has no entitlement unless a court deems that an implied contract had arisen, whether
objectively or subjectively.
• Salvage is distinct from Prize law, which is the seizing of property from the enemy at a
time of war, for which a reward is made by the Admiralty Court sitting as a Prize
Court.
 RECOGNIZED SUBJECT MATTER

• Traditionally, salvage only recognizes a ship or craft ("vessel"), cargo on board,

freight payable, and bunkers carried on board as the subject of property in danger.
• The scope of salvage has been expanded by the 1989 Salvage Convention, and
protection of the environment is part of salvage. Oil pollution can cause damage to
the environment. If the salvor prevents oil pollution from happening, he indeed
performs a valuable service to the community as mentioned by (1997) 1 Lloyd's Rep
323 (HL), pp 326–28.
 RECOGNIZED SUBJECT MATTER

• Therefore, the salvor will be rewarded with special compensation, i.e., liability
salvage instead of property salvage.
• The Convention does not consider saving lives to be part of salvage, but if one vessel
saves life and the other saves property, the arbitrator may apportion the salvage
reward between them as he thinks fit.
 REAL PERIL

• Danger needs to be real but not necessarily immediate or absolute. The subject of salvage must be
in real danger, which means the property is exposed to damage or destruction.
• The burden of proof lies on the salvor, which means the salvor needs to prove real danger existed
when the performance of service commenced. The court or arbitrators must determine whether the
property was truly in danger. As every situation differs, both subjective and objective tests will be
conducted. Common considerations are:
• Would a reasonable Master of the vessel in distress have answered yes or no to the offer of assistance?
• Was there a real apprehension of danger even though that danger may not have been absolute or
immediate?
• Was the danger fanciful or so remote as only to be a distant possibility?
 REAL PERIL

• It is incumbent upon the court to assess the existence and level of danger, both present and future.
• The case of the Troilus (1951 1 Lloyd's Rep. 467, HL) illustrated the concept of future danger that the
court must take into account when determining the existence of danger. In this particular case, the
cargo owners contended that the ship was in perfect safety when she reached Aden, and therefore it
constituted ocean towage but not salvage when towing from Aden to UK. The court held that even
though the ship and cargo was in physical safety, the services rendered still amounted to salvage
service on the grounds that the master of a damaged ship must do his best to preserve the ship and
cargo and bring them to their destination as cheaply and efficiently as possible. The salvage award
was reasonable as long as the master acts reasonably for the combined benefit of ship and cargo.
• In the modern world, the dispute normally is not about whether there is just the existence of danger,
but also the degree of danger, as it determines the extent of the award.
 TIME LIMIT TO CLAIM THE SALVAGE

• Article 23 of the 1989 Convention provides for a two-year limit to commence judicial or
arbitration proceedings arising from a salvage claim.
• The limitation commences on the date on which the salvage operations are terminated.
• During the two-year period, an extension of time can be agreed by parties.
• An action for indemnity by a person liable may be instituted after the expiration of the
limitation period with the assumption that it is brought within the time allowed by the
states in which the proceedings are brought.
• However, if the ship is not saved and the loss was due to the salvor's negligence, the time
limit to bring action against the salvor will be based on the tort of negligence.
 MARITIME PERILS

• Maritime Perils means the perils or dangers incidental to the navigation of the ship at
sea. This Includes
• Perils of the sea (Act of winds, waves and other forces of nature)
• Fire
• Act of war
• Act of public enemies
• Act of God/Vis Major/Force Majeure/ Force Major
 MARITIME PERILS

• Piracy
• Robbery, theft or pilferage
• Capture by alien enemy
• Restraint of princes, detainment by rulers and government of people
• Jettison
• Any other perils similar to one at the land.
 LOSSES COVERED BY PERILS OF SEA ARE:

• Loss of cargo caused by vessel striking upon a submerged rock or wreck

• Loss due to fouling or collision
• Loss brought about by ship’s crew by negligence so long is not willful
 LOSSES COVERED BY PERILS OF SEA ARE:

• Loss or damage to grains due to ingress of moisture when the ship sails through
rough weather.
• Loss or damage to grains by heating of compartments when the ship sails through
rough weather and the ventilations of the compartments are closed.
• Damage of cargo caused by entrance of seawater through rat holes.
 LOSSES NOT COVERED BY PERILS OF
SEA ARE :
• Loss or damage of cargo due to chemical reaction with seawater.
• Action of worms on Timbers/Woods etc.
• Death of cattle carried as cargo due to shortage of fodder on elongation of ship’s
voyage.
DOCUMENTATION AND PROCEDURE
OF RECOVERY OF DAMAGES FROM
CARRIERS
6 STEPS TO TAKE WHEN YOUR FREIGHT IS
DAMAGED OR LOST
• Let’s walk through this step-by-step to determine the proper course of action when
something goes wrong with your freight.

• 1) Take a close look at delivered freight and inspect all details. Pay attention to every
part or item; open crates if needed – there could be concealed damages. Determine
what exactly is stolen, missing or damaged. Don’t be intimidated by the driver, who
can claim he or she is in a hurry for the next route – you have a right to record all
details necessary.
 CONT…

• 2) Write everything down and take photos, if possible.

• The more documentation, the better. Make notes of damages and shortages on the
Bill of Lading and make sure the carrier is aware of the situation as soon as possible.
• Don’t underestimate the importance of communication and cooperation; carriers can
try to salvage, re-deliver or return the freight if damage or shortage statement was
passed on quickly enough.
 CONT…

• 3) Do not refuse a shipment and never discard damaged freight.

• If shippers get rid of the freight, they may not be paid the full freight claim amount.
• So keep all freight and packages intact if possible.
 CONT…

• 4) Fill out the proper freight claim, shipping claim, cargo claim or transportation claim
paperwork.
• It is a legal request to a carrier for financial reimbursement on damaged or lost freight.
The freight claim is created to recover costs for the shipper, but not the profit, only the
difference between the original value and the damaged value.
• So, the shipper must determine a reasonable dollar amount for the claim – it is the
shipper’s legal obligation to minimize the cost of claim.
• The carrier must acknowledge a claim within 30 days of initial filling. Concealed damages
and shortages should be reported to the carrier within 10-15 days of receipt of the load.
 CONT…

• 5) Pay the freight bill as soon as possible.

• The shipper is still responsible for payment of goods’ transportation, even if there are
damaged, lost or stolen freight.
• The claim will be processed by an insurance company.
 NECESSARY DOCUMENTS

• 6) Keep all necessary documents:

• A copy of the bill of lading
• A copy of the freight bill (paid)
• A copy of the invoice showing the amount paid for the goods
• A copy of the packing slip
• A standard claim form or a letter identifying the shipment and the claim amount
• Photos of the damage
 IMPORTANT LINKS

• https://knowledgeofsea.com/salvage/
• https://www.marineinsight.com/maritime-law/laws-of-salvage-10-things-you-must-
know/
• https://www.spacelegalissues.com/the-law-of-salvage/
• https://www.linkedin.com/pulse/types-losses-marine-insurance-daanish-shaikh
• https://www.iedunote.com/types-of-marine-losses
ANY QUESTION?
Thank you