Salvage

 Is Service or act rendered voluntarily

to maritime property in peril with
resulting benefit to property or the
environment.
Elements of Salvage
 Maritime Property.

 Voluntary service.

 Peril.

 Success.
Rights and duties of Salvor
 Salvage Award.

 Special Compensation.

 Maritime Lien on property.

Rights and duties of Salvor to
owner of the Vessel
 Carry out Salvage operation with due
care.
 To exercise due care to prevent or
minimize damage to environment.
 If reasonably require, seek assistance
of other salvor.
 To Accept Intervention of other
salvors when master of vessel
requests so.
Rights and duties of Master
 Duties of every master to render any
person in danger of being lost at sea.
To the salvor:
 Cooperate fully during salvage operations.

 Exercise due care to prevent or minimize

damage to environment.
 To accept redelivery of vessel when

brought to place of safety as requested by

salvors.
Criteria for fixing salvage award
 Salved value of Vessel and property.
 Skill and efforts of Salvors to minimize damage to
environment and property.
 Measurement of success obtained by salvor.
 Nature and degree of danger.
 Time used, expenses and lossses incurred.
 Risk of liability and other risks run by salvors and to
his equipment.
 Promptness of services rendered.
 Availability and use of vessels and other equipment
for salvage operations.
 State of readiness and efficiency of salvor’s
equipment and the value thereof.
Special compensation
 If no reward, can receive special compensation
only if averting or minimizing loss to
environment.
 Includes out of pocket expenses and fair rate of
equipment and personal.
 Could be 0% to 30% of the expenses incurred by
salvor or upto 100% as decided by tribunals.
 Only paid if compensation is greater than reward.
 If salvor is negligent and failed to prevent or
minimize damage to environment, no
compensation.
Salient Features of ISC 1989
 Define salvage operation, vessel, property, damage to
environment.
 Provides that duty of Salvor to prevent or minimize
damage to environment can’t be altered in contract.
 Provides that Master has express authority to
conclude the salvage contract on behalf of vessel and
property abroad that vessel.
 Sets out the duties of Salvor, Master and includes that
due care to be exercised to prevent or minimize the
loss to environment.
 Master’s duty to render assistance to nay person of
being lost at sea.
 No Cure No pay, amended by special compensation.
Salient Features of ISC 1989
 No remuneration from person whose
life is saved.
 Contract under duress or unequitable
may be modified.
 If negligence on part of salvor, can be
deprived of reward and special
compensation.
 Provides for security, interim
payment and maritime lien.
Nagasaki spirit and Ocean Blessing
 19 Sep,1992 collision betn N. Spirit and Ocean Blessing @
Northern part of Malacca Strait.
 Onboard N.Spirit 40154 T of Khafji Crude Oil.
 Due Collision, 12000T of crude spilled into sea and caught
fire.
 Both ship engulfed in fire.
 All crew member of Ocean Blessing died and only 2 crew
member of N.Spirit escaped.
 20 Sep, @ 0900 hrs SemCo Salvage and marine pte ltd
agreed to salve N. spirit on terms of LOF 1990. Also agreed
to salve Ocean Blessing under LOF 1990 terms.
 Same day SemCo Employed numbers of tugs and com’d
extinguishing fire.
 At 1220 hrs on 26 Sep fire extinguished.
Case Study continued
 At 1700 hrs on 26 Sep, malaysian police asked
SEMCO to tow away v/l away from coast due fear of
pollution.
 On 3rd Oct, at 1403 hrs N.Spirit anchored off Belwan
in Indonesia and remained there.
 On 22nd Oct, Indonesian authority gave permission for
Transshipment.
 AT 0025 hrs on 29 Oct Transshipment comd at
different location with Pacific Diamond.
 At 1400 hrs on 25th Nov She was towed to Singapore.
 At !500 hrs, 12 Dec N.Spirit was handed over to
Owner afloat at singapore Quay.
Further on Case Study
 Special Compensation claimed by
SEMCO was much more than
S.A( approx 140%) from owners.
 Owners refused to pay the special
compensation to SEMCO and Make an
appeal in the court of law.
What does Lof 1990 says reg
Special Compensation in Article 14
 If salvor failed to earn S.A but prevented
damage to environment, entitled for special
compensation equivalent to his expenses
from owners.
 Special compensation can increased upto
30% of the expenses incurred by salvor by
Arbitrator.
 Can be further increased to 100% by
tribunals.
 Salvor can’t make profit of his expenses.
 Salvor can claim for Spl comp > S.A.
What are Salvor’s Expenses
 O.P.E = Out of pocket expenses.
 F.R.E & P = Fair rate of equipment
and personnel.
Nagasaki Spirit
 Spl Comp > S.A.
 Entitled for spl comp.
 F.R.E & P = Calculated from the time
tug departed Singapore.
 Spl Comp Enhanced by 60% by
Arbitrator.
 Spl comp was reduced accordingly.
Result
 I.S.U refused to do any Salvage operation.
 P&I club was in problem to pay for marine
pollution.
 An agreement Betn I.S.U and P&I club.
 First time SCOPIC was included in LOF
2000.
 Was on trial for 2 years before finally came
into force.