General Average

 There is a general average act when,

and only when, any extraordinary
sacrifice or expenditure is
intentionally and reasonably made or
incurred for the common safety for
the purpose of preserving from peril
the property involved in a common
maritime adventure.
Essential elements of general
Average
 Loss must be extraordinary in nature.
 The common adventure must be in
peril.
 GA must be voluntary and intentional.
 Reasonably sacrifice or expenditure
 The general average act must be
successful.
Examples of General Average
Sacrifice:
 Use of engine to refloat a grounded
ship resulting in damage to hull and
machinery.
 Jettisoning of cargo to refloat a
grounded ship or for safety of vessel.
 Damage to cargo/ship due to use of
water to extinguish the fire.
 Loss of freight on jettisoned cargo
Examples of General Average
Expenditure:
 Tugs are engaged to pull the vessel off the
strand.(Refloat)
 Part of cargo is discharged into barges.(Refloat)
 Cargo is discharged to get at the seat of the
fire.
 Vessel is at cargo lashing given way and holed
the shipside vessel is put into port of refuge:
 Port disbursements
 Extra fuel burnt
 Wages of crew and Master
How General Average is
adjusted.
 According to the law and practice,
where the contract of
affreightment ends.
 Or as per York Antwerp Rule if
provided in COA.
Contributing values to GA
 Ship

 Cargo

 Freight.
What are York Antwerp Rules?
 These rules are applied to adjust
general average, provided
incorporated in CP, B/L or COA.
 Rules consist of rule of interpretation,
rule paramount, 7 lettered rules and
22 numbered rules.
Rules of Interpretation
 General Average adjusted as per
lettered rule.
Rule paramount 5
 No allowance for sacrifice or
expenditure unless reasonably made.
 Rule A to G specifies general
guidelines on adjustment of GA.
 Rule I to XXII specifies how GA is to
be adjusted and relates to specific GA
acts.
 Numbered Rule
 Rule I. Jettison of cargo. 
 Rule II. Damage by jettison and sacrifice for the common safety. 
 Rule III. Extinguishing fire on shipboard. 
 Rule IV. Cutting away wreck. 
 Rule V. Voluntary stranding. 
 Rule VI. Salvage remuneration. 
 Rule VII. Damage to machinery and boilers. 
 Rule VIII. Expenses lightening a ship when ashore, and consequent damage. 
 Rule IX. Ship's material and stores burnt for fuel. 
 Rule X. Expenses at port of refuge etc. 
 Rule XI. Wages and maintenance of crew and other expenses bearing up for and in a port of
refuge, etc. 
 Rule XII. Damage to cargo in discharging, etc. 
 Rule XIII. Deductions from cost of repairs. 
 Rule XIV. Temporary repairs. 
 Rule XV. Loss of freight. 
 Rule XVI. Amount to be made good for cargo lost or damaged by sacrifice. 
 Rule XVII. Contributory values. 
 Rule XVIII. Damage to ship. 
 Rule XIX. Undeclared or wrongfully declared cargo. 
 Rule XX. Provision of funds. 
 Rule XXI. Interest on losses made good in general average. 
 Rule XXII. Treatment of cash deposits. No allowance for sacrifice or expenditure unless
reasonably made.
 Rule A to G specifies general guidelines on adjustment of GA.
 Rule I to XXII specifies how GA is to be adjusted and relates to specific GA acts.
Procedure after GA Act
 Master to declare GA at POR or at
destination.
 S/o responsible for GA adjustment and
receiving contributions.
 Notify consignee of GA act.
 Appoints AA.
 Make declaration of GA as per law and
customs of port.
 Obtains appropriate security from
Consignee.
 Documents required by AA
 Deck and Engine Log book.
 Master note of protest.
 Master and C/E reports on Facts.
 Survey report on ship’s damage and repairs.
 Survey report on cargo damage.
 Salvage contract and report on salvage operation.
 Bell Book, statement of bunkers and fuel for re
floating.
 List of jettisoned cargo.
 Statement of quantity of cargo discharged,
reconditioned, stored and reloaded.
 Accounts for disbursements
including
 All accounts for disbursements with supporting
vouchers.
 Portage bill and statement of crew's victualling
(with indication of scale thereof) during
prolongation of voyage and extra period of
detention at port of refuge.
 Statements for bunkers and stores consumed
during the aforesaid period (with unit price).
 Off-hire sheet for ships under time-charter.
 Other documents including
 Cargo stowage plan, manifest and freight list.

 Charter party and bills of lading.

 Ship's particulars.

 Hull policy.

 Copies of letters, cables and telexes relating to

the accident.
 General Average Security
 Security for G.A. to be collected by S/O
from Cargo owner after declaration of G.A.
or prior discharging of cargo.
 Deposits to be either in cash or deposits in
case cash is not collected.
 The A.A draws up statement of adjustment
on the basis of all documents collected.
 Statement of average adjustment does not
binding force by law, if parties not
satisfied, make settlement thru negotiation
or by legal proceedings(arbitration or
litigation).