Salvage case makes waves

Arbitrator makes welcome decision to disregard the long-debated salvage distinction

Ferrer

In a recent appeal, the Lloyd’s open form appeal arbitrator, Sir David Steel, has revisited the salvage danger known as “immobilised until professionally assisted” and the long-debated fine distinction as to whether or not “professional” assistance is required in different situations which impacts on the remuneration for salvage.

In cases involving rescue by towage or simple refloating of an immobilised vessel, the physical risk to which a vessel is exposed is often minimal. The weather may be benign, the hull may be intact and the vessel may not be at risk of damage. The only danger to which she is exposed is immobilisation. In such a situation the distinction between immobilisation requiring a professional salvor and some less serious immobilisation is an important one, as it has a significant impact on the financial level of the award. 

The recent Evanthia M case helps to clarify this. The appeal arbitrator dispensed entirely with this long-debated distinction holding that it was “unreal or at least as lacking any useful specificity”.

The facts were unremarkable: the vessel suffered an engine breakdown which was irreparable at sea. A salvage tug was engaged and the vessel was towed to safety. The salvage arbitrator had held that “this small casualty required a simple and straightforward towage service in the benign conditions of the Mediterranean in summer. The service was well within the capabilities of any relatively modest tug with a towing capability”. 

The arbitrator therefore rejected the submission by contractors that a reasonably prudent and skilful person would not refuse an offer of help from a professional salvor. 

The appeal arbitrator later found that it was not possible to make such a “demarcation in any reliable or coherent manner”. 

Sir David Steel held that: “Of course the quality of the services required by a vessel in the salvage context will have a significant impact in the assessment of any award. If success is achieved, the remuneration will reflect the skill and efforts of the salvors, the time used and expenses incurred, the risks run, the promptness, the availability and use of equipment and the date of readiness and efficiency of the salvors’ equipment and values. The greater the extent to which quality services are rendered, the more likely they are being performed by entities which can claim professional status. 

“But I do not subscribe to the view that it is possible to justify a step change in terms of dangers from a vessel needing assistance to a vessel needing substantial assistance.” 

The appeal arbitrator was aware that the alleged rationale for the distinction was that the use of non-professional salvors carries with it a risk of further damage to the casualty, but he considered that “it does not justify some clear distinction between professional assistance and the rest”. 

While the removal of the distinction between “professionally assisted” and “assisted” is likely to be controversial, it is a welcome change which reflects the fact that those engaged in salvage services are often the same as individuals involved in commercial towage contracts.