Arielle Shipping Ltd v Owners of the “Lady Emma” [1993] FJHC 11; HBG0003j.1991s (11 February 1993)

Marine Salvage- contract for towage service- not agreement for salvage

The defendant’s vessel, the ‘Lady Emma’ was blown ashore and grounded high and dry as the result of a cyclone. After 2 failed attempts by a salvage company to refloat the vessel, the defendant asked the plaintiff , captain of the vessel ‘Arielle’ to pull the ‘Lady Emma’ free from where she was stranded. The ‘Arielle’ had been used to tow oil rigs but was not designed for salvage operations and had never been used as such. The plaintiff advised the defendant that he considered that the ‘Lady Emma’ could be towed off the reef. The plaintiff asked the defendant to supply the salvage equipment and the diver and stipulated a $3000 per day charge whether or not the operation was successful. A $3000 deposit was paid and the plaintiff tried to refloat the vessel for 3 days, but was unsuccessful. The defendant refused payment claiming that the operation was not carried out in a workmanlike manner.
DECISION: Action allowed
HELD: The plaintiff agreed to perform a towing job. This was evidenced by the oral agreement between the parties and by the fact that the defendant paid a $3000 deposit. The defendant required a salvage operation. The court compared towage and salvage services where salvage is voluntary with no title to award unless the ship freight or cargo is saved. The court was of the view that this was a contractual towage service for which payment was agreed. The duty of care of the plaintiff was not that of a salvage contractor undertaking a continual obligation until the ship is lost or salvaged. The plaintiff’s duty of care was that he use reasonable skill and care in the provision of the services.

Bohn v Vanuatu Maritime Authority [2001] VUSC 127; Civil Case 115 of 2000 (9 September 2001); Bohn v Vanuatu Maritime Authority [2003] VUSC 137; Civil Case 115 of 2000 (28 April 2003)

Marine salvage- contract to salvage terminated when salvage operation almost complete- party contracted to salvage entitled to reasonable value of work done The parties contracted for the salvage of 2 vessels that posed a safety threat to the harbour. The contract stipulated that the work was to be completed in 30 days. The plaintiff encountered many difficulties in the operation particularly in finding equipment and competent personnel. After 37 days the plaintiff wrote to the defendant requested an extension of the allowable time to complete the contract. The defendant failed to respond and the plaintiff continued with the salvage operation on an implicit understanding. After 4 months on the job the parties had a difficult relationship frustrating the operation further. After nearly 8 months the salvage was completed and arrangements were made to scuttle the vessels. The defendants appeared to have encouraged the plaintiffs to complete the contract after the time period. However the defendant refused to pay on the basis of a breach of the contract in that the plaintiff did not complete in time. The defendant claimed that work done by the plaintiff after the expiration of the contract was as a voluntary salvor, and the defendant challenged the competency of the work done. The plaintiff claimed quantum meruit for the value of the work done under the contract.
DECISION: for the Plaintiff
HELD: The defendant had the right to terminate the contract. However when the contract was terminated most of the work had been completed. The court found on the evidence that the work had been done competently. Therefore the plaintiff was entitled to a reasonable value of the work done.

Mauitoga v Consort Shipping Line Ltd [1995] FJHC 16; HBG0003j.1994s (18 January 1995)

Marine salvage- Apportioning the share of the owner of the salving vessel

The owner of a salving vessel received a $25,000 award for the salvage of a vessel. The salvage was undertaken by the Captain and crew of the salving vessel and these parties applied to the court for a determination of the proportion of the award that they were entitled to. The owner of the salving vessel argued that no apportion was necessary as wages had been paid during the salvage operation.
DECISION: 75% to the owner and 25% to Captain and crew (of the latter amount, 1/3 to the Captain and the rest divided amongst crew members
HELD: Although the Captain and the crew members were paid their usual wages as employees of the vessel owner, according to maritime practice they were entitled to their respective share in the reward. Since 1883 and the demise of sail, the apportionment to the owner has been generally 75%.

Owner of the Ship Classique v Marine Services Ltd [1993] SBCA 3; CA-CAC 008 of 1992 (30 June 1993)

Marine salvage- quantum- claim for salvage is not a claim for a liquidated amountanalogous to a claim for damages at common law. Jurisdiction- Lloyd’s contract provided for arbitration to proceed in London, but court would not allow challenge to jurisdiction 2 years after defendant had taken a step in the action.

The salvor claimed $85,000 for salvage. The vessel was arrested, but the owner took the ship out of the jurisdiction in contempt of the court ordered arrest. Subsequently the salvor was awarded judgment of $85,000 in default. The trial court upheld the judgment, and the owner appealed on the grounds that the judgment was irregular, no evidence having been considered in establishing quantum. The owner also disputed jurisdiction, arguing that the contract provided for arbitration in London.
DECISION: Appeal allowed.
HELD: The judgment was irregularly obtained because there was no evidence at all before the Judge supporting the quantum of the judgment. As to jurisdiction, the defendant could not challenge jurisdiction 2 years after it had entered an appearance.

Seafreight Pty Ltd v The Ship ‘Manutea’ [1975] PGSC 28; [1975] PNGLR 64 (29 March 1975)

Marine salvage- Lloyd’s “no cure- no pay” agreement- claim must be quantified to be considered proper claim for purposes of arrest of vessel for security

The defendant ship (Manutea) was successfully salved by the plaintiff. During the extensive tow the two captains entered an oral salvage agreement which was to be in terms of a Lloyd’s Salvage Agreement described as a “no cure- no pay” agreement. Contrary to the agreement the salved ship was moved from her place of safety without the consent of the salvor. The plaintiff had her arrested and filed an in rem claim for salvage fees. The claim for salvage fees was made after the arrest. The owner of the Manutea applied for an order to set aside the warrant to arrest and to release the vessel from the arrest made under the warrant.
DECISION: Order granted
HELD: The court looked at clauses 4 & 5 of the contract. Pursuant to this contract the salvor must notify Lloyd’s of the amount for which he requires security be given- this was not done by the salvor in this case. The contract also provided that the property would not be arrested or detained unless security was not given within 14 days. The court decided that there was a period after the successful salvage operation and before the claim under a “no cure- no pay” agreement where there is no maritime lien except where there is reason to believe that removal of the salved property is contemplated. The ship had been moved without the consent of the plaintiff but the court found that there was good reason to move the ship and it had not been moved to a foreign port. There had not been a claim made for salvage at the time of the arrest because at that time the claim had not been quantified.