In light of the FRONT ALTAIR and KOKUKA COURAGEOUS incidents this week it is likely that the remaining handful of international salvors will now up their presence in and resources from the UAE, so as to respond in the event of further attacks. Some may mobilise under responder agreements but where, as in the case of the FRONT ALTAIR, serious harm is inflicted, Lloyds Open Form is the go-to contract for both owners and salvage contractors alike.

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Firstly, LOF ensures that cargo interests contribute to the salvage award – a bonus for both claimants and hull underwriters. GA may still be declared, and so port of refuge expenses, crew, deviation, temporary repair and likely transhipment costs will be shared pro-rata to values. Early engagement of cargo receivers and charterers, as stakeholders, may also enhance the prospects of negotiating access to a suitable port of refuge.

Secondly LOF is considered a reasonablecontract for owners to enter into, automatically binding charterers and cargo. Unless owners have unlawfully deviated into a High Risk zone or fail to plan and comply with safety warnings or procedures, there should be no issues in principle between stakeholders under any contract of carriage incorporating the Hague Visby Rules or charterparty applying English law. Agreement to LOF has the less obvious but important practical benefit of ensuring that cargo and chartering interests are legally represented in London, creating in turn a forum for discussion and constructive cooperation in the hands of experienced professionals.

Past Gulf War awards and settlements are testament to the potentially high rewards payable to salvors in what tend to be high salved value cases. Applying the award criteria of article 13 of the 1989 Salvage Convention, key for the salvors will be the recognition given to a rapid mobilisation of experienced salvage and fire-fighting crew and their engagement of suitable floating assets in the locality. The latter are likely to be on enhanced daily rates under amended TOWHIRE terms but equally, in appropriate cases, an ISU Award Sharing Sub-Contract (2001) form can be agreed. Effective fire-fighting will be the main benefit conferred, followed by securing of any breach to prevent pollution and towage to a port of refuge. Subsequent cargo operations will invariably fall outside of the salvage operation but will only be permitted once salvage security has been lodged in London.

LOF also recognises services rendered prior to agreement. Therefore where assistance has been provided by potentially competing salvors, for example boundary cooling or holding the vessel to wind or evacuating crew, the Form is entirely flexible so as to accommodate a situation where one responder is then brought under the wing of the LOF contractor, the former’s efforts forming part of the latter’s claim.  There is much merit in reducing competing claims and security demands particularly in jurisdictions that, understandably, may have little applied knowledge of salvage law and practice.  Likewise, important will be the status of the salvors and their commitment to and investment in salvage.  As such, professional salvors with international reach will invariably be awarded more than a local salvor.

A particular risk run by salvors, as seen in the FLAMINIA case, is the prospect of an extended TOWHIRE at contractor’s expense pending admission to a port of refuge: ultimately however this will be rewarded along with an acknowledgment of successful efforts to gain access to a suitable port but it may not always be the outcome that the owners of a hired-in towage vessel will have bargained for.

It seems that sub-surface mines and torpedoes have replaced the hand-fired self-propelled grenades predominantly employed in the Gulf War to disable tankers and threaten shipping lanes: the reason being that, unlike in 1987, deployment of a craft with hostile intent will be only too readily spotted and the perpetrators identifiable. Whilst the current attacks will not be so dangerous to crew in the ship’s accommodation, it is the engine room crew now most at risk during manned watches. The salvors will rightly contend that their willingness to operate in a declared JWC listed area, a High Risk and/or Marsec 1-3 areas should lead to an enhanced award. What led to awards escalating to a greatly enhanced level however in the second phase of the Gulf War conflict, was a reported attack on a salvage tug.

From the owners’ perspective, if the crew or a skeleton crew can remain on board ensuring the vessel’s own fi-fi or smothering gear is deployed and monitored, that prompt information on cargo type(s) and arrangements together with ship’s fi-fi arrangements and kit is supplied to salvors, this will help to keep a lid on the level of award. Little things such as the lowering of the accommodation ladder to allow salvage personnel to board are useful factors.  Occasionally ill-directed or non-professional efforts by responders cause more harm than good but if no crew are around to witness that, it’s possible that the LOF arbitrator, tasked with assessing the award, might not get a truly balanced view of the evidence. Finally of course, as soon as the fire is out and safe access on board is permissible, owners and cargo interests should be placing fire expert chemists on board to assess the degree of danger that would have been faced by the salved property “absent assistance”.  It is usually best that these inspections are done on a joint without prejudice basis to minimise unnecessarily conflicting expert evidence and associated costs.