IN THIS ISSUE
1. Hong Kong Maritime Week
2. Brexit Destinations Knowns and Unknown for P&I Clubs
3. No Coverage for Boating Accident Due to Breach of Operator Warranty
4. Gracious Living Above Kwai Tsing Terminal
5. Kiss the Good Times Good bye
6. People and Places
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1. Hong Kong Maritime Week
There was a time many years ago when the merits of Hong Kong were deemed self explanatory and the maritime industry players there got on with running their businesses for profit and without fuss. Nowadays great efforts are made to put the best foot forward to attract people to Hong Kong to play a part in a thriving regional centre which straddles the east and west with practised ease. Your editor spent many years in Hong Kong in an office overlooking a small dock in Wanchai and the project building the new Exhibition Centre. In those days it was said that one in five jobs in Hong Kong were related to the port and maritime industries. Moving from Hong Kong to one of the more traditional maritime centres on the Atlantic has been described as moving from colour TV to black & white.
Jointly organised by the Hong Kong Maritime and Port Board, Hong Kong Shipowners Association and Hong Kong Maritime Museum, the second edition of the Hong Kong Maritime Week (previously known as Hong Kong Maritime Industry Week) will be held from 19 to 26 November 2017 to “Propel Hong Kong” as a renowned international maritime centre.It is billed as an intensive week of multifarious maritime activities. The organisers have sent in a schedule of the week’s event which can be accessed below. With 50 events to choose from, there may be quite a lot of pressure time and endurance.
http://www.hkmw.hk/english/event.html
Here is the latest newsletter sent out by the organisers:-
http://www.hkmw.hk/english/HKMW%20ebulletin%20no.5/HKMW%20ebulletin%20no.5(Eng).html
One event close to the hearts of a few of our Readers may be the evening event on Monday organised by The Hong Kong and Mainland Legal Profession Association with speakers from the Department of Justice (policy maker), in-house counsel from shipping company (end-users), shipping solicitor (facilitator) and a maritime arbitrator. This interactive panel discussion aims to discuss how Hong Kong can take advantage of the Belt and Road and Great Bay Area Initiatives to become a regional maritime hub and a regional maritime arbitration centre.
http://www.hkmw.hk/english/event_detail.html?id=112007
2. Brexit Destinations Knowns and Unknown for P&I Clubs
This small item in Lloyd’s List caught our eye:-
“Meanwhile, it seems Brexit really does mean Brexit for P&I Clubs. The Netherlands is the most likely location of a potential subsidiary to enable the Britannia Club to continue trading on equal terms within the European Union after Brexit. The revelation comes as speculation grows that many British-based clubs are considering similar options as the likely date of Britain’s departure from the EU, currently planned for March 2019, draws nearer. The UK Club may be heading to Luxembourg, while North of England and Standard are thought to be considering Dublin. ”
The West of England has long experience of the luxembourgios insurance regulator, as does British Marine [ed]
3. No Coverage for Boating Accident Due to Breach of Operator Warranty
Jason P. Minkin and Jonathan A. Cipriani of BatesCarey in Chicago write:-
Under maritime law, a breach of a promissory warranty in a maritime insurance contract excuses the insurer from coverage. This principle was applied recently by a federal district court to void coverage for a boating accident where the vessel, at the time of the accident, was operated by an individual who was not named as an operator under the marine insurance policy’s operator warranty. See Maclean v. Travelers Ins. Co., 2017 WL 4873495 (D. Mass. Oct. 26, 2017). The court’s ruling is a reminder that breaching an operator warranty may result in a loss of insurance coverage.
In August 2013, Kevin and Donna Maclean boarded the M/V NIKKI to enjoy a “lightning speedboat adventure” in Boston Harbor. According to the Macleans, the speedboat was traveling at high speed when it crossed the wake of another boat, tossing the Macleans into the air, resulting in serious injuries.
The owner of the M/V NIKKI had purchased commercial marine insurance cover through Travelers Property Casualty Company of America. The policy contained two relevant provisions. First, the policy contained a choice of law provision providing that it “shall be interpreted in accordance with the provisions of Federal Maritime Insurance Law.” Second, the policy contained a Named Operator Endorsement, which required that any operator of the vessel be approved by Travelers and listed in a Named Operator Schedule. The endorsement further provided that coverage under the policy “is null and void when the vessel is operated by anyone other than the persons listed in the Named Operator Schedule.”
At the time of the accident, the vessel was operated by an individual who was not named as an operator under the Named Operator Endorsement. For this reason, Travelers asserted that the operation of the vessel breached the policy warranty, and thus the M/V NIKKI’s owner was not entitled to defense or indemnity coverage.. The owner assigned rights to the Macleans, who then sued Travelers, seeking a declaration that Travelers was required to provide coverage.
The court sided with Travelers. Under maritime law, according to the court, “a breach of a promissory warranty in a maritime insurance contract excuses the insurer from coverage.” The court explained that the Named Operator Endorsement was a promissory warranty because it was a provision “by which the insured stipulates that something shall be done or omitted after the policy takes effect and during its continuance.” Because the policy itself stated that it would be “null and void when the insured vessel is operated by anyone other than those persons listed on the Named Operator Schedule,” and because the incident occurred when someone other than a listed operator was operating the vessel, the policy’s coverage, according to the court, did not extend to the accident.
Separately, the Macleans argued that the policy was ambiguous, requiring it to be construed in favor of coverage. Specifically, they argued that the vessel operator had in fact been added to the Named Operator Schedule-two days after the accident. They submitted that the policy was silent about “retroactive approval” of Named Operators, which should result in coverage. The court rejected this argument as well. While the theory was “clever,” “it does not square with the clear text of the policy which is void when operated by a non-listed operator.” For this reason, the court declined to create ambiguity where none existed.
In Maclean, the court strictly enforced the operator warranty to preclude coverage where, as was the case here, the vessel was being operated in breach of the warranty at the time of the accident. The case is a reminder of how, under maritime law, an operator warranty will be applied as written to void coverage for an accident when the vessel is operated by a non-listed operator.
4. Gracious Living Above Kwai Tsing Terminal
Visitors to Hong Kong will be struck as your editor was once upon a time at how the modern financial centre of Hong Kong lives cheek by jowl with the container industry and looks out on the unlikely stevedoring improvisation known as mid stream barging. A public consultation will ask next March what people would feel about living in flats based on high pontoons above the Kwai Tsing Container Terminal . Or would they prefer to see the facility moved somewhere else?
Read the story here:-
http://tinyurl.com/boxportpontoon
5. Kiss the Good Times Good bye
Continuing the long speculation that it is arrevederci to the motor car as we know it we feature this week a piece Bob Lutz which appears in Automotive News
The auto-industry elder statesman declares in this essay that the game is over. “It saddens me to say it, but we are approaching the end of the automotive era. Travel will be in standardized modules. The end state will be the fully autonomous module with no capability for the driver to exercise command. The tipping point will come when 20 to 30 percent of vehicles are fully autonomous. Countries will look at the accident statistics and figure out that human drivers are causing 99.9 percent of the accidents”
We can well imagine Hong Kong as an early adopter of the technology.
6. People and Places
Hill Dickinson is pleased to announce that partner Sumeet Malhotra has joined its Singapore office. Sumeet is qualified as an advocate in India and as a solicitor in England & Wales. He began his career as an advocate at the Mumbai Bar, practicing at a Chambers which specialised in shipping and commodity trading matters.
He went on to occupy an in-house position at Bernhard Schulte Shipping in Hong Kong, where he dealt with charterparty disputes, marine casualties, crew compensation claims, piracy matters and ship manager’s liability claims.
More recently, Sumeet has worked at senior in-house positions at Cargill, and at Noble Group in Singapore, where he has dealt with dry shipping matters, commodity trade disputes and transactional matters involving commodity trading and commodity-backed structured trade finance.
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The CEO of a maritime welfare charity has just uncovered his own personal link to tragedy at sea – with his grandfather’s death at the hands of a German warship 75 years ago on Sunday (November 19).Stuart Rivers is CEO of Sailors’ Society, which cares for seafarers when they suffer trauma at sea and offers counselling to bereaved families when the worst happens and their loved ones do not return.
But he did not realise his own family’s trauma until earlier this year, when his cousin in Canada sent him details of the tragedy.Stuart’s grandfather, William Ross, a fisherman from Aberdeen, was one of 34 men lost when the trawler he was on board, HMS Ullswater, was torpedoed in the English Channel. He was 43 years old.
The Ullswater was sunk near Eddystone Lighthouse by heavily armed German S-boats while defending a convoy of merchant ships.As the vessel sank, the German boats torpedoed Norwegian steamer SS Lab and British vessels SS Yewforest and SS Birgitte, all of which sank in minutes.Yewforest had attempted to save the crew of the Ullswater when it was hit, with only four of its crew surviving.
Stuart’s grandfather is commemorated at the Royal Naval Patrol Service War Memorial at Sparrow’s Nest in Lowestoft.
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The Standard Club has appointed Cesare d’Amico, of d’Amico Societa di Navigazione SpA, as chairman of its board. Cesare was unanimously elected by the board at its last meeting and becomes chairman from January 2018, subject to regulatory approval. Nicolas Hadjioannou from Alassia Newships Management Inc, will become the new joint deputy chairman, working alongside existing deputy chairman Erik Johnsen of Seaocean Carriers Pte Ltd, in the New Year, subject to approval.
From the Avo Archive
The website of this newsletter contains all the editorial material since the inception of the Maritime Advocate as a print based quarterly in 1997 under the founding aegis of John Guy, Chris Hewer and Manfred Arnold. Readers can go to the site and search the database on the home page in its entirety. If you are looking for an old case, an old controversy or you would just like to see how many times you and your firm have featured in our annals feel free to access the archive. It is like this e-zine, free to Readers and we always appreciate the support of advertisers and sponsors.
We had a look for pieces on Hong Kong and found this report by Roger Overall which appeared in Back Issue 10 in February 2000:-
THE emphasis of power in the maritime industries continues to shift inexorably towards the Far East. Conservative estimates put the share of the world’s fleet now controlled by Asian interests at around 45 per cent. Against this background, Hong Kong and Singapore are expected to play an increasingly active role in the conduct of maritime law.
UK firms have an especially strong presence in Hong Kong – a legacy of 99 years of British rule. This legacy is also reflected in the similarities between the UK and Hong Kong legal regimes. Maritime law in Hong Kong is to all intents and purposes British Admiralty law, with local amendments where necessary. It is not surprising, then, that a thumb through the directory of firms practising admiralty law reveals a list of names that could have been photocopied from the UK’s Legal 500. Yet, it is easy to overstate the Britishness of maritime law in Hong Kong today.
“Whilst it is generally true to say that maritime law is mostly in the hands of UK firms with offices in Hong Kong, one should not infer from this that the level of Chinese interest in maritime law is limited,” says Chris Kidd, partner at Ince & Co, and secretary of the Hong Kong Maritime Law Association. “There is, generally speaking, a high degree of Chinese interest in maritime law in Hong Kong, and this is reflected by the fact that most firms have a large number of Chinese-speaking partners and assistants. I do not think that it would be right to describe Hong Kong as a British bastion.”
Indeed not. There is a tangible sense of pride among Hong Kong’s Chinese inhabitants that the city is no longer governed by foreigners, and their eyes have turned firmly towards the mainland. For its part, China has become more outward- looking. A sure sign of this is the gradual increase in its stake in the international shipping industry. More ships, more yards, better ports, increased trade. And, according to Kidd, the Chinese are “keen to learn from Hong Kong’s experience.”
Many thought the opposite would happen, and that China would mould Hong Kong in its own image. It is an opinion that can still be heard, according to Chris Potts, principal partner at Crump & Co. “There is a perception that Hong Kong has been sucked into the People’s Republic of China system,” he says. “This is misguided. The PRC has gone out of its way to preserve Hong Kong’s status. It sees Hong Kong as a window to the outside world, and it wants to nurture this.”
In doing so, the PRC is also preserving Hong Kong’s well-developed arbitration forum, which has grown up around the Hong Kong International Arbitration Centre, established in 1985 to fulfil a perceived need for such a facility. In its first year, it handled nine cases. In 1998, it handled 240 cases in a variety of sectors. “The centre has panels of international and local arbitrators. There are between thirty and forty names in all, including a few specialist maritime arbitrators,” says Robin Peard, a partner in Johnson Stokes and Master, himself a maritime arbitrator and vice-chairman of the arbitration centre.
Unlike competing arbitration forums in the region, Hong Kong does not restrict arbitration to members of the Hong Kong bar only. According to Peard, anyone can arbitrate in Hong Kong. “The fact that this is allowed provides the centre with a much greater pool of experts to draw from than is available in other Asian arbitration centres,” he says.
With the fundamentals in place, Hong Kong looks set to increase the amount of maritime work handled by its lawyers and arbitrators. A healthy, and growing, client base and plenty of expertise to draw upon. But, in Hong Kong, there is a feeling that there is nothing that cannot be improved upon.
For example, Justice William Waung, Hong Kong’s admiralty judge and chairman of the Hong Kong Maritime Law Association, says, “We are looking into improving the auction process in Hong Kong. At the moment, it is tender-based, and we’d like to get rid of the gap between the bids made for a vessel and the asking price or the value of the ship.” If the gap between the asking price and that offered is too large, the case has to be referred to Justice Waung, who has the power to grant permission for the sale to go ahead. This delays the process unnecessarily, he feels, and he is keen to find an alternative.
Laws
When one wishes to unlock a door but has has only one hand free, the keys are in the opposite pocket. (Von Fumbles Law)
A door will snap shut only when you have left the keys inside. (Yale Law of Destiny)
When one’s hands are covered with oil, grease, or glue, your nose will start to itch. (Law of Ichiban)
Your insurance will cover everything but what has happened. (Insurance So Sorry Law)
When things seem to be going well, you’ve probably forgotten to do something. (Cheney’s Second Corollary)
When things seem easy to do, it’s because you haven’t followed all the instructions. (Destiny Awaits Law)
If you keep your cool when everyone else is losing his, it’s probably because you have not realized the seriousness of the problem. (Law of Gravitas)
Most problems are not created or solved; they only change appearances. (Einstein’s Law of Persistence)
You will run to answer the telephone just as the party hangs up on you. (Principle of Dingaling)
If there are only two programs on TV that are worth your time, they will always be at the same time. (Law of Wasteland)
The cost is always higher than one budgets for, and it is exactly 3.14 times higher, hence the importance of pi. (Law of Pi Eyed)
The probability that one will spill food on one’s clothes is directly proportional to the need to be clean. (Law of Campbell Scoop)
Each and every body submerged in a bathtub will cause the phone to ring. (Law of Yes Now)
Each and every body sitting on a commode will cause the doorbell to ring. (Law of Ding Dong)
Wind velocity will increase proportionally to the cost of one’s hairdo. (The Don King Principle)
After discarding something not used for years, you will need it one week later. (Law of Fatal Irreversibility)
Arriving early for an appointment will cause the receptionist to be absent, and if one arrives late, everyone else has arrived before you. (Law of Delay)
Do not take life too seriously, because in the end, you won’t come out alive anyway. (Theory of Absolute Certainty)
Hong Kong from Above
Aerial views of urban Hong Kong which convey the unlikely city scape of a remarkable place:-