1. Burden of Proof
2. CHIRP Digest
3. Maryam Taher
4. Control Systems on Pilotage Waters
5. Prudent Uninsured
6. People and Places
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1. Burden of Proof
Filippo Lorenzon who is a Professor of Maritime and Commercial Law at Dalian Maritime University, China and a Solicitor for Campbell Johnston Clark, London has written a note in the Gard P&I newsletter:-
Volcafe Ltd and another v Compania Sud Americana de Vapores SA ( UKSC 61) concerned a cargo of coffee beans shipped in containers from South America to North Europe. The coffee beans were stuffed in unventilated containers by stevedores contracted by the carrier. Coffee beans will emit moisture when carried from a warm to a cool climate. Stevedores contracted by the carrier lined the containers with kraft paper as a precaution against moisture damage. In spite of this precaution, the coffee beans showed evidence of condensation damage at discharge.
Volcafe sets out the important principle that “the carrier ha[s] the legal burden of proving that he took due care to protect the goods from damage, including due care to protect the cargo from damage arising from inherent characteristics such as its hygroscopic character” (Volcafe, at ). In holding so, the Supreme Court considered whether there were industry standards for caring for this specific cargo, and if so, whether the carriers could prove they had followed such standards. This can be a challenging task for a carrier, as they are not, and cannot be, experts for every type of cargo presented for carriage. Except for physical safety codes, such as the IMDG, IMSBC and Grain Code, many cargoes have no standardised care instructions for sea carriage, even though they may have inherent characteristics that could result in damage if certain precautions are not taken. In the absence of such standards, carriers are advised to request specific instructions from shippers as to the care of the cargo they carry, and take careful records of when and how they are followed.
While it is still too early to know how arbitrators and courts will digest and apply Volcafe, The CMA CGM Libra and The Lady M, this sudden attention to reliance on Hague/Hague-Visby Rules defences is a stark reminder of the importance of information sharing and diligent record keeping. As a loss prevention approach, carriers and their liability underwriters together with cargo industry representatives should consider collecting commodity specific industry practices for loading, stowing and packing and make them widely available to the market. These may then be used as benchmarks in assessing a carrier’s negligence or the absence thereof.
Read his note in full here:-
2. CHIRP Digest
CHIRP has published the 2018 edition of their Annual Digest. The Digest contains articles that CHIRP has published in FEEDBACK magazines 50 through to 53, and in addition there are several Insight articles included which CHIRP published last year with the assistance of members of the CHIRP Maritime Advisory Board. All of the videos that CHIRP has produced this year may be found in Appendix V. Further details may be found on the Annual Digest page of their website.
3. Maryam Taher
To Lancaster Gate we went to attend a Persian Spring party hosted by renowned sanctions lawyer Maryam Taher whose expertise in this tricky area is described in the latest edition of the specialist journal WorldECR.
Read the interview here:-
4. Control Systems on Pilotage Waters
Thomas Ross, who is an undergraduate at Plymouth University, has written in with details of a questionaire he hopes the mariners who read this e-zine may fill in to help his research. He writes:-
The purpose of this questionnaire is to gather research for a my BSc Undergraduate thesis at the University of Plymouth. The provisional title of the project is “An analysis of seafarers’ perspectives on the use of control systems in pilotage waters”. By submitting the survey your Readers consent for the information provided to be used for this academic thesis and nothing more. Upon completion of the academic study the responses to the survey will be destroyed. However, the results of the research may be published.
5. Prudent Uninsured
James Brewer writes:-
Shipowners dealing with repairs and other essentials after a marine casualty are often asked by their insurer to treat such expenses as carefully as if they were a “prudent uninsured.” How prudent is such a demand?
The wisdom of this approach was closely examined at the latest London seminar organised by the Association of Average Adjusters in conjunction with the International Underwriting Association.
The speaker, Nigel Rogers, engagingly entitled his talk “Dear Prudence,” as he posed the question: “How valid is the Prudent Uninsured Test?” Dear Prudence is a song [dedicated to Prudence, the sister of actress Mia Farrow] on the 1968 White Album of The Beatles.
The claims expert’s conclusion was that “when an owner has a casualty, he may not only hope for but expect assistance and proactive service – something a bit more helpful than the time-honoured diktat” that he acts as if under the constraints of having no insurance.
“In other words, rather less – ‘act as if prudent uninsured’ – and a bit more ‘Dear Prudence – let’s talk,'” urged Mr Rogers, who is a past chairman and a Fellow of the Association of Average Adjusters and partner with Rogers Wilkin Ahern, a City marine claims consultancy and provider of adjusting services.
He began by saying that the call to show prudence in the marine insurance context was nothing like as seductive as in the Beatles ditty and was more in the nature of a reprimand, evoking a mystified response from shipowners, who either declared “But I did” or “But I am insured”.
Mr Rogers questioned how satisfactorily the prescription provides guidance to shipowners in the commercial environment. When insurers instructed the policyholder to “act as if prudent uninsured” this meant that the owner should make the same decisions as if the costs were borne by owner’s account. “This can lead to confusion, and differences in opinion between insurers and shipowners when commercial issues intrude, and an owner needs to get the ship back trading as soon as possible.”
He conceded that “there is much that is good and sensible in the idea that an owner spends money that he intends to claim from underwriters as carefully as if it was his own and hence selects the cheapest viable repair yard, research the market to source parts appropriately, reserve rights against errant third parties and in general to take all measures to mitigate the cost of repairs.” There could however be confusion as to what a prudent uninsured would do in certain circumstances, “and also the phrase does not always suffice for many owners in this day and age who require rather clearer guidance and better assistance following a casualty.”
After an insured casualty an owner is entitled to the reasonable cost of repairs and it is sometimes assumed that if the owner is instructed to act as prudent uninsured that would lead towards that reasonable result. But there might be a lack of connectivity between the two mantras – reasonable cost and prudent uninsured – since the owner will be making decisions with an eye to his commercial position. The owner might wind up saying when part of his claim is rejected: “But I did act as if uninsured – I did what I was told. If I were paying all the repair costs myself then I would without hesitation pay these extra costs to return my vessel to full freight earning operations. Mine is a time-sensitive trade. I have valued customers. And in this internet and social media age, I can’t afford the reputational damage that would arise from an avoidable delay.”
This raised the question as to exactly what was insured. It is frequently described as “hull and machinery, materials, equipment and everything connected therewith nothing excluded.” But is the ship a physical object or, as the owner might have it, ‘a nice little earner’?
There were stark differences of legal opinion on this point, with some favouring the view that the ship is just a ship, a physical object, and others saying that its capacity as a freight earning instrument should be considered. While this divergence might seem academic, said Mr Rogers, the issue comes into sharp focus when dealing with the costs of what are termed expediting expenses or temporary measures – for example excess costs of overtime [extra payment to make a ship available for work], temporary repairs, temporary generator hire, and so on.
For an underwriter taking the physical object approach, maintaining that they are responsible for the reasonable cost of repair but not for commercial considerations, the approach in earlier times would have been to pay further costs only where there were savings. There were instances though of underwriters prepared to entertain commercial considerations where an owner was always going to spend what it took to get a vessel back into operation as quickly as possible.
The lines started to become blurred when insurers might see their physical object cover shading into a ‘loss of hire’ area if they became liable to pay expenses to mitigate such an aspect. A solution would need to be found to address the disconnect between the physical and commercial imperatives. Mr Rogers said that over the years he had dealt with many owners who were excellent at running ships but were challenged in dealing with a major casualty repair. They might lack knowledge of repair facilities in the relevant region; lack commercial clout with the repair yards; have limited experience sourcing spare parts; have difficulties in financing or cash flow; and have no in-house insurance expertise.
For such an owner an instruction to act as if uninsured would probably be extremely unhelpful, particularly when the local office of the attending underwriters’ surveyors was likely to have much greater local knowledge and experience than the owner. Mr Rogers insisted that it was best both for the owners pleading that they were acting as if prudent uninsured and those who were pointing out that they were insured and needed help, to have early engagement and dialogue with insurers so that issues could be identified and addressed before key decisions were made, so that an owner “knows exactly where he stands.”
6. People and Places
Our good friend Maria Dixon was recently awarded The Panama Maritime Lifetime Achievement Award in 2019 for contibutions to the Panamanian and International Maritime Industries.
Tokio Marine Kiln (TMK) has appointed Will Curran as the new head of reinsurance.
Curran succeeds David Huckstepp who is leaving TMK on a “planned break” from the sector.
Curran has been the deputy underwriter of TMK’s reinsurance team since 2008. Prior to joining TMK, he worked at Beazley, Wellington and Catlin, having started his career at Lloyd’s in 1996 as a graduate.
At the American P&I Club’s headquarters in New York, Margaret Lee has been appointed as Lead Counsel. With twenty years of experience in the industry, Margaret is a New York-admitted attorney whoworked in private practice before joining the Club’s management several years ago.Margaret has particular expertise in occupational disease claims and, in addition to overseeing the wide – and diverse – range of legal matters which attend the operation of the Club and its
Managers, she is a member of the International Group’s Occupational Disease Sub-Committee inwhich role she liaises with the representatives of other clubs in this important area of the Group’s collective engagements.
In the Managers’ office in Piraeus, Joanna Koukouli has been appointed as Deputy GlobalClaims Director, reporting to Global Claims Director Don Moore in New York. Holding bothundergraduate and postgraduate degrees in law, and qualified to practice in Greece, the UnitedKingdom and New York, Joanna also has twenty years’ industry experience including that ofin-house counsel at a major Greek container company.Joanna has also been appointed as Joint Managing Director of the Piraeus office, in which roleshe will continue to work closely with Dorothea Ioannou, the Managers’ Chief Commercial Officer.
In addition, Marivi Banou has been appointed as P&I Claims Manager, assisting Joanna Koukouli in the general day-to-day supervision of the Piraeus-based claims team. Having gained a degree from Metropolitan University, London in shipping and transport, and then acquired experience in both the shipowning and insurance broking sectors, Marivi originally joined the Managers’ Greek office on its opening in 2005.
At the same time, Elina Souli was recently recruited by the Managers’ Piraeus office to undertake the roles of FD&D Manager and Regional Business Development Director. With undergraduate and postgraduate degrees in law, and holding legal qualifications from both Greece and the United Kingdom, Elina has extensive experience working with both a major local shipping firm and the branch office of another Group club.
Bolero International has appointed Jacco De Jong as its new Head of Global Sales.
De Jong, formerly Bolero’s Head of Global Strategic Business Development, will report directly to CEO Andrew Raymond, assuming responsibility for the continued expansion of Bolero’s global network and the development of collaborative partnerships with new technology initiatives such as Blockchain. His new role also gives him overall responsibility for marketing.
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.
Work is underway to lodge the Archive within a new site for this publication.
Any similarity between you and a human is purely coincidental!
Are you always so stupid or is today a special occasion?
As an outsider, what do you think of the human race?
I’d like to kick you in the teeth, but why should I improve your looks??
At least there’s one thing good about your body. It isn’t as ugly as your face!
Brains aren’t everything. In fact, in your case they’re nothing
Careful now, don’t let your brains go to your head!
I like you. People say I’ve no taste, but I like you.
Did your parents ever ask you to run away from home?
If I had a face like yours; I’d sue my parents!
Don’t feel bad. A lot of people have no talent!
Don’t get insulted, but is your job devoted to spreading ignorance?
Keep talking; someday you’ll say something intelligent!
Don’t you love nature, despite what it did to you?
How would you like to feel the way you look?
Hi! I’m a human being! What are you?
I can’t talk to you right now; tell me, where will you be in the next 10 years?
I don’t want you to turn the other cheek; it’s just as ugly.
I don’t know who you are, but whatever you are, I’m sure everyone will agree with me.
I don’t know what makes you so stupid, but it really works.
I could make a monkey out of you, but why should I take all the credit?
I can’t seem to remember your name, and please don’t help me!
I don’t even like the people you’re trying to imitate, if you are at all.
I know you were born silly, but why did you have a relapse?
I know you’re a self-made man. It’s nice of you to take the blame!
I know you’re not as stupid as you look. Nobody could be!
I’ve seen people like you, but I had to pay admission .
Signs and Meanings
Spotted in a toilet of a London office:
TOILET OUT OF ORDER. PLEASE USE FLOOR BELOW.
In a Laundromat:
AUTOMATIC WASHING MACHINES: PLEASE REMOVE ALL YOUR CLOTHES WHEN THE LIGHT GOES OUT
In a London department store:
BARGAIN BASEMENT UPSTAIRS
In an office:
WOULD THE PERSON WHO TOOK THE STEP LADDER YESTERDAY PLEASE BRING IT BACK OR FURTHER STEPS WILL BE TAKEN?
In an office:
AFTER TEA BREAK STAFF SHOULD EMPTY THE TEAPOT AND STAND UPSIDE DOWN ON THE DRAINING BOARD.
Outside a secondhand shop:
WE EXCHANGE ANYTHING – BICYCLES, WASHING MACHINES, ETC.
WHY NOT BRING YOUR WIFE ALONG AND GET A WONDERFUL BARGAIN?
Notice in health food shop window:
CLOSED DUE TO ILLNESS
Spotted in a safari park:
ELEPHANTS PLEASE STAY IN YOUR CAR
Seen during a conference:
FOR ANYONE WHO HAS CHILDREN AND DOESN’T KNOW IT, THERE IS A DAY CARE ON THE FIRST FLOOR.
Notice in a field:
THE FARMER ALLOWS WALKERS TO CROSS THE FIELD FOR FREE, BUT THE BULL CHARGES..
Message on a leaflet:
IF YOU CANNOT READ, THIS LEAFLET WILL TELL YOU HOW TO GET LESSONS.
On a repair shop door:
WE CAN REPAIR ANYTHING.
(PLEASE KNOCK HARD ON THE DOOR – THE BELL DOESN’T WORK).
Thanks for Reading the Maritime Advocate online
Maritime Advocate Online is a weekly digest of news and views on the maritime industries, with particular reference to legal issues and dispute resolution. It is published to over 21 000 individual subscribers each week and republished within firms and organisations all over the maritime world. It is the largest publication of its kind. We estimate it goes to around 60 000 Readers in over 120 countries.