IN THIS ISSUE
1. Curial Law
2. The Third Goal Fifty Years on: Getting the Ball over the Line
under the DTV-Hull Clauses
3. Calcium Hypochlorite: It’s Back and Hiding in Plain
Sight
4. York Antwerp Rules 2016–A Revised Regime to Meet Current
Adjustment Practices
5. Guide to the Safe Carrying of Bulk Cargoes
6. People and Places
The Maritime Advocate–A Growing Concern
This publication, nicknamed "the Avo" passed
a milestone this summer. It has passed the 20 000 subscriber mark, the
highest total since its foundation in 2001. As a result of hand-ons
and internal republications within firms, it is fair to assume a total
readership of around 60 000 located in 120 countries. This gives the
Avo a very wide footprint in the maritime world. If you have a message
or product to promote or circulate, the Avo can promise to get the word
out at affordable rates. Give us a try.
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1. Curial Law
The latest case appearing in the Arbitration & Jurisdiction section
of DMC’s CaseNotes is by Pak Hei Li, LLB(Hons), PCLL (University
of Hong Kong) and relates to a decision of the English High Court in
the case of Shagang South-East Asia Trading v Daewoo Logistics. The
Court held that, where the parties had agreed on the venue of an arbitration,
there had to be clear words to displace the presumption that the curial
law (the law governing the procedure of the arbitration) was the law
of the place of arbitration. A provision saying “English law to
be applied” did not suffice, as it was most likely referring to
the choice of substantive law, that is, the law governing the claim
made in the arbitration reference.
Access the case note here:-
http://www.onlinedmc.co.uk/index.php/Shagang_South-East_Asia_Trading_v_Daewoo_Logistics
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2. The Third Goal Fifty Years on: Getting the Ball over the Line
under the DTV-Hull Clauses
Sheila Jones has sent in this report, a typically fine focused presentation
for average adjusters:-
A call for a mediation forum to help settle some of the basic disparities
in marine hull claims practice has come from Burkhard Fischer, vice-chairman
of the Association of Average Adjusters.
Speaking at a meeting jointly organised by the average adjusters’ association
and the International Underwriting Association, Mr Fischer outlined
fundamental differences between English and German hull and machinery
clauses, and rifts in interpretation within the latter.
Mr Fischer told the event: "It would be immensely beneficial for
shipowners, underwriters and adjusters if there were a forum with the
authority to provide mutually acceptable solutions to controversial
issues."
Mr Fischer, who is a partner with Albatross Adjusters of Limassol,
kicked off his presentation by referring to the contentious third goal
for England in the 1966 World Cup Final at Wembley, "probably the
most discussed and disputed goal in football history. Did the ball cross
the line or not? No doubt that is a matter of interpretation."
It served to demonstrate that the Germans and English viewed certain
things differently.
Following Dr Schommer’s brief introduction to the legal background
of the German hull conditions, Mr Fischer highlighted distinctive points
of Germany’s widely-used DTV-Hull Clauses. They provided all risks cover
with named exclusions; wide third party liability cover, including some
items traditionally covered by P&I; and the wording of some clauses
was ambiguous and allowed different interpretations, partly because
of a lack of relevant court judgments. Even after decades of use there
were still discussions about the correct "German" interpretation
of certain points.
A case illustrating one of the basic differences between the English
"named perils" in the Institute Time Clauses (Hulls) 1983
and the German "all risks" approach was the Popi M. That was
the name of a ship which sank mysteriously in calm seas off the coast
of Algeria in August 1978 when water got into the engine room through
the port side shell plating. Earlier, the ship had passed through bad
conditions in the Bay of Biscay.
The underwriters maintained that the ship had simply fallen apart.
The owners were unable to prove a specific cause which could be described
as a "peril of the sea," saying the vessel must have hit a
submerged object. The English court ruled that neither seaworthiness
nor unseaworthiness was proven. It was improbable that the loss was
caused by a peril of the sea and impossible that the sudden and violent
effect on the vessel could have resulted from wear and tear. As the
proximate cause of the loss remained in doubt, the shipowners failed
to discharge their burden of proof.
Most likely, the German approach would have been different. If the
owners could prove that there was damage or loss, its extent, and that
the loss was within the policy period, there would in principle be a
claim, and it would be for underwriters to disprove it.
Mr Fischer listed differences between the English and German hull conditions,
elaborating four of them:
The line between defect and consequence. German practice since introduction
of the DTV-Hull Clauses has been to consider insurance cover only for
damage on parts other than those with a material, manufacturing or design
defect. Dr Schommer explained how a 1999 judgment of the Hanseatic Court
of Appeal showed that the court was unimpressed by 20 years of adjusting
tradition, holding that there was nothing in the wording that would
exclude a wrongly constructed or designed part from cover. The German
insurance market reacted by introducing a document which re-established
prior market practice, although not many shipowners accepted it.
Ordinary and extraordinary wear and tear. Suppose a manufacturing fault
causes extraordinary corrosion, as a result of which another part fails,
how would a German court look at that? In principle the clause excludes
cover for damage caused by corrosion, even if the corrosion was extraordinary.
In contrast, some authorities agreed that only ordinary wear and tear
was excluded.
No deductible applied to sue and labour charges. Unlike in the ITC,
a DTV clause clearly allowed several types of claim without the application
of the deductible. In particular, under a clause on sue and labour charges,
the deductible would not apply to expenses. Mr Fischer said: "There
are contradicting opinions as to whether sue and labour charges are
recoverable under the policy if you are saving something, or attempting
to save something that would fall below the policy deductible… The
obvious and perhaps only equitable solution, i.e. applying the policy
deductible to the total sum of the Particular Average claim and the
sue and labour charges, is unfortunately not supported by the ADS /DTV-Hull
Clauses." The ADS are the German General Rules of Marine Insurance.
When is a ship moving? Contrary to ITC clause 8, which covers only
legal liability arising from collision with other vessels, DTV clause
34 is a third party liability clause that provides much wider cover,
even for items traditionally absorbed by P&I clubs. One of the basic
criteria that triggers third party liability under clause 34 is that
damage was caused either by movements of the vessel or by the vessel’s
participation in shipping traffic. The expression "movement of
the vessel" should be quite clear, but it was not. The majority
of German adjusters would consider the definition of such movement as
being of an active nature in a navigational context, but not in a passive
or technical or cargo operations sense. On that basis damage caused
to a berth whilst the vessel is fast and safely alongside would not
fall under cover provided by DTV clause 34.
Despite this, said Dr Schommer, a literal interpretation suggested that
movement could be relative to water or to the ground: it could be ahead,
astern or sideways. Damage to a fender by a moored vessel is caused
by movement. A ship could be moving vertically (for instance, a ship
berthed at a tidal location damages a shore gantry crane, or capsizing
at berth damages shore installations). On the other hand, movement of
a single component such as the ship’s crane that causes damage to a
shore crane or the crane of another vessel, could not in this context
be considered as movement.
Summing up, Mr Fischer said that literal interpretations of clauses
were perhaps convenient to a non-expert, or to a court of law, but there
should be more to it. "As adjusters, we take into consideration
the historical development of a clause including its previous market
practice, the various commentaries and – not forgetting – we will always
apply common sense."
For a copy of the slideshow given by Burkhard Fischer go to:-
https://www.average-adjusters.com/news/iua-aaa/
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3. Calcium Hypochlorite: It’s Back and Hiding in Plain Sight
The hfw website recently published this article on a hardy shipping
perennial by Rory Butler and Alex Kemp:-
The often dramatic risks associated with transporting calcium hypochlorite
first came to light in the 1970s in a series of serious incidents involving
US and Japanese producers. Casualties in the 1990s including (it has
been suggested) “Contship France”, “DG Harmony”,
Aconcagua” and “CMA Djakarta” brought the problem back
into the spotlight with increased awareness of operators to these risks.
Calcium hypochlorite is often shipped in powder, granules or tablets
as a white or yellowish solid. It is liable to exothermic decomposition
at elevated temperatures, initiated by heat, impurities in the product
or reaction with acids. The temperature at which self-accelerating decomposition
commences can be as low as 50ºC depending upon packaging. The potentially
severe consequences of a casualty from calcium hypochlorite led to it
becoming categorised as a dangerous cargo and included within the IMDG
Code as a Class 5.1 oxidising agent (or on occasion a Class 8 corrosive).
» Read more
http://www.hfw.com/Calcium-Hypochlorite-Its-Back-And-Hiding-In-Plain-Sight-November-2016
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Henry.Hill@worldwidecurrencies.com…………………….+44 (0)20
3326 4514
4. York Antwerp Rules 2016–A Revised Regime to Meet Current Adjustment
Practices
Duncan Ealand and Menelaos Nicolaou of the firm of Campbell Johnston
Clark, writing in the November 2016 Arthur J. Gallagher Marine Hull
and War Risks Market Report discuss the changes in the York Antwerp
rules (YAR):-
Revision of the Rules:-
With the ultimate aim of adjusting the YAR to reflect current practices,
the International Working Group of the Comité Maritime International
(CMI) approved, in May 2016, a revised version of the YRA: the York-Antwerp
Rules 2016. This stems from many years of consultation, following the
unpopularity of the YAR 2004, which were deemed by many to be too cargo-friendly.
The YAR 2016 attempts to strike a better balance between cargo interest
and ship owners. BIMCO – one of the world’s largest shipping associations
– has announced that all new and revised BIMCO charterparties, bills
of lading and waybills will now refer to general average being adjusted
in accordance with the YAR 2016. The International
Union of Marine Insurance (IUMI) and the International Chamber of Shipping
(ICS) have also given their approval to the YAR 2016. Accordingly, the
YAR 2016 are expected to be widely incorporated in to contracts
of carriage.
Click below to read a consideration of the key amendments:-
http://www.ajginternational.com/media/97567/marine_hull_and_machinery_report_november-2016.pdf
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5. Guide to the Safe
Carrying of Bulk Cargoes
Helen Cotton has sent in this notice:-
When bulk cargoes shift, liquefy, catch fire or explode due to poor
loading procedures, the consequences can be critical – ships could
capsize, lose stability or sustain severe structural damage.
“Carrying solid bulk cargoes safely: Guidance for crews on the
International Maritime Solid Bulk Cargoes (IMSBC) Code”, is an
updated version of a 2013-published guide for ships’ officers and
agents who arrange cargoes for loading, produced jointly by Lloyd’s
Register, UK P&I Club, and Intercargo.
This new edition outlines the precautions that need to be taken before
accepting solid bulk cargoes for shipment and sets out procedures for
safe loading and carriage and details the primary hazards associated
with different types of cargoes. The guide includes a quick reference
checklist and flowchart summarising the steps to be followed.
Updated guidance includes a warning on the possible liquefaction properties
of bauxite (which was considered until recently a cargo not liable to
liquefaction), advice on the issue of cargo residues deemed harmful
to the marine environment, changes to the IMSBC Code’s structure,
advice on SOLAS mandatory enclosed space entry and rescue drills, and
updated references to supporting IMO Circulars.
A PDF of the pocket guide can be downloaded at:-
Hard copies can be ordered from:-
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6. People and Places
A global free trade skeptic has been elected to the White House. The
GTR zine has this early report:-
Donald Trump’s designs for US infrastructure come under the scrutiny
of the Handy Shipping Guide:-
http://tinyurl.com/trumpinfrastructure
———-
Hill Dickinson has hired Iain Johnston as its first Chief Operating
Officer (COO). Johnston, who will take up the position of COO this month,
will be charged with further strengthening Hill Dickinson’s position
in the marketplace, accelerating the firm’s development and overseeing
the day to day operations of the business.
———-
Maritime recruitment specialist Halcyon Recruitment has appointed David
Townley as its new Operations Director in Singapore and Neal Mankey
as a Principal Consultant in the UK, in support of Halcyon’s continuing
growth.
———-
Clyde & Co has appointed Chris Pratts as Partner and made four
other hires to its London marine cargo group. Chris Pratts is a leading
marine cargo insurance lawyer in the London market and joins Clyde &
Co to further enhance the firm’s pre-eminent marine team. He joins from
Waltons & Morse LLP (now part of Kennedys Law LLP) where he spent
14 years and was a partner.
Also joining the marine team in London and Guildford in recent weeks
are Kish Sharma, a consultant and Christine Davey, a junior associate
from Waltons & Morse, Emma Treseder, an associate from Ross &
Co, and Cameron Boyd, a junior associate from Roose & Partners.
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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 scoured the Archive for references to the White House, producing
but a single reference demonstrating no more than the need for editorial
vigilance. This list appears in Issue 525 of May 4th, 2012:-
The Importance of Proof Reading
IMPORTANT NOTICE: If you are one of hundreds of parachuting enthusiasts
who bought our Easy Sky Diving book, please make the following correction:
on page 8, line 7, the words "state zip code" should have
read "pull rip cord."
It was incorrectly reported last Friday that today is T-shirt Appreciation
Day. In fact, it is actually Teacher Appreciation Day.
There was a mistake in an item sent in two weeks ago which stated that
Ed Burnham entertained a party at crap shooting. It should have been
trap shooting.
There are two important corrections to the information in the update
on our Deep Relaxation professional development program. First, the
program will include meditation, not medication. Second, it is experiential,
not experimental.
In the City Beat section of Friday’s paper, firefighter Dwight Brady
was misidentified. His nickname in the department is "Dewey."
Another firefighter is nicknamed "Weirdo." We apologize for
our mistake.
Our newspaper carried the notice last week that Mr. Oscar Hoffnagle
is a defective on the police force. This was a typographical error.
Mr. Hoffnagle is, of course, a detective on the police farce.
In a recent edition, we referred to the chairman of Chrysler Corporation
as Lee Iacoocoo. His real name is Lee Iacacca. The Gazette regrets the
error.
Apology: I originally wrote, "Woodrow Wilson’s wife grazed sheep
on front lawn of the White House." I’m sorry that typesetting inadvertently
left out the word "sheep."
In one edition of today’s Food Section, an inaccurate number of jalapeno
peppers was given for Jeanette Crowley’s Southwestern chicken salad
recipe. The recipe should call for two, not 21, jalapeno peppers.
The marriage of Miss Freda van Amburg and Willie Branton, which was
announced in this paper a few weeks ago, was a mistake which we wish
to correct.
[Source: Paul Dixon]
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Mike Seaborne’s Isle of Dogs, Then & Now
Our favourite blog on London, called Spitalfields Life carries another
strong series of photographs on the all but vanished waterfront of the
old London docks:-
No part of London’s East End has changed more in the last generation
that the Isle of Dogs. Between 1983 & 1986, photographer Mike Seaborne
recorded it prior to redevelopment, as part of a project with the Island
History Society, and then returned in 2014 to capture the same views
as they are today.
http://spitalfieldslife.com/2016/11/08/mike-seabornes-isle-of-dogs-then-now/
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News
A New York attorney representing a wealthy art collector called and
asked to speak to his client, "Saul, I have some good news and,
I have some bad news."
The art collector replied, "I’ve had an awful day; let’s hear
the good news first."
The lawyer said, "Well, I met with your wife today, and she informed
me that she invested $5,000 in two pictures that she thinks will bring
a minimum of $15-20 million. I think she could be right."
Saul replied enthusiastically, "Well done! My wife is a brilliant
businesswoman!
You’ve just made my day. Now I know I can handle the bad news. What
is it?" ? ?The lawyer replied, "The pictures are of you with
your secretary.”
[Frazer Hunt]
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Maritime Advocate Online is a weekly digest of news and views on the
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