Sunseeker Shield - Salvage Explained
The question of salvage can fill a Sunseeker Owner or Captain with dread; hence the following information will hopefully throw just a little light onto the subject.
What is Salvage?
Salvage is a voluntary and successful rescue of your Sunseeker or those on board from a peril of the sea.
Sunseeker Shield includes the "reasonable costs incurred, including salvage, in preventing or minimizing a loss covered..." Peace of mind can be gained from this. However there are a
number of points to consider.
Towage is defined as "the movement of your Sunseeker afloat by means of being towed by another vessel or towing another vessel other than in distress in the best interests of either
vessel"
It is important therefore to understand the difference between salvage and towage.
If assistance at sea is required, you should consider if your Sunseeker is in peril? Remember, Towage as set out above does not involve immediate distress.
Whilst circumstances may be extremely inconvenient it may only be a tow that is required. A good example might be if your Sunseeker had run out of fuel, is in no imminent danger but
must await the delivery of fuel. (Remember your Sunseeker Shield policy "will pay up to £50,000 for reasonable costs incurred in the event there is an emergency situation where the
vessel is not in imminent danger, resulting from the delivery of fuel, oil, parts or loaned batteries (excluding the cost of the items themselves) or emergency labour whilst away from
safe harbour)"
Obviously if in peril and the safety of the boat or those on board is at risk in any way, a salvor may well be required constituting Salvage under the Sunseeker Shield policy.
Accepting a line
Merely accepting a line without any agreement may unfortunately constitute salvage and, in the example given above, a Court or Arbitrator will very likely find that salvage services
have been rendered unless you have agreed in advance that the tow will be performed on a contractual basis. Agree therefore the basis of any tow before accepting that tow, even
verbally with a witness to the agreement, which can then be recorded in writing as soon as possible.
A fair price for salvage
If salvage services have been rendered, and the proper level of remuneration cannot be agreed, it will be for a Court or Arbitrator to decide what is reasonable. Hence the Insurers
understandable inclusion of "reasonable costs incurred..."
Salvage costs can be agreed in one of four ways:
- Between the salvor and Captain, in advance of the salvage.
- In negotiation between the salvor and your Shield Insurers either prior to or after the salvage.
- Utilising binding arbitration after the salvage.
- Litigation on the part of the salvor.
The latter two can prove to be very expensive, with cost alone often outweighing the cost of any salvage operation hence the first of the two options shown are preferred.
If at all possible the cost of the services rendered can be agreed at a fixed price, based upon the time involved, fuel, and any other expenditure that the salvor might reasonably have
to meet. In this way the services will not constitute salvage but work rendered on an agreed contractual basis.
Lloyd's Open Form
If an agreement can not be reached, a salvor, Owner or Captain may ask or be asked to commit to sign a Lloyd's Open Form prior to the commencement of a salvage.
This is merely an agreement or contract between Owner or Captain and salvor for the basis of the salvage and allows the salvage to commence with the extent of the award determined
later. The salvor may wish to invoke what are termed the SCOPIC terms, provided SCOPIC is incorporated into the Lloyds Form contract. This simply means that the salvor will be paid
even if the salvage attempt is unsuccessful.
Involve Your Sunseeker Shield Insurers
In the event of a salvage requirement, if at all possible involve your Insurers. Despite Gallagher providing a 24 hour / 7 day helpline, it may not always be possible or realistic to
obtain their immediate advice and support. It is however important to report all that has occurred with the fullest details as a matter of urgency. This will both protect your position
and that of your insurers who having established cover can then take over the negotiations of any award on your behalf.
If any Owner or Captain acts prudently as if they were not insured, to protect the interests of their Sunseeker, by default they will also protect the position of their Insurers and
are unlikely to prejudice their position.
