Boating Western Australia Inc. 10 Years of service to the Western Australian Boating Public

Position Statements

Mission Statement
BoatingWA is a non profit association, established for the promotion and development of safe, economic and enjoyable recreational boating through Western Australia.

BoatingWA
PO Box 1080
Claremont  6910
Western Australia

FAX and Voice
08 93353296

e-mail; secretary@boatingwa.com.au

Office
1 Capo D'Orlando Drive
Fremantle, Western Australia, 6160

Small Vessel Salvage Arbitration  USA
U.S.A. OPEN FORM SALVAGE AGREEMENT 
INTERNATIONAL CONVENTION ON SALVAGE, 1989 USA
Convention for the Unification of Certain Rules of Law respecting Assistance and Salvagee at Sea
The International Convention On Salvage, IMO 1989

 

Small Vessel Salvage Arbitration

RULES FOR RECREATIONAL AND SMALL VESSEL SALVAGE ARBITRATION FOREWORD Until recently, U.S. yacht owners faced with a salvage situation under a Lloyd's Open Form (No Cure-No Pay) Salvage Agreement found they were bound to arbitrate any disputes in London under English law. The 1992 Federal District Court decision in Brier v. Northstar Marine. and other cases following it, have changed this. They signal a distinct trend by our courts away from enforcing the London arbitration provision of the LOF in cases involving recreational and other small vessels,where the casualty occurs in U.S. waters and involves American interests only. This has created a need for an effective arbitral forum to resolve such disputes domestically. These Rules, and the suggested Model Arbitration Clause accompanying them have been designed to provide a speedy, efficient and economical U.S. forum for resolving such disputes. 

RECREATIONAL AND SMALL VESSEL SALVAGE ARBITRATION MODEL CLAUSE "Any dispute arising out of this Agreement shall be referred to arbitration in the U.S. under the Rules for Recreational and Small Vessel Salvage Arbitration of the Society of Maritime Arbitrators, Inc. Arbitrators shall be commercial persons familiar with maritime salvage. Any award made hereunder shall be final and binding,and for the purpose of enforcement may be entered for judgment in any Court of competent jurisdiction. "

 RECREATIONAL AND SMALL VESSEL SALVAGE ARBITRATION RULES 
I. Qualifications of Arbitrators The Society of Maritime Arbitrators, Inc. (SMA) shall maintain a list of arbitrators among its membership who are familiar with maritime salvage. Copies of the resumes of those arbitrators shall be made available upon request to parties seeking to appoint arbitrators in salvage cases. 
II. Appointment of Arbitrator(s) 
(a) Upon a demand for arbitration by either side, the parties shall choose a sole arbitrator by agreement. However, if the parties are unable to agree upon a sole arbitrator within 15 days after the demand for arbitration, each is then to submit the names of three acceptable arbitrators from the SMA list to the President of the SMA, who shall select by random process one of the six names so submitted. Notwithstanding the foregoing, the parties may agree upon a tripartite panel of arbitrators. In such case each shall choose an arbitrator, and the two so chosen shall choose a third who shall also chair the panel for administrative and procedural purposes. In the event they cannot agree on a third within 15 days, the two party-appointed arbitrators shall request the President of the SMA to appoint one at random from the SMA list of salvage arbitrators. 
(b) `In the event there is more than one salver involved in the dispute ( excluding subcontractors ), and all of the salvage agreements incorporate these Rules, the disputes shall be consolidated before a sole arbitrator unless all parties have agreed upon a tripartite panel. In either case, all of the salvers shall be considered one party for the purposes of this section and the appointment of arbitrators shall be governed by the provisions of subparagraph (a) above. 
III. Failure to Respond Should the respondent fail to respond within 15 days hum the demand for arbitration, the arbitrator named by the claimant shall serve as the sole arbitrator, with the same authority as if agreed between the parties. 
IV. Submission of Evidence, Hearing 
(a) Within 15 days from the date of appointment, or completion of the panel, the arbitrator(s) shall establish a schedule for the submission of documentary evidence. 
(b) In order to minimize the costs of the arbitration the parties shall submit their positions in writing for decision by the arbitrator(s). The submissions should include documentary evidence to support their positions ( such as, but not limited to salvage reports, valuations, insurance certificates, photographs, survey reports, repair estimates and receipts, etc.), and such sworn testimony by affidavit as is relevant to the issues. 
(c) Upon request by either party within 15 days after written submissions have been made, a single hearing will be convened for the purpose of oral argument by the parties and/or their counsel to supplement the written presentations. No witnesses other than the parties themselves will be heard, and unless mutually agreed and arranged by the parties, no transcript of the hearing shall be taken. The hearing shall be held at any location agreed upon by the parties and the arbitrator(s). 
(d) At the sole discretion of the arbitrator(s), each side may be permitted one postponement for good cause shown, the duration of which shall be determined by the arbitrator(s) depending on the circumstances. 
(e) Within 15 days after the hearing, or 15 days after the submission of documents if no hearing has been held, both parties may submit final written argument to summarize their positions, following which the proceeding shall be closed. 
(f) The arbitrator(s) shall at all times have the sole discretion to modify the procedure set forth in this section if warranted by special circumstances. 
V. Award 
(a) The arbitrator(s) shall issue a written award within 30 days after the proceeding has been closed, which shall set forth the arbitrator(s) findings of bet and decision clearly and concisely. Failure to issue the award within 30 days, however, shall not constitute grounds for appeal or vacatur of the award. The award may be published by the SMA. 
(b) In a tripartite proceeding. the decision of any two arbitrators shall be final and binding. In such case, the award will include the dissenting arbitrator's opinion. 
(c) The arbitrator(s) shall have the discretion to assess costs, including attorneys' fees and the fees and expenses of the arbitrator(s), in whole or in part against either party. 
VI. Limited Appeal of Award 
(a) If, and only if, the dispute is before a sole arbitrator, the decision of the arbitrator may be appealed. In the event the parties cannot agree upon an arbitrator to hear the appeal, the appellants) may, within 15 days after issuance of the original award, make a written request to the President of the SMA to appoint one. Upon receipt of such request, the President of the SMA shall choose an arbitrator at random from the SMA list of salvage arbitrators. 
(b) The appeal arbitrator shall review the original decision. His review shall be limited to clear error, and he shall either affirm or modify the award on this basis alone. His decision shall be issued within 15 days after his receipt of the award and evidence relevant to the appeal, and shall be absolutely final and binding upon the parties. 
VII. Arbitrator(s) Feels) and Expenses 
(a) A sole arbitrator's fee shall not exceed $1,000. In a tripartite proceeding, the fee of each arbitrator shall not exceed $750, except that the chairman shall be entitled to an additional compensation of $250. These fees are based upon submissions made pursuant to IV(b) and (e). In addition, the arbitrator(s) shall be entitled to reimbursement for the expenses of the arbitration, including telephone and facsimile charges, photocopying, postage, etc. at cost. Alternatively, the arbitrator(s) may charge $100 in lieu of an account of such expenses. 
(b) Pursuant to IV(c) the fee for a hearing shall be $300 per arbitrator.
(c) An appeal arbitrator shall be entitled to a fee not to exceed $500. 
VIII. Security for Arbitrator(s) Feels) and Expenses At any time prior to issuance of the award the arbitrator(s) may require each party to post security for 100% of the estimated arbitrator(s) feels) and expenses. Upon such demand each side shall promptly post the required amount in the Escrow Account of the SMA, or in any other manner acceptable to the arbitrator(s). 
IX. Application of Rules Except as hereinbefore provided, the Maritime Arbitration Rules of the Society of Maritime Arbitrators, Inc. in effect at the time the arbitration is commenced shall otherwise apply to any proceeding hereunder. 

The Society of Maritime Arbitrators, Inc.
U.S. OPEN FORM SALVAGE AGREEMENT
Codename -- MARSALV^®

This SALVAGE AGREEMENT ("The Agreement"), between _____________________________, Master/Operator/ Owner/Underwriter of the vessel ______________________________ ("The Vessel") and __________________________("The Salvor"), is for salvage services to be rendered to the Vessel and her cargo and/or other property currently lying at or near _______________________, under the following terms and conditions:

FIRST: The Salvor shall use his best endeavours to salve the Vessel and her cargo and/or other property and deliver same safely afloat, hauled or on dry-dock at or near ___________________, at which place and time the Salvor's services will terminate unless otherwise mutually agreed.

SECOND: The Master/Operator and crew of the Vessel agree to lend their aid and assistance to the Salvor, who shall be entitled, free of expense, to the reasonable use of the Vessel's equipment.

THIRD: The Salvor's services are to be performed on the following basis (check and initial one):

[_] No Cure-No Pay (Compensation to be conditioned upon successful salvage of the Vessel and/or her cargo and/or other property. In such case, the Salvor's compensation shall be pursuant to the criteria and other provisions of Article 13 of the 1989 International Convention on Salvage shown on the reverse of this Agreement).
[_] No Cure-No Pay, Fixed Fee $__________________
[_] Per Diem/Hourly at $_____________ per day/hour pro rata
[_] Other ______________________________________________________________ ______________________________________________________________________

FOURTH: Notwithstanding the election(s) made in Paragraph THIRD, the Salvor shall in any event be entitled to compensation for actions taken by the Salvor to prevent or minimize damage to the environment, in accordance with Articles 13 and 14 of the 1989 International Convention on Salvage shown on the reverse of this Agreement.

FIFTH: The Salvor shall have a lien upon the Vessel, her cargo and/or other property for services rendered pursuant to Paragraphs THIRD and FOURTH, and may demand reasonable security for such services from her Master, Owner, Operator or Underwriters as a condition for releasing same.

SIXTH: This Agreement shall be governed by and construed in accordance with the Federal Maritime Law of the United States. Any dispute arising out of this Agreement shall be referred to arbitration as follows:

(1) Disputes involving the salvage of vessels in commerce shall be resolved by arbitration in New York under the Maritime Arbitration Rules of the Society of Maritime Arbitrators, Inc.

(2) Disputes involving the salvage of yachts and other recreational vessels shall be resolved in the United States under the Rules for Recreational and Small Vessel Salvage Arbitration of the Society of Maritime Arbitrators, Inc. The Arbitrator(s) shall be familiar with maritime salvage, and shall be empowered to resolve any differences as to the application of sub-paragraphs (1) or (2) above. Any award made hereunder may include attorney's fees and costs, and shall be final and binding. For the purpose of enforcement the Award may be entered for judgment in any court of competent jurisdiction.

INSTRUCTIONS: Print out the above form in three colours: White: Salvor; Blue; Master/Owner; Pink; Underwriter

INTERNATIONAL CONVENTION ON SALVAGE, 1989

Article 13

Criteria for Fixing the Reward

1. The reward shall be fixed with a view to encouraging salvage operations, taking into account the following criteria without regard to the order in which they are presented below:

(a) the salved value of the vessel and other property;
(b) the skill and efforts of the salvors in preventing or minimizing damage to the environment;
(c) the measure of success obtained by the salvor;
(d) the nature and degree of the danger
(e) the skill and efforts of the salvors in salving the vessel, other property and life;
(f) the time used and expenses and losses incurred by the salvors;
(g) the risk of liability and other risks run by the salvors or their equipment;
(h) the promptness of the services rendered;
(i) the availability and use of vessels or other equipment intended for salvage operations;
(j) the state of readiness and efficiency of the salvor's equipment and the value thereof.

2. Payment of a reward fixed according to paragraph 1 shall be made by all of the vessel and other property interests in proportion to their respective salved values. However, a State Party may in its national law provide that the payment of a reward has to be made by one of these interests, subject to a right of recourse of this interest against the other interests for their respective shares. Nothing in this article shall prevent any right of defence.

3. The rewards, exclusive of any interest and recoverable legal costs that may be payable thereon, shall not exceed the salved value of the vessel and other property.

Article 14

Special Compensation

1. If the salvor has carried out salvage operations in respect of a vessel which by itself or its cargo threatened damage to the environment and has failed to earn a reward under article 13 at least equivalent to the special compensation assessable in accordance with this article, he shall be entitled to special compensation from the owner of that vessel equivalent to his expenses as herein defined.

2. If, in the circumstances set out in paragraph 1, the salvor by his salvage operations has prevented or minimized damage to the environment, the special compensation payable by the owner to the salvor under paragraph 1 may be increased up to a maximum of 30% of the expenses incurred by the salvor. However, the tribunal, if it deems it fair and just to do so and bearing in mind the relevant criteria set out in article 13, paragraph 1, may increase such special compensation further, but in no event shall the total increase be more than 100% of the expenses incurred by the salvor.

3. Salvor's expenses for the purpose of paragraphs 1 and 2 means the out-of-pocket expenses reasonably incurred by the salvor in the salvage operation and a fair rate for equipment and personnel actually and reasonably used in the salvage operation, taking into consideration the criteria set out in article 13, paragraph 1(h), (i) and (j).

4. The total special compensation under this article shall be paid only if and to the extent that such compensation is greater than any reward recoverable by the salvor under article 13.

5. If the salvor has been negligent and has thereby failed to prevent or minimize damage to the environment, he may be deprived of the whole or part of any special compensation due under this article.

6. Nothing in this article shall affect any right of recourse on the part of the owner of the vessel.

© 1996 Society of Maritime Arbitrators, Inc.

His Majesty the King of the United Kingdom of Great Britain and Ireland and of the British Dominions beyond the Seas, Emperor of India; His Majesty the German Emperor, King of Prussia, in the name of the German Empire; the President of the Argentine Republic; His Majesty the Emperor of Austria, King of Bohemia, etc, and Apostolic King of Hungary, for Austria and Hungary; His Majesty the King of the Belgians; the President of the United States of Brazil; the President of the Republic of Chile; the President of the Republic of Cuba; His Majesty the King of Denmark; His Majesty the King of Spain; the President of the United States of America; the President of the French Republic; His Majesty the King of the Hellenes; His Majesty the King of Italy; His Majesty the Emperor of Japan; the President of the United States of Mexico; the President of the Republic of Nicaragua; His Majesty the King of Norway, Her Majesty the Queen of the Netherlands; His Majesty the King of Portugal and the Algarves; His Majesty the King of Roumania; His Majesty the Emperor of All the Russias; His Majesty the King of Sweden; the President of the Republic of Uruguay;

HAVING RECOGNISED the desirability of determining by agreement certain uniform rules of law respecting assistance and salvage at sea, have decided to conclude a Convention to that end, and have appointed as their plenipotentiaries, that is to say:

Who, having been duly authorised to that effect, have agreed as follows:

Assistance and salvage of seagoing vessels in danger, of any things on board, of freight and passage money, and also services of the same nature rendered by sea-going vessels to vessels of inland navigation or vice versa, are subject to the following provisions, without any distinction being drawn between these two kinds of service [viz, assistance and salvage], and in whatever waters the services have been rendered.

Every act of assistance or salvage of which has had a useful result gives a right to equitable remuneration.

No remuneration is due if the services rendered have no beneficial result.

In no case shall the sum to be paid exceed the value of the property salved.

Persons who have taken part in salvage operations notwithstanding the express and reasonable prohibition on the part of the vessel to which the services were rendered, have no right to any remuneration.

A tug has no right to remuneration for assistance to or salvage of the vessel she is towing or of the vessel's cargo, except where she has rendered exceptional services which cannot be considered as rendered in fulfilment of the contract of towage.

Remuneration is due notwithstanding that the salvage services have been rendered by or to vessels belonging to the same owner.

The amount of remuneration is fixed by agreement between the parties, and, failing agreement, by the court.

The proportion in which the remuneration is to be distributed amongst the salvors is fixed in the same manner.

The apportionment of the remuneration amongst the owner, master and other persons in the service of each salving vessel shall be determined by the law of the vessel's flag.

Every agreement as to assistance or salvage entered into at the moment and under the influence of danger may, at the request of either party, be annulled or modified by the court, if it considers that the conditions agreed upon are not equitable.

In all cases, when it is proved that the consent of one of the parties is vitiated by fraud or concealment, or when the remuneration is, in proportion to the services rendered, in an excessive degree too large or too small, the agreement may be annulled or modified by the court at the request of the party affected.

The remuneration is fixed by the court according to the circumstances of each case, on the basis of the following considerations: (a) firstly, the measure of success obtained, the efforts and deserts of the salvors, the danger run by the salved vessel, by her passengers, crew and cargo, by the salvors, and by the salving vessel; the time expended, the expenses incurred and losses suffered, and the risks of liability and other risks run by the salvors, and also the value of the property exposed to such risks, due regard being had to the special appropriation (if any) of the salvors' vessel for salvage purposes; (b) secondly, the value of the property salved.

The same considerations apply for the purpose of fixing the apportionment provided for by the second paragraph of Article 6.

The court may deprive the salvors of all remuneration, or may award a reduced remuneration, if it appears that the salvors have by their fault rendered the salvage or assistance necessary or have been guilty of theft, fraudulent concealment, or other acts of fraud.

No remuneration is due from persons whose lives are saved, but nothing in this Article shall affect the provisions of the national laws on this subject.

Salvors of human life, who have taken part in the services rendered on the occasion of the accident giving rise to salvage or assistance, are entitled to a fair share of the remuneration awarded to the salvors of the vessel, her cargo, and accessories.

A salvage action is barred after an interval of two years from the day on which the operations of assistance or salvage terminate.

The grounds upon which the said period of limitation may be suspended or interrupted are determined by the law of the court where the case is tried.

The High Contracting Parties reserve to themselves the right to provide, by legislation in their respective countries, that the said period shall be extended in cases where it has not been possible to arrest the vessel assisted or salved in the territorial waters of the State in which the plaintiff has his domicile or principal place of business.

Every master is bound, so far as he can do so without serious danger to his vessel, her crew and her passengers, to render assistance to everybody, even though an enemy, found at sea in danger of being lost.

The owner of a vessel incurs no liability by reason of contravention of the above provision.

The High Contracting Parties, whose legislation does not forbid infringements of the preceding Article, bind themselves to take or to propose to their respective legislatures the measures necessary for the prevention of such infringements.

The High Contracting Parties will communicate to one another as soon as possible the laws or regulations which have already been or may be hereafter promulgated in their States for giving effect to the above provision.

This Convention does not affect the provisions of national laws or international treaties as regards the organisation of services of assistance and salvage by or under the control of public authorities, nor, in particular, does it affect such laws or treaties on the subject of the salvage of fishing gear.

This Convention does not apply to ships of war or to Government ships appropriated exclusively to a public service.

The provisions of this Convention shall be applied as regards all persons interested when either the assisting or salving vessel or the vessel assisted or salved belongs to a State of the High Contracting Parties, as well as in any other cases for which the national laws provide.

Provided always that:

1. As regards persons interested who belong to a non-contracting State the application of the above provisions may be made by each of the contracting States conditional upon reciprocity.

2. Where all the persons interested belong to the same State as the court trying the case, the provisions of the national law and not of the Convention are applicable.

3. Without prejudice to any wider provisions of any national laws, Article 11 only applies as between vessels belonging to the States of the High Contracting Parties.

Any one of the High Contracting Parties shall have the right, three years after this Convention comes into force, to call for a fresh conference with a view to possible amendments, and particularly with a view to extend, if possible, the sphere of its application.

Any Power exercising this right must notify its intention to the other Powers, through the Belgian Government, which will make arrangements for convening the conference within six months.

States which have not signed the present Convention are allowed to accede to it at their request. Such accession shall be notified through the diplomatic channel to the Belgian Government, and by the latter to each of the Governments of the other Contracting Parties; it shall become effective one month after the despatch of such notification by the Belgian Government.

The present Convention shall be ratified.

After an interval of at most one year from the date on which the Convention is signed, the Belgian Government shall place itself in communication with the Governments of the High Contracting Parties which have declared themselves prepared to ratify the Convention, with a view to decide whether it should be put into force.

The ratifications shall, if so decided, be deposited forthwith at Brussels, and the Convention shall come into force a month after such deposit.

The Protocol shall remain open another year in favour of the States represented at the Brussels Conference. After this interval they can only accede to it in conformity with the provisions of Article 17.

In the case of one or other of the High Contracting Parties denouncing this Convention, such denunciation shall not take effect until a year after the day on which it has been notified to the Belgian Government, and the Convention shall remain in force as between the other contracting Parties.

IN WITNESS WHEREOF, the plenipotentiaries of the respective High Contracting Parties have signed this Convention and have affixed thereto their seals.

DONE at Brussels, in a single copy, September 23rd, 1910