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Issue 237 |
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Maritime Advocate Online
is a weekly digest of news and views on the maritime industries,
with particular reference to dispute resolution. It is a sister
publication to the quarterly, full-colour
Maritime Advocate magazine, available on subscription from
Merlin Legal Publishing. ____________________________________________________________________ To
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IN THIS ISSUE: 1. Cheap finance drying up 2. Free out 3. Pilot negligence 4. Late amendment 5. Legal change in Turkey 6. Salvage completed 7. Kidnap cover 8. Debating image 9. People & Places |
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1.
Cheap finance drying up ACCORDING to leading shipping accountant and business consultant Moore Stephens, shipowners looking to refinance should make their move now as all the indications are that the cheapest finance in shipping history is likely to come to an end soon as the banks start to look for new markets. In the latest issue of The Bottom Line, the Moore Stephens Shipping Industry Group newsletter, Chris Chasty, head of the firm's shipping group, says, "Banks are getting edgy and, although there is a lot of cheap money available now, and owners have equity to match it, the sensible banks have begun to call the bottom of the bank cycle. When major shipping banks are lending at 85 basis points over LIBOR to second-tier owners - and they are - commonsense begins to seep into bank credit committees." Chasty says that banks should start thinking about where else to lend, should seek out niche and emerging markets, and should stop chasing the known names. Owners, he adds, should refinance right now, before the banks take the initiative. Chasty also notes that shipyards around the world are "playing a waiting game, holding back on selling slots from 2008 onwards. They hope to get good prices to cover the huge losses they made over the last bump, when steel prices drove them into the red. But owners can hold their breath longer. They have the cash and they don't need to move. They expect prices to fall, as no-one believes freight rates will hold up for ever. Unfortunately, history shows that, when owners have money, they also have the urge to spend it - so yards with one eye open should start contracting now, quietly, at good prices to well-heeled owners. There are already some signs of that."
www.moorestephens.co.uk 2. Free out When a charter party stipulates 'Free Out', the vessel and the carrier have no liability for cargo damage caused by a stevedore controlled by the charterers. That was the ruling of the US Court of Appeals for the Fifth Circuit, in a recent case reported in the latest Client Alert from DeOrchis & Partners. The appeal court also found that 'proper delivery' from the carrier to the cargo owner occurred when the charterer's stevedores began the discharge process, at which time control of the cargo passed to the stevedores as shippers' agents. The case involved a consignment of steel coils damaged by a charterer's stevedores after discharge from the vessel. The court held that, as the coils were subject to 'Free Out', "the presumption was that the charterer would determine the method and purveyor of discharge". There was evidence that the stevedores were controlled by the charterers.
medeorchis@marinelex.com 3. Pilot negligence A RECENT decision on appeal in Australia has confirmed that pilot licensing is not of itself relevant to the immunity of a pilot's general employer for his negligence; and that incorrect operational advice from a pilot could constitute "misleading and deceptive conduct" in breach of the Trade Practices Act. The bulk carrier 'SA Fortius' was entering Port in 2002 when it struck the bulk coal terminal, causing about $12m-worth of damage. The port is a compulsory pilotage area, and a local pilot, employed by the port authority, was on the bridge at the time of the accident. The coal terminal sued the owners of the ship in the Australian federal court. The owners, in turn, cross-claimed against the port authority, alleging that the accident was due to the pilot's negligence. The judge at first instance ruled that the incident was the result of the negligence of both the master and the pilot. The court ordered that the owner reimburse the terminal operator's repair costs, but upheld the long-established common law rule that the owner and master of a ship are responsible for the negligence of a voluntary pilot, and that this exemption also covered compulsory pilots. The owner appealed, alleging that the trial judge had erred in confirming the port authority's immunity. The appeal has now been rejected, the court upholding the first instance judge's finding of immunity. The pilot, while he did not lack the appropriate qualifications or experience, was not actually licensed at the time of the incident, although everybody involved believed that he was. So the owner argued that an unlicensed pilot altered the legal position, and robbed the port authority of its usual immunity. The port authority's response was that, during a voluntary pilotage, a temporary master/servant relationship was created between the master and owners of the vessel and the pilot - and that relationship was not dependant on the qualifications or licensing of the pilot, but operated to the exclusion of any pre-existing employment relationship between the pilot and the corporation. The owner also appealed on the basis of Section 52 of the Australian Trade Practices Act 1974, relating to misleading or deceptive practices in 'trade or commerce'. The appeal court agreed with the owner that the pilot's activities came within the description of trade and commerce and that his conduct was misleading and deceptive. But it agreed with the first instance judge, who had found that the master had not placed relevant reliance on the advice of the pilot. In the latest issue of its TT Talk newsletter, the TT Club, reporting on a synopsis of the case by Michael Fisher, a partner in the Brisbane law firm of Thynne & Macartney, writes, "Overall, the decision is interesting in two particular respects: the confirmation that pilot licensing is not of itself relevant to the immunity of the pilot's general employer for his negligence; and the perhaps slightly surprising confirmation that incorrect operational advice from a pilot is 'in trade or commerce' and could constitute 'misleading and deceptive conduct' in breach of the Trade Practices Act. It is understood that the shipowners are intending to appeal to the High Court of Australia. The
full text of the decision can be found on the website of the
Australian
http://www.austlii.edu.au/au/cases/cth/FCAFC/2005/256.html 4. Late amendment IN a decision which Holland + Knight characterises in its Maritime Items email service as "apparently driven more by mercy than merit," the US Court of Appeals for the Third Circuit has ruled that an injured seaman may amend his complaint four years after his first injury so as to add the United States as a defendant. The plaintiff allegedly suffered four separate but similar injuries on four different ships, the names of all of which began with 'USNS'. After several years, he brought suit against the operators of the ships. Even after being told that the actions were controlled by the Suits in Admiralty Act and the Public Vessels Act, the plaintiff waited until he received copies of the ship operating agreements before seeking to amend his complaint to add the United States as a defendant. The trial court denied his motion. But the appeal court ruled that the trial court had abused its discretion and applied an incorrect standard in denying the motion. The decision omits any discussion of the waiver of sovereign immunity.
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______________________________________________________________________ THE Council of Ministers in Turkey is reviewing the new draft commercial code which proposes major changes to maritime trade. The changes respond to the need to implement international conventions and reflect experience gained over the past fifty years from the application of the current commercial code. For a more detailed account, provided by Ali Kartal of Aybay & Aybay to the International Law Office website, go to:
www.internationallawoffice.com/?l=8J2NM&i=1013606 DUTCH salvage and towage company Multraship Salvage BV has successfully refloated the Slovakian pusher-tug 'Polana', which sank in the River Danube on December 19 last year following a serious fire in it engineroom. Despite a rapid response from local firefighters at the time of the casualty, the fire spread into the 'Polana's' accommodation and other parts of the ship. The vessel subsequently sank in 10-12 metres of water in the Romanian section of the river, off Giurgiu. The Romanian authorities ordered the owners to remove the vessel immediately, not least because the Polana had over forty tonnes of fuel on board. Leendert Muller, managing director of Multraship Salvage, says, "High water levels and currents running up to between four and five knots made diving almost impossible. Placing the lifting wires was therefore a difficult and time-consuming job. But we needed to act quickly because we knew from previous experience, and particularly from last year's salvage of the 'Rostok' from the Romanian Danube, that the ingress of heavy sand is extremely rapid. That proved to be the case once more. The vessel weighed around 375 tonnes, but the net weight of the vessel with sand inside was over 600 tonnes". Reports indicate that a small amount of fuel escaped from the vessel at the time of its sinking, but the remaining fuel was successfully transferred by the salvors into tank barges. The vessel has now been successfully redelivered to its owners.
www.multraship.nl TRANSMARINE has combined forces with the St Paul Travelers syndicate at Lloyd's to create a tailor-made kidnap and ransom wording designed to cover anybody lawfully on board an insured vessel, while ashore in port, or in transit. The policy is underwritten 100 per cent by St Paul Travelers and distributed by Michael Else and Company as exclusive underwriting agents. Transmarine says the new cover has been prompted by an "alarming increase in the incidence of seafarers being kidnapped for ransom".
transmarine@else.co.uk TOPICS debated at the 12th annual Hellenic-American and Norwegian-American annual conference in New York on February 7 will include the maritime industry's image, the Jones Act, and the FFA market. Michael Grey of Lloyd's List will moderate the discussion on image. Participants in the 'Jones Act Resurrection: Reality or Fiction?" discussion will include Intertanko chairman Stephen Van Dyck, and Mike McClure, CFO of Navios, will conduct the panel on the FFA market. The conference will conclude with a cocktail reception sponsored by Healy & Baillie and Jacq Pierot Jr & Sons. _____________________________________________________________________ 9. People & Places BRIAN Perrott, Richard Merrylees and Jason Mantovan are to join Holman Fenwick & Willan. Perrott, former head of litigation at Cargil, will join the HFW partnership in London on February 1. Merrylees and Mantovan join as assistants.
www.hfw.com Clyde & Co is to open an office in Shanghai, on February 20. This will be the firm's third office in Asia, alongside Hong Kong and Singapore. The office will focus initially on insurance, transportation (including all aspects of marine work), international trade and commercial work.
www.clydeco.com DOUG Barrow, a byword in bunkers, is the new chief executive of Maritime London, replacing Tony Funnell in that post.
www.maritimelondon.com UNDERWRITING director Paul Jennings and finance director Alan Wilson have been appointed to the new role of deputy managing directors by the North of England P&I Club. They will report to existing joint managing directors Rodney Eccleston and Peter Crichton until May this year, when Crichton plans to retire and Eccleston will become sole managing director.
www.nepia.com Dinner time YOUR editor has been to hundreds - perhaps thousands - of shipping dinners over the years. These have ranged from hedonistic banquets in hothouse climes to drab dinners in liveried London halls where the company has been as vinegarish as the wine. On one occasion, your editor spent a whole evening at a shipping dinner pretending to be somebody else, and had reached the cheeseboard stage before being exposed after stumbling over a tricky question about the collision rules that would have been meat and drink to the person whose identity he had assumed. Most people could probably count on the fingers of one hand the enjoyable annual dinners they have attended. The one that sticks most vividly in your editor's mind was a General Council of British Shipping dinner back in the 80s during which a long and incredibly tedious dissertation by a European shipping minister was interrupted by a belted English earl who grumbled, very audibly, "Why doesn't the damn fellow shut up? Who wants to hear a lot of waffle about a country no bigger than the Isle of Wight?" Of course there is a place for annual dinners. Without them we should have little need of dinner suits or décolletage. The London Maritime Arbitrators Association annual dinner is generally a very convivial occasion, and Carpenters Hall will doubtless be full to the rafters on March 1 this year. And do not be put off by the comment from the Hon Sec that, "Should you be uncertain as to the name of your guest at the time of your application, please do not delay your application." Not all the LMAA guests are so forgetful.
www.lmaa.org.uk Big bother NOT long to go now. Soon, your editor will have no need to make sure that he is in a part of the house (the west wing is his current favourite) where no sight, sound or news of Big Brother can reach his eyes or ears. And it will be safe to look at the newspapers, and to turn on the wireless, once more. If there has ever been a more detestable programme on television, with a more despicable cast, compered by a more annoying person (who has forsaken shouting at the top of her voice only to adopt instead a faux archness which is even more exasperating), narrated by a person with a voice more irritating than a wasp, your editor does not want to know about it.
Both John Logie Baird and George Orwell deserve better. No marks for marketing WHAT is it about law firms and marketing? For a profession with a rightly sober approach to advertising, the law is guilty of some of the very worst types of promotional disasters. For some, mistakes are understandable because, prevented by the rules of their profession from advertising in the very media they wanted to be seen in, they sometimes indulged in the sort of nonsense promotions that would make an onion weep. But, for others, there is no excuse. Richards Butler is the latest law firm to come up with a truly ridiculous promotional idea, on this occasion an invitation card for its Shipping Group Reception to be held at Christ Church, in London, on February 2. The invitation takes the form of a ship's wheel which rotates on a piece of thick blue card, revealing as it turns the faces of seven men (presumably Richards Butler shipping partners) portrayed in a childlike manner as pirates. It is very silly. Lawyers, so often the subject of cruel and unfair jokes, are understandably sensitive about their image. But this sort of thing is a classic example of somebody in marketing trying too hard - and failing, ludicrously - to show that lawyers have a sense of humour. It isn't funny. It's laughable.
www.richardsbutler.com There's posh POSH and Becks climb into a taxi at Heathrow after arriving back in the UK from a trip to the US. Predictably, the taxi-driver falls into eager conversation with the England football captain. "Where you been then, David?" he asks. "We've been to New York," responds Beckham, with a knowing wink at his wife on the seat beside him. "Go anywhere nice?" "Yeh, we did some clubs and we ate at some great restaurants. There was one in particular where the food was out of this world." "Which one was that, then? I'm asking 'cos my brother's a cab driver in New York, and people are always asking him where to go to eat." "Oh, what was the name of it? It's on the tip of my tongue. I just can't think at the minute." Becks racks his brains, struggling to remember the name of the restaurant. His face then betrays a flash of inspiration and, leaning forward, he asks the cab driver, "What's the name of that big railway station in London?" "Waterloo?" ventures the cab driver. "No." "Paddington?" "No." "King's Cross?" "No." "Victoria?" "That's
IT," says Becks, becoming very animated, and turning to Posh.
"Victoria, what was the name of that great restaurant we went to
in New York?" Best Questions and Answers of the Week Q: According to Mr Bumble in Oliver Twist, the law is WHAT? A:
Never wrong Q: In 1956, which events for the Melbourne Olympic Games were held in Sweden as a result of Australia's stringent quarantine laws - equestrian or weightlifting? A:
Weightlifting Q: The John Le Carre novel which has recently been made into an acclaimed film is The Constant WHAT? A:
Policeman Q: Which 'B' is the name of a place where beer is brewed commercially? A:
A beery Q: Which type of drum has a name which also means 'to trap'? A: Bass
(BBC TV, The Weakest Link) |
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