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MARINE CASUALITY MANAGEMENT
Role of Average Adjuster

By
Leena Mody

“PCC AUTO MOVER”

“CC CONTAINER SHIFTER”

Collision Scenario

  • A collision occurred around midnight on 1st January 2006 in the southern Irish sea.

  • Two vessels in collision viz. PCC “AUTO MOVER”, CC “CONTAINER SHIFTER” with “WARSPEED FERRY” in nearby vicinity.

  • Poor weather conditions at time of collision.

  • No loss of life and negligible pollution.

  • All vessels equipped with ARPA, AIS, Course Recorder and Movement Logger.

  • Neither vessel had Voyage Data Recorder (VDR).

  • High speed collision.

  • “AUTO MOVER” severely damaged her starboard side midship resulting in flooding of some of her lower car decks.

  • “CONTAINER SHIFTER” sustained severe damage to her bow.

  • About 13 deck containers lost overboard.

  • “CONTAINER SHIFTER” stood by until crew of “AUTO MOVER” rescued and thereafter “CONTAINER SHIFTER” proceeded to nearest port for repairs.

  • After “AUTO MOVER” was abandoned she drifted westward with tugs in attendance.

  • No damage to “WARSPEED FERRY”.

Background
Collisions can be divided in four categories:-

  • One vessel solely to blame.

  • Both vessels to blame.

  • Where negligence not proved against either vessel (inevitable accidents - force majeure).

  • Inscrutable fault.

Collision usually is a result of failure to comply with Convention on the International Regulations for Preventing Collision at Sea-1972 (COLREGs) as amended.


Collision Liability

  • If one vessel solely to blame, she will be responsible for her ascertained liability, which may be limited according to statute, but if both vessels to blame, the liability is divided in most jurisdiction as per degree of blame attached to each vessel.

  • Vessel claiming compensation for loss/damage will have the burden of proving that the other vessel was negligent.

Steps in Response to Collision

  • Hull Underwriters to be advised for any liability arising on the hull policy towards -
                  -possible collision recovery, and/or
                  -potential liability for 3/4thof the damage to other vessel.

  • Average Adjusters to be appointed for preparing claim on Hull Underwriters, P&I Club and recovery claim from opponent vessel.

  • P&I Club to be informed for potential liability of 1/4th of damages to the other vessel plus other liabilities in full which are excluded under Hull & Machinery policy.

  • Lawyers to be appointed as one may overlook the legal consequence of decisions taken in the aftermath of a major collision.

  • Lawyers and P&I Club to be consulted regarding the exchange of adequate security for estimated damage done due to collision including demurrage, interest and costs. If both vessels are entered with P&I Club then Clubs may themselves exchange appropriate guarantees.

Assessment of Liability

  • Investigate closely the circumstances of the incident, evidence of the crew and witnesses to the incident in order to assess the loss.

  • Two major problems on ship collisions are ascertainment of degree of blame and the prediction of damages that occurred during the incident.

  • In major collisions simulation of ship collision is carried out to assist in assessment of liability.
    Where a ship is equipped with Voyage Data Recorder (VDR), data retrieved from VDR may form a crucial evidence.

  • Contradictory factual position often leads to disputes in determining the time of collision, distances, bearings, speeds, course alterations, etc.

Damage Surveyor’s Role

  • A damage surveyor to be appointed by each of the parties representing the vessel to ascertain nature, cause and extent of damage.

  • Each surveyor will then carry out calculations to estimate the extent and cost of repairs.

  • Surveyor will require ship’s plans to assist.

  • Each of the damage surveyor will usually be also allowed to carry out a ‘without prejudice’ survey on the other vessel but not allowed to communicate with any crew member of the other vessel.

Adjuster’s Role

  • After collision a quick assessment is made by the adjusters on the question of liability, likely claim of both vessels, quantum of collision security to be procured, limitation funds under various limitation regimes and prospects of breaking or proving the right to limitation.

  • The question of limitation is often the determinative issue on question of jurisdiction.

  • To identify and secure favourable jurisdiction that may include the arrest of a sistership.

Lawyer’s Role

  • One lawyer will be appointed representing each vessel and other interested parties.

  • Statements from crew members and officers witnessing the event are taken by lawyers alongwith other information such as ship’s records, logbooks, ship’s plans etc.

  • Negotiations with opponent vessel’s solicitors on degree of blame, quantum of security/ liability, settlement amount, interest, costs, etc.

  • To establish degree of fault based on assessment of true collision time and position of colliding vessels

Speed & Angle of Blow Analysis Surveyor

  • To appoint a speed and angle of blow surveyor in event of disagreement on the degree of blame.

  • Angle of blow surveyor carries out independent analysis of both vessels and gives opinion on the speed and angle of impact.

  • Angle of blow surveyor measures various angle and depth of penetration in relation to frame numbers with the help of various ship’s plans.

  • Scale plan drawings of each vessel are drawn then fitted together to show the approximate positions of the two vessels at the time of impact in order to give relative angles between the two vessels.

  • This analysis enables to determine collision angle at the moment of maximum penetration.

  • These surveyors are also allowed to carry out ‘without prejudice’ survey on the other vessel, but not allowed to communicate with crew on either vessel.

Sketch showing approximate positions, speed and angle of two vessels at the time of impact.

Collision

Typical struck vessel

Bow of a striking vessel

Collision Security

  • In collision cases before commencing legal proceedings, it is desirable to ensure that service of suit will be accepted in the country where a maritime lien will be enforced and this is often done by obtaining security from those representing the allegedly negligent party.
     

  • The negligent vessel’s P&I Club and Hull & Machinery Underwriters generally provide the required security.
    Where security is denied there may be a need to ‘arrest the vessel’ by issue of a writ in the relevant court and service on the allegedly negligent party.
     

  • Under the Maritime Convention Act, 1911 action to enforce a lien in respect of a collision should commence within two years from the date of the collision.

Limitation of Liability

  • Law in most countries permits a ship owner to limit his liability for damage arising out of collision provided the collision occurs without his privity or knowledge.
     

  • Limitation is based on the registered tonnage of the ship claiming limitation and is expressed in ‘gold francs’, nominal monetary units which can be used to establish currency equivalent.
     

  • The four main limitation regimes can be categorized as -
               -1957 Brussels Convention,
               -1976 London Convention,
               -Protocol of 1996, and
               -based on damaged value of ship and freight as under U.S. law.
     

  • In some countries where the 1996 Protocol is ratified the limits as set out in the 1976 Convention are substantially increased.

Insurance on Collision Liabilities

  • The Running Down Clause or 3/4th Collision Liability Clause in a Standard Hull Insurance Policy is a supplementary contract.
     

  • It covers certain liabilities arising from collision in addition to the basic cover for loss or damage to the insured vessel caused by collision.
     

  • The amount recoverable under the clause is restricted to 3/4ths of the liability which is further limited to 3/4th of sum insured.
     

  • Hull cover also responds to 3/4th of the legal costs i.e. cost of defence and/or cost of contesting collision liability.
     

  • Where both vessels are to be blamed and unless the liability of one or both vessel become limited by law, the indemnity under Collision Clause shall be calculated on the principle of cross liability basis.

 

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