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Salvage Contract for Ship - How to Request ? Handling, Responsibility & Recordings

When a ship suffers a casualty, or is otherwise in a position of peril, the master must decide as a matter of urgency whether assistance, including salvage assistance, is needed or if the situation can be handled using the ship"s own resources. The Master should normally request salvage after consultation with the management Company. However he has complete authority to seek salvage assistance without reference to the Company if he considers this necessary. The Master should refer to the publication on board “Peril at Sea and Salvage” for professional guidance.

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Matters to be Confirmed when Concluding a Salvage Contract

The Master shall confirm the following items when concluding a salvage contract:
  1. Instructions given by the Company (if available);
  2. Name of Salvagers and Position of Signatories;
  3. Contents of Salvage Contract;
  4. Place of arbitration for Salvage Awards
  5. Getting consent of the hull insurance company and cargo owners, where possible.
Attention to be Paid in Concluding Salvage Contract

Decided by the Master
  1. A salvage contract shall normally be concluded with consent of the Hull Insurance Company and Cargo Owners.
  2. In an Urgent situation, the Master may conclude a salvage contract by his own decision to protect Human lives, the Hull and Cargo, and to avoid Environmental Pollution.
The Master shall take the following matters into consideration in concluding a salvage contract :
stranded vessel
Fig : Vessel in distress

The Master’s Responsibility during Salvage Operation
  1. Even in a case where a salvage contract has been concluded and the salvager carries out the salvage operation, the Master continuous to be responsible for the persons, hull, outfit and the cargo onboard. Therefore, the Master shall pay great attention to the safe and effective execution of the salvage operation.
  2. “No Cure No Pay” is the basic principle of the Lloyd’s Open Form, and it is generally understood that the rescued party shall not interfere with the rescue operation. Therefore, the Master shall be diplomatic and cooperative towards the salvagers, so as to not disadvantage arbitration in the future.
  3. If the Master offers his opinion on the salvage operation to the salvagers, it shall be made clear that these are Suggestions only, so that the responsibility is not shifted to him in the future.
  4. If the Master according to his professional judgment has to interfere in a salvage operation to safeguard human life, vessel, cargo and the environment he shall offer his protest in writing.

Recording during Salvage Operation

For proper assessment of the salvage awards at the arbitration later, the Master shall record the following items during the salvage operation : The Master need to investigate and record details of the distress, condition around the vessel, and dangers facing the salvagers during the salvage operation

Report to the Company

The Master shall report the following items to the Company immediately after the completion of the salvage operation as the data to assess whether the operation has been reasonable and carried out effectively or not, in deciding the salvage awards in the future:
Legal assistance - Appointment of Company Solicitor

The Company may appoint a solicitor after an incident involving liability and/or third parties to act on behalf of Owners and Underwriters in order to investigate the incident. If this decision is made, the Master will be immediately notified and given details of the lawyer attending. The ship’s personnel must not discuss the incident with anyone other than the lawyer. In certain countries, a civil authority may be given the responsibility of investigating the incident. In such a circumstance it is in order to discuss the case with the civil authority investigator but, if possible, any discussion is to be delayed until the arrival of the Company’s solicitor.


Any method of communication may be used when a ship is in peril. Speed is essential and if power supplies are available satellite communications or main radiotelegraphy may be the most rapid way of establishing contract. At short to medium ranges, person to person radiotelephone contact may be the most effective. Governments and coastal state agencies normally require the use of VHF radiotelephony. If main and reserve radio equipment is unavailable, efforts should be made to relay messages through ships or shore stations in the vicinity using, for example, battery powered emergency sets. To obtain priority when transmitting messages by radio to stations or ships within range, the master should use the appropriate prefix signal to indicate that his message concerns distress (SOS, or by voice, MAYDAY), urgency (XXX, or by voice, PAN) or safety (TTT, or by voice, SÉCURITÉ).

In general, all communications should be brief, to the point and, except for those prefixed for distress, where practicable transmitted on working frequencies after communication has been established. This will keep the emergency and calling frequencies clear for other essential communications.

Salvage association

When damage to a vessel occurs which may give rise to a claim, owners have a duty to advise underwriters promptly. The underwriters will contact the Salvage Association, who will in turn instruct a surveyor to attend the vessel. The surveyor's log is to establish the facts surrounding the damage. The Salvage Association is an independent organisation which has representatives all over the world.

Related Information
  1. Guideline for salvage of another ship after collision accident

  2. In case of damage to anchor and chain when to claim for '' general average"? ....

  3. Requirement of towing arrangement in oil tankers, readyness, & training onboard

  4. Salvage remunerations - benifits of L.O.F. contract or daily hire basis contract

  5. How to deal with a damaged anchor? ....

  6. How to recover a lost anchor ? ....

  7. What is stranding ? Investigation of possibility of self-refloating and urgency of danger ....

  8. What are the emergency procedures for loss of anchor and chain? ....

  9. In case of damage to anchor and chain when to claim for '' general average"? ....

Additional Info Pages

  1. General Average & The York Antwerp Rules
    The law of General Average is a principle of maritime law whereby all stakeholders in a sea venture proportionally share any losses resulting from a voluntary sacrifice of part of the ship or cargo to save the whole in an emergency. It is a unique maritime concept. One of the most ancient aspects of shipping is the general average. When an intentional sacrifice of property is made onboard a ship to avoid a common peril, the law of general average requires all of the parties to the maritime adventure that benefited by the intentional sacrifice to contribute money on a pro-rata basis.

  2. P&I Clubs guideline
    The P&I Clubs are correctly called Protection and Indemnity Associations and number around 20 worldwide with the majority being United Kingdom based. The ship owner in taking out insurance with a particular association becomes a member of that Club. The Clubs are mutual in nature, which means that all costs involved in providing cover or paying out a claim to any one member is shared by all members. This is achieved by setting a rating or premium for the owner, known as an “advance call”, and is based on the owner’s history and exposure to risk.

  3. Marine cargo insurance underwriters
    Ships operate in a difficult environment and cargo may be lost or damaged during domestic and/or international transit. However, ocean carriers are well protected under the law against responsibility for loss or damage to cargo that might arise during the transportation of goods.

  4. P & I Insurance cover and Members of IG club
    At the heart of P and I is the concept of “mutuality”. Shipowners form a nonprofit association to protect and indemnify one another against third party liabilities. Unlike commercial insurance, the insured ship owners, meaning the “members” of the Club, are both the insurer and the insured. Each P and I Club is controlled by its members.

  5. Hull & Machinery underwriters
    A hull and machinery underwriter provides insurance coverage for boats, ships, and other naval assets. It gives protection to shipowners against hull, machinery and onboard equipment damages in the event of any perils encountered while on the water, including collision with another vessel, natural obstacles and other structures as well as storms and other natural disasters.

  6. Procedure for insurance claim
    A ship is insured against various risks by the Owner taking out different insurance policies. But for many reasons insurance claims often being denied by marine insurance providers. So that a shipowner can prosecute a claim accurately and successfully, the Master needs to send full details and documentation relating to any accidents or incidents resulting in damage to the ship, property, cargo, or personal injury. Nautical Institute publication, “The Mariner’s Role in Collecting Evidence” is a good source of guidance to shipmasters.

  7. The role of a insurance broker
    Marine insurance brokers play a significant role in helping companies and individuals procure marine cargo insurance, hull and machinery insurance, P and I cover, and other forms of insurance as the case may be. They are able to canvas the worldwide marine insurance market. The goal is to assist in getting the best terms of insurance cover at the most competitive premium rates.

  8. Marine salvage procedures
    Marine salvage contracts fall into two main categories. First, those which enable salvage services to be rendered on the basis that the compensation to be paid to the salvors will be determined after the completion of the services, either by settlement or if the parties cannot agree, then by a court or by an arbitrator

  9. Role of shipbrokers
    London and New York have always been viewed as major shipbroking centers. In recent years, many U.S. ship brokerage firms have relocated to offices in Stamford and Greenwich, Connecticut, and nearby communities. Of course, there is a large shipbroking presence in Singapore, Hamburg, as well as other cities.

  10. Sale & purchase brokers
    Sale and Purchase Brokers (S and P Brokers) are highly specialized shipbrokers. Their clients are typically ship owners. S and P Brokers serve as intermediaries in the business of selling and buying ships. They assist in the sale and purchase of second-hand tonnage and newbuilding. Their compensation is normally in the form of a commission.

Collecting Information and Data for Passage Planning

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