Public policy supports salvage and as a result when assistance is rendered at sea a salvage reward is likely. However, certain categories of claimant are not entitled to claim salvage, largely for public policy reasons.
For instance, it is reasonable to exclude from the right to claim salvage persons who may deliberately create danger in order to gain a salvage reward. Thus, in general, the master and the crew of the salved vessel, as well as pilots and tugs under contracts of towage will not be able to claim while per forming the services contracted for.
The Salvage Convention requires that “the services rendered exceed what can be reasonably considered as due performance of a contract entered into before the danger arose”.
However, when the services provided do exceed the contractual arrangement, e.g., when the vessel is abandoned by order of the master, then one would expect that the crew members may act as salvors.
Similarly, if during the performance of a towage contract the situation becomes dangerous, towage may turn into salvage.
Two other categories of person who may find difficulty in claiming salvage are salvors employed by governmental or public services and the governmental or public services themselves, for example the Navy or the Coastguard.
The general encouragement of salvage requires that a shipowner should be allowed to provide salvage assistance to another of its ships. This is consistent with the pre-existing law of salvage under which in the appropriate circumstances a salvage reward may be due to the shipowner or the cargo owner.
Financial Security
The right to the salvage reward is supported by a maritime lien of the highest priority and by a possessory lien. However, particularly in respect of the special compensation, salvors need to know as early as possible that payment for their services will be forth coming and that the shipowner will be capable of paying. Accordingly, the provision of financial security at an early stage is important for the salvors.
The Salvage Convention leaves unaffected maritime liens existing under national law as well as liens under other international conventions. The only restriction imposed is that where security is provided the maritime lien cannot be exercised.
However, the amount of the required security is not specified but needs to be “satisfactory” by reference not only to the reward itself but to interest and costs. The duty to provide financial security is put upon the owners of the property. Nonetheless, the shipowner, apart from the obligation to provide financial security for the part of the reward for which it is responsible, is also under a duty to exercise best endeavours in ensuring that the cargo interests will also provide security in respect of their part of the reward.
To enhance the probabilities of recovery for the salvor the Salvage Convention provides that the ship or other property salved should not be moved from the port prior to the provision of security. However, these words do not create robust obligations because there are no sanctions provided under the Salvage Convention to cover the situation where, for example, the cargo is removed from the ship and the port. Moreover, it is unclear how the person permitting the unauthorised release of the property can become liable to the salvors. Similarly, the general requirement about the provision of satisfactory security does not spell out what the salvor’s options are where such security is not provided.
Apportionment of the Salvage Reward
Where more than one salvor is involved in the salvage operation, the question on how the salvage reward should be distributed becomes important. Article 15 of the Salvage Convention requires that any salvage reward or special compensation is to be divided between the salvors in accordance with the criteria set out in Article 13.
In addition, the distribution of the salvage reward between salvor’s crew is subject to the law of the flag of the salvor’s ship. Where salvage is not performed from a ship, the law of the contract between the salvor and its employees will decide how the reward should be split.
Of course, if there are sub- contracts between the head salvor and other contributors, it is usual that both the law and jurisdiction, and probably the substantive part of the payment, has been agreed.
A different problem arises where the ship performing the salvage is under a demise or time charter. The question whether and to what extent the salvage reward will be split between owners, demise charterers and other charterers will depend on the relevant charterparty.
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