Services

Although General Average (GA) is a concept which traces its origin in ancient maritime law (Rhodian Law), it is still an integral part of the admiralty law of most countries. In order to achieve uniformity in treatment of GA, York Antwerp Rules (YAR) were formed in 1877 which have undergone various revisions, generally leading to progressive extensions in the scope of GA. Today, invariably all charter parties incorporate GA clause stating that GA to be adjusted as per YAR.

General Average is an internationally recognised system, where intentional losses or expenses arising out of a General Average situation are shared and paid for by all those involved in the common maritime adventure. Our job as General Average Adjuster is to:-

• Identify the General Average situation and advise the parties on steps to be taken
• Organise the process of collection of General Average Security and General Average guarantee from the various contributing interests and their underwriters
• Ensure that the General Average adjustment is prepared in accordance with the relevant terms of either the contract of afreightment or the charter party or the bill of lading
• Advise shipowners on special General Average Absorption Clauses to be included in Hull & Machinery policies in order to save time and labour in calculating claim on other contributing interests as also the hassle of collecting General Average documents for small claims
• Assist in calculating salved value of ship and cargo by working closely with the legal representatives of the interests involved
• Calculation of contributory value, apportionment of GA fund between various interests, calculation of GA interest and commission forms the major part of GA adjustment report
• Recommendations for payment on-account are also made in GA cases
• Preparation of a statement on G.A. claim on the marine insurance policy involving General Average, Salvage, Sue & Labour
• Collection of GA contribution and effecting settlement is done based on apportionment of GA amongst various contributing interests
• Apportionment of recoveries from third parties including apportionment of interest and payment on-account

Salvage

In vessels requiring salvage services, the Division suggests on the adequacy of the type of salvage contract to be undertaken (i.e. daily hire v/s Lloyd’s Open Form) depending on the circumstances of each case. Advice is provided on procedures and formalities to be complied with under an LOF contract. Assistance is also rendered in collection of salvage security/bail fees, during the salvage arbitration procedures, collection of proportionate salvage remuneration from various interests as awarded by the arbitrator, etc.

Despite modern aids to navigation and stringent safety regulations there has been a steady increase in the incidents giving rise to total loss of ship. Total loss broadly falls into two categories viz., Actual Total Loss and Constructive Total Loss.

Where the subject matter insured is destroyed or so damaged as to cease to be a thing of the kind insured i.e. “loss of specie” or where the assured is irretrievably deprived of the subject matter insured there is an Actual Total Loss.

Whereas, there is a Constructive Total Loss where the subject matter insured is reasonably abandoned on account of its actual total loss appearing to be unavoidable, or because it cannot be preserved from actual total loss without an expenditure which would exceed its insured value when the expenditure had been incurred.

In total loss cases the Average Adjusting Division of J.B. BODA & Co. assists in:-

• Determining whether there is an Actual Total Loss or a Constructive Total Loss
• If Constructive Total Loss, giving advice on tendering Notice of Abandonment, time when notice to be given
• Presenting facts and figures on total cost of recovery plus repairs
• Advising on effect of abandonment and subrogation
• In process of sale of wreck or assessing the value of wreck on ‘as-is-where-is’ basis

Collisions at sea normally cause mutual damage and if both sides are at fault, the assured under the hull policy will have a claim against the owner of the other ship for a fraction of his own damage concurrently whilst being liable for a corresponding fraction of the other ship’s damage.

In collision matters, the Average Adjusting Division of J.B. BODA & Co. Pvt. Ltd. assists in:-

• Collection of collision security
• Resolving difficult claims by working in close liaison with the principals or their legal representative of the vessels involved in collision
• Our in-house technical and legal experts assist in determining the angle of blow and degree of blame
• Advise on limitation of liability, applicable jurisdiction and settlement arising therefrom
• Apportionment of loss under the hull (3/4th), P&I (1/4th) and Excess Liabilities policies
• Preparing claim statements on marine insurance policies involving collision, on single liability basis or on cross liability basis
• Prepare statement of recovery made from opponent vessel in respect of loss, demurrage, delay, interest and costs, etc.

Loss of hire insurance is an insurance against shipowner’s failure to earn monies accruing from the use of a vessel due to a marine casualty preventing the insured vessel from operating.

We prepare loss of hire claims under different policy forms in use and calculate the underwriters’ liability after considering excess of number of days as provided in the policy.

J.B. BODA & Co. Pvt. Ltd. also deals in shipbuilders’ and ship repairer’s claims. In consultation with our technical advisors, we analyse the liability arising out of any claim for both the above mentioned policies and adjust the claim according to the established principles to ensure prompt settlement.

The hull policy imposes a duty upon the assured and their agents to take such measures as may be reasonable and necessary for the purpose of averting or minimising a loss which would be recoverable under the policy. The pre-requisite for any claim under the sue & labour clause is first that the peril averted must be one that is covered under the policy and second there must have been danger of loss which would have been covered by the policy.

J.B. BODA Average Adjusting Division not only assists in preparation of sue & labour claim but also advises the clients on the thin demarcation in distinguishing whether the claim falls on general average, salvage and sue & labour charges. In adjusting these claims underinsurance is considered if applicable and apportionment of these charges are also done on excess liabilities policy.