Owner claims against manager for failure to update ballast water management plan

FAILURE to keep a proper onboard record of regulatory and legislative changes can have costly consequences for shipowners and their intermediaries, as evidenced by a claim recently handled by International Transport Intermediaries Club (ITIC).

The crew of a ship which frequently traded to US ports found themselves in contravention of state legislation when they conducted deballasting operations enroute to California more than 50 nautical miles out from the California coast. Such an operation had been permissible - and had indeed been performed by the crew - under the regulations in force when the ship had previously traded to California. But, on this occasion, such deballasting was in violation of new regulations which had entered into force in July 2017, requiring ships entering from international waters to deballast more than 200 nautical miles from the coast of California.

The Californian authorities had disseminated this change to the shipping community by way of circulars. Information had also been published by the ship’s P&I club, but the change had not been not picked up by the ship’s managers. As a result, the ship’s ballast water plan had not been updated to reflect the new rules.

The master admitted to the Californian authorities that the crew were not aware of the change in legislation, and the authorities duly issued a fine of $280,000 against the owner. This was subsequently negotiated down to $215,000, which the owner claimed from the ship managers on the basis that they should have been aware of the change in law and should have updated the ballast water plan. The claim was settled by ITIC.


ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

ITIC helps ship manager successfully refute owner’s allegation of negligence

International Transport Intermediaries Club (ITIC) has successfully defended a ship manager against allegations of negligence made by a shipowner following the loss of a lifeboat overboard.

The lifeboat was subsequently found drifting off the port of Naze, Japan, after the master of the vessel had reported it missing. In view of the cost of deviating the ship to recover the lifeboat, compared to the cost of replacing it, it was decided, in consultation with hull underwriters and the vessel’s P&I club, to abandon it. The P&I club arranged for the lifeboat’s disposal through its correspondent in Japan.

The owner brought a claim against the ship manager for $90,000, which sum was moreover withheld against fees and disbursements owed to the manager, alleging that the loss of the lifeboat had been caused by the manager’s gross negligence and mismanagement.

However, under the SHIPMAN 2009 management contract governing the relationship between the parties, the owner had no right to set off a claim against what was owed to the manager. Neither could the owner provide any evidence to support its claim that the ship manager had been negligent, let alone grossly negligent.

A report into the incident concluded that it had not been possible to physically examine the release mechanism of the lifeboat before arrangements for its disposal were made by the P&I club correspondent in Japan. The lifeboat had successfully undergone its annual service and inspection six months previously, however, and had been wire-lashed on board the vessel for added security.

ITIC advised the owner that, if the sum owed to the manager was not paid, interest would be applied, and the ship would be arrested. The owner thereafter remitted the funds due, and nothing further was heard about the lost lifeboat.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com