Чрезвычайно интересный случай написания одним и тем же автором (Herman Steen) двух статей, в которых исследуется один и тот же казус – Renos case (Sveriges Angfartygs Assurans Forening (The Swedish Club) v Connect Shipping Inc [2019] UKSC 29). В этих статьях упомянутый казус рассматривается в нескольких различных аспектах: со стороны страхования и морского права. Niklas Sonnenschein, юрисконсульт Ассоциации морских страховщиков Северных стран, содействовал в создании обеих статей.
Introduction
Nordic Plan
Comment
Introduction
The UK Supreme Court’s recent decision in the Renos case (Sveriges Angfartygs Assurans Forening (The Swedish Club) v Connect Shipping Inc [2019] UKSC 29)) is a landmark decision on marine insurance under the English Institute Time Clauses Hulls (1/10/83) (ITCH) conditions.(1) It clarifies that when determining whether a vessel is a constructive total loss (CTL) under the ITCH conditions, regard should be had to the costs incurred prior to the owner’s notice of abandonment, but not to remuneration payable under a special compensation protection and indemnity clause (SCOPIC). The decision is of significance to the insurance market because of its financial and practical implications. But what would the position be under the 2019 version of the Nordic Marine Insurance Plan 2013 (Nordic Plan)?
Nordic Plan
Under the Nordic Plan, an assured is entitled to claim a CTL if the conditions for condemnation of a vessel set out in Clause 11-3 are met. ‘Condemnation’ is the term used in the Nordic Plan for CTL. The conditions for condemnation are met when the damage is so extensive that the cost of repairing the vessel would amount to at least 80% of the insurable value (or of the value of the vessel after repairs, if the latter is higher than the insurable value).
Under Clause 11-5, if an assured wants a vessel to be condemned, it must submit a request for condemnation to the insurer without undue delay after the vessel has been salvaged and it has had an opportunity to survey the damage. This allows the parties to make rational decisions based on their best evaluation of the situation. The assured is not required to give notice of abandonment.
Pursuant to Clause 11-3(4), repair costs are deemed to include all costs of removal and repairs which, when the request for condemnation is submitted, must be anticipated if the vessel is to be repaired. The relevant costs include the costs of repairing all damage reported in the previous three years. However, the provision sets out some important exceptions, including that salvage awards will not be considered.
As is pointed out in the commentary on the Nordic Plan, the fact that removal costs are included in the calculation means that the decisive point about condemnation is founded on a more realistic basis. Alternatively, damage to a ship would be considered alone, regardless of the ship’s location. The example in the commentary is that there will be a material difference between a damaged ship which is in a port at, for example, Svalbard and a ship with similar damage in a port with good possibilities of repairs.
However, a line must be drawn between removal costs (which count towards condemnation) and salvage awards (which do not count towards condemnation).
The main reason why salvage awards are excluded from a condemnation assessment is that it will always be difficult to estimate a salvage award in advance, and this would introduce a serious element of uncertainty in the condemnation formula. At the same time, it is difficult to survey damage properly if a vessel has not been salvaged.
The commentary states that the distinction between a salvage award and the expenses that will be included, especially removal costs, must be based on general maritime law criteria:
The decisive factor must be the situation which the ship was in when the salvor was given the assignment, and not whether the remuneration agreed to on a ‘no cure – no pay basis’ was determined in advance or shall be paid according to accounts rendered.
This means that not only Article 13 awards, but also SCOPIC remuneration, will be excluded under the Nordic Plan in a condemnation calculation.
Even if a salvage award is not included in the condemnation formula, hull and machinery insurers must in practice also take the salvage award into consideration if the assured claims for a total loss before the ship has been salvaged. The significance of the condemnation request being made while the ship is still at the place of casualty lies in the fact that this is the point in time that will be decisive for the assessment of the costs and the market value of the ship.
Further, under the Nordic Plan, salvage awards are covered as costs of measures taken to avert or minimise loss arising in connection with the casualty (sue and labour costs) up to an equivalent amount of the sum insured in addition to the compensation for a particular or total loss.
Comment
The assessment in the Renos case would clearly be different under the Nordic Plan.
First, the CTL threshold is different. Under the Nordic Plan, the threshold is 80%, whereas it is 100% under the ITCH.
Second, salvage awards are treated differently in a CTL assessment. The UK Supreme Court established in the Renos case that salvage costs count towards CTL under the ITCH, but that SCOPIC remuneration does not count. However, under the Nordic Plan, the costs of salvage awards do not count towards CTL, irrespective of whether the award is an Article 13 award or SCOPIC remuneration. The common denominator therefore between the Nordic Plan and the ITCH, following the Renos case, is that SCOPIC remuneration does not count towards CTL.
The idea behind the regulation in the Nordic Plan (ie, the combination of the lower threshold and excluding salvage awards) is that it makes it easier for an assured to assess whether the requirements for a total loss are satisfied.
Finally, the mechanics under the Nordic Plan may, in practice, more easily lead to a condemnation (mainly because of the lower threshold).
Endnotes
(1) For an overview of the UK Supreme Court’s decision, please see “Supreme Court issues important decision on CTL in Renos case”.
Niklas Sonnenschein, legal counsel at the Nordic Association of Marine Insurers, assisted with the preparation of this article.
Автор: Herman Steen
Источник: https://www.internationallawoffice.com/Newsletters/Shipping-Transport/International/Wikborg-Rein/UK-Supreme-Court-decision-in-Renos-case-position-under-Nordic-Plan?utm_source=ILO+Newsletter&utm_medium=email&utm_content=Newsletter+2020-01-08&utm_campaign=Shipping+%26+Transport+Newsletter
Introduction
Facts
Lower court decisions
Supreme Court decision
Introduction
The Supreme Court’s recent decision in the Renos case (Sveriges Angfartygs Assurans Forening (The Swedish Club) v Connect Shipping Inc [2019] UKSC 29)) is a landmark decision on marine insurance under the Institute Time Clauses Hulls (1/10/83) (ITCH) conditions. It clarifies that when determining whether a vessel is a constructive total loss (CTL) under the ITCH conditions, regard should be had to the costs incurred prior to the owner’s notice of abandonment (NOA), but not to remuneration payable under a special compensation protection and indemnity (P&I) clause (SCOPIC). The decision is of significance to the insurance market because of its financial and practical implications.
Facts
The Renos sustained significant damage following a fire off the Red Sea coast on 23 August 2012, resulting in it losing main engine power and requiring salvage assistance. A Lloyd’s open form (LOF) with a SCOPIC was signed, and the SCOPIC was invoked. Following extensive discussions between the vessel’s owners and hull and machinery (H&M) insurers, the owners tendered an NOA on 1 February 2013. The H&M insurers contended that the vessel was not a CTL.
A SCOPIC is an optional clause in an LOF. If included and invoked by a salvor, it provides guaranteed remuneration based on predetermined rates for tugs, personnel and equipment deployed by the salvor. SCOPIC remuneration is payable only insofar as it exceeds a conventional salvage award under Article 13 of the Salvage Convention 1989. As a rule, an Article 13 award is an H&M risk, whereas SCOPIC remuneration is a P&I risk.
Lower court decisions
Both the High Court and the Court of Appeal found that the vessel was a CTL, on the basis that the pre-NOA costs and the SCOPIC costs were included, and found it unnecessary to make findings as to the other alleged costs of recovery and repair. The Supreme Court granted leave of appeal in respect of the pre-NOA and SCOPIC issues.
Supreme Court decision
Should costs incurred prior to NOA be excluded from CTL calculation?
On this issue, the Supreme Court affirmed the decision of the lower courts and held that the cost of repairing the damage for the purpose of determining whether the vessel was a CTL under Section 60(2)(ii) of the Marine Insurance Act included all of the reasonable costs of salving and safeguarding the Renos from the time of the casualty onwards, together with the prospective cost of repairing it. The cost of repairing the damage was in no way adeemed because part of it had already been incurred when NOA was given and action was brought on the policy.
Should SCOPIC costs be excluded from CTL calculation?
The Supreme Court disagreed with the lower courts on this issue and held that SCOPIC costs should not be considered when assessing whether a vessel is a CTL. The Supreme Court emphasised that SCOPIC costs are not intended to enable a ship to be repaired, but to protect a shipowner’s potential liability for environmental pollution. According to the Supreme Court, this was not part of the measure of the damage to the Renos and had nothing to do with the possibility of repairing it. The Supreme Court pointed out that environmental pollution is a P&I risk and was covered by the owners’ P&I club. However, it held that the mere fact that the H&M insurer would not, under the policy terms, be liable for some item of expenditure on a partial loss basis did not necessarily mean that it could not be included in the assessment of whether there was a CTL.
In many cases, this may have great financial implications as SCOPIC costs may be a large part of salvage costs, such as in this case where the SCOPIC costs were about half of the total salvage remuneration.
The Supreme Court set aside the High Court’s order and remitted the matter back to it to determine – with SCOPIC excluded from the assessment – whether the Renos was a CTL.
Endnotes
(1) For a discussion on the position under the 2019 version of the Nordic Marine Insurance Plan 2013, please see “UK Supreme Court decision in Renos case: position under Nordic Plan”.
Niklas Sonnenschein, legal counsel at the Nordic Association of Marine Insurers, assisted with the preparation of this article.
Автор: Herman Steen
Источник: https://www.internationallawoffice.com/Newsletters/Shipping-Transport/United-Kingdom/Wikborg-Rein/Supreme-Court-issues-important-decision-on-CTL-in-Renos-case?utm_source=ILO+Newsletter&utm_medium=email&utm_content=Newsletter+2020-01-08&utm_campaign=Shipping+%26+Transport+Newsletter