Law of salvage
The sea can be a dangerous and inhospitable place for mariners, and when things go wrong, assistance from other mariners facing similar danger may be our only hope. As incentive to other mariners to render aid and assistance, the law of salvage rewards salvors with a percentage of the value of what they save.
Three elements of salvage
1. A boat must be in peril, which is any situation that might expose the boat or legally protected marine environment to loss or destruction. Examples include a boat hard aground on a rocky bottom being pounded by waves, a boat taking on water and in danger of sinking, and widespread fire raging aboard a boat.
2. The salvor’s actions must be voluntary and must not be under a preexisting obligation to help. For example, U.S. Coast Guard rescue would not be eligible for salvage, neither would a towing company with which you have a preexisting contract covering the services provided.
3. Salvors must be successful in saving the boat or minimizing damage.
Dealing with salvage situations
1. Maintain comprehensive/liability marine insurance on your boat. Make sure that your comprehensive insurance covers salvage costs up to your boat’s full value, not a percentage, and that there’s no deduction for salvage costs. In addition, make sure your liability coverage includes the cost of wreck removal on top of your comprehensive coverage. Under most maritime insurance policies, as the insured owner, you have a duty to mitigate damages under the “sue and labor” clause. This clause also allows you to recover reasonable expenses incurred to minimize or avert a loss of insured property.
2. Maintain towing company (Sea Tow, BoatU.S.) insurance and use that towing company whenever possible. Become familiar with your towing company’s agreement and what it considers towing versus salvage.
3. Notify your insurance carrier immediately if a responder claims salvage. Most insurance contracts require you to notify the company within a certain time period; failure to notify your insurance company could be used as grounds to deny your claim.
4. If faced with a situation that could be viewed as salvage, request clarification before accepting services. If the responder claims salvage, provide your insurance information and insist that they deal directly with your insurance company to establish the price and to obtain payment. If you do not have salvage insurance, request the work be done on a fixed-price or time-and-materials basis before accepting services, and get the quote in writing or have it witnessed by a third party.
5. In times of stress, it’s almost impossible to assess and interpret the language of a contract, so you may wish to avoid signing a salvage contract if possible, especially since no written contract is necessary for salvage to apply.
Rob Turkewitz is an attorney
and the legal officer for the Charleston Sail & Power Squadron.