Salvage

A salvor is a person who performs a successful action to save a ship, her equipment or cargo from loss or damage at sea. The property actually saved is called the “salvage”. A lawsuit to claim a monetary salvage award may be brought against either the owner of the vessel salvaged or the vessel itself in rem. Federal courts have exclusive jurisdiction over salvage cases that are brought in rem. The statute of limitations for filing a salvage award claim is two years. A claim for salvage is a claim for either “pure salvage” or “contract salvage”.

Elements of “Pure Salvage” Claims

“Pure salvage” is a reward for perilous service. There are three elements of a pure salvage claim:

  1. The property must be exposed to a marine peril.
  2. The salvage service must be voluntary, whereby the salvor is under no preexisting duty to render the service.
  3. The salvage operation must be successful in whole or part.

To qualify as a marine peril the danger need not be imminent. There only needs to be a reasonable apprehension of peril. A claimant seeking a salvage award must show that, at the time assistance was rendered, the salved vessel had been damaged or exposed to some danger that could lead to her destruction or further damage in the absence of the service provided.

A party claiming a salvage award has the burden of proving that the salvor’s effort contributed to success in saving the property. This requirement has two dimensions. First, under the “no cure-no pay” rule there can be no salvage award if the property is lost despite the efforts of the party rendering services. Second, the party must show it played it played a role in the success of the salvage.

Contract Salvage

Salvage services may be rendered under a salvage contract which may call for compensation at a fixed rate payable regardless of success or it may incorporate a “no cure-no-pay” provision whereby compensation is contingent on the success of the salvage operations. In recent years various versions of the Lloyds Open Form (LOF), a salvage contract form, have been used. However, any written or oral contract, if proven, will suffice.

Life Salvage

Under the Life Salvage Act, a party who provides services that result in the saving of lives is entitled to share in any salvage award granted to other persons who saved the vessel or cargo where both were engaged in a common salvage operation.

Excerpts from Admiralty and Maritime Law by Professor Robert Force (Federal Judicial Center 2004).