B-133482, SEP. 27, 1957

B-133482: Sep 27, 1957

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WAS TOWED BY THE SALVORS TO ADEN. IT IS REPORTED IN THE LETTER FROM MSTS THAT NO GENERAL AVERAGE STATEMENT HAS BEEN PREPARED NOR IS IT PROBABLE THAT SUCH STATEMENT WILL ISSUE FOR A YEAR. THAT THE SHIPMENT WAS UNDER A CONFERENCE LINE FORM OF BILL OF LADING INCORPORATING THE YORK-ANTWERP RULES (1950) PROVIDING FOR PAYMENT OF CARGO OF GENERAL AVERAGE AND SALVAGE. THAT THIS INCIDENT CONCERNS BOTH A FOREIGN FLAG CARRIER AND A FOREIGN SALVOR WITH RESPECT TO WHICH IT IS TO THE GOVERNMENT'S INTEREST TO ESTABLISH A REPUTATION FOR FAIR DEALING AND EXPEDIENT PAYMENT. THERE IS NO DEFENSE TO THE SALVAGE CLAIM. SINCE THE SALVAGE CONTRACT PRICE IS REASONABLE. SINCE THE GOVERNMENT CARGO IS BY FAR THE LARGEST SHARE OF THE VENTURE.

B-133482, SEP. 27, 1957

TO THE SECRETARY OF THE NAVY:

ON AUGUST 2, 1957, UNDER FILE REFERENCE (GA-487) SER 916N7, COUNSEL, MILITARY SEA TRANSPORTATION SERVICE, REQUESTED AUTHORITY FOR THAT SERVICE TO MAKE AN INTERIM PROVISIONAL PAYMENT OF 13,080 POUNDS STERLING ENGLISH CURRENCY FOR SALVAGE PRIOR TO THE FINAL COMPUTATION OF THE GOVERNMENT'S CONTRIBUTORY SHARE OF GENERAL AVERAGE AND SALVAGE ARISING OUT OF A MACHINERY BREAKDOWN AND SUBSEQUENT TOWAGE AND REPAIR OF THE MV ANDREAS BOYS ON JUNE 26, 1957. THE VESSEL, A DANISH FLAG SHIP, BROKE DOWN ABOUT 750 MILES OFF THE COAST OF MOMBASA, KENYA, AFRICA, AND WAS TOWED BY THE SALVORS TO ADEN, THE CLOSEST POINT OF REPAIR. THE VESSEL OWNERS, WITH MSTS CONCURRENCE, ENTERED INTO A "NO CARA-NO PAY" CONTRACT AGREEING TO PAY 15,000 POUNDS STERLING FOR A SUCCESSFUL TOW TO ADEN. THE SUM OF 13,080 POUNDS STERLING REPRESENTS THE APPROXIMATE PORTION OF THE AGREED SALVAGE CHARGEABLE TO THE GOVERNMENT CARGO AS ONE OF THE INTERESTS REQUIRED TO CONTRIBUTE TOWARD THE SALVAGE.

IT IS REPORTED IN THE LETTER FROM MSTS THAT NO GENERAL AVERAGE STATEMENT HAS BEEN PREPARED NOR IS IT PROBABLE THAT SUCH STATEMENT WILL ISSUE FOR A YEAR; THAT THE SHIPMENT WAS UNDER A CONFERENCE LINE FORM OF BILL OF LADING INCORPORATING THE YORK-ANTWERP RULES (1950) PROVIDING FOR PAYMENT OF CARGO OF GENERAL AVERAGE AND SALVAGE; AND, THAT THIS INCIDENT CONCERNS BOTH A FOREIGN FLAG CARRIER AND A FOREIGN SALVOR WITH RESPECT TO WHICH IT IS TO THE GOVERNMENT'S INTEREST TO ESTABLISH A REPUTATION FOR FAIR DEALING AND EXPEDIENT PAYMENT. ONE OF THE ENCLOSURES TO THE MSTS LETTER INDICATES THAT, AT PRESENT, THERE IS NO DEFENSE TO THE SALVAGE CLAIM.

SINCE THE SALVAGE CONTRACT PRICE IS REASONABLE, AND SINCE THE GOVERNMENT CARGO IS BY FAR THE LARGEST SHARE OF THE VENTURE, THE MILITARY SEA TRANSPORTATION SERVICE IS ANXIOUS TO MAKE AS PROMPT A PAYMENT TO THE SALVOR AS POSSIBLE. IT IS EXPLAINED THAT IF THE PROVISIONAL PAYMENT IS AUTHORIZED, SUCH PAYMENT WILL BE MADE SUBJECT TO A FINAL ACCOUNTING AND WITH THE RESERVATION TO THE GOVERNMENT OF ALL RIGHTS. IN THIS RESPECT, IT IS STATED, THE MILITARY SEA TRANSPORTATION SERVICE WILL TAKE THE NECESSARY PRECAUTIONS TO SEE THAT PAYMENT GETS INTO THE HANDS OF THE SALVOR AND FOR THIS REASON REQUESTS AUTHORIZATION TO MAKE THE PAYMENT ITSELF RATHER THAN HAVE THE GENERAL ACCOUNTING OFFICE MAKE THE PAYMENT AND CHARGE IT TO MSTS FUNDS.

IT IS RECOGNIZED THAT UNDER THE MARITIME LAW OF ALL NATIONS, SALVORS INVARIABLY POSSESS THE RIGHT OF COMPENSATION FOR THEIR SERVICES AND THE RIGHT TO HOLD THE PROPERTY SALVED UNTIL THE PAYMENT IS RECEIVED, OR OTHERWISE SECURED. THE DAVIS, 10 WALL. 15. ONLY IN THE UNITED STATES AND ITS POSSESSIONS IS GOVERNMENT CARGO SECURE FROM SEIZURE BY LAW. 46 U.S.C 741. ACCORDINGLY, AND FOR THE REASONS SET FORTH BY THE MILITARY SEA TRANSPORTATION SERVICE IN ITS LETTER OF AUGUST 2, 1957, WE HAVE NO OBJECTION TO THAT SERVICE MAKING PAYMENT FOR THE SALVAGE UNDER THE CONDITIONS SET FORTH IN THE LETTER WHICH WILL ASSURE THE SAFEGUARDING OF ALL GOVERNMENT RIGHTS. IT IS REQUESTED THAT APPROPRIATE REFERENCE TO THIS MATTER BE INCLUDED WHEN THE GENERAL AVERAGE STATEMENT CONCERNING THIS VESSEL IS TRANSMITTED HERE FOR SETTLEMENT SO THAT ALL ADJUSTMENTS MAY BE MADE ON ACCOUNT OF SUCH PROVISIONAL PAYMENT OF SALVAGE.