Jettison of cargo
“No jettison of cargo shall be made good as general average, unless such cargo is carried in accordance with the recognized custom of the trade.”
Evolution of the rule
Perhaps the most significant thing about this rule is that it says nothing at all about the allowance in general averages of cargo jettison from under deck: the reason being that since the very earliest days the jettison of under deck cargo for the common safety has been recognized by law of all countries as the prime example of general average sacrifice.
On the other hand, the law has developed in different directions in different countries with regard to the allowance in general average, if any, for the jettison of cargo carried on deck.
Consequently, few laws were adopted at the 1864 York conference in order to attain uniformity.
In 1877, no doubt owing to the influence of the greatest number of continental delegates present, the Antwerp Conference reversed the provision for allowance of jettison of timber cargoes carried on deck.
In 1880s, a number cases on this point decided in the British Court, made it very clear that as far as English law was concerned a jettison on cargo carried in accordance with the recognised custom of trade, and not in violation of the contract, was within general averages.
In 1890s, at the Liverpool conference, the British Association of Average Adjusters proposed an amendment to rule I, but the proposal was not accepted.
There were no changes made in the rule at the conferences of 1949 or 1974.
It was not until the 1924 Stockholm Conference, that the modified version of the British proposal was accepted and the present text emerged, without reference to what constitutes the deck of a vessel.
“……. The recognized custom of the trade”
In English law, there is a little matter to establish what constitutes a recognised custom of trade. In practice, it is subjective to the facts of each case, whether; the location of the storage is a proper place for the cargo to be carried in accordance with the custom of the trade. When CMI International Sub-Committee reviewed the York-Antwerp Rules in 1973, no amendment was suggested to this Rule. It can be concluded that in the present time, it has become a recognized custom in all trades to carry containers on the deck for both deep sea and coastal voyages, and also that this custom applies to both types of ships, custom made for the trade as well as those adapted for the purpose.
Loss or Damage by Sacrifice for the Common Safety
Loss of or damage to the property involved in the common maritime adventure by or in consequence of a sacrifice made for the common safety, and by water which goes down a ship’s hatches opened or the other opening made for the purpose of making a jettison for the common safety, shall be made good as general average.
The origin of the rule was as a negative resolution passed by the 1860 Glasgow Conference, which read:
“ That the damage done to the cargo by the chafing and breakage, resulting from a jettison of part of the remainder of the cargo, ought not to be allowed in general average.”
The reason for promoting this resolution was the practical difficulty of establishing what claims by chafing and breakage may have resulted from cargo being disturbed in its stowage by the efforts of those undertaking the jettison, and what was the result of accidental damage or normal handling.
At the York Conference in 1864 principle was preferred to practical convenience, which resulted in the reversal of the Glasgow Resolution and a paragraph was added to affirm the established practice of allowing damage caused by water going down the hatches during the jettison.
Damage by Jettison
Damage done to goods or merchandise by water which unavoidably goes down a ship’s hatches opened, or other opening made, for the purpose of making a jettison shall be made good as general average, in case the loss by jettison is so made good. Damage done by breakage or chafing, or otherwise from derangement of stowage consequent upon a jettison, shall be made good as general average.
At the Liverpool Conference in 1890, the rule was broadened so as to bring within its framework not only the damage sustained by cargo in case of jettison, but also damage to both ship and cargo, caused by any other sacrifice made for the common safety of the goods.
No alteration was made in the 1924, 1950 or 1974 versions of the York-Antwerp rules.
At Sydney in 1994, the title was changed and the opening words of the rule were also amended.
The text referred only to “damage” and not to “loss”. Also, the only interests referred to was ship and cargo, and for this reason it was felt that the wordings of the rule were not correct. Therefore in Sydney, the BMLA proposed that the opening words of the rule to be simply read as “ Loss or damage sustained in consequence of….”. This proposal got support from the CMI International Sub-Committee as a drafting amendment since no change of substance was intended.
At Sydney, the U.S. delegation, in the course of arguing their case for the exclusion from general average of all pollution liabilities by means of a Rule Paramount, objected to the British recommendation for the improvement of Rule II on the ground that, absent a Rule Paramount, it would leave the door open to the admission of third party claims for damages for, inter pollution consequent upon the jettison of oil.
These words were designed to exclude any allowances under the rules II, IV, and VIII for the loss or damage incurred by parties not involved in the common maritime adventure. But it is wide enough to include:
1. all physical property, irrespective of its ownership, which is legitimately on board the vessel at the time of the general averages act. This will include containers, charters bunkers, as well as navigational and other equipment hired for the purpose;
2. Freight at risk.
Some goods may be on board the ship legally but exempted from paying general average contribution and for this reason, they were thought to be outside the common maritime adventure. This is not true. In an adjustment prepared in 1931 in accordance with the 1924 rules, where a considerable damage to the luggage of the passenger which was caused to measures taken to extinguish the fire, was made good as a general average sacrifice, whereas the unaffected baggage was exempted from the contribution by Rule XVII. In an article published on the case, a commentator wrote:
This apparent anomaly is to be explained by the fact that while the parties to the contract of affreightment and their underwriters may for convenience and the saving of expense agree to exempt passengers’ baggage from liability to contribution they cannot take away the right of any [other] party to claim compensation in general average for damage done to their property by the measures taken to save the common adventure in time of a peril.
As to losses of freight, Rule XV, as we shall see, provides for the admission in general average of any such loss arising from damage to or loss of cargo“ either when caused by a general average act, or when the damage to or loss of Cargo is so made good”. The aim is to make good in general average the freight element at carrier’s risk on goods which are subject to allowance for sacrifice. However, the wording of the rule is rather and in some cases in the past has been subject to a more broad interpretation that was intended by the draftsman. Since 1994, it is the author’s opinion that justification for the allowance in these circumstances can be found within Rule II.
Author: Navin Kumar Jaggi