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Tuesday, September 1, 2020

interestingly Marine Insurance ~ yacht in transit !!

 In unprecedented Pandemic – people have remained at home (!) from Mar 24,2020 – and many are talking about economic imbalance – of not being to earn.  There is a different World out there – of uber rich who own pleasure boats and this post is on one such !

For economic reasons and for satisfying the demands – ‘goods are moved from one place to another’.  Goods in transit are insured under Marine Policies.  There are two divisions – Marine Hull and Marine Cargo.  Goods are cargo, while Ships, boats are Hull – but when a boat is transported in another Ship – the boat (the Hull) becomes the subject matter of Marine Cargo Insurance.  In Marine, there will be a Consignor and a Consignee and often the goods are sent through a Carrier – the Carriage operator [need not be owning the conveyance of carriage] charges freight and is obligated to deliver the goods at the intended destination.

A yacht  is a sail or power vessel used for pleasure, cruising, or racing. There is no standard definition, so the term applies to such vessels that have a cabin with amenities that accommodate overnight use. To be termed a yacht, as opposed to a boat, such a pleasure vessel is likely to be at least 33 feet (10 m) in length and have been judged to have good aesthetic qualities.  There are some classifications su9ch as Commercial; Private; Pleasure – and then by its size and power.  Racing yachts are designed to emphasize performance over comfort.  Charter yachts are run as a business for profit. As of 2020 there were more than 15,000 yachts of sufficient size to require a professional crew.

Transportation, logistics, carriage, packing, documentation, liabilities of persons involved are complex.  When we entrust some goods to a Transporter  for delivery – we presume that they would safely deliver the same at intended destination failing which, you can hold them responsible for the loss or damage.  In reality,  things are not so simple !  ..  to start with there are Road Carriers, Rail Carriage, carriage by Sea (ship) and Air carriage.  If carriage is Port to Port Transport, the responsibility (if any) of the Carrier for loss or damage to the Goods occurring from the time when the Goods are loaded on board the Vessel at the Port of Loading until the time when the Goods are discharged from the Vessel at the Port of Discharge.   

The law of Carriage of goods governs the transportation of goods by land, sea, or air. The relevant law governs the rights, responsibilities, liabilities, and immunities of the carrier and of the persons employing the services of the carrier.   Until the development of railroads, the most prominent mode of transport was by water. The law governing carriage of goods by sea developed much earlier than that governing inland transportation. The sea laws of the island of Rhodes achieved such prominence that a part of them was carried, many centuries later, into the legislation of Justinian.  This duty of the carrier to deliver the goods safely was considered to exist without regard to obligations arising under any contract between the parties.

As an essential contractual undertaking of the carrier, delivery of goods gives rise to a series of related obligations and liabilities. According to the provisions in contracts of carriage of goods or the carriage laws, impliedly or expressly,   the obligations focus on the followings, inter alias: Firstly, a carrier shall deliver the goods safely; secondly, deliver at an agreed place, or in some special circumstances, at a proper place other than the agreed one; thirdly, deliver in time; fourthly, deliver with the proper mode; and, the last, deliver to the proper person.

Then there is ‘due diligence’; extent of liability (limited liability) and immunity of carriers.  One of the important provisions of COGSA [Carriage of Goods by Sea Act] is  “Neither the carrier nor the ship shall be liable for loss or damage arising or resulting from unseaworthiness unless caused by want of due diligence on the part of the carrier to make the ship seaworthy, and to secure that the ship is properly manned, equipped, and supplied.. .. …..   (partly reproduced)

Now with this lengthy background read this news article that appeared in MailOnline.  Italian billionaire Pier Luigi Laro Piana whose £30m superyacht sank after it fell off the back of a cargo freighter is suing the British transport firm for compensation. Pier Luigi is an heir to the high end clothing company Loro Piana, which was founded in 1924 by his grandfather Pietro.

The owner of a £30million  (Rs. 295 cr) super yacht is suing a British transport company for the loss of his vessel which fell off a cargo vessel and sank in a storm. Italian billionaire Pier Luigi Laro Piana commissioned Peters and May to transport his three-year-old yacht, My Song, between Antigua and Genoa. However, in May 2019, the yacht, which was being carried by the freighter Brattingsborg, was lost overboard in a storm around 40 miles from Menorca and sank.  Later, the huge yacht was spotted half submerged and drifting 40 miles from Menorca. According to The Times, Mr Piana is suing the the firm for the replacement value of yacht. However, the Southampton-based Peters and May deny responsibility.

According to court papers: 'The primary assessment is that the yacht's cradle - owned and provided by the yacht, warranted by the yacht for sea transport and assembled by the yacht's crew - collapsed during the voyage.'  Mr Piana's lawyers are seeking to have the case returned to an Italian court. He had previously told La Repubblica: 'For anyone who loves the sea, this boat is like a second home, and it is as if my home has burnt down.  'We decided to transport it on a cargo ship to be sure it wasn't damaged because you can never be sure of the weather.'   

The yacht was salvaged by a German firm but it was beyond economic repair as teh carbon fibre hull was holed in several places and the masts were broken off. Her owner had arranged for 'My Song' to take part in the 2019 Loro Piana Superyacht Regatta, where she was a returning winner. My Song is described as 'a wolf in sheep's clothing' - she has a 56-metre-high mast and under full sail can reach more than 30 knots.  'She was packed with cutting edge design and technology and also served as a comfortable cruising yacht.'

With regards – S. Sampathkumar


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