8/12/2019 How to Survive a Casuality

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4 News Friday February 15, 2013 Lloyds List

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How tosurvive a

casualtyStandard Club claimschief shares advice

LIZMCMAHON

ITIS vitaltoget theresponsetoacasualtyright becausewreck removalcostsare an increasingly significantfeatureof maritimecasualtiesandit isultimatelyshipownersthatbear theburdenthrough increasedinsurancecosts,Standard ClubsyndicateclaimsdirectorSam Kendall-Marsden

says.While somecostdriverssuch as

locationaremattersof fortuityandcannot becontrolled,Mr Kendall-Marsdensaysotherscan beandit isimportant tofocuson thesetomitigate theoverall costs.Forexample,he says theplan,timing,contractselectionand choosingtherightcontractorcan allbe managed.

Itis important tohavea clearpictureof truefactsas quicklyaspossibleand before youmakeadecision. You willfindthat youarebombardedwith informationimmediately after thecasualty, andnotallofit will beaccurate,headvises.

Atthispoint,an experiencedP&Iclubclaimshandler may, if

appropriate,deployto thescenewithoutdelayto evaluatethesituation andassistthemember onsite.MrKendall-Marsdensaysthismayinclude liaisingwiththeauthorities andnegotiating withsalvors.

Itis vital tomakecontactwith theauthoritiesat anearlystageand offerthema crediblestrategy. Itis alsouseful tohaveknowledgeof third-

partyexperts, likethe InternationalTankerOwners PollutionFederation,whohavea database of localresources inmany areas,he says.

MrKendall-Marsdensaystendering is a tried andtestedmethodofarrivingat thebest solutionat acompetitive costbutan effectivetender processdepends onthebiddersbeing providedwith sufficientinformationand beingallowedsufficienttimeto preparebids.

Beawarethatif anLOF [LloydsOpenForm] issigned,the salvorsmay

invoke SpecialCompensationP&IClubClause andthiscould make itharderto terminate thecontract andswitchtothenextphaseof theresponse(possibly withalternativecontractors)thanmay otherwise bethecase,he warns.

Thisis becauseclausenine ofScopicpreventsterminationif therelevantauthoritiesprevent thesalvorfromdemobilising itsequipment.

Inanyevent,itis criticaltohaveaviableplan for the followingphase oftheresponse thattheauthoritieswillaccept,MrKendall-Marsdensays.Thisplanmay includea caretakingphase withvisible signsofprogress tosatisfythe authoritiesthatprogressisbeingmade.

Considera lumpsumcontractto

controlcosts, facilitateaccuratereserving andshareriskwiththesalvors. Bonusesandpenaltiescanalsobeusedto incentivisetimelycontractualperformance,hesays.

Pinpointall themajorplayersinthecasualty andtheirimportanceandhowtheycan influencetheprocess,Mr Kendall-Marsdensays.

These include:the insurance

managerand other relevantshipowner staff;P&I clubclaimsmanager; hulland machineryunderwriters; theauthorities (whichwillvaryfromcase tocase butwhichwouldinvariablyinclude the localcoastguard);salvors; correspondents;lawyers;and pollutionrespondersoradvisers.

Donot take anybigdecisionswithoutyourinsurers andensurethattheinsurancemanagerhas strongrelationswiththeirclub,he says.

Alsoensurethatindividualmastersand shoreside staff aresufficientlyeducatedin howtorespondso thattheydo not,forexample,signa contractpresentedto

themby a salvorwithoutfirstseekingadvice.

Ignoringlocal authorities orappearingnot tounderstandtheirneedscanmake fora very unhappyexperience.Challengingunreasonable requirementsmay beanoptionin appropriate cases.n

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A stepby stepguide to dealingwith disaster

STANDARDClub syndicateclaimsdirectorSam Kendall-Marsdenadvisesensuring theemergencyresponseplan isupto dateandistestedon a regularbasis,involvingunderwritersand otheradvisers.

Thisis primarily adeskexercisedesignedto ensurethat everythinghasbeen thoughtthrough,thatpeopleunderstandtheir rolesin theeventof a casualtyand haveclearlinesof communication,hesays.

Ensureall keyrelationshipsare ingoodorder withauthorities atportsthatyouuse regularly andpotentialserviceproviders suchas salvors,correspondents, lawyersand anti-pollutioncompanies.

Mr Kendall-Marsdensaysmediarelations arean important elementofplanninga responseto anemergencyandmediaadvisersshouldensureyouhavethe trustof keypublications.P&IClubsplaya supportand advisoryrolehere.

THEkeydecisionsimmediatelyafter a casualtyare thenatureoftheresponse, choice of salvorandthetype ofcontractthatyouusee.g.LloydsOpenForm versustimeandmaterials(for example,BIMCOWreckhire)or LOFversusa towagecontract(forexample,BIMCOTowhire).

Gettingit rightmeans savingalotofmoney andin a salvageorwreck removal time, andallowsfora large amountof flexibility,saysMr Kendall-Marsden.

A golden ruleis toworkintandemwith your insurersandconsultthem. Decisionssometimesgettakenin theheatof themomentwithoutproper consideration andconsultation. Thiscanwaste a lotofmoney becauseyouhave thewrong plan, contractand/orthewrongsalvor,he advises.

Thisis anareawheretheP&IClubshouldhave a leadingrole.Also, howyouhandleandrespondtothe media in theimmediateaftermath ofan incidentis crucial.

THISwouldtypically involvebunker removaland other steps tominimisethe dangerofenvironmentaldamage,and thenstartingremedial work.

MrKendall-Marsdensaysthatatthispoint,relationswiththeauthoritiescan becritical.

Atbest, yourpartnership withthem will form thebasisof asuccessfulresponse; at worst,theycouldmakeyourlife verydifficult,add substantially tothecost andthe media fallout,hesays.

Thiscouldinclude making

unreasonabledemands inrelation tobunker removal,for example,whereawreck islocatedat depth.Theharderandmoretime-consuming theoperation, thehigherthe cost.

MrKendall-Marsdensaysit isimportant toremember theauthoritiesmaywell beunderpolitical pressuretobeseentobedoingsomething andtherehavebeenoccasionswheretheir demandshave beenunreasonableandthepotential benefitsof theactionstheyhave requiredhave beenoutweighedby operationaldifficultiesand cost.

The onus ison youto comeupwitha viableplan which therelevantauthoritieswillagree to,so thatyoucanremainin controland have abetter chanceofcontrollingcosts.Ignoringtheirorders,as sometimeshappens,is fraughtwithdanger,hesays.

Youwillbe inthefiring line ifsomethinggoeswrong ortheycould justgetsomeoneelse todo theworkandsend youthebill.

YourP&IClubshouldnowbeatthe front line,directingtheresponsein consultationwiththeshipowner.

ATTHISpoint,everythingshouldbeunder control, saysMrKendall-Marsden.

Theship shouldbe stableand theenvironmental threateliminated.

Thenexttaskis tokeepthings ingoodorder while responsibilityforremovalof vessel orwreckand otherwork isdecidedupon.

Prepare for constantpressurefromauthoritiesto getthingsdone.

Itis essentialtomakethe

right decisions insteadof rushingthings,or theeventualoutcomemaybe a lotmoreexpensivethannecessary, plusthereistheriskofpossible badpublicity,hesays.

Theshipowner, theclubandtheirtechnical advisersshouldwork together inthepreparationof aninvitationtotender,the evaluationof thebidsandthe selectionof a preferredcontractor.

MR KENDALL-Marsdensayswhilethecontractorswillbe doing thework, theshipownerand itsclubshouldbeactively managingcontractualperformance,keepingtheauthorities updatedandobtainingnecessary permitsandpermissionson anongoingbasis,sothe operation canrun smoothly.

Differentcasualtiesbring differentproblems,but itis importantto havea planin place tomitigateoverallcosts. AP

Pre-casualty Phase one:emergencyresponse

Phase two: addressing environmental concerns

Phase three: caretaking

Phase four:removal

This is primarily a deskexercise designed to ensurethat everything has beenthought through

Sam Kendall-Marsden