INSURANCE OF RISKS UNDER THE BAREBOAT CHARTER …

Zbornik PFZ, 67, (1) 85-105 (2017) 85

* Marija Pijaca, Ph. D., Postdoctoral Researcher, Maritime Department, University of Zadar, Mihovila Pavlinovića 1, Zadar; [email protected]

** BoženaBulum,Ph.D.,SeniorResearchAssistant,AdriaticInstitute,CroatianAca-demy of SciencesandArts,AugustaŠenoe4,Zagreb;[email protected]

INSURANCE OF RISKS UNDER THE BAREBOAT CHARTER CONTRACT

Marija Pijaca, Ph. D. * UDK: 368.23Božena Bulum, Ph. D. ** 347.795:368.23

Izvorniznanstvenirad Primljeno:ožujak2016.

The bareboat charter contract may appear to be a simple contractual relation: the owner gives to the charterer a vessel for the performance of a sea-going activity, and charterer pays hire to the owner. However, this contractual relation is very complex and the complexity of this contract can be seen in the complex system of legal relations of the parties that arises from the provision of vessel for use. Based on the complexities of mutual rights and obligations of the parties to a bareboat charter contract, an issue of insurance also arises in a very complex form. The hull and machinery insurance and liability insurance are intertwined and therefore there is a very real possibility that some interests might be missed and left unin-sured. Therefore, it is necessary to establish with certainty who is obliged to take out hull and machinery and liability insurance and to establish all other aspects of insurance specific for this type of vessel employment. The aim of this paper is to ascertain the characteristics of bareboat charter contract insurance, especially hull and machinery and liability insurance, and, also, to analyse the manner in which the issue of bareboat charter contract insurance is standardized by the provisions of the BIMCO Standard Bareboat Charter, code name BARECON 2001. This standard contractual form is most often used in the practice of bare-boat charter contracting and therefore it is deemed necessary to establish whether or not its provisions provide broad enough coverage of bareboat charter contract insurance. By analysing the insurance provisions of the standard contractual

M. Pijaca, B. Bulum: Insurance of Risks under the bareboat Charter Contract86

form BARECON 2001, the authors provide a conclusion as to whether or not the specified provisions meet the interests of the parties to a bareboat charter.

Keywords: bareboat charter, hull and machinery insurance, liability insuran-ce, insurance provisions of the BARECON 2001

1. INTRODUCTION

Legalissuesofinsurance,mainlyofhullandmachineryinsuranceandli-ability insurance forthedurationofthebareboatcharter,shouldnotbelefttochance.Henceitisnecessarythatthepartiesknowthattheseinsuranceissuesshouldbeclearlyresolvedinthebareboatchartercontract.Startingfromthefact that inmodernbusinesspracticeofbareboatcharter standardcontractformsareused,thequestionarisesinwhichwaytheissueofinsuranceisdealtwithinthecontentofthestandardforms.TakeforexamplethecontentoftheStandardBareboatCharter,codenameBARECON20011,thelastbareboatcharterformbytheinternationalmaritimeassociationBalticandInternation-alMaritimeCouncil(BIMCO)2,whichismostoftenusedinthecontractingofbareboatcharters.3BARECON2001containsmanyprovisions,twoofwhicharededicatedtoinsurance:Article13,entitledInsurance and repairs,and14,Insurance, repairs and classification.

In this paperwewill determine themain features of a bareboat chartercontractandexplaintheinsuranceinterestsofthecontractingpartiesduringabareboatcharter.Afterwards,wewillpointoutthemaincharacteristicsofhullandmachineryandliabilityinsurance.Also,wewillanalyseintheirentiretytheinsuranceprovisionsoftheBARECON2001formandestablishwhetherthey satisfy theparties’ interests.Toconclude,wewill stateourviewas towhetheritisnecessarytoamendtheinsuranceprovisionsoftheformforthepurposeofbetterprotectionofthecontractingparties.

1 BARECON2001isavailableinitsentiretyonBIMCOwebsite:https://www.bim-co.org/~/media/Chartering/Document_Samples/Sundry_Other_Forms/Sample_Copy_BARECON_2001.ashx(11February2016).

2 FordetailsaboutBIMCOvisitwww.bimco.org;alsoBIMCO Centenary, Baltic and InternationalMaritimeCouncil,Copenhagen,2005;Bekiashev,K.A.;Serebriakov,V., International Maritime Organizations: Essays on Structure and Activites, Martinus NijhoffPublishers,Hague-Boston-London,1981,p.3.

3 Davis, M., Bareboat Charters, 2nded.,LLP,London-Singapore,2005,p.20.

https://www.bimco.org/~/media/Chartering/Document_Samples/Sundry_Other_Forms/Sample_Copy_BARECON_2001.ashx (19



http://www.bimco.org

Zbornik PFZ, 67, (1) 85-105 (2017) 87

2. MAIN FEATURES OF THE BAREBOAT CHARTER

Thebareboatchartercontractiscompletelydifferentfromothercontractsfortheemploymentofseagoingvessels.4Thistypeofcontractdiffersfromagroupofcontractsfortheemploymentofsea-goingvesselsinafewcriteria,suchastheaimoftheconclusionofthebareboatcharter.

Thebareboatchartermayappeartobeasimplecontractualrelation:theownergivestothechartereravesselfortheperformanceofasea-goingactivity,andthechartererpayshiretotheownerinconsiderationoftheperformanceofthatactivity.However,thiscontractualrelationisfarfromsimple.Thatthisisaverycomplexcontractcanbeseeninacomplexsystemofparties’relationsstemmingoutoftheprovisionofvesselforuse.Twoimportantfactsshouldbepointedouthere.Firstly,bytheconclusionofthecontracttheownergivesthe vessel for use to the charterer, i.e. delivers the vessel into possession, so thecharterercanuseitasagreed.Secondly,thepropertytransfersfromtheownertothechartererwherebythechartererbecomestheshipoperator,orasitiscalledinlegalliterature,hebecomesthe“maritimeowner”5,i.e.“ownerpro hac vice”.6Itisnecessarytoemphasizethatitisthetransferoftherightofpossessionandthefunctionoftheoperatorfromonecontractingpartytotheotherwhichformstheessenceofthiscomplexlegalmatter,thusincreasingtheimportanceof thebareboatchartercontractas theoperator isconsideredacomplexfunctioninmaritimelaw.

4 Forexample,refertotheclassificationofcontractsbasedontheemploymentofsea-goingvesselsasperCroatianMaritimeCode(OfficialGazetteoftheRepublicofCroatiaNarodnenovine,nos.181/04,76/07,146/08,61/11,56/13,26/15)asperArticle 442-443; formoredetail refer toPavić,D.,Pomorsko imovinsko pravo, Književnikrug,Split,2006,p.87;foranexampleofsystematizationofcontractsontheemploymentof sea-goingvessels shownthroughsomecomparativerightsexamplesrefertoGrabovac,I.,Sistematika ugovora o iskorištavanju brodova – usporedna analiza,Suvremenipromet,vol.12,no.2-3,1990,pp.43–45;also seeTetley,W., International Maritime and Admiralty Law,InternationalShippingPublication,Québec,2002,pp.124–128.

5 Brajković,V.,Problem brodara i njegove odgovornosti de iure condendo, in: Ugovori o iskorišćavanju brodova na moru: Zbornik rasprava,Jugoslavenskaakademijaznanostiiumjetnosti,Zagreb,1951,p.60.

6 Tetley,W.,undernoten.4,p.125quotedLearyvs.UnitedStates,81U.S.(14Wall)607(1872),Reedvs.TheYaka373U.S.410,1963.AMC1373,Matutevs.LloydBermudaLinesLtd.,931F.2d231,1991.AMC1830(3Cir.1991.)[author’sremark];alsoseeKeenan,R.T.,Charter Parties and Bills of Lading,Margu-etteLawReview,vol.42,no.3,1959,p.347.


TheBARECON2001form,whichweusedastheexampleofabareboatcharter contract contains in its entirety the stated main features of the con-tractual relationsofabareboatcharter.Theformcontainsmanyprovisionswhichareusedfortheregulationoftheparties’rightsandobligations.Wecansingleoutthemostimportantfeatures:charterperiod,delivery,timeofdeliv-ery,cancellingclause,tradingrestrictions,surveysondeliveryandredelivery,inspection, inventories, oil and stores, maintenance and operation, hire, mort-gage, insurance and repairs, insurance, repairs and classification, redelivery,non-lien,indemnity,lien,salvage,wreckremoval,generalaverage,contractofcarriage,bankguarantee,assignment,sub-charterandsale,requisition/acquisi-tion,war,commissionpaymenttotheshipbroker,termination,repossession,disputeresolution,noticesandsomeoptionalprovisions(provisionsapplica-bletonewbuildingvesselsonly,hire/purchaseagreementprovisionsapplicabletovesselsregisteredinabareboatcharterregister).Also,some“usual”provi-sionsconcerningthelegalrelationsoftheparties,suchasvesseldelivery,theowner’sresponsibilityfornotmakingthevesselseaworthy,vesselredelivery,responsibilityofthechartererforthevessel’sconditionatredelivery,andpay-mentofhirearesignificantlybetterregulatedbytheBARECON2001formthanthelegalregulationsconcerningbareboatcharterswhichdedicateonlyasmallnumberofprovisions,mainlydispositive,totheselegalmatters.7

RegardlessofthebroadcontentoftheprovisionsoftheBARECON2001form,somelegalmattersconcerning liabilityremainunknown.Thisspecifi-callyreferstotheowner’sand/orcharterer’sliabilitythatmightoccurforthedurationofabareboatchartercontract,andwhichreferstotheliabilityfordamage caused by a bareboat charter towards third parties (swimmers andotherpersonsatsea),ortheenvironment(incaseofatankerbareboatcharter,orbunkeroilpollution).However,therearealsootherimportantissueswhichrequire clarification.

3. INTERESTS OF CONTRACTING PARTIES IN INSURANCE

Takingintoconsiderationthebasiccharacteristicsofthebareboatcharteritisclearthattheproprietaryandlegalrelationsarenotanexclusivecriterion

7 SeeforexampleCroatianMaritimeCodeandprovisionsentitledBareboatcharter- Zakup,Articles658-672or ItalianMaritimeCode(Codice della navigazione)andprovisions entitled Locazione di nave,Articles376-383.

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for establishing the existence of interest in hull andmachinery insurance.8 Alongsidetheowner,thechartereralsohasalegalinterestinhullandmachin-eryinsuranceinthedurationofthebareboatchartercontract.Acharterercanalsosufferdamagearisingfromthelossofordamagetothevessel,hisinterestin hull and machinery insurance is justified.9Thebasisofthecharterer’sinter-estishisobligationtomaintainthevesselduringthebareboatchartercontractandreturnitinthesameconditioninwhichitwasreceivedaftertheexpira-tion of the contract.10

In addition to hull andmachinery insurance, during a bareboat chartercontractboththeownerandthechartererhavean interest inobtaining in-surance against liability (contractual and third party liability). Contractualliabilitygenerallyoccursbyfailuretofulfillcontractualobligations,whereasthirdpartyliabilityoccursbyadamagingactivity.Forexample,inabareboatchartercontracttheowner’scontractualliabilitycanrefertohisliabilityforthevessel’snavigationalincapacity,whilethecontractualliabilityofthechar-terermayconcernreturningthevesseltotheownerintheconditionreceivedforthecharter,takingintoaccountregularwearandtearofthevessel.Thirdparty liabilityreferstotheliabilitystemmingfromcollisions,impacts,marinepollutionandthelike.Inthiscase,theaggrievedpartyisthethirdparty.11Aspecialformofliabilityisthecharterer’sobligationtothecrew,i.e.hisliabilityinthecapacityoftheoperatorforcertaincosts(forexample,liabilityfordam-ageoccurredduetoaphysicalinjuryordeathofacrewmember,liabilityfor

8 Pavić,D.,Pomorsko osiguranje pravo i praksa,KnjiževnikrugSplit,Split,2012,p.331;alsoseeWinfieldStretch,G.,Chartering of Ships, Charter parties and Bills of Lading, Notes, References, Forms,BierneAssociatesInc.,NewYork,1953,pp.224–225.

9 Itisnecessarytoaddthatasubcharterer,acontractingpartyofthevesselsubchar-terconcludedwithacharterer,canalsohavealegalinterestinhullandmachineryinsurance,ascanamortgagee.Abankcanalsohaveaspecialinterestinthehullandmachineryinsurance.Forthisreason,inpracticetheinsuredpersonandhullandmachinery insurerusuallyundertake,by virtueof a special legal procedure,thattheinsurancepremiumforthelossordamageofavesselundermortgageshallbepaidtothemortgagee.FordetailsPavić,D.,Ugovorno pravo osiguranja, komentar zakonskih odredaba,Tectus,Zagreb,2009,p.551.

10 Thesecharterer’sresposibilities,pursuanttotheBARECON2001form,stemfromtheprovisionofArticle10Maintenance and OperationandArticle15Redelivery.Asimilarprovision is included intheCroatianMaritimeCode,whoseArticle661,paragraph2providesthefollowing:“Acharterershallmaintainthevesselforthedurationofthecontractand,afteritsexpiration,returnthevesselinthesamecon-ditionandplaceashereceivedit.”

11 Pavić,D.,op. cit.(fn.8),p.419.


damagecausedtoitemsintendedforpersonalusebyacrewmember,liabilitytowardsacrewmemberduringmedicaltreatment,theobligationtocoverthecostsofareturntripforcrewmembers(repatriation),obligationtocompen-sateforcrewmembers’salariesintheeventofashipwreck).

Thechartererhasaspecialinterestinliabilityinsurance,whichisusuallyconcludedbyashipoperator,sinceasweemphasizedearlier,themaineffectachievedbytheconclusionofabareboatchartercontractisthetransferofthecapacityoftheshipoperatorfromtheownertoacharterer.Theowner,ontheotherhand,alsohasaninterestinliabilityinsurance.Pursuanttothesolutionsproposedbysomeconventions’(seeinfra),theownercanalsobethebearerofliabilityfordamagecausedbythevessel.Inthesecases,thecompulsorycon-ventionalsolutionsimposeonthe“registeredowner”or“owner”compulsoryinsuranceorotherfinancialsecurity(suchasaguaranteeofabankorsimilarinstitution).

Withregardtotheforegoing,theparties’interestsininsuranceingeneralforthedurationofthecontractaremutuallyintertwined.Hence,itispossiblethatsomeinsuranceinterestsremainuninsured.Thereforeitisnecessarytoestablishwithcertaintywhoseresponsibilityitistoinsurethehullandma-chineryandtoinsureoneselfagainstallliabilitieswiththepurposeofprotect-ingtheinterestsofbothpartiestothebareboatchartercontract.

4. INSURANCE OF THE HULL AND MACHINERY AND INSURANCE AGAINST LIABILITY DURING THE TERM OF A BAREBOAT CHARTER CONTRACT

Fromthestandpointoftheprotectionofinterestsofthepartiestoabare-boatchartercontract,thetwomostimportanttypesofinsurancearehullandmachineryinsuranceandliabilityinsurance.Thefirsttypeofinsurancetriestopreventthelossofordamagetothevessel,whereastheothertypeofinsurancetriestoprotecttheinterestsoftheownerandthechartererwhen,duetopos-sibleliability,theyareobligedtocompensatefordamage.Withinthecontextofliabilityinsuranceitisimportanttodeterminetheprovisionsofcompulsoryinsurance stipulated by internationalmaritime conventions.Theprovisionsconcerningcompulsoryinsuranceareespeciallyimportantfromthepositionofabareboatchartercontractsincetheownerhastobeawareoftheseobliga-tionsregardlessofgivingthevesseltothechartererforuse.

Ananalysisoflegalmattersregardinginsuranceduringthetermofabare-boatchartercontractmustbeapproachedstartingwithapresentationofthe

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most important elements of hull andmachinery and liability insurance, aswellascompulsoryinsurancepursuanttointernationalmaritimeconventions.Withintheframeworkofthegeneralfeaturesofhullandmachineryandli-abilityinsurancewewillsingleoutsomespecificelementsofthesaidtypesofinsuranceduringthetermofabareboatchartercontract.

4.1. Hull and machinery insurance

Asregardshullandmachineryinsuranceitisnecessarytoindicateinmoredetail the elementsofavesselthatarecoveredbytheinsurance.WithregardtothesignificantroleofEnglishmaritimeinsuranceintheworld,inhullandmachineryinsurancetheinsurablevalueisthevalue,asstipulatedbytheMa-rine InsuranceActof1906, at the commencementof the risk,of the ship,includingheroutfit,provisionsandstores for theofficersandcrew,moneyadvancedforseamen’swages,andotherdisbursements(ifany)(Article16oftheMarineInsuranceAct).12 Insuranceforahullandmachinerycarryingoutinternationaltransportis

mainlydesignedpursuanttoinstitutionaryclausesofLondon-basedinsurers.Hence,Englishmarineinsuranceisimportantforhullandmachineryinsur-ancebecause,amongotherthings,theseclausesexplicitlyenvisagetheapplica-tionofEnglishlaw.ThestandardEnglishinsuranceconditionsusedare:InstituteHullClauses

(1983and1995) andInternationalHullClauses(2003).Theserepresentacollectionofclauseswhichregulatethemostimportantissuesofthecontrac-tual relationship of marine insurance.13 There are a couple of institutionalclauseswhichdifferonlyintheirscopeofcoverage(insuranceforso-calledfullcoverage,limitedcoverageandinsuranceagainstacompleteloss“only”).In-stituteTimeClause–HullsandInstituteVoyageClause–Hullsofferthewid-estcoverage.Theseclausesformthebasicconditionsformarinerisksinhullandmachineryinsurance.AccordingtotheInstituteTimeClause–Hulls,fullinsurancecoverageincludesthoseriskswhichareincludedinthePerils Clause and the Pollution Hazard Clause.14SincetheInstituteTime/Voyage Clause–

12 Availableinitsentiretyonwebsite:http://www.legislation.gov.uk/ukpga/Edw7/6/41/part/3(12February2016).

13 Pavić,D.,op. cit.(fn.8),p.351.14 Perils Clausedividestheinuredrisksintotwogroups.Thefirstgroupincludesloss

ordamagetotheinsuredhullandmachinerydueto: - dangeratsea(dangeratsea,forexample,impact,impactwithfloatingorsubmer

geditems,sinking,capsizing,stranding,impactwiththeseaground,storm), -fire,explosion,


Hullsdoesnotcoverwarrisksandstrikerisks,theInstituteWarandStrikesClauses,Hulls–TimeandInstituteWarandStrikesClauses,Hulls–Voyage15 includecompleteinsuranceagainstsuchrisks.

With hull and machinery insurance it is necessary to emphasize that the hullandmachineryshouldbe insured to theamountwhichcorresponds totherealvesselvalueandwhichshouldbeenteredintheinsurancepolicy.Theissueofdeterminingtheactualvalueofavesselisrathercomplicated16 so that theactualvalueofthevesselwhichbringsprofitisdeterminedonlywhenthecostsofequippingthevesselandtheconsiderationwhichcanbeearnedby

-violenttheftcommittedbypersonsoutsidetheinsuredvessel, - jettison, - piracy, -breakageoraccidentofnuclearinstallationsorreactors, -contactwithairplaneorotheraircrafts,oritemswhichfallfromthem,withaland vehicle,adock,harbourequipmentandinstallations,

-earthquakes,volcanoerruptionsorthunderstrikes. Thesecondgroupincludeslossordamagetotheinsuredhullandmachinerydue

to: -accidentsduringloading,unloadingandmovementofcargoorfuel, -boilerburs,shaftbreakageorotherhiddenfaultsinthemachineryorhullofa

vessel, -negligenceofthemaster,officer,creworpilot, - negligenceofrepairersorchartererundertheconditionthatthosepersonshave

the capacity of insured persons as per the contract. Themaindifferencebetweenthesetwogroupsisthattheriskcoverageofthese-

condgroupisconditionedbythefactthatthedamagedidnotoccurasaconsequ-ence of due diligenceonbehalfoftheinsuredperson.

Polluttion Hazard Clausebroadenstheinsuranceinorderforittoincludethelossordamagetothevesseliftheyarecausedbyafailureofastateadministrativebodyinthepreventionofoccurrenceorreductionoftheriskwhenthepollutionriskisanimmediateconsequenceofvesseldamageforwhichinsurerisliabletocoverpursu-anttothehullandmachineryinsurancepolicy.Thiscoverageisconditionedbythefactthatthedamagedidnotoccurasaconsequenceofduedilligence.Ibid., pp. 352 –353;alsoPavić,D.,Međunarodne klauzule za osiguranje brodova (2003.),Našemore,vol.52,2005,pp.175–176;abautPerils ClausealsoseeDavison,R.;Snelson,A.,The Law of Towage,Lloyd’sofLondonpressLtd,London-NewYork-Hamburg-HongKong,1990,pp.110–111.

15 Insuranceagainstwarrisksisdividedintoregularwarinsuranceduringtheuseofavessel (foroneyear)andadditional insurance forentry intoso-calledwarzoneswherewarrisksarelargeandimminent.Ivošević,B.V.,Brodarski ugovor na vrijeme za cijeli brod (time charter),Institutzapomorstvoiturizam, Kotor,1984,p.76.

16 FordetailsPavić,D.,op. cit.(fn.8),pp.338–343.

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employingthevessel(freight,i.e.hire)istakenintoconsideration.Withoutinsuringthecostsandconsideration,incaseofacompletevesselloss,thein-surancebeneficiarywouldnotreceivefullindemnificationforthedamagesuf-fered.Theownerand/orthechartererasinsurancebeneficiariesmightsuffervarioustypesofdamageincasetheinsuredvalueofthevessel wasnotproperlydetermined.Ifthechartererisaninsurancebeneficiaryandtheinsuredvalueofthevesselwaslessthanthevalueusedforthecalculationofcontributionsingeneralaverage,theninthecaseofapplicationofEnglishlaw,thiscontri-butioniscompensatedfromtheinsuranceonlyproportionallytotherelationbetweentheinsuredvalueandthisothervalue.17

Takingintoconsiderationthecorrespondingassignmentofrightsandobli-gationstothecontractingparties,inadditiontohullandmachineryinsuranceformarinerisksandwarandstrikerisks,othervessel-relatedinterestscanalsobeinsured.Primarily,theownercaninsurethehire,whilethecharterercaninsureotherexpensesandcoststhatheincurredduringthevesselexploitation.Theinsuranceofthesecharterer’sinterestswhichfallintothecategoryofad-ditionalinterestscanbeenvisagedbythebareboatchartercontractbecausetheaimofthiscontractistoregulatetheparties’relationsforthepurposeofvessel employment.

When it comes to hull and machinery insurance, the question arises as to whichofthecontractingpartiesisobligedtobearinsurancecosts.Webelievethatthecontractingpartieshavetoresolvetheseissuesthroughthebareboatchartercontract.Thedurationofthecontractmighthaveadecisiveroleintheregulationoftheissueofinsurancecosts.

4.2. Liability insurance

Thelegalbasisofliabilityinsuranceisbasedonthefactthatliabilitymightstemfromvesselemployment.Aliabilityinsurancecontractcanbeconcludedbyeverypersonwhocanbetheholderoftheliabilityfordamage.Abareboatcharterisatypeofcontractinwhichthereisawidercircleofpersonsonthesideofthevesselwhocanbeholdersofliabilitystemmingfromvesseluse.

LiabilityinsuranceisusuallytakenoutatProtectingandIndemnityAssocia-tions(P&Iclubs)whicharecharacterizedbytheirspecificoperationsystem.18

17 Websiteundernoten.12(14February2016).18 P&Iclubsareinsuranceorganizationswhichoperateundertheprincipleofmutual

insurance for risk insurancewhich cannotbe insuredwith insurers that operate


The rules of a P&I club determine the types of damage and costs coveredbytheinsuranceandcircumstanceswhichhavetobemetfortheinsurancebeneficiarytohavetherighttoindemnification.ThemostimportanttypesofliabilityinsurancewhichP&Iclubsexclusivelyprovidetotheirmembersarethe following: insurance against boat collisiondamage (one fourthor threefourths19),damagetofixedorfloatingobjects,responsibilityforcargo,objectsboardedontheinsuredhullandmachinery,physicalinjuries,illnessanddeathofacrewmemberandotherpersons,suchaspassengers,obligationstowardspersonal belongings of a crewmember, obligations towards the vessel’s di-version,insuranceofprofessionalrescuers,rescueofpersons,generalaveragecontribution,liabilityinrelationtoawreckoftheinsuredship,responsibility

underthepremiuminsuranceprinciple.Oneofthemaindifferencesbetweenmu-tual and premium insurance is that for mutual insurance one pays a call and not a fixedpremium.MembershipinaP&Iclubisgainedinrelationtoaspecificvessel,andamemberisinsuredagainstliabilitiesandcostswhichstemfromtheintereststhathehasinrelationtothesubscribedvessel.ACertificateofEntryisissuedforeverysubscribedvessel.Attheconclusionofacontractanadvancecallispaid,andthefinalcallforeachbusinessyeardependsontheratiobetweenthepaidamountsanddamagepaidforeverysinglememberandtheclubinitsentirety.Ifthefundformed from advanced calls is not sufficient, then a supplementary call is calculated formembers.Traditionally,aP&Icluboperateswiththeaimofindemnifyingtheinsuredpersonandpaysdamagesfromtheinsurancepolicytotheinsuredpersonunder the condition that the insured person himself has indeed paid the indemni-ficationamounttoathirdpersononthegroundsofliabilitycoveredbytheinsu-rancepolicy.Thisstemsfromtheso-calledpay to be paid rulewhichisconsideredoneofthekeyconditionsofallP&Icoverage.TheimportanceofaP&Iclubisnotreflectedonlyinthefactthat,throughitsnetworkofexpertassociates,itofferstoitsmemberscoverageagainsttheirliabilitiesbutalsobecauseitoffersaneffectivelegalandtechnicalsupportindefendingagainstunjustanddisproportionateinde-mnificationrequestsinalllargerworldports.PursuanttoVincencaPadovan,A.,Uloga pomorskog osiguranja u zaštiti morskog okoliša od onečišćenja s brodova,Hrvatskaakademijaznanostiiumjetnosti,Jadranskizavod,Zagreb,2012,p.86;Zelenika,R.;Knapić,I.;Likić,R.,Upravljanje rizicima u klupskom osiguranju,Našemore,vol.54,n.1-2,2007,p.51;Medić,M.,Osiguranje odgovornosti brodara putem P&I klubova, Praktičnimenadžment,vol.1,no.1,2010,p.63;Hodges,S.,Cases and Materials on Marine Insurance Law,CavendishPublishingLimited,London,1999,pp.535,541–547;Hazelwood,J.S.; Semark,D.,P&I Clubs, Law and Practice,4thed,Informa,London,2010,chapter1;Gurses,O.,Marine Insurance Law, 1sted,Taylor&Fran-cisLtd.,London,2015;alsowebsitesofUKP&IClub,http://www.ukpandi.com/about-the-club/(19February2016).

19 InmoredetailPetrinović,R.,“Collision Liability Clause” u institutskim klauzulama za osiguranje brodova,ZbornikradovaPravnogfakultetauSplitu,vol.38,no.4,2001,pp.491-506.

http://www.ukpandi.com/about-the-club/

http://www.ukpandi.com/about-the-club/

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fortowing,coverageofconsequencesofoilpollutiondamageordamagefromotherdangeroussubstancesreleasedfromthevessel,liabilityforlegalexpensesand other various costs.20

TheP&Iclubrulesstipulatethatamembervesselhastohaveaclassaward-edbyaclassificationclubandhastomaintainthatclassforthedurationofthe insurance.Membershavetostrictly fulfill the legal requirementsof thestateflaginrelationtouse,construction,adaptation,vesselcondition,navi-gationalabilityandequipment.Amembervesselhas tohaveallprescribedcertificatesinrelationtosafetyofmanagementandprotectionthuscontribut-ingtoahighervesselsafetylevel.Everyfailureresultsinthelossoftherightto indemnification.21ItisimportanttoaddthatastandardbareboatchartercontractBARECON2001containsaboxinwhichthedataontheclassifica-tionsystem,thedateofthelastvesselinspectiononbehalfoftheclassificationcompany,thenumberofmonthsofvalidityofclasscertificates,whicharealsoimportant for the purpose of hull and machinery insurance, are entered.22

Furthermore,asregardstheparties’liability,itisnecessarytorefertosomeinternationalmaritimeconventionswhichenvisagecompulsoryinsuranceortheprovisionofanothertypeoffinancialsecurity(suchasaguaranteefromabankorsimilarinstitution).Namely,althoughthegeneralrightofmarineinsuranceisbasedontheconsentoftheparties,therearecertainexceptionsto that principle prescribedby compulsory convention solutions.A requestfor compulsory insurance or another type of financial security is a concept of the international maritime conventions from the domain of sea environment protection and transport of passengers. Compulsory insurance or financialsecurity is prescribed by the followingmaritime conventions: InternationalConventiononCivilLiabilityforOilPollutionDamage,196923, amended in 199224(CLCConvention);InternationalConventiononLiabilityandCom-pensation forDamage in Connection with the Carriage ofHazardous and

20 Ifthedamageisobservedpursuanttotypes,thehighestincidenceofdamageisthattothecargo;SeeHazelwood,J.S., P&I Clubs, Law and Practice, 3rd ed, LLP, London-HongKong,2000.

21 Pavić,D.,op. cit.(fn.9),p619.22 RefertoBARECON2001,PartI,box10,11and12.23 TheConventionwasadoptedonaDiplomaticConferenceinBrusselson29No-

vember1969andbecameeffectiveon19June1975.24 TheProtocolwasadoptedonaDiplomaticConferenceinCapeTawnon7Novem-ber1992andbecameeffectiveon30May1996.


NoxiousSubstancesbySea,1996(HNSConvention);25 InternationalCon-ventiononCivil Liability forBunkerOilPollutionDamage, 2001 (BunkerConvention);26WreckRemovalConvention,2007(WRCConvention)27 and AthensConventionRelatingtotheCarriageofPassengersandtheirLuggagebySea,2002(AthensConventionof2002).28

Withinthecontextoftheprovisionsoncompulsoryinsuranceitisneces-sarytopointoutthattheownerofthevesselregisteredinacontractingstateandcarryingmorethan2,000tonsofoilinbulkascargoisrequiredtomain-taininsuranceorotherfinancialsecurity(Article7oftheCLCConvention).29

Also,theownerofavesselhavingagrosstonnagegreaterthan1,000regis-teredinastatepartytotheBunkerConventionisrequiredtomaintaininsur-

25 HNSConventionwasadoptedonaDiplomaticConferenceinLondonon3May1996;TheConventionhasneverenteredinforce.

26 TheBunkerConventionwasadoptedonaDiplomaticConferenceinLondonon23March2001andbecameeffectiveon21November2008.

27 WRCConventionwasadoptedonaDiplomaticConferenceinNairobion18May2007andbecameeffectiveon14April2015.

28 The revised part of theAthensConvention of 1974 (adopted on 13December1974andbecameeffectiveon29April1987),togetherwiththefinalprovisionsoftheProtocolof2002(adoptedon1November2002andbecameeffectiveon23April2014)constitutesarevisedtextofanewconventionentitled:Athens Conven-tion Relating to the Carriage of Passengers and their Luggage by Sea, 2002.

29 TheprovisionsoftheCLCConventiondirecttheliabilityforseapollutionbyoilcarriedinbulkascargostrictlytowardstheowner(Article3,paragraph1oftheCLCConvention). Emphasizing the channeling of the responsibility onto the owner,theCLCConventionstatesthegroupofpersonsagainstwhichanindemnificationrequestcannotbesubmitted.Oneofthetaxativelystatedpersonsagainstwhomanindemnificationrequestcannotbesubmittedisthebareboatcharterer(Article3,paragraph4oftheCLCConvention).Alongwithabareboatcharterer,theCLCConventionasperArticle3,paragraph4definesotherpersonsagainstwhomanindemnificationrequestcannotbefiled,whetherbasedonconventionornot;thoseare:a)theservantsoragentsoftheownerorthemembersofthecrew;b)thepilotoranyotherpersonwho,withoutbeingamemberofthecrew,performsservicesforthevessel;c)anycharterer(howsoeverdescribed,includingabareboatcharterer),manageroroperatorofthevessel;d)anypersonperformingsalvageoperationswiththeconsentoftheownerorontheinstructionsofacompetentpublicauthority;e)anypersontakingpreventivemeasures;f)allservantsoragentsofpersonsmentio-nedunderitems(c),(d)and(e).ForotherprovisionsoftheCLCConventionreferto:Ćorić,D.,Onečišćenja mora s brodova, međunarodna i nacionalna pravna regulacija, PravnifakultetSveučilištauRijeci,Rijeka,2009,pp.129–150;alsoBerlingieri,F.,International Maritime Conventions: Volume 3, Protection of the Maritime Environment, InformaLaw,Routledge,Arbingdon,2015,pp.156–188.

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anceorotherfinancialsecuritytocovertheliabilityoftheownerforpollutiondamagebybunkeroil(Article7oftheBunkerConvention).30

PursuanttotheprovisionsoftheWRCconvention,theownerofavesselofagrosstonnageof300grosstonsandaboveandflyingtheflagofastateparty is required to maintain insurance or other financial security to cover the liabilityforthecostsoflocating,markingandremovingawreck(Article12oftheWRCConvention).31

TheHNSConventionenvisagesthesameobligationwhichmakestheown-erobligedtomaintaininsuranceorotherfinancialsecurityinthesumsfixedbyapplyingthelimitsofliabilitytocoverliabilityfordamageundertheCon-vention(Article12oftheHNSConvention).Incaseofavesselforthecar-riageofhazardousandnoxioussubstancesbysea,theownerisresponsiblefortakingoutinsuranceagainstliabilityfordamageinrelationtothecarriage.32

Finally, pursuant to the provisions of the Athens Convention of 2002,whenpassengersarecarriedonboardavesselregisteredinastatepartythatislicensedtocarrymorethan12passengers,anycarrierwhoactuallyperformsthewholeorapartofthecarriagemustmaintaininsuranceorotherfinancialsecuritytocoverliabilityundertheConventioninrespectofthedeathorper-sonalinjurytopassengers(Article5oftheAthensConventionof2002).Everyactualcarrierisobligedtohavecompulsoryinsurance,whichisrequiredsolelyforthecaseofdeathandpersonalinjuryofapassenger,andnotbaggageloss.33

30 TheprovisionsoftheBunkerConventiondirecttheliabilitytotheship owner.Theterm ship owner, pursuanttotheintroductoryexplanationofthetermsoftheBun-kerConvention,impliestheregisteredowner,bareboatcharterer,managerandope-ratorofthevessel.PursuanttotheprovisionsoftheBunkerConvention,theship owneratthetimeofanincident is liableforpollutiondamagecausedbybunkeroil(Article3,paragraph1oftheBunkerConvention).ForotherprovisionsoftheBunkerConventionreferto:Ćorić,D.,op. cit.(fn.29),pp.155–161;Berlingieri,F.,op. cit.(fn.29),pp.189–207.

31 TheWRCConventioninmoredetail:Rahan,D.,Međunarodna konvencija o uklanja-nju podrtina, 2007.,ZbornikradovaPravnogfakultetauSplitu,vol.46,no.2,2009,pp.391–406;SkorupanWolff,V.;Petrinović,R.,Međunarodna konvencija o ukla-njanju podrtina,Poredbenopomorskopravo,vol.47,no.162,2008,pp.109–134;Griggs,P.,Draft Wreck Removal Convention,CMIYearbook2005-2006,pp.376–383.

32 For liabilityoftheownerandotherprovisionsoftheHNSConventionreferto:Ćorić,D.,op. cit.(fn.29),pp.150–155.

33 ForotherprovisionsoftheAthensConventionof2002referto:PospišilMiler,M.,Atenska konvencija o prijevozu putnika i njihove prtljage morem 2002,Poredbenopomor-skopravo,vol.43,no.158,2004,pp.227–262.


Eachvesselthatcomplieswithaconventionobligationconcerningtheim-plementationofinsuranceorfinancialsecurityisrequiredtocarryonboardacertificateofinsuranceorotherfinancialsecuritywhichconfirmsthattheinsurance or other financial security is in force pursuant to the provisions.34

5. ADDITIONAL REMARKS ON THE INSURANCE PROVISIONS OF THE BARECON 2001 FORM

BARECON 2001 stipulates two insurance-related provisions: Article 13Insurance and Repairs andArticle14Insurance, Repairs and Classification. Provi-sion14isoptionalandisappliedsolelyifthepartieshavecontracteditsap-plication,wherebyprovisionofArticle13isconsideredtobedeletedfromthestandard form, i.e. invalid.

PursuanttoArticle13oftheBARECON2001,duringthecharterperiodthevesselmustbekeptinsuredbythechartererathisexpenseagainst:“hullandmachinery,warandProtectionandIndemnity(P&I)risks(andanyrisksagainstwhich it is compulsory to insure for theoperationof thevessel)”.35 Article13providesthat thecharterer isobligedto insureagainstanyothercompulsoryrisks,includingmaintainingfinancialsecurity.Theformofinsur-anceissubjecttotheowner’swrittenapproval,whichisnottobeunreason-ablywithheld.

34 Furthersignificantcontributiontotheexpansionofcompulsoryinsuranceispro-videdbyDirective2009/20/EUoftheEuropeanParliamentandtheCounciloftheEuropeanUnionontheinsuranceofshipownersformaritimeclaimsof23April2009,whichprescribescompulsoryinsuranceofashipownerformaritimeclaimsasperInternationalConventiononLimitationofLiabilityforMaritimeClaims,1976(adoptedon19November1976andenteredinforceon1December1986)andtheProtocolof1996(adoptedon2May1996andenteredinforceon13May2004).AboutInternationalConventiononLimitationofLiability forMaritimeClaims,1976 and the Protocol of 1996 see: http://www.imo.org/en/About/Conventions/ListOfConventions/Pages/Convention-on-Limitation-of-Liability-for-Maritime-Cla-ims-(LLMC).aspx(14February2016).

35 Thewords“hullandmachinery”havebeeninsertedinArticle13oftheBARECON2001 to replace the word “marine” in the equivalent provision of the previousBIMCOstandardcontractformonthebareboatchartercodenameBARECON89soastorestrictthescopeofapplicationandsoastoexcludeotherinsuranceswhichmayotherwisecomewithinthedefinitionof“marine”insurance.Davis,M.op. cit. (fn.3),p.77.ForBARECON89see:https://www.bimco.org/~/media/Chartering/Document_Samples/Withdrawn/Sample_Copy_BARECON_89.ashx (15 February2016).

https://www.bimco.org/~/media/Chartering/Document_Samples/Withdrawn/Sample_Copy_BARECON_89.ashx

https://www.bimco.org/~/media/Chartering/Document_Samples/Withdrawn/Sample_Copy_BARECON_89.ashx

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IfthepartiesactpursuanttotheprovisionofArticle14,hullandmachin-ery insurance andwar risk insurance is contracted at the owner’s expense,whereasinsuranceagainstProtectionandIndemnity(P&I)risksandcompul-soryinsurance,includingmaintainingfinancialsecurity,iscontractedatthecharterer’sexpense.

TheacceptanceoftheprovisionofArticle13meansthatinthecaseofoc-currenceofaninsuredrisk,withtheapprovaloftheownerandtheinsurer,thechartererperformstherepairsofthevesseldamagecoveredbytheinsur-ance,reimbursementofallcostsrelatedtorepairs,insuredcharges,expensesandinsurer’sobligations.Thechartererisobligedtoeffectallinsuredrepairsandtoarrangeforthepaymentandcollectionofallcostsinconnectionwithsuchrepairs,aswellastoarrangeforallrepairsnotcoveredbytheinsuranceorbelowthelevelofthedeductible,oranypossiblefranchise36(BARECON2001,PartII,Article13(a)).

Ifthecontractingpartieshaveaninterestinadditionalinsuranceforthecoverageofadditionalrisks,forexamplecontractingofinsuranceincaseofalossoftimecausedbytime-consumingrepairsofthevessels’hull37, the cover-ageislimitedforeachcontractingpartytotheamountstatedinthecontract.PursuanttoArticle13(b)ofBARECON2001acontractingpartyisobligedtodeliverthedetailsoftheadditionalinsurance(copiesofanycovernotesorpoliciesandwrittenconsentoftheinsurers)totheotherparty.

Article13(c)ofBARECON2001introducesanewrequirementobligingthecharterertoprovideinformationandpromptlyexecutesuchdocumentsasmayberequiredtoenabletheownertocomplywiththeinsuranceprovisionsof any financial instrument.38

36 Franchise istheamountorpercentagestipulatedbytheinsurancecontractpursuanttowhichtheinsurancedoesnotcompensatefordamage.Theinsurancebeneficiarybearsthecostofdamagealthoughitisusuallycoveredbyinsurance.Itcanbestatedasasumofmoneyorasapercentageoftheinsuredamount.Themainpurposeoftheapplicationofthefranchiseistostimulateaninsurancebeneficiarytounder-takepreventivemeasuresagainstdamageandtoreducethealreadyoccurreddam-agetoavoidthecostoftheprocedureofestablishmentandliquidationofminordamageaswellastoexcludealldamageduetonormalcargoorvolumeloss.Pavić,D., op. cit.(fn.8),pp.241–242.

37 Pursuant to Explanatory notes for BARECON 2001,availableon:https://www.bimco.org/Chartering/Documents/Bareboat_Chartering/BARECON2001/Explanatory_Notes_BARECON2001.aspx.(15February2016).

38 Davis, M., op. cit.(fn.3),p. 79;alsoseewebsiteunderfn.1.

https://www.bimco.org/Chartering/Documents/Bareboat_Chartering/BARECON2001/Explanatory_Notes_BARECON2001.aspx. (15




BARECON2001differentiatesbetweentheinsuranceforthecaseofactualandconstructive,compromisedoragreedcompletevesselloss(seeBARECON2001,PartII,Article13(d)).Actual loss impliesphysical lossordamagetoaninsuredvesselwhereasconstructivelossimpliesthelossofcommercialuseofthevessel.Byencompassingvariouscasesofvessellossacompletelynewcriterionforthedeterminationofcompletelosshasbeenintroduced.Namely,fromthecontentofastandardcontractformofthebareboatchartercontractunderthecodenameBARECON89thehullandmachineryinsurancecoversonlythephysicallossanddamage.WiththeBARECON2001formanothercompromisedandagreedvessellosshasbeenaddedwhichcanbeinterpretedwithinthescopeoftheagreedcontract,compromise,acceptanceorthesettle-ment of the parties.39

Thechartererisobligedtonotifytheownerandthemortgagee(ifany)ofanyoccurrenceswhicharelikelytoresultinthevesselbecomingatotalloss(BARECON2001,PartII,Article13(d)).Theowneris,ontheotherhand,obliged,upon the requestof the charterer, topromptly execute suchdocu-mentsasmaybe required toenable the charterer toabandon thevessel toinsurersandclaimaconstructivetotalloss(BARECON2001,PartII,Article13(e)).

Finally, it isnecessarytodeterminethevessel’svalue for thepurposeofinsurancecoverage.PursuanttotheBARECON2001formthevalueofthevesselisdeterminedbytheagreementofthecontractualparties(contract value)whichisenteredinthefirstpartofbox29(BARECON2001,PartII,Article13(f)).Iftheamountdeterminedbythecontractdoesnotcorrespondtotheactualvalueofthevessel,i.e.iftheamountisenteredwithanintenttocom-mitfraudagainsttheinsurer,thevalueofthevesselwhichcanbeinsuredistaken.40

Ontheotherhand,inpracticeitcanhappenthattheownerdoesnotde-mandfromthecharterertoinsurethehullandmachinery,butinthedeliveryofthevesselalsooffershullandmachineryinsurance.Ifthechartereracceptsthe offered insurance, the parties must accept the insurance provision pursu-anttoArticle14oftheformBARECON2001.AccordingtoArticle14,theobligationof thehullandmachineryandwar risk insurancearecontractedattheowner’scostwhereastheinsuranceagainstProtectionandIndemnity

39 Explanatory notes for BARECON 2001. 40 Davis, M., op. cit.(fn.3),p.80;alsoseewebsiteunderfn.1.

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(P&I)risks(andanyrisksagainstwhichitiscompulsorytoinsurefortheop-erationofthevessel)arecontractedatthecharterer’sexpense.

It is considered that the hull andmachinery insurance by the owner isusuallycontractedinacharterforadefiniteperiodoftime,whichisusuallyashorterperiod(fromfourtosixmonths)41 so the provision has a special appli-cationtopassengervesselswhichareplacedintobareboatcharterforseasonalcruise or ferries hired for summer season.42Usuallytheownermaintainsthehullandmachineryinsuranceathisownexpense.43

PursuanttothestatedprovisionofArticle14oftheBARECON2001form,theownerbearstheexpenseofhullandmachineryinsuranceagainstmaritimeandwarrisks,althoughthecharterermust,withtheapprovaloftheownerorthe insurer, perform all insured repairs and cover the costs of all such repairs. Providedthataninvoiceissubmitted,theinsurermustcoverthecostsofthecharterer.

Theownerand/ortheinsurer,incaseoflossordamagetoavessel,machin-ery or devices, are not entitled to a compensation from a charterer as opposed toArticle13whichstipulatesthatthechartererisresponsibleforcontractingandinsurancepaymentsfortheProtectionandIndemnityriskscoverageandfortherisksforwhichaninsuranceiscompulsory,andwhichwereapprovedbytheowner.However,ifthechartererbyhisactionornegligenceendangersthecontractedinsurance,heisliabletocompensateforanylossestotheownerandto indemnifyhimwithregardtotheclaimsanddemandswhichwouldotherwisebecoveredbytheinsurance.Theowner,undersuchcircumstances,hastherighttowithdrawthevessel,whichterminatesthecontractpursuanttothe provision on the termination of the contract44(BARECON2001,IIPart,Article14(c)and14(d)).

41 Pursuant to Explanatory notes for BARECON 2001. 42 Davis, M., op. cit.(fn.3),p.82.43 Pursuant to Explanatory notes for BARECON 2001. 44 When it is referred to the termination of the contract stipulated under the provi-

sion TerminationfromtheBARECON2001form,theoccurrenceofcertaincircum-stancesisimpliedwithinthedurationofthecontractwhichleadtotheterminationofthecontractagainstthecontractingparties’willorwhichgivetherighttooneortheothercontractingpartytorequestsuchtermination.TheprovisionontheterminationofacontractstipulatedundertheBARECON2001contractimpliestheterminationofthecontractbasedonthecharterer’sdefaultandthelossofthevessel.Italsostatesotherreasonsfortheterminationofacontractsuchasliquida-tion,bankruptcyandothercircumstanceswhichareaconsequenceofafinanciallossofthecontractingparty;seeBARECON2001,PartII,Article28.


Thechartererisresponsibleforotherrepairsandcostswhicharenotcov-ered by the insurance and/or are beyond the franchise level. The charterermustbearthecostsofthetimenecessaryfortherepairsofavesselandsuchtimeisincludedinthedurationofthecharter.Thisincludesthetimeneces-saryforrepairscausedbythelatentdefectsofthevessel(BARECON2001,IIPart,Article14(e)and14(f)).

TheremainingpartofArticle14mutatis mutandis contains identical provi-sionsofArticle13of theBARECON2001 form: contractingof additionalinsurance; insurance in caseof actual, constructive, compromisedor agreedcomplete loss of a vessel and determination of a value of the vessel for the purpose of insurance.

Finally, in thewhole concept ofArticle 14 it is implied that the ownermaintainstheclassofavesseluntilthedatestatedbytheclassificationcom-pany aswell as all other certificates for the duration of the charter. If theagreedcharterisforashorterperiodoftime,forexamplefourtosixmonths,itisnotappropriatethatthecharterershouldberesponsiblefortherenewalofthe class of a vessel.45Thepossessionofaclassandprescribedcertificatesareconditionsforthevessel’smembershipintheP&IClubaswellasforhullandmachineryinsuranceandliabilityinsurance.

6. CONCLUSION

Inthispaperwehavetriedtoidentifythespecificfeatureswhichcharacter-izeinsuranceduringthetermofabareboatchartercontract,focusingmainlyonhullandmachineryandliabilityinsurance.Anydiscussionofinsuranceinabareboatchartercontractisimpossibletopresentwithoutanoverviewofthemainfeaturesofabareboatchartercontract.Were-emphasizedthatbothpar-tieshaveaninterestininsuringthehullandmachineryandliabilityduringthetermofabareboatchartercontract.Inindividualcasestheownercanbeheldliablefordamagecausedbythevessel(forexampleCLCConventionexplicitlydirectsthe liabilityforseapollutionbyoilcarriedasabulkincargototheowner;theBunkerConventiondirectstheliabilityforseapollutionbybunkeroiltoboththeownerandthecharterer).Moreover,wehavedeterminedthatthe factof lettingthevesselbeuseddoesnotrelievetheownerof liability;hencetheowner,togetherwiththecharterer,hasaninterestintakingoutin-suranceagainstliability.Alongwiththegeneralfeaturesofhullandmachinery

45 FormoredetailsrefertoExplanatory notes for BARECON 2001.

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andliabilityinsurance(thecommonusageofinstitutionaryclauses - InstituteHullClauses,InternationalHullClauses, InstituteWarandStrikesClauses;theroleoftheP&IClubs),westatedsomeprovisionsofcompulsoryinsurancewhicharestipulatedbyseveralinternationalmaritimeconventions.Solutionsproposedbysomeconventions’:

- avesselthatcarriesmorethan2,000tonsofoilinbulkascargomusthavecompulsoryinsuranceorotherfinancialsecurity(Article7oftheCLCConvention);

- the owner of any vessel having a gross tonnage greater than 1,000 isobligedtomaintaininsuranceorotherfinancialsecurityforthecoverageofliabilityfordamageduetoseapollutionbybunkeroil(Article7oftheBunkerConvention);

- theownerofavesselhavingagrosstonnagegreaterthan300grosstonsisobligedtomaintaininforceinsuranceorotherfinancialsecurityforthecoverageoflocationcosts,markingandremovalofawreck(Article12oftheWRCConvention);

- avesselthatcarries12ormorepassengersisobligedtohaveacertificateofcompulsoryinsuranceorfinancialsecuritywhichprovesthatthecar-rierwhoperformsactualtransporthasthirdpartyliabilitycoverage(Ar-ticle5oftheAthensConvention2002).

AlthoughtheHNSConventionhasnotenteredintoforceonaninterna-tional level, it is necessary to note that it also stipulates compulsory insurance. PursuanttotheHNSConvention,theownerisalsoobligedtoconcludeaninsurance contract or some other financial security in case of sea pollution withhazardousandnoxioussubstances(Article12).

FromtheexampleoftheprovisionsoftheBARECON2001formwehavedeterminedthat theexpenseofhullandmachinery insurancecanbebornebyacharterer(Article13)ortheowner(Article14)dependingonwhichcon-tractual provisionof the form thepartieshave agreedupon.Acceptanceofoneprovisiondeletes theother.Pursuant to theBIMCOexplanatorynotesconcerningtheprovisionsofBARECON2001,theacceptanceoftheprovisionofArticle14,i.e.contractingoftheowner’sobligationtobeartheinsuranceexpense,iscustomaryinbareboatchartersforashorterperiodoftime.Hav-inganalysedtheprovisionsoftheBARECON2001formwehavedeterminedthattheformenvisagestheobligationoftakingoutinsuranceagainstmaritimeandwarrisks,butalsoagainstanyrisksthatthevesselisexposedtoduringitsmaritimeendeavours.BARECON2001indicatestheobligationofthecharter-


ertobeartheexpenseevenwhenitcomestocompulsoryinsurance,althoughtheprovisionsdonotdirectlyspecifythecompulsoryinsurance.Webelievethatexpandingtheseprovisionswithconventionsolutionsonthecompulsoryinsuranceshouldbeconsidered.Inotherwords,webelievethatitisdesirableto have such convention solutions inmindwhen concluding of a bareboatcharter contract.

WecanconcludethattheinsuranceprovisionsfromtheBARECON2001formaresatisfying,withthesaidnotetoclearlystatetheobligations,primarilyofcompulsoryinsurance.Contractingpartieshavetohaveagoodknowledgeofcompulsoryinsuranceofthesaidmaritimeconventionsolutions.Addition-ally, theseprovisions refer theparties to their contractingpositions for thedurationofthebareboatcharter.

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Sažetak

Dr. sc. Marija Pijaca *

Dr. sc. Božena Bulum **

RIZICI OSIGURANJA KOD UGOVORA O ZAKUPU BRODA

Ugovor o zakupu broda može se činiti jednostavnim ugovornim odnosom: zakupoda-vatelj daje zakupoprimatelju brod na uporabu radi obavljanja plovidbene djelatnosti, a zakupoprimatelj plaća zakupodavatelju zakupninu. Međutim, riječ je o iznimno slože-nom ugovornom odnosu koji se ogleda u kompleksnom sustavu pravnih odnosa ugovornih stranaka koji proizlazi iz davanja broda na uporabu. U skladu s kompleksnošću među-sobnih prava i obveza stranaka iz ugovora o zakupu broda u prilično složenom obliku javlja se i pitanje osiguranja. Interesi osiguranja broda i odgovornosti međusobno se prepleću pa je lako moguće da neki interes promakne i ostane neosiguran. Zato je potrebno sa sigurnošću utvrditi tko je dužan osigurati brod, osigurati se od odgovornosti te utvrditi ostale oblike osiguranja specifične za tu vrstu iskorištavanja broda. U ovom radu cilj je utvrditi obilježja osiguranja kod ugovora o zakupu broda te, također, analizirati način na koji je pitanje osiguranja zakupljenog broda normirano odredbama BIMCO-ova standardnog ugovornog obrasca o zakupu broda, kodnog naziva BARECON 2001. Isti ugovorni obrazac najčešće se koristi u praksi ugovaranja zakupa broda, pa se smatra potrebnim utvrditi predviđaju li odredbe standardnog ugovornog obrasca dovoljno široko pokriće osiguranja za trajanja ugovora o zakupu broda. Analizom i tumačenjem odreda-ba o osiguranju standardnog ugovornog obrasca BARECON 2001 autorice iznose za-ključak zadovoljavaju li naznačene odredbe interese stranaka iz ugovora o zakupu broda.

Ključne riječi: ugovor o zakupu broda, osiguranje broda, osiguranje od odgovornosti, odredbe o osiguranju obrasca BARECON 2001

* Dr.sc.MarijaPijaca,poslijedoktorandicanaPomorskomodjeluSveučilištauZa-dru,MihovilaPavlinovićabb,Zadar;[email protected]

** Dr.sc.BoženaBulum,višaznanstvenasuradnicaJadranskogzavodaHrvatskeaka-demijeznanostiiumjetnosti,AugustaŠenoe4,Zagreb;[email protected]