ARTICLE: The Sinking of the "Bulgaria" (2011)

 

Vessel: Passenger Ship "Bulgaria"

Year: 2011 (July)

Place: Tatarstan, Volga River, Russian Federation.

Incident: Sinking.

Casualties: 77 Adult fatalities, 11 children. 

Cause: Age & Maintenance of Vessel / Overcrowding / Heavy Weather. 

On 11 July the vessel "Bulgaria" was sailing, heavily overcrowded, when it rolled, allowing water to rush into the internal spaces, causing the vessel to sink. It took just three minutes to sink leaving almost 200 people overboard and trapped inside, two miles from land.

One of the most tragic reports from the incident was that two nearby vessels sailed past and refused to offer assistance to the survivors. It noew appears that legal proceedings will be issued against those two ships by the Russian government.

The ship was 55 years old and its construction meant that any water ingress to internal areas was fatal (there were no seperation comprtments in the hull). The extrememe overcrowding would not allow it to stay upright in the weather it experienced. Investigations into this tragic accident are ongoing.

ARTICLE: The "Exxon Valdez" Oil Spill (1989)

The vessel underway, with tug assistance.

Vessel: "Exxon Valdez"

Year: 1989

Place: Alaska, USA

Incident: Pollution (Crude Oil)

Loss: Approx. 500,000 barrels of crude oil spilled, affecting 1,300 miles of coastline.

Cause: Grounding on reef due to insufficient maintenance of software and crew fatigue / negligence. 

On 24 March 1989 the tanker "Exxon Valdez" was underway in the pristine natural habitat of Prince WIlliam Sound, Alaska, carrying 55 million gallons of crude oil, when she struck the a reef. She became grounded on the reef and her hull was breached, allowing oil to escape into the surrounding sea. In the days following as much as possibly 58 % of the crude oil onboard spilled into the ocean and to this day it is considered to be one of the biggest man-made environmental disasters of all time.

The Master was found to have been asleep at the time (below deck), and the third mate (who was taking his place on the bridge) failed to see or avoid the danger. The ship's RAYCAS raydar system, which could have prevented the accident, was not working. Many of the failings identified in subsequent reports / investigations were not considered to be unique to Exxon, or this vessel, and were thought to be industry-wide concerns. 


A US court in Baker v Exxon awarded the victims of the incident approximitely USD 5.3 Billion in compensation, but this has since been the subject of numerous appeals and the amount was reduced to about one tenth of that amount. The main reason for the reduction was an argument over the level of 'punitive damages' under US law. The initial judgement was made essentially on the principle that a judge could award what they felt appropriate as a level of punishment (USD 5 Billion was about one year's profit for the oil company), but the latest appeal judgment was made basically on the idea that the 'punitive' damages should be within a ratio of the real damages payable. 

The incident has led to some of the most wide-ranging reforms in the tanker world, in terms of recommended safety procedures, working hours for crews, oil pollution laws and regulations etc.

A photograph of the aftermath of the spill.

GUIDE: Towage Claims / Law

When we consider towage, we generally think of one vessel pulling another at sea. However, technically towage is merely any operation where one vessel is assisting another (helping to berth, ating as pusher tug, providing an escort, etc.

The vast majority of towage claims are claims in contract.[1] Routine towage operations under contract are referred to in law as “ordinary towage”, and are contrasted with the sort of ‘emergency’ towage which takes place during a salvage operation. In the vast majority of ordinary towage situations a tug will be providing services on a standard form of contract wording, which both parties will be familiar with.

“Knock-for-Knock” Terms (kfk / k4k)

It is important that our Members enter towage contracts which are on what is known as “knock-for-knock” terms, or terms more favourable. Knock-for-knock terms are essentially an agreement whereby each party takes responsibility for damage to their own property or injury to their own employees, regardless of how caused (i.e. who was negligent). Accordingly, the parties also agree to indemnify each other against claims brought by third parties against the wrong side. The most common standard form towage contracts all include such terms, or terms more favourable still.  

Standard Form Contracts

The main standard form towage contracts used are as follows: 

“UK Standard”[2] - These are the main terms used by harbour authorities in the UK and are used for all general day-to-day towage operations undertaken by their tugs. They are found throughout the common law world and are considered exclusionary, in that they generally exclude the liability of the tug, for damage to the tow and even for damage to the tug (which must be paid for by the tow). For this reason they are considered more favourable, for the tug, than basic “knock-for-knock” terms.

“Towcon” 2008[3] - Towcon contains a basic form of knock-for-knock terms, where the tow and tug agree to meet their own liabilities. Where the tug collides with another vessel or property it accepts liability for the damage and where the tow collides it does the same. The contract is designed for use in the ocean towage of a vessel from one place to another at a fixed rate.

“Towhire” 2008[4] - Towhire contains the same basic form of knock-for-knock terms as Towcon, but the contract is designed for the hire of a tug for a period of time, rather than for one specific job.

“Supplytime” 1989 or 2005[5] - Supplytime is not technically a towage contract but a charterparty for the hire of a vessel. However, it is often used in the offshore industry as a contract under which to hire a tug, which will then provide towage services. The contract contains knock-for-knock terms but there is a risk if the tug, once hired, is used for towage operations involving third party vessels. They may then bring claims directly against the tugowner, who would be unable to rely on contractual defences or limits.

Contracts at Common Law 
Sometimes terms are not agreed in advance of the towage operation, or the terms used by the tug are not properly incorporated into the contract of towage. In these circumstances the courts will apply what they call an ‘ordinary contract of towage’. This is a contract with only basic terms, under which the owner of the tug is required to provide a seaworthy tug, which is properly manned and equipped and they must be competent and use skill in carrying out the operation.

A common law towage contract, such as this, is not desirable for a tugowner because although it still absolves them of liability for accidents beyond their control, it does not provide the necessary defences, limitations of liability and safeguards that the normal standard form conditions provide.

The often cited general principle of towage that "tug is servant of tow", in other words the tug is (generally) the smaller vessel and is only acting under the instructions of the larger vessel. The principler comes from The Niobe (1888).   

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[1] There are some notable exceptions. In salvage claims where there is no contract claims arising are based on equitable rights at common law. In so-called ‘gratuitous’ towage situations, where no charge is made for the towage service, claims are based in tort. And where the tow is capable of being considered ‘property’ (say a dumb barge incapable of independent navigation and with no crew) then a claim in bailment is also possible.

[2] UK Standard Conditions for Towage and Other Services (Revised 1986) – Issued by the British Tug Owners Association.

[3] BIMCO’s Towcon 2008 – International Ocean Towage Agreement (Lump Sum).

[4] BIMCO’s Towhire 2008  – International Ocean Towage Agreement (Daily Hire).

[5] BIMCO’s Supplytime ’89 / Supplytime 2005 – Time Charter Party for Offshore Service Vessels.