the media in a high-profile casualty situation

The Swedish Club

No. 1 - 2012 April

Page 24-27

MANAGINGthe mediain a high-profilecasualty situation

Criminalisation of seafarers Page 9-11

UNSUNG HEROES of the MV “Rena”Page 28-29

THE SWEDISH CLUB TRITON 1-2012

2

Content | No. 1 - 2012 April

LeAder | Exposure has become reality! 3

MArketING & | 140 years old, full of new-born energy

BUSINeSS deVeLOPMeNt | and a prosperous future 4

rISk & OPerAtIONS | Happy New Policy Year! 5-6

FINANCe | Result 2011 6-7

Fd&d | Freight Demurrage & Defence insurance | – State of Affairs 8

P&I | Criminalisation of Seafarers 9-11

| Scindia Duties and Longshore Activities in | the United States 12-14

CLUB INFOrMAtION | News from Gothenburg 15

P&I | The High Cost of failing “Grain Clean” in | Australia 16-17

| United States Coast Guard grants petition | to limit OPA 90 liability for Selendang Ayu | Oil Spill 18-20

SAFety | Titanic and SOLAS 1912 - 2012 21

LOSS PreVeNtION | P&I Claims Analysis 22-23

MedIA | Under the spotlight | – Managing the media in a high-profile | casualty situation 24-27 POLLUtION | Unsung heroes of the MV Rena grounding | 28-29

CLUB INFOrMAtION | Notice Board 30

the SwedISh CLUB | MRM 31-33

ACAdeMy | Out and about with MRM 32-33

CLUB INFOrMAtION | Staff presentations

| Marine Claims Manager, | Johan kahlmeter 34, 36

| P&I Claims Manager, | Maria Berndtsson 35-36

| News from Piraeus 37

| News from Asia 38

| News from Oslo 39

| Varbergs Fortress 40

| Out and about 41-42

| Staff news 43

| Club quiz 43

| Club calendar 44

The Swedish Club is a mutual marine insurancecompany, owned and controlled by its members. the Club writes Protection & Indemnity, Freight,demurrage & defence, Charterers' Liability, hull &Machinery, war risks, Loss of hire insurance and anyadditional insurance required by shipowners. the Club also writes hull & Machinery, war risks and Loss of hire for Mobile offshore units and FPSO's.

Head Office Sweden

Visiting address Gullbergs Strandgata 6 411 04 Gothenburg Postal address P.O. Box 171 Se-401 22 Gothenburg, Sweden tel +46 31 638 400 Fax +46 31 156 711 e-mail [email protected] emergency tel +46 31 151 328

Greece 5th Floor, 87 Akti Miaouli Gr-185 38 Piraeus, Greece tel +30 211 120 8400 Fax +30 210 452 5957 e-mail [email protected] tel +30 6944 530 856

Hong Kong Suite 6306, Central Plaza 18 harbour road, wanchai, hong kong tel +852 2598 6238 Fax +852 2845 9203 e-mail [email protected] emergency tel +852 2598 6464

Japan room 103, 6-1, 1 Chome, kaigan, Minatu-ku tokyo 105-0022, Japan tel +81 3 6459 0870 Fax +81 3 6459 0871 e-mail [email protected] emergency tel +81 3 6459 0870

Norway house of Business, 6th floor Postal address tjuvholmen Allé 3 N-0252, Oslo, Norway tel +47 9828 0514 Mobile +47 9486 1205 e-mail [email protected] emergency tel +46 31 151 328

The Swedish Club Triton is published three times a year and distributed free of charge. the Swedish Club triton is an editorially independent newsletter and opinions expressed by external contributors are not necessarilythose of the Swedish Club. Articles herein are not intended to provide legal advice and the Club does not accept responsibility for errors or omissions or their consequences. For further information regarding any issue raised herein, please contact our head office in Gothenburg.

Editorial Advisory Board Maria Berndtsson, Susanne Blomstrand, hans Filipsson, henric Gard, Birgitta hed, Johan kahlmeter, Anders Leissner, Lars A. Malm, Lars rhodin, tony Schröder, Carola weidenholm.

Production co-ordinator Susanne Blomstrand.

PR-consultant trS Public relations Ltd., London.

Layout eliasson Information, Gothenburg.

Cover photo iStockphoto.

Print Pr Offset. 1204Pr5000B

© the Swedish Club Articles or extracts may be quoted provided thatthe Swedish Club is credited as the source.

www.swedishclub.com


3

dear members and associates,

Shipping has been hit by some major casualties

recently. Apart from our own rena container ship

grounding in October last year, the industry saw the

Costa Concordia cruise ship capsize in January this

year. how can these incidents happen? how can these

severe groundings occur? I was asked that question

by my children and it was not that easy to answer in

fact. yet it looks so banal with a picture of a ship on

the rocks. Suffice it to say, casualties are rarely the re-

sult of a single error. they are, with few exceptions,

the result of concurrency of many circumstances or

through a complex chain of events. Naturally, some-

thing must have gone very wrong on the bridge in

both New Zealand and Italy. expectations in shipping

are now for even more emphasis being put on bridge

team management in general and passage planning

in particular in future. the need for continuous Mari-

time resource Management training has again been

underlined.

Casualty response is a joint effort between ship-

owners and underwriters’ partners in chief. Few

responses follow textbook examples on how to pro-

ceed; they are always subject to change. they often

become very challenging, not least from an environ-

mental and political points of view. Our greatest chal-

lenge in the rena case was the lack of response re-

sources locally. the ship ran aground in an extremely

exposed position in the Bay of Plenty, 12 miles off the

port of tauranga. An effective response was also im-

paired by severe weather conditions that occur from

time to time, making it too dangerous to continue

the operation. yet the response is relentless in its en-

deavour to carry on despite logistical problems. In my

view, the owners of the vessel should be commended

for their devotion, patience and will to constructively

deal with the situation in the aftermath of the inci-

dent.

In underwriting we consider exposure. It is present,

it is imminent and yet so remote it seems. risks are

obvious but it’s not uncommon to hear “it will not

happen to us - we have far better systems”. In the

rena and Costa Concordia cases, exposure has be-

come reality. the probability of these casualties is low

but when they occur it is a sharp reminder of the risks

involved in shipping. It is necessary to rate exposure

across the entire insurance portfolio. to this end, re-

sponsible underwriting requires every member to

play their part. Only then can the underwriting be re-

garded as sustainable over the longer perspective.

the Club saw a volatile claims year in 2011 coupled

with modest support from investments. the outcome

of the technical account quite significantly deviates

from the actuarial expectation. In 2010 we had the

opposite experience with virtually every area and

product working our way. In 2011, we stood the test

and showed resilience in the face of adversity. Under-

writing should be assessed over a longer period in

terms of volatility. Over the past three years we have

progressed well in terms of business volumes, results

and free reserves. we also receive the strongest ap-

proval endorsement ever which was shown in the

latest members’ questionnaire. After all, this is what

really counts moving ahead; sustainability combined

with excellent services.

with best regards,

Leader | MD Lars Rhodin

Exposure has become reality!

PHo

to: Jo

nas A

hlsén

Lars RhodinManaging director


4

Marketing & Business Development | State of the Market

HIStORy is important and most, if not all, companies or or-ganisations are a product or a reflection of their history. History on the other hand does not tell us much about the future. An important differentiator is that companies or organisations that analyse, learn and act on what history teaches us have a better chance of influencing or even creating their future.

The 101st P&I renewal has just finishedAt the time of writing we have just finished our 101st P&I re-newal. Every renewal has its own characteristics and every re-newal is different, as is this one. In the current freight market environment where shipowners are struggling, costs such as insurance are naturally being focused on more by owners as well as managers. It is therefore pleasing to be able to report that this year’s P&I renewal also ended satisfactorily from the Club’s perspective. Not only did we achieve our general increase set by the board, we also managed to expand our renewal portfolio and received firm commitments of a sizeable tonnage amount to attach during the year. We take this as yet another endorsement of the Club’s ambition to slowly but steadily build a portfolio of high quality shipowners and managers with an eye for stabil-ity, financial resilience and a service concept second to none. Although, we expect the overall growth rate to slightly slow down in the short-term, due to factors beyond our control, the Club has managed to expand the P&I portfolio by well over 30% since 2009 and transformed from a small to a mid-sized P&I club.

Heading towards our first energy renewalsA year has past since starting our most recent business line, En-ergy, and we are rapidly approaching a series of first renewals. The first year of operation has been very satisfactory and I dare say that we have proceeded according to plan, if not ahead of them. Our portfolio currently consists of over 30 accounts and covers well in excess of 200 offshore units. This is indeed a good start and ratification that the Club’s diversification ambitions

are well founded and make sense from a business perspectiveOur office in Oslo has done a tremendous job and has been

helped by the good timing of our entry, as well as a need from owners and brokers for fresh, new, local, long-term capacity. At the moment the vast majority of the business underwritten emanates from Scandinavian owners and brokers. Over the next year we intend to carefully explore business based and produced outside Scandinavia, provided of course that the quality and pricing is in line with our models.

Getting the price right (immediately)is still the key after 140 yearsP&I business is generally long-term and the marine market continues to be a commodity market. Major market claims, like the Costa Concordia, will of course have an impact on current rating levels but a major obstacle against a much-needed, firm, upward rate correction is overcapacity. The concept of general increase has never attracted the marine market and probably never will. It is therefore paramount to get the price right (im-mediately) as the market is very liquid and the possibility of adjusting the pricing over time demands almost magical skills. Nevertheless, the marine side of our business remains very im-portant to us and our commitment to further diversify within the marine portfolio remains strong.

Celebrating 30 years of “delivering the firm” in AsiaIn 2012 we also celebrate 30 years of being and operating in Asia. Our Hong Kong office opened in 1982 and offers The Swedish Club all-in-one concept to Asian shipowners and charterers. Over the years the Asian region has become increas-ingly important to us and today around 30% of the Club’s P&I portfolio is dealt with by our Hong Kong office. Being able to see the formidable growth and development that the region in the past, present and future has, is exciting and a strong motiva-tor for all of us at the Club to continue to “deliver the firm” to Asian owners and brokers.

The Swedish Club has a long and proud history from its founding in 1872 to the present day. For most people 140 years is a very long time, and that’s true. On the other hand it is also proof that the Club has been able to use its history in order to adapt, adjust, develop and move forward. This important work is continuing at full strength and rest assured – “we are with you at all times and all the way”.

“140 years old, full of new-born energy and a prosperous future”

Henric Garddirector, Marketing & Business development


5

Risk & operations | Marine Renewal 2012

Lars A. Malmdirector, risk & Operations

Happy New Policy Year!MANAGING our business partners’ expec-tations with renewal surrounded by a lot of uncertainty about the state of the economy in future, is of even greater importance than before. For us it has been natural to take a longer view of the rating structure and finding an equitable balance between the timing of rate corrections over time and the ability of meeting our requirements. As always there are levels that you simply can-not deviate from. The alternative to unsus-tainable levels is of course de-risking. We are in the process of enhancing the Club’s already strong financial position making us an even more solid business partner where stakeholders can feel comfortable that they are investing in future certainty. Due to the current financial turmoil, predictability is increasingly more important than ever. The Club has delivered sustainable tech-nical underwriting results in recent years and even though 2011 was something of a disappointment in that respect – we are confident that we will be “back in black” going forward. We are in many respects continuing our efforts in taking the Club to the next level.

Development of IT solutionscontinuesWe are continuing to develop IT solutions on our website and for smart phones to sup-port our business partners’ day-to-day busi-

ness. We have already taken the first step and introduced certain interactive features on our website enabling our business part-ners to make various transactions on-line through The Swedish Club On Line plat-form (SCOL). For more information about SCOL, please see page 30.

Work on refining our Internal Capital Model continues to increase, and over the long-term, this will have a positive impact on our members.

P&I RenewalAs far as claims on the P&I side is con-cerned, 2011 was admittedly slightly worse than expected. We noticed an increase in the number of larger claims. We can safely say that the number of smaller claims in the categories of “Cargo” and “Crew” has increased a lot over the past five years. 2011 also started rather well in terms of return on our investments. The latter part of 2011, however, performed less satisfactorily in this respect and left us with less contribu-tion than expected.

In conclusion, the Club’s overall financial standing remains strong and when taking the overall situation into account we were pleased that this year’s renewal could be handled in a balanced manner. The Club’s position has improved year-on-year and it is clear that results, enhanced risk manage-ment, service and re-emphasized focus on marketing are paying off well.

During the policy year 2011/12 we added further business to our P&I portfolio. At policy year-end 2012/13 we are expecting to have a combined owners/charters book of approximately 55 million gross tonnes. As we have elaborated before – but it deserves to be said again – size is important only if sustainable over the long-term. The Club’s growth with this renewal is very pleasing and again reflects the most profound sup-port and genuine commitment to the Club from its business partners.

Marine RenewalMarine & Energy renewals have, over the years, gradually become spread out over the year, the significance of the 1 January renewal is today somewhat less than it used to be. Having said that, some of the Club’s most important members still renew on this date. The Marine and Energy insur-ances are the owners’ most basic protection

The historic reason why 20 February is the date for renewing P&I insurance, is because this was the time of the year when a new trading season could begin. So, a new trading season has begun but admittedly it leaves us with slightly mixed emotions.

From the Club’s perspective we have met our tar-gets as far as rates are concerned and we added some new tonnage.

From the owners’ perspective however, the outlook is of course very troublesome and uncertain indeed. From the outset it was clear that this renewal was, to a

greater extent than many times before, about manag-ing both exposure and expectations.

In conclusion the Club did very well in both re-spects. In contrast to the past two winters in our re-gion, this one has so far been very mild and accom-modating.

That cannot be said about the state of the shipping market where icy winds continue to blow, exposing relationships to frostbite on the back of the ongoing financial turbulence.

9 continues on page 6


6

Finance | Result 2011

tough claims yearput figures in deficit

tHE CLUB reports a twelve-month loss of USD 9.3 million (2010: +29.5), which is a fall of USD 20.9 million compared to the profit reported for the first six months of the year. The dete-rioration in the second half of the year is primarily due to three major P&I claims, along with a decline in the eq-uity portfolio.

Major P&I claimsThe Club can expect to have just be-low one P&I claim per year in excess of the USD 8 million pool retention. For almost four years, August 2007 – May 2011, there were none. After that, things changed dramatically and in less than four months we had three claims in excess of that amount.

The first was the bulk carrier, Pioneer Pacific. On 20 June 2011 this vessel was involved in a collision at Rio Parma in Argentina, striking and damaging a terminal structure. The current reserva-tion for this casualty is USD 16 million.

The next incident occurred on 29 July, and this time it was the bulk car-rier B Oceania, which sunk off the coast of Malaysia after colliding with another vessel. A wreck removal operation has been initiated and the current claims reservation is USD 45 million.

Disaster struck again on 4 October

Group Pooling Agreement and Excess of Loss reinsurance cover – works well.

Premium volume increased by 9% com-pared to last year. The new business area, Energy, was responsible for more than one-third of the overall premium volume increase of USD 14 million. All insur-ances classes, with the exception of Hull & Machinery, reported increased premium volumes.

The total cost for reinsurance relative to premium volumes is at the same level compared to 2010. However, reinsurance spending fell substantially in 2011 for the Marine class, Loss of Hire. This was due to the phase-out from a quota share reinsur-ance to an excess of loss cover, which took place over last year.

EnergyThe new business area, Energy (launched 1 March 2011), performed in line with busi-ness plans and reported a net earned pre-mium of USD 4.4 million. Furthermore, no major claims were reported. This busi-ness area is primarily managed from our newly opened office in Oslo.

Marine businessThe Marine business area consists of Hull & Machinery, Increased Value, Loss of Hire and War. Overall, a slight loss was re-ported and the combined ratio was 104%.

9 continued from page 5

Energy business last year proved to be very successful and should be seen as another way for us to safeguard delivery of sustain-able results over time.

Further diversification on the Marine side, and for the Club as a whole, is obvi-ously more important when the market is anything but firm. Even though the mar-ket could be described from our point of view as “dull” we still enjoy reaffirmed and loyal support from our members on the property side of our business. This can be achieved by us de-risking and diversifica-tion, enabling us to take a more holistic ap-

Happy New... against unwanted fortuitous incidents in relation to their property and earnings. The amount of support you can afford to give members is very much correlated with the long-term sustainability of the differ-ent classes of insurance the Club engages in. The margin of support can be increased by adding additional sustainable classes of business.

Last year we took yet another important step in diversifying by introducing the Energy Class of business. The Club has been able to deliver rather good results on the Marine side in recent years. Adding the

when the container ship Rena hit ground off the coast of Tauranga, New Zealand. This casualty also involves wreck removal and in January 2012, the P&I claims res-ervation was increased from USD 125 to USD 175 million. For this vessel, the Club also has claims costs for Hull & Machinery and Increased Value.

Underwriting resultDespite the unfavourable trend in claims, the underwriting loss was limited to USD 11.8 million (2010: +17.7) and the overall combined ratio was 110% (2010: 87). This clearly indicates that our solid reinsur-ance structure – not least the International


7

Finance | Result 2011

However, the situation varies for each in-surance class. Smaller classes are reporting stable underwriting returns that are even higher than in 2010. This compensates for the downturn in Hull & Machinery, which had a poor year. The majority of growth in this business area comes from War, related to the coverage that we pro-vide against pirate attacks in the Gulf of Aden. However, even though the War coverage that we provide our shipowners makes a positive contribution to the Club’s overall result, we all naturally wish it was unnecessary.

Claims costsIn 2011, 15 claims in excess of USD 500,000 were reported, which is the same frequency as last year. However, the severi-ty of claims was much higher in 2011. Dur-ing 2010, the two most expensive claims (both on the Marine side) amounted to USD 2.5 and 6.5 million respectively. This year, there were eight claims (compared to two last year) where the estimated claims cost before reinsurance exceeded USD 2 million, and some of them, as mentioned earlier, have reservations far above the amounts reserved in 2010.

Financial resultThe financial result for 2011 was USD 2.5 million (2010: +11.6) and the value of the

proach to our members’ overall insurance commitments with the Club.

Last year we reported a slightly better outcome than expected in terms of large claims. For 2011 it is correct to say that the number of large claims increased. For 2012 we cannot see, despite the problem-atic shipping markets, that shipping activi-ties will drop significantly. To this end, we expect large claims will remain fairly stable and at a high level. Acknowledging this of course means that we will have to make sure that rates are set accordingly. As far as volume is concerned the Club has

increased its H&M book slightly and this is mainly through organic growth. Due to the de-risking strategy we see that our aver-age share written fell during 2011 and is expected to continue to drop during 2012. Overall, this is in line with our current cycle management.

Energy RenewalThe Energy business that we started on 1 March 2011, has developed better than expected. We are currently involved in more than 30 accounts and we expect to increase that volume slightly throughout

2012. Our average share on Energy is 3.5% and we will maintain this level of commit-ment in 2012. As mentioned in connection with P&I above, but even more relevant to Marine & Energy: “Size is important only if sustainable over the long-term”. This statement is more relevant to the property side of the business, because for obvious reasons it is far more commoditized than the liability side.

2011

JuNE

20Monday

2011

JuLy

29Friday

2011OCTOBER

4Tuesday

Jan Rydenfeltdirector, Finance & reinsurance, It

investment portfolio at year-end was USD 315 million (2010: +297). During the au-tumn, when volatility in the equity market was extreme, the Club took a cautious ap-proach. At the end of August, we sold half of the equity holdings in exchange for US treasuries. In January 2012, we re-entered the market and obtained the same expo-sure that we had back in August 2011. These risk management measures did not have any noticeable impact on the result, since we basically re-entered the market at the same level. But, the low exposure to equities during this turbulent period did make life a bit more pleasant for us!

An underwriting deficit of almost USD 12 million and a financial result of just USD 2.5 million was not what we aimed for. However, given what has happened on both the claims side and in financial markets, we are nevertheless satisfied. Let’s hope that 2012 will be more in line with our expectations. Or why not – even a lit-tle better!


8

FD&D | Legal update

Anders Leissnerdirector, Corporate Legal & Fd&d

tHE CLUB’S FD&D portfolio continued to develop positively in 2011. As of 1 February 2012, 738 vessels (29.2 million GT) were insured for FD&D risks compared to 693 vessels in 2010 and 580 vessels in 2009. Our ambition is, obviously, to continue this growth and develop the portfolio further in all markets. FD&D insurance is an important supplement to the other classes of insurance, in particular in these turbulent times with a high demand for legal services.

Looking at the FD&D statistics, it is obvious that the Club’s members have had, and continue to have, difficulties. The market turbulence in 2007 and 2008 led to 312 FD&D claims being registered in 2008, a record num-ber. This represented 0.44 claims per entered vessel. In 2009, the number of claims was down to 0.37 followed by 0.29 in 2010 and the figure for 2011 is 0.35. One reasonable assumption is that if the markets will stabilize then fre-quency will continue to go down. Having said this, market turbulence, and not least long periods of depressed markets, vastly increases the risk for large legal disputes when parties can no longer meet their contractual obligations. In 2011, the Club assisted several owner-members in disputes concerning values in the region of USD 50–100 million as a result of early termination of long-term time charterparties. Our assessment is that, regretfully, we have not seen the end of this trend as numerous companies that grew too rap-idly in 2007-2009 still constitute a high default risk. Consequently, even if claims frequencies are falling the risk for large claims in 2012 remains high.

One way of measuring the results of insurance business is calculating the combined ratio, which is claims costs in relation to premiums and operation-al costs. Despite a five-year period that has been exceptionally challenging for the FD&D class (and its members) the average combined ratio for these years is 107%. Compared to the target of 100% the achieved result is quite accept-able although over the long-term it may be a sign that, structurally, premium levels are too low. After all, FD&D premium levels have been relatively stable for the past ten years. On the other hand, the level of legal costs has not been stable – our assessment is that the average hourly rate for a London lawyer has risen by at least 25% over the same period.

In 2011 there was also frequent usage of the Club’s FD&D services in re-spect of topical issues such as sanctions and piracy. Loading of iron ore and nickel ore fines in India and Brazil also generated complex charterparty dis-putes with which the Club’s lawyers have assisted. However, again, the far most common type of intervention concerned various types of debt collect-ing. One particularly problematic situation was unpaid bunker invoices. Irre-spective if an unpaid bunker invoice gives rise to a maritime lien in the vessel (that varies between countries) the owner and the Club will have an onerous task fighting off arrest attempts by the supplier in one port after another and eventually the owner may be left with no other option but to pay the invoice themselves.

Finally, a word of caution. In times like these guarantee letters have greater importance. Indeed, it may be desirable for the owner to know that the performance by the charterer for a time charterparty (e.g. hire payment) is guaranteed by a larger and better-known entity. However, variations in the underlying contract without consent by the guarantor may discharge the guarantor under the guarantee letter. There is a very simple remedy to avoid such a fatal situation – do not forget to seek consent from the guarantor when amending the charterparty!

Freight demurrage & defence insurance is a

legal cost insurance. the insured has access to

the expertise of the Club’s Freight demurrage &

defence lawyers and has also cover for legal costs

up to USd 5 million regarding a wide range of

disputes pertaining to the operation of the vessel

that are not covered by any other class of insurance.

Freight Demurrage & Defence insurance

STATEof Affairs


9

FD&D | Legal update P&I | Criminalisation of Seafarers

Freight Demurrage & Defence insurance

STATEof Affairs

Learningfrom the pastto improve the future

Olivia MurraySenior Associate, Ince & Co LLPLondon

Capt Faz PeermohamedPartner, Ince & Co LLPLondon

Faz Peermohamed is a Partner at the London offices of Ince & Co LLP and heads Ince’s Global Admiralty Group. He is renowned for his ability to handle all aspects of Admiralty work, from collisions, salvage, total losses, groundings and shipboard fires to general shipping disputes. He is particularly known for his expert advice in the highly charged atmosphere following a maritime casualty.

In the aftermath of a casualty, particularly in high profile incidents where pollution is involved, history has an unfortunate tendency to re-peat itself as far as unfair treatment of seafarers is concerned. Local au-thorities and prosecutors will inevi-tably face immense pressure from the public to deal effectively with those assumed to be responsible for the incident – and it is often the crew who suffer the consequences. Situ-ations such as that faced by Captain Mangouras, the master of the Pres-tige, suggest that there is a need for laws which more effectively under-pin the human rights of the accused in highly-charged cases of this sort.

Protecting the Seafarer– International LawThere is valid concern within the indus-try that the trend towards an assumption of criminality on the part of the seafarer and owner is likely to deter good quality individuals from a seafaring career. In a cli-mate of criminalisation, another legitimate concern is that enquiries may never reveal the true cause of an incident for crew may fear self-incrimination. None of this can be good for the shipping industry, nor for the

ordinary citizen who relies upon quality seafarers safely steering those crucial goods and energy carriers to deliver his everyday needs in a safe and timely manner.

The issues surrounding the alleged unfair treatment of seafarers have arisen despite the fact that mandatory safeguards for the protection of individuals, and seafarers in particular, already exist under international law.

universal Declaration of Human Rights (uDHR)The UDHR provides that everyone has the right to leave any country and return to his own. It is therefore normally difficult to justify withholding of a passport, let alone hotel arrest or detention in custody, on the mere ground that the individual has been charged with an offence, unless there is at least a reasonable possibility that he could, if convicted, be punished by a term of im-prisonment.

uNCLOS 1982 (uNCLOS)There are also safeguards set out in UNC-LOS, specifically under Article 230, which constitute an internationally agreed balance between public concerns about pollution on the one hand and the recognised rights of the accused including the liberty of

Olivia Murray is a Senior Associate at Ince & Co LLP. olivia has particular experience in work relating to seafarer rights; she is an active member of the CMI International Working Group on the Fair treatment of Seafarers and has recently been appointed Chair of the Group.


Criminalisationof Seafarers PH

oto

: iStockp

ho

to


10

P&I | Criminalisation of Seafarers

foreign seafarers, on the other. Article 230 effectively bars coastal states from imprisoning foreign seafarers for any pollution offence beyond their territorial waters, or for one within those waters, un-less involving a wilful and serious act of pollution. However, there have been concerns expressed within the international maritime community that these restrictions have not always assisted the de-fendant.

MARPOL 1973/1978 (MARPOL)The principal international regulations to prevent pollution from ships are those set out in MARPOL. Importantly, MARPOL recognises the importance of the distinction between operational (i.e. intentional) and accidental spills. Accordingly, intentional dis-charges are prohibited except where certain stringent conditions are met and MARPOL provides an exemption from liability in certain circumstances. In the case of accidental spills this exemption may avail a master or shipowner where the discharge resulted from dam-age to the ship or its equipment provided he did not act with intent or recklessness.

Industry concern regarding the protection of SeafarersThere has been concern expressed - not only by shipping and seafar-ing bodies but also by human rights organisations, international legal bodies and governments - that the recognised rights of seafar-ers were not being respected for domestic political reasons. Recent years have seen measures introduced, therefore, with a view to ad-dressing the issues that repeatedly seem to arise.

IMO Guidelines on the Fair Treatment of Seafarers in the Event of the Maritime Accident (the Guidelines)The Guidelines were adopted by the IMO and ILO in 2006 and, whilst not legally binding, they are intended to establish interna-tional norms for governments and courts to take into account. In the context of pollution cases, the particular vulnerability of seafar-ers to extended detention has been recognised in the Guidelines which provide, inter alia, that a port or coastal state should ‘use all available means to preserve evidence to minimize the continuing need for the physical presence of any seafarer’ and recognise that seafar-ers require special protection, especially in relation to contact with

public authorities. The stated objective of the Guidelines is to ensure that seafarers are treated fairly following a maritime accident and during any investi-gation and detention by public authorities and that detention is for no longer than necessary. The human rights and other legiti-mate interests of seafarers involved should be respected at all times.

In November 2011 the IMO Assembly adopted a resolution en-titled ‘Promotion as widely as possible of the application of the 2006 Guidelines on Fair Treatment of Seafarers in the Event of a Mari-time Accident’ (the Resolution). The Resolution calls upon govern-ments to give effect to the Guidelines, and invites interested parties to assist in raising awareness of the Guidelines.

The IMO Code of the International Standards and Recom-mended Practices for a Safety Investigation into a Marine Cas-ualty or Marine Incident (the Code)The Code was adopted in 2008 and entered into force in January 2010. It is designed to facilitate objective marine safety investiga-tions for the benefit of flag States, coastal States, the Organization and the shipping industry in general. Its stated objective is the pro-vision of a common approach for States to adopt in the conduct of marine safety investigations into marine casualties and marine incidents. The Code recognises and addresses the vulnerability of seafarers in the aftermath of a casualty and Chapter 12 of the Code provides mandatory standards in relation to obtaining evidence from seafarers. The Preamble to the Code expressly refers to the IMO Guidelines mentioned above and indeed the Legal Commit-tee of the IMO has expressly acknowledged that these should be implemented in tandem with the Code.

Key issues for Shipowners/Managers and CrewIf a casualty is not managed properly to protect both crew and company, the consequences could be dire and include the risk of severe penalties (custodial as well as monetary) for all concerned and a real danger of reputational damage. There can be little doubt

The Prestigethe Prestige, carrying 77,000 tons of fuel oil, is a well-known

example of a situation where, it has been suggested, the public authorities have been keen to deflect blame from themselves and find a scapegoat. Nearly ten years after the ship broke up, Captain Mangouras is still waiting for his criminal trial to take place. Cases prior and subsequent to the Prestige, however, have demonstrated that, far from be-ing a one off, such instances of potential unfair treatment of seafarers continue to occur.

3 SCAPEGOATS



11

P&I | Criminalisation of Seafarers

The Tasman SpiritIn 2003, for example, the treatment of the crew and the sal-

vage master in the tasman Spirit incident prompted wide-spread condemnation. this tanker, laden with Iranian crude oil,

grounded at the entrance to karachi Port, eventually breaking up and lead-ing to a spill of some 34,000 tonnes of oil. the case is illustrative of a situ-ation where focus upon the alleged failings of the crew served to deflect attention from suggestions that local authorities may be at fault. All the Greek crew on duty were detained as well as the salvage master (who only attended after the vessel broke up). the ‘karachi 8’, as the detained group became known, were held for almost nine months and were released only after intense political pressure and continued lobbying by many interna-tional organisations as well as the Greek Government and european Union.

The Hebei Spiritthe hebei Spirit collision in 2007

resulted in some 11,000 tonnes of crude oil leaking into the yellow Sea and

was the largest oil spill in South korean histo-ry. the detention and treatment of the tanker’s master and chief officer was the subject of sig-nificant protest and condemnation across the maritime industry and the case highlights the difficulties foreign seafarers may face in the politically charged context of a major oil spill.

that the approach taken by the media affects both

public opinion and, poten-tially, the actions taken by the

authorities. By keeping these issues in mind it may be possi-

ble to minimise the damaging impact of a casualty. Effective casualty management is

essential following a high profile incident and an awareness of the potential for unfair treatment of the

crew should be at the heart of the incident response.

Awareness of International Safeguards relating to the Fair Treatment of SeafarersFor a shipowner and his crew to have a fighting chance of protect-ing the crew in the aftermath of a casualty it will be crucial that they, and their advisors, have an awareness of the safeguards avail-able to seafarers under international law, both mandatory and non binding. It is also important to ensure that local authorities and prosecutors are aware of those safeguards, preferably before charges are brought and the decision to prosecute is taken. They should also be aware of the potential for cross-border measures to be taken against them in particular circumstances. A shipowner’s representa-tive, for example, should be aware that he could potentially be vul-nerable to a European Arrest Warrant being issued in the aftermath of a casualty abroad.

Information management – External and InternalMany parties with conflicting interests will pressure owners for the urgent provision of information. It will be crucial to put in place dedicated channels of communication to ensure that information is gathered and analysed as soon as possible so that a consistent approach can be adopted. Internal communications should also be carefully considered and managed, in particular in relation to the creation of post-incident documents. Particular care should be taken regarding the release of information and documents relating to causation. Such information should be carefully considered with your lawyers in the first instance.

Media StrategyA common media strategy should be agreed upon with your lawyers and any external communication should be carefully considered in order to protect the crew and company’s reputation, to mitigate the risk of litigation or criminal prosecution and to manage public perception. In applicable cases, reassuring the public as to the exist-ence of an international regime for the provision of compensation or crew release may assist in assuaging anxiety which will inevitably exist where significant pollution damage has occurred. Past cases have demonstrated that managing public perception regarding the availability of international regimes and possible compensation can assist in reducing the level of claims.

ConclusionClearly the ideal situation is to prevent casualties from occurring in the first place. A momentary lapse of concentration on the bridge can result in a life changing crisis for both crew and owners. If the worst does occur, however, every decision taken in those first few hours and days after a casualty will have a long term impact on every aspect of the case – from the potential criminal liability of crew and shipowner’s shore representatives to a shipowner’s repu-tation and the eventual cost of the incident. In time, a company’s reputation will be measured less by reference to the original cause of the casualty but more in terms of how it was perceived to have responded. When it comes to the fair treatment of seafarers, to the extent it is possible, ‘prevention’ is always better than ‘cure.’ Once an entrenched position against the crew has been taken by local authorities and prosecutors, it may well be hard for them to ‘back down’ and crew and owners may well find themselves facing crimi-nal proceedings for years to come.

Whilst measures such as the Guidelines and the recent IMO As-sembly Resolution on the subject are encouraging, it is clear that there is still much to be done and it remains to be seen whether all parties involved can work together to ensure that seafarers are treat-ed fairly and consistently in the aftermath of a casualty.


12

P&I | Scindia duties

Scindia Duties and Longsh ore Activities in the United Sta tes

Longshore work in the United States can easily create personal injury liabil-ity exposure for an unwary shipowner. This article addresses the duties owed by a shipowner to longshoremen in the States, and provides recommendations to minimize such exposure.

The leading United States Supreme Court case setting forth the obligations of a vessel owner is Scindia Steam Navigation Co. v. De Los Santos, 451 U.S. 156 (1981). Scindia stands for two important propositions.

Firstly, as a general matter, the shipowner may rely upon the stevedore to avoid expos-ing longshoremen to unreasonable hazards. However, under U.S. maritime law and the U.S. Longshore and Harbor Workers Com-pensation Act (“LHWCA”), a vessel owner cannot recover against a stevedore employer for any injuries that occur to a longshoreman. Moreover, in the event that the vessel owner breaches one of its duties to the longshoreman (discussed below) resulting in injury, the long-shoreman can sue the vessel owner for negli-gence. Under joint and several liability princi-ples that apply pursuant to U.S. maritime law, if we hypothesize that the vessel owner is 10% at fault, the longshoreman 20%, and the steve-dore employer 70%, the vessel owner nonethe-less would be responsible for 80% of the dam-ages awarded.

This result follows because joint and sev-eral liability principles under U.S. maritime law shift the risk of uncollectibility from an innocent plaintiff to a culpable tortfeasor. The LHWCA’s compensation bar essentially transforms the stevedore into a judgment-proof defendant. Additionally, the stevedore’s worker’s compensation carrier generally inter-venes in any suit against owners or charterers to recover medical care costs expended on the longshoreman’s behalf. Consequently, the ves-sel owner, rather than the longshoreman, bears the brunt of fault attributable to the stevedore, despite Scindia’s first proposition.

Secondly, Scindia holds that the vessel owes

the stevedore and his longshore employees the duty of exercising due care under the circum-stances. Thus, while the primary responsibility for the longshoremen’s safety ostensibly rests with the stevedore, the vessel owner also owes a standard of care to the longshoremen. That standard encompasses three duties to long-shoremen servicing the vessel: (1) the “Turno-ver Duty,” (2) the “Active Control Duty,” and (3) the “Duty to Intervene.”

1. The “Turnover Duty”The “Turnover Duty” requires the vessel owner to furnish a reasonably safe ship, and to warn the longshoremen of hazards from gear, equipment, tools and the workspace to be used during cargo operations “that are known to the ship or should be known to it in the exer-cise of reasonable care.” However, the vessel owner is not obligated to warn the stevedores about hazards that are open and obvious, or dangers that “a reasonably competent steve-dore should anticipate encountering.” For example, in a recent case, the Fifth Circuit Court of Appeals (which governs federal pro-ceedings in Texas, Louisiana and Mississippi) found that a longshoreman, who was injured because of an open and obvious defect in a stow of steel coils in the cargo hold, could not recover against the vessel owner, operator or charterer. In that case, one of the steel coils fell from atop the stow onto the longshore-man resulting in the loss of a leg. The court found that a “vessel owner has no legal duty to prevent or alleviate an unsafe condition in the cargo hold resulting from an improper stow when the condition is open and obvious to the longshore workers.”

Vessel owners may wish to consider some preventative measures before arriving in a U.S. port. To ward off potential liability exposure in the event a longshoreman claims injury, owners may be able to satisfy their Turnover Duty obligations through the use of a check-list identifying potentially hazardous condi-tions, perhaps coupled with a simple vessel dia-gram showing the main deck, cargo holds and

Keith Letourneau received a Bachelor of Science degree with honors from the United States Coast Guard Academy in 1980. His military service included ex-perience as a deck watch officer aboard a medium endurance cutter in Florida and as com-manding officer of a Coast Guard patrol boat stationed along the southeast texas coast. He holds the rank of Commander, U.S. Coast Guard, Retired. He graduated in 1989 from the Marshall-Wythe School of Law, College of William and Mary, as a member of the order of the Coif. Mr. Letourneau served as a trial attorney for both the Coast Guard’s Procurement Law Divi-sion and the Admiralty Section of the U.S. Department of Justice’s Civil Division. He is a founding shareholder in the law firm Bell, Ryniker & Letourneau, P.C., based in Houston, texas. He is licensed to practice in texas and Virginia, and admitted before numer-ous federal district and appel-late courts, including the third, Fourth, Fifth and Seventh Circuit Courts of Appeals.

Keith B. LetourneauShareholderBell, ryniker & Letourneauhouston



13

Scindia Duties and Longsh ore Activities in the United Sta tes

the turnover Dutythe Active Control Dutythe Duty to Intervene

PHo

to: Stefan

Eliasson

the SwedISh CLUB trItON 1-2012

13


14

other areas where the longshoremen are scheduled to work. Prior to the vessel’s arrival in port, one of vessel’s officers

should carefully inspect each of these areas, and note on the checklist any potentially hazardous conditions, for example, with respect to hatchways, latches, ladders, lighting, twist locks, wires, cables, equipment lying about, rusty conditions of deck and handhold surfaces, etc. The checklist could note where any repairs are being conducted, and the scope of the project (to place the stevedore on notice of not only where re-pair work is ongoing, but where re-pair work is being considered).

Provided vessel workspaces are in good condition, it may make sense to take a series of digital photographs of the spaces where the longshoremen will work, including access ladders, to document the condition during the pre-arrival walk through. To complete the turnover process, upon arrival in port, the chief mate could present the checklist to the steve-dore, and the two could walk the vessel where the longshoremen will work noting any areas of concern.

If the vessel provides any equip-ment employed during longshore work, for example, twist locks, lash-ing chains, hooks, etc., such equip-ment should be regularly inspected, serviced, and replaced as necessary, with documentation provided (or perhaps at least made available) to the stevedores evidencing the condi-tion of such equipment at the start of longshore operations.

2. The “Active Control Duty”The “Active Control Duty” is breached if the vessel owner “ac-tively involves itself in the cargo operations and negligently injures a longshoreman” or “if it fails to exercise due care to avoid exposing longshoremen to harm from hazards they may encounter in areas, or from equipment, under the active con-trol of the vessel during the stevedoring operation.” Before longshore activities commence, the master or chief mate may wish to instruct vessel personnel to stay completely clear of loading or unloading operations, leaving such work to the longshore gangs. By doing so, owners may avoid the “Active Control Duty” in its entirety.

3. The “Duty to Intervene”Lastly, under the “Duty to Intervene”, a vessel owner owes a duty to intervene if “contract provision, positive law, or custom” dictates “by way of supervision or inspection [that the vessel owner] exercise reasonable care to discover danger-ous conditions that develop within the confines of the cargo operations that are assigned to the stevedore.” The “Duty to

Intervene” may be implicated if the master or chief officer is contractually obligated to supervise cargo operations, or if ves-sel equipment used during such operations is not operating properly, for example, ship’s winches or cranes.

Numerous accidents have occurred over the years involv-ing vessel cranes while operated by longshoremen. Generally, such cases have involved the failure to properly maintain crane components and equipment in good operating order. Own-ers should consider tasking their technical superintendents to

ensure that ship’s cranes are regularly inspected and serviced, and current on all class certifications.

Often times, the charter agreement allocates responsibilities for cargo stowage to the charterer “under the master’s supervision,” and sometimes the vessel owner and charterer have entered into an Inter-Club Agree-ment, or incorporated it by reference into the charter. These arrangements may affect how a case brought by the longshoreman against both the ves-sel owner and charterer will be de-fended, but do not necessarily alter whether the longshoreman may bring suit against both parties in the first instance. To avoid assisting the long-shoreman by pointing fingers at each other, it is important at the inception of such a suit to work out the defense arrangements between vessel owner and charterer if at all possible.

The vessel owner’s duty to intervene does not extend to open and obvi-ous transitory conditions (1) created

entirely by the stevedore, (2) under its control, or (3) relating wholly to the stevedore’s own gear and operations.

SummaryIn summary, whiles stevedores are purportedly the party pri-marily responsible for the safety of longshoremen in the States, in the event of an accident resulting in personal injury or death, owners face considerable liability exposure should the vessel breach one of the three Scindia duties (Turnover, Active Control, or Duty to Intervene), especially because any liability of the stevedore is attributable to the culpable defendant(s) under U.S. maritime law. The best method to obviate such liability is to institute regular procedures to satisfy or avoid breaching these duties: inspect vessel equipment and spaces; document any potentially hazardous conditions; convey this information to the stevedore prior to commencing cargo op-erations; stay out of active cargo operations; and service and inspect the ship’s cranes regularly. These suggestions should help to minimize owner’s liability exposure in the event of a longshoreman’s accident.


P&I | Scindia duties

Inspect vessel equipment and spaces

Document any potentially hazardous conditions

Convey this information to the stevedore prior to commencing cargo opera-tions

Stay out of active cargo operations

Service and inspect the ship’s cranes regularly


15

Club Information | News from Gothenburg

Tony SchröderArea Manager team Gothenburg

Bitingthe bullet

On our service side we are pleased to advise that we have strengthened our Marine claims side by employing Magnus Johansson as a Senior Claims Executive. Magnus is a Naval Architect and was previously a Superintendent with Broströms (bought by Maersk in 2008) and before he joined the Club he was Sales and Project Manager at the largest shipyard in Gothenburg, Götaverken Cityvarvet. Magnus’ technical back-ground will be a first-class reinforcement of the technical side of Marine claims handling. We have further employed Caroline Stenman Dencker, a lawyer, as a Marine Claims Adjuster. As a full marine claims service provider Marine Claims Adjusting is an integral and important part of the Club’ service structure. We are glad to have them both onboard.

On the marketing side Team Gothenburg will in the spring – March through May – have various Club evenings, breakfast meetings and lunch seminars. Focus will be on Maritime Re-source Management (MRM). We hope to see many of you in Oslo, Bremen, Hamburg, Istanbul or Copenhagen!

AS A SHIpOwNERS’ association we know – as well as our members do – the difficult times that are presently keeping a firm grip on shipping. Many shipping indices are point-ing south. At the same time shipowners’ underwriters face increased claims frequency and severity – in particular on cargo and crew claims (personal injuries, illnesses etc.). Hull claims follow the commercial shipping market (or are rather anti-cyclical) in so much as that when shipping is booming, so are claims. When shipping is at its peak hull claims rise, when shipping is in the doldrums, hull claims are less frequent. On the liability side however, this is not the case. P&I claims are exposed to new legislation, increased limits of liabilities, harder political stances and jurisdictional difficulties. P&I clubs are therefore seeing a broader field of claims, whilst at the same time the cost per claim is on the rise. Clubs are going to have to bite the bullet of the increased claims trend. Due to the sad state of the shipping market, shipowners are going to have to bite the bullet too, this year as well, some more than others – however hopefully they will not bite the dust! 2012 will no doubt be a year of endurance – let’s hope that we all get through it stronger and more vitalised.

P&I renewals are never easy, but this year the gap between claims trends on the one hand – and the poor state of the shipping market on the other – made it extra challenging. We and our good members have however managed to come through this with a mutual understanding and renewed con-fidence. That is our ultimate guiding star as a shipowners’ Club. We have a responsibility to safeguard the Club’s well-being – for the best of the shipowners!


16

Recently a ship arrived in Adelaide, Australia. The owners of that ship were experienced and careful. They knew Australia was tough on ‘grain clean’ – they had instructed the master to clean the hold and had received the master’s assurance that everything was “OK”. Three weeks later they were writing a cheque for over A$200,000 for cleaning. How did this happen and what are the lessons for the rest of us?

The Export Control Act (1982) requires both the Australian Quarantine and Inspection Service (AQIS) and an inde-pendent marine underwriter’s surveyor to inspect the vessel’s holds before loading grain. (For ease of reference in this paper I will call these two people “The Inspec-tors”.)

The vessel must pass both inspections before it can load.

The independent inspectorThe underwriters ‘independent’ inspec-tor is ‘independent’ in the sense he works for an independent company but he is ap-pointed by the cargo underwriters and ob-viously that is his focus.

When ships fail, many owners ask us, “Is that guy helping out the shipper because they are not ready to load?” The answer is “No’.

He is not appointed by the shippers and in our experience he is not influenced at all by the shippers’ or charterers’ commercial interests. His focus is entirely on certifying the ship as fit to load with respect to the

pumping system, moisture, the hatches, odours, rust scale, grease or oil stains and most importantly, previous cargo residues.

AQIS inspectionAQIS does a very similar inspection to the ‘independent’ surveyor’ but their objectives are slightly different. AQIS is focused on the ‘quality’ of Australia’s exports. They look at the holds because ‘dirty’ holds re-sult in ‘dirty’ cargo.

At the risk of stating the obvious, it is important to remember grain is food and must be fit for human consumption. It is therefore perhaps not surprising these in-spectors are careful.

The initial inspection by the under-writer’s surveyor tends to take place at the anchorage and the inspection by AQIS normally takes place at the berth.

How the inspections are conductedWhen a ship fails, it is wrong to assume the master and owners lacked diligence. That is almost never the case. Usually the mas-ter and owners know they are going to be inspected and they usually make a serious effort to pass. The surveyors however look in areas the crew cannot easily get to - high areas, behind ladders, behind manhole cov-ers, on top of underdeck beams, behind bulkheads and into void spaces and those are the areas that usually cause failure.

Usually inspections are initially con-ducted without using cherry pickers and usually not only about “what the Inspector sees” but also “about the general impres-sion the Inspector forms.” Many ships pass these first inspections BUT if either sur-veyor has doubts about the cleanliness of areas they cannot properly see, they ask for cherry pickers to be provided. Usually, that is when the trouble starts - because inspec-tion by cherry picker is tough to pass. Even ships that have just come from dry dock have failed when inspected using cherry pickers. The reason is the inspector looks at

areas of the ship ‘up close’ which the crew cannot normally even see - let alone reach to clean.

So the first lesson to learn is: “Make sure the ship is clean and gives a

good impression of cleanliness so that it decisively passes the first inspection done without a cherry picker – so the inspector has no cause to call for a cherry picker.”

Why do vessels usually fail?There are three main reasons:

1. The holds were simply not close to clean enough to pass when inspected.

2. The ship was nearly good enough to pass and with the right advice and su-pervision it might have passed.

3. That particular surveyor applied a high-er standard than others would have.

Case Study 1A 1997 built Panamax bulk carrier arrived at the anchorage in early October 2011 with an ETB of ten days later. The under-writer’s inspector attended on board, at the anchorage (via a launch) a few days before the ETB, and failed the ship. The inspector reported he had found a large number of deficiencies including infestation with in-sects in a void space behind a panel within a hold and substantial quantities of residue from previous cargos in high areas of the ship. The ship was delayed two weeks and cleaned and fumigated with the ship’s crew and shore labour using cherry pickers and high-pressure washing. The cleaning cost was more than A$200,000. This is an ex-ample of point ‘1’ above – i.e. a ship that was perhaps not close to passing.

Case Study 2A 2011 built ship arrived at an Australianport in 2011. The ship was less than six months old and had only made a few voy-ages. The ship passed inspection at an-chorage by the underwriter’s inspector

The High Cost of failing “Grain Clean” in Australia

James NeillSolicitorAus Ship Sydney, Australia

P&I | Cleanliness of holds


17

but then failed AQIS’ survey when at the berth. The ship was subsequently cleaned using the ship’s crew and shore labour us-ing cherry pickers and high-pressure wash-ing. The ship was delayed ten days and the cleaning cost was over A$200,000. This is an example of two inspecting surveyors having different opinions and the differ-ent standards two surveyors can have when conducting the same inspection. It is also an example of a ship that perhaps ‘could’ have passed had the owners obtained good advice and supervision.

What lessons can we learn?Firstly, owners should note this is a com-mon and expensive problem. We do not know the statistics but believe over the last three years at least ten ships per year have failed these surveys and incurred cleaning costs of about A$200,000 per ship. Secondly, owners can do something to minimise the risk. If the ship is fixed to load grain in Australia the crew should clean the holds thoroughly:• IfthenextcargoisgrainfromAustralia

and it is safe to do so, get the crew up on top of the previous cargo before dis-charge and clean the high areas while you can.

• Somecrewshavesuccessfullyusedlad-ders and platforms to clean high areas prior to inspection.

• Verycarefulcleaningthelowreachableareas creates a good impression with the inspectors.

Thirdly, owners should consider getting their own surveyor to attend BEFORE the underwriters and AQIS attend so as to ‘pre-inspect’ and then have the surveyor supervise additional cleaning prior to the actual inspections, so as to increase the chances of passing first time. On numerous occasions this has worked successfully.Fourthly, owners should consider getting their own surveyor to attend during the in-spections. These inspections are very much a matter of ‘opinion’ and ‘degree’ and therefore owners can sometimes positively influence that ‘opinion’ by using a senior surveyor who is ‘a local’ and ‘respected’. One never knows for sure but we think we have seen surveyors achieve good results in this respect. Finally, it is usually a false economy for owners not to send their own surveyor. On one spectacular occasion an owner was pre-pared to send a surveyor but decided the cost of a helicopter to that anchorage was just too high and so did not send him – the owners subsequently spent more than A$200,000 cleaning that ship.

Recommendations

1. Read and understand the “lessons” out-lined in this article.

2. Arrive with a very clean ship!! (Not so easy in the real world.)

3. Appoint your own surveyor to inspect your ship before the official inspec-tions take place. The cost is usually well worth it compared to failing inspection and having to clean.

4. Appoint your own surveyor to accom-pany the inspectors. This can make the difference sometimes.

5. If you did not follow the recommenda-tions above and your vessel fails, im-mediately contact the owners P&I sur-veyor to provide advice.

6. If cleaning is required, seek advice from the P&I surveyor and accept that ad-vice. Much money and time has been wasted pursuing alternatives against the recommendations of the P&I surveyors.

7. When contracting with cleaning com-panies, get several quotes and try to contract for a lump-sum amount if pos-sible. Also take heed of local experience and the advice of your agent. Lower daily rates are not a bargain if the task takes more days.

Some crews have successfully used ladders and platforms to clean high areas prior to inspection.

PHo

to: TSC


18

P&I | OPA

ON 27 JANUARy 2012 the United States Coast Guard National Pollution Funds Center (the “NPFC”) issued a deci-sion upholding the right of the owner and operator of the Selendang Ayu to limit their liabilities under the U.S. Oil Pollu-tion Act of 1990 (“OPA”) arising from the Selendang Ayu oil spill. The NPFC’s deci-sion allows the ship’s owner and operator (the “RP”) to limit their OPA liabilities to USD 23,853,000.00, based on the ship’s gross tonnage and the applicable OPA lim-it at the time of the casualty. The OPA re-lated liabilities resulting from the incident have exceeded USD 130,000,000, and the NPFC’s decision entitles The Swed-ish Club, the International Group, and the Group’s reinsurers to be reimbursed for their OPA expenditures in excess of the OPA limit from the Oil Spill Liability Trust Fund (“the Fund”).

The casualtyThe fully-laden Panamax bulk carrier was on a voyage between Seattle, Washington and Xiamen, China in December 2004 when the casualty occurred. On 6 Decem-ber 2004, while transiting the Bering Sea north of the Aleutian Islands, the crew shut down the main engine, after discov-ering a crack in one of the cylinder liners. With a storm approaching, the crew iso-lated the cracked cylinder liner, with the intention of restarting the engine and sail-ing to a port of refuge. However, after they successfully isolated the damaged cylinder, they could not restart the main engine. The storm reached the ship before local tugs could take her under tow, and drove the ship towards shore. When the tugs and a U.S. Coast Guard Cutter arrived on scene, they were unable to halt the ship’s drift in the stormy seas and winds. During this time, the ship’s crew struggled under extremely trying conditions to repair and restart the main engine.

On the afternoon of 8 December, after drifting for more than 50 hours, the Selen-

dang Ayu grounded on the exposed, rocky coastline of northwest Unalaska Island. The ship broke in half shortly after the grounding, resulting in the total loss of the ship and its cargo of soy beans, and the dis-charge of approximately 350,000 gallons of bunker fuel and diesel from the ship’s double bottom fuel tanks, which ruptured on impact. Tragically, six of the ship’s crew perished when a U.S. Coast Guard heli-copter crashed while lifting them from the stricken ship.

The response The Coast Guard and the State of Alaska established a command center at Dutch Harbor, Unalaska Island, a commercial fishing port located approximately 40 miles by air from the site of the grounding. Personnel from The Swedish Club, the RP, the Club’s local correspondent, and nu-merous oil response contractors travelled to Dutch Harbor to coordinate and handle the response, settle claims, and represent the ship’s owners and operators in the of-ficial government investigations which en-sued. Despite the fierce winter conditions, the Club’s contractors were successful in removing more than 100,000 gallons of fuel from the ship’s wing tanks and engine room tanks, by pumping the fuel into port-able tanks and flying them to shore by heli-copter. Shoreline cleanup operations began in December 2004 and were completed in the summer of 2006.

Despite the fact that the Bering Sea is the largest and most productive commercial fishery area in the United States, the Club and its consultants were able to avoid the closure of several large commercial fisheries, and to settle all claims asserted by commer-cial fishermen without litigation, with the exception of one frivolous lawsuit that was dismissed by the Court. The Club settled the claims of local landowners whose lands were impacted by the spill, and conducted a cooperative natural resource damages as-sessment with state and federal officials.

United States Coast Guard grants petitionto limit OPA 90 liability for Selendang Ayu Oil Spill

Bert Ray received his B.S. degree from the College of William and Mary in 1982, an M.S. degree from George Mason University in 1986, and a J.D. degree from the University of oregon in 1988. He is a member of the Alaska Bar Association, the Washington Bar Association, the Maritime Law Association of the United States, and Litigation Counsel of Amer-ica. He has a diverse, general litigation practice that includes environmental, maritime, com-mercial, securities, malpractice and white collar criminal mat-ters. He practices extensively in state and federal courts, as well as in commercial arbitrations, and before administrative agen-cies. He regularly represents clients in casualty responses in Alaska and along the US West Coast, serving as lead counsel during response operations and in resulting litigation. He also has significant experience represent-ing clients in natural resource damage assessments conduct-ed by state and federal agencies.

Herbert H. Ray Jr.Managing Shareholder keesal, young & Logan Anchorage, Alaska, USA


19

United States Coast Guard grants petitionto limit OPA 90 liability for Selendang Ayu Oil Spill

Shortly after the grounding, the State of Alaska demanded that the owner remove the wreck of the Selendang Ayu. Given the size of the vessel, and the remote, exposed location of the wreck, removal of the wreck would have been very expensive. The Club, its local correspondent and consultants arranged for the removal of all remaining pollutants from the wreck. They then met with State of Alaska officials and demon-

strated that while the wreck itself posed no risk of harm to the environment, a large-scale wreck removal operation at the exposed, remote location of the wreck, and the resulting environmental disruption, posed significant environmental risks. As a result of these efforts, the State of Alaska ultimately agreed that the wreck could be left in place, so long as the superstruc-ture remaining above the waterline was

removed. A local contractor was able to remove the remaining superstructure for a small fraction of the cost of removing the entire wreck.

Limitation of liabilityUnder OPA, an RP is strictly liable for response costs and damages arising from an incident. However, the RP may limit


PHo

to: u

nifi

ed C

om

man

d

The ship broke in half shortly after the grounding.


20

its OPA liability if it demonstrates that the Incident was not caused by gross negligence, willful misconduct, or the violation of a U.S. statute or regulation governing ship operations. In addition, the RP must dem-onstrate that it timely notified the United States of the incident, and that it provided reasonable cooperation and assistance in response to the spill. The burden of proof is on the RP to prove by a preponderance of the evidence that it is entitled to limit its OPA liability.

Because it may take several years before an RP is in a position to prove that it is entitled to limit its OPA liability, and it takes sev-eral years for the NPFC to adjudicate such a claim, the RP may incur OPA response costs and damages that exceed the limita-tion amount, before the NPFC determines whether the RP is entitled to limit its liabili-ty. One purpose of the Fund is to reimburse RPs who establish they are entitled to limit their OPA liability, and who have incurred OPA costs that exceed the liability limit.

In the case of the Selendang Ayu, the proximate causes of the grounding were the

crack in a main engine cylinder liner, and the crew’s inability to restart the engine after isolating the cracked cylinder. The RP was required to prove that these events were not the result of gross negligence or willful misconduct on its part. Because the engine room was flooded when the ship grounded, and the ship’s chief engineer and second engineer died in the helicopter crash, much of the evidence regarding the cause of the cracked liner, and the inability to restart the engine, was lost when the ship grounded and the helicopter crashed.

The Club, its correspondent, and engi-neering experts interviewed the surviving members of the ship’s crew and other en-gineers and technical superintendents em-ployed by the RP, examined the ship’s main-tenance records, and reviewed photographs of the engine taken by the crew while they struggled to restart it. As a result of the evidence obtained during this forensic investigation, they were able to persuade the NPFC that the cracked cylinder liner and the inability to restart the engine were not caused by gross negligence or willful

misconduct, or the violation of any United States laws.

The RP also had to address claims that the crew waited too long to notify the Coast Guard and local officials about the engine casualty, and delayed in searching for salvage tugs to respond. More than 12 hours elapsed from the time the engine lin-er crack was discovered until local officials were notified that the ship was drifting to-wards shore. The Club and its correspond-ent were able to demonstrate that there were no tugs available to respond to the casualty when it occurred, and that the tugs that eventually responded would not have arrived any sooner.

The decision to grant limitation of liabil-ity is the first step in what will be a substan-tial recovery for the IG and their reinsurers from the NPFC. Ultimately, this recovery will improve the Group’s loss record with the reinsurance market, benefitting rein-surers as well as all of the Clubs and their members.

P&I | OPA


PHo

to: u

nifi

ed C

om

man

d

On 8 December 2004, the Selendang Ayu grounded on the exposed coastline of Unalaska Island.


21

Safety | SOLAS

Sailing on the Seven Seas is often described in a romantic way but so many losses throughout history tell another story. While shipping is per-haps the most international of all industries, it is also one of the most dangerous. Despite the fact that ships have never been so technically advanced as they are today, acci-dents still happen.

Today’s shipping industry is a lot bigger than it was a hundred years ago and we can at least say that the relative number of dis-asters, and the loss of life, has been reduced. However, there is still a great need for safety improvements and training for both officers and ratings.

The Merchant Shipping Act About thirty-five years before the Titanic disaster, the British Government presented a proposal for increased safety at sea, the “Merchant Shipping Act”. It was a result of hard work from Mr Samuel Plimsoll who was a colourful pioneer in the field of im-proved safety at sea.

Mr Plimsoll was elected to the Parlia-ment in 1868, at the age of 44. He started a campaign against unseaworthy vessels and, at the start of his campaign, became very unpopular among established politicians and those with financial interests in the coal trade.

He continued his mission and we can still see the “Plimsoll Line” (Load Line) painted on both sides of all vessels. The “Load Line” shows the minimum freeboard

Titanic and SOLAS (Safety Of Lifes At Sea)

1912 - 2012

Hans Filipssondeputy Area Manager team Gothenburg

PHo

to: R

alph

Wh

ite/CO

RB

IS

The Titanic sails away from the dock for her maiden voyage in 1912.

(or maximum cargo intake). Overloading will lead to a reduced freeboard and less stability as a result.

Titanic – the biggest disaster everOn 10 April 1912, the S/S Titanic began her maiden voyage, bound for New York City, with Captain Edward J. Smith in command.

Just before midnight, on 14 April 1912, the luxury, British, passenger liner sank after colliding with a huge iceberg. The Titanic was said to be one of the most modern and unsinkable ships of the time and therefore only carried 20 lifeboats on her fateful maiden voyage, four more than required by the British authorities. Unfortunately, that was less than half the number needed to accommodate every-one on board.

About 1500 passengers including ship personnel lost their lives. Men and mem-bers of the 2nd and 3rd class were less likely to survive. 97 per cent of the women in first class survived. Overall, only 20 per cent of the men survived, compared with almost 75 per cent of the women.

The Titanic was the biggest disaster by far and publicity was enormous. A large number of the passengers were among the most prominent people of the day. It was decided that something had to be done to avoid such disasters in the future.

The SOLAS ConventionThe first version of SOLAS was adopted in 1914, in response to the Titanic disas-ter. The SOLAS Convention in its suc-

cessive forms is generally regarded as the most important of all international trea-ties concerning the safety of merchant ships.

The main objective of the SOLAS Con-vention is to specify minimum standards for the construction, equipment and op-eration of ships, compatible with their safety. Flag States are responsible for en-suring that ships under their flag comply with its requirements, and a number of certificates are prescribed in the Conven-tion as proof that this has been done.

100 years have passedThe Titanic disaster occurred almost 100 years ago to the day before this issue of Triton is distributed among members and other business partners.

The time from when Mr Samuel Plim-soll was elected in 1868, also very much reflects the time when The Swedish Club has been one of the players in marine insurance. The Swedish Club was es-tablished in 1872 and we will not only continue to provide shipowners with in-surance cover, but also continue contrib-uting to the important work for improved safety at sea.


22

tHIS IS A BRIEf article from a comprehensive study about P&I claims over the past ten years that will soon be published. This study will look specifically at cargo, illness and injury claims, which have occurred on bulker, container and tanker vessels and address the specific issues to why these claims occur.

There is a worrying increase in claim frequency since 2009 but also an increase in the average claim cost. This is the same for all the three claim categories and vessel types. One of the reasons for this increase could be the financial crisis and eco-nomic uncertainty in the world since 2008. This uncertainty does not only affect companies but is likely to create stress to employees as well.

CargoThe average cost of a cargo claim is stable. However, with a large increase in frequency the total cost would be substantial. Between 2010 and 2011 the total cost increased by around 20%.

The most expensive cargo claim category is contamination, which is mainly an issue for tankers and bulkers. Wet damage is the most expensive claim category for container vessels.

In order to prevent contamination, it is imperative to take cargo samples. There are unfortunately numerous cases where the vessel has loaded an entire consignment and discovered af-terwards that it was contaminated.

IllnessThe two most common illnesses are cardiovascular disease and problems with the digestive system. Cardiovascular disease is almost three times as common as problems with the digestive system.

This is a huge concern, as cardiovascular disease remains one of the biggest causes of death worldwide.

To prevent these issues and ensure that crew members are healthy and fit for duty, the normal medical examination seems to be insufficient. It will take years of unhealthy living for a serious illness to develop. To be able to discover if a person is

suffering from an illness the Club has developed a Pre Engage-ment Medical Examination (PEME), which is a more compre-hensive examination. If the PEME is completed correctly it is likely that a serious illness will be discovered.

InjuryInjuries mostly occur during normal maintenance work. Ap-proved procedures are disregarded and unfortunately it is com-mon that neither a work permit or risk assessment has been issued.

An ISM requirement has been in place since 1 July 2010 for companies to have shipboard operational procedures that are based on risk assessments. The purpose of a risk assessment is to carry out a careful examination of shipboard operations to verify that there are adequate controls in place making risk lev-els acceptable.

If the risk assessment has been completed correctly it is likely that most risks will be addressed. If a work permit has also been issued for the specific job it should be obvious to crew members how to complete the job safely.

Immediate causesSo why do accidents happen? Has the crew not received enough training, lacking experience, suffering from fatigue? Are they disregarding procedures? Is the company not explaining what is expected of their employees?

There are usually many reasons why an accident happens but the immediate cause is usually obvious. Most people are aware when something is dangerous but for some reason believe that

P&I Claims Analysis

Joakim EnströmLoss Pevention Officer

Loss Prevention | P&I


23

Loss Prevention | P&I

Illness: Bulker, Container, Tanker - Claims cost >= USD 5000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

1000

2000

3000

4000

5000

6000

0

0.05

0.1

0.15

0.2

0.25

Cos

t per

ves

sel

Fre

quen

cy

Injury: Bulker, Container, Tanker - Claims cost >= USD 5000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

0

0.02

0.04

0.06

0.08

0.1

0.12

0.14

0.16

Cos

t per

ves

sel

Fre

quen

cy

Cargo, Injury, Illness: Bulker, Container, Tanker – Claims >= 5000 USD

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

Cos

t per

ves

sel

Fre

quen

cy

Cargo: Bulker, Container, Tanker - Claims cost >= USD 5000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0

5000

10000

15000

20000

25000

30000

35000

40000

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

Cos

t per

ves

sel

Fre

quen

cy

the risk is acceptable. We hear about these miscalculations every-day in the news. The problem with a vessel is that the con-sequences can be enormous and even fatal.

There are some recurring immediate causes: Lack of planning Lack of experience No clear guidelines Not following company procedures Procedures are unclear or not extensive enough Not being assertive Not recognising dangerous situations Disregarding own safety and well-being Poor communication

Lack of safety cultureThe immediate causes mentioned above would indicate a pos-sible lack of safety culture. One of the difficulties in implement-ing a good safety culture is that safety for one person can be different to another. To change these habits it is imperative that everyone onboard knows what is expected of them. Shoreside activities need to be clear about policy and company culture. All employees need to receive proper training and follow-ups

and the root causes need to be identified and rectified. In a well functioning safety culture most people realise the

importance of procedures and are aware of the consequences of not following them. The procedures can be seen as something positive that will benefit their own safety and that it is worth the trouble of e.g. using a safety harness, filling out the work permit correctly and following the actual requirements.

This is what MRM is all aboutThe above issues are similar to the immediate causes in the Col-lisions and Groundings study (see article in Triton 2-2011). This is expected, as the failure will most likely be from human error. This once again emphasizes the importance of a good safety cul-ture and improving the knowledge about human errors, which MRM (Maritime Resource Management) is all about.

ConclusionTo prevent these claims it’s essential for a proper safety culture to be established at the company. For the company to success-fully implement a safety culture it is essential that all involved receive training, are informed about the importance of the safe-ty system, that all concerned are aware that they are expected to follow procedures and that it is unacceptable to disregard safety.


24

Media | Communications strategy

UND ER tHE SpOtLIGHtManaging the media in a high-profilecasualtysituation



25


All shipowners have operational risk exposures: the loss of life, environmental damage and property and economic losses potentially associated with a casualty. Much can be done to reduce risks, through proactive loss prevention, rig-orous training and adherence to sound procedures, but the fact remains that no owner is immune from the possibility of a major casualty. Such events can find the owner at the cen-tre of public controversy, largely fuelled by hostile media coverage.

The reputational threats associated with shipping are inherent and should be recognised as such by all owners with concern for their standing in the market and the wider world. We live in a world of 24/7 rolling news and social media. The public dimension of these risk ex-posures simply cannot be ignored. It is no longer enough to do a good job when a casualty occurs, the owner must also be seen to do a good job. An effective response must be recognised for what it is. This is not easy to achieve, as accidents – by definition – are highly negative events. So, it is important to be realistic when considering the matter of media communications in such grossly adverse circumstances. Equally, the obvious difficulties are no excuse for not trying! Indeed, a failure to communicate effectively in a crisis is likely to exacerbate the economic damage on all fronts.

understanding how the media worksThis issue is best considered by reviewing the characteristics of the vari-ous types of media. Here, the key broadcast outlets – primarily the major TV news channels with an international reach - shape public perceptions and heavily influence the direction taken by other media (including mass circulation newspapers). An owner with no experience of media exposure in major accident situations will feel the “culture shock” in these circumstances. There is that surprisingly accurate cuta-way image of the grounded vessel, sitting on the reef. How was that done in a matter of a few hours, with no help from our Technical De-partment? How did they find the Master’s wife? How did they get hold of the identity of the Master in the first place?

Perhaps the biggest shock is the speed required for effective media communications. When challenged on a dangerously sensitive issue, it is useless to offer a response the next day (having talked it over with the lawyers). When morning comes, the media attention is elsewhere and a fresh challenge has emerged. It is too late! It is so easy to find yourself on the backfoot, permanently or two steps behind the media agenda.

tRS Director Tony Redding is a public relations and crisis communications specialist with over 25 years’ experience in the maritime and casualty response sectors. tRS Public Relations is based in Canter-bury, Kent, UK and has a large international client base in the maritime industries. tony Redding has organised and participated in over 250 crisis training workshops and simu-lations worldwide, from the Americas and Europe to the Middle East and Far East. He has assisted shipowners faced with significant accident and issues management challeng-es, concerning oil spills, fires, explosions, groundings and loss of life.

Tony Reddingdirector, trS Public relations Canterbury, Uk

UND ER tHE SpOtLIGHt


PHo

to: M

org

ueFile


26

Print media have more time to explore and investigate the accident and its causes. Privacy and media intrusion are hot issues in the UK, driven by the various phone hacking scandals. The owner should assume that ALL investigative tools will be used in a really big story. “Pub-lic interest” may offer some degree of defence for intru-sion (although it does not excuse criminal activity). The central point is simple: the bigger the story, the more the media can be expected to commit resources and money to investigate. Frankly, the owner’s main concern in such situations is more likely to be the accuracy of media re-ports, rather than any inaccuracies.

One consideration here is the ability to source news leads and photos/video clips from social media. The in-discretions associated with social media are legendary. Many companies have already responded by issuing a Social Media Policy for their employees (although, of course, the effectiveness of such measures is questionable, to say the least, in relation to the children of employees!).

Many shipping professionals are surprised at the me-dia’s level of ignorance on shipping matters. This can be especially acute in the broadcast media. In one case – some years ago – a CNN planner asked the author if he could arrange permission for a TV reporter and crew to land by helicopter on the main deck of a burning tanker. When it was pointed out that the vessel in question was on fire at the stern, the caller argued that it was a big ship and “surely it would be safe to land at the front”. On another occasion, a lady representing a major TV news channel asked if the Salvage Master and his team could refloat the ship during daylight hours, “as, naturally, we want to film it!”

Such incidents may be amusing (in retrospect), but they do make a serious point. Successful media commu-nications in casualty situations is not just about getting

your message across. You must also be prepared to EX-PLAIN THINGS and put them into context.

There is also the delicate matter of fair treatment. This is an extremely rare commodity during coverage of a major story involving loss of life, pollution and, perhaps, the suggestion that safety took a back seat to profit. It is important to remember that fair treatment is not yours by right, but needs to be worked for (and deserved!)

Preparing for media responseThe first preparatory step is recognition that media cov-erage is an integral part of major casualty/spill response. The extra media-related workload during a high pressure operational response needs to be recognised and allowed for. The procedures for efficient media response should be formalised and included in the company’s Emergency Response Plan. Drills should include the “public compo-nent” (media/relatives/other audiences). There should be dedicated training in the public response aspects of casu-alty management. Convincing and skilled communica-tors, from within the senior management group, should be identified and trained for a challenging public role following a high profile accident.

It makes sense to make a pre-event response agree-ment with media specialists. It also makes sense to train with these advisors, so as to identify and coach company spokespersons and, in addition, create awareness and un-derstanding of the full impact of public and media issues.

This process should also involve consideration of the owner’s vulnerabilities, at company, ship and incident level. From the company perspective, sensitivities may in-volve problems with a particular class of vessel or a track record including past incidents of a serious nature. From the standpoint of the vessel involved, the vulnerabilities might concern age, flag, manning, port state record and



Convincing and skilled communicators,

from within the senior management

group, should be identified and trained

for a challenging public role following a

high profile accident.


27

any past incidents. Remember that no amount of clever public relations and smart communications can paper over operational failures by the crew or the owner’s emer-gency team ashore. Every important operational option should be considered from a public interest perspective (for example: How long did it take to make the call for tug assistance? Why were non-essential personnel left on board, given the risk of a second explosion? With his ves-sel so heavily damaged, why did the Captain sail parallelto the coast, rather than head out to sea?). Negative perceptions can multiply rapidly unless clear and firm responses are forthcoming. The answers need to come fast and they need to be convincing. The owner needs to be honest and avoid any temptation to mislead. The very essence of good media response is to know just how far to go, in terms of detail.

Attending on sceneSome accidents attract a very large media presence on-scene. They will arrive with all the paraphernalia of mod-ern electronic new-gathering. The owner’s spokesperson may soon be participating in daily media briefings hosted by Coast Guard or Government Ministry.

There are certain issues which are fundamental for suc-cessful response on-scene. They include solidarity and security. “Solidarity” requires the maintenance of public positions which (so far as possible) are aligned with those of the shore authorities. This may not be easy, but disa-greements are best kept private, if possible. The media feasts on division. It is good practice to avoid criticising those parties you may be working with for many weeks to come.

As for “security”, it is important to protect the crew and their families from media intrusion. Seafarers are often traumatised by their experiences. Bear in mind

that they will remain prime targets for journalists and TV reporters until their repatriation. Even then, they and their families may still be hounded, if news interest remains strong.

A last point on “security”: every member of the owner’s response team is “on duty” for every second spent out-side the hotel room. Smiles, jokes and a glass of beer are open to misinterpretation and exploitation in situations involving loss of life and severe pollution damage. There really is NOTHING FUNNY about a marine accident.

To conclude, in today’s world it is a big mistake to fail to recognise the power of the media and public opinion. Once an owner loses control of the public dimension, he will find it almost impossible to restore the situation. Negative views tend to root deeply and quickly, as the search for scapegoats gathers momentum.

The answers need to come fast and they

need to be convincing. The owner needs

to be honest and avoid any temptation

to mislead. The very essence of good

media response is to know just how far

to go, in terms of detail.


PHo

to: iSto

ckph

oto

PHo

to: M

org

ueF

ile


28

ON 5 OCtOBER 2011, in the early hours of the morning, the container ship MV Rena ran aground at full steam on the Astrolabe Reef on its approach to the Port of Tauranga on New Zealand’s east coast.

With 1,368 containers on board, 32 of which contained hazardous materials, as well as 1,648 tonnes of heavy fuel oil, the stricken ship became the first major con-tainer and oil spill disaster New Zealand has faced – calling for the largest coastal clean-up ever.

Following the grounding of the vessel and the initial release of about 300 tonnes of fuel and cargo – the sight of oil on the local white sandy beaches was an unprec-edented event in New Zealand. However, although some oil stains remain in the landscape, much of the 300 tonnes of fuel spilt when the vessel started to break up was cleaned up in a very short time by a massive voluntary effort from the people of Tauranga and others around the Bay of Plenty.

Initial ResponseITOPF (The International Tanker Own-ers Pollution Federation) were amongst the first experts on the scene, and with their worldwide experience in dealing with oil spills, provided invaluable guidance on the appropriate way to remove and clean the contaminated shoreline. Different techniques are required and guidance was provided on what was most appropriate for the circumstances of this case.

An incident command centre (ICC) was set up in a disused supermarket, with professional salvors being appointed and experts flying in from all over the world. Based upon not dis-similar events in the South of England following the grounding of the MSC Napoli, this included the spe-cialised Braemar/Unimar team appointed by the owners and The Swedish Club to

Unsung Heroes of the MV Rena grounding

John D. OwenSenior Claims Manager team Piraeus

Pollution | Cleanup operation

The owners of the Rena and the Club

wish to recognise and pay tribute to the huge effort of the people of New Zealandand their response incollectively helpingclean the beaches

spearhead container and debris recovery. Passionate Kiwis, who love their coast, soon made it quite clear to the authorities that, like it or not, they were going to be a part of the clean-up effort.

Throughout the process the local tan-gata whenua (“people of the land” - the indigenous people) have proven to be a real inspiration; their efforts have set a fantas-tic example of a motivated and cohesive community effort to restore the coastline – which is such an important part of their heritage and culture. Iwi (“peoples” - social units of Maori) have worked hand in hand with the Club’s appointed contractors throughout the response, putting in a huge voluntary effort collecting debris along the coast – with company staff assisting in re-covery, and with the labour teams focused on the hardest hit areas.

Motiti IslandMotiti Island lying closest to the Astrolabe reef sits only seven kilometres south of the stricken Rena. As such a great deal of the oil and debris came ashore here. Residents had been faced with an enormous and daunting clean-up task as tonnes of con-tainer debris soaked in oil had coated the shores of their precious island. Braemar and Unimar have been working closely with the community around the rocky and inaccessible coastline, reaching areas where containers and debris were wedged between large boulders and jammed into rocky inlets. Working with the commu-nity provided a wealth of first-hand local

knowledge, crucial in navigating the cliffs and bays and assisting in the approach to culturally sensitive areas. Collectively, the local community at Motiti and the vari-ous contractors and voluntary teams, who all received appropriate health and safety guidance have, with the use of helicop-ters and specialised beach craft, collected


29

hundreds of tonnes of cargo and container debris.

January 2012Seven metre swells battered the MV Rena on the night of 7 January. By the morn-ing of the 8th, the Rena had broken in two, and while the bow section remained firmly grounded on the reef, the split caused the two sections to slew away from each other and settle lower in the water. This triggered the release of debris and oil sheen into the sea. The easterly winds and currents pushed the contents of several hundred additional containers and debris as wide as the length of football fields, trailing north towards the beautiful unspoilt beaches of Matakana Island and Waihi Beach on the mainland. By the morning of the 9th, Tangata When-ua on Matakana Island had swarmed onto the beach, picking up milk powder packets spewing out of shattered containers, loose

wood debris and thousands of food packets. The owners of the Rena and The Swedish Club encouraged Braemar to work closely with the landowners and local iwi to for-mulate an innovative operational plan. It involved employing iwi labour to assist in the most labour-intensive areas of the shoreline recovery and with the help of ma-chinery ashore, barges and helicopters, they began New Zealand’s biggest ever shoreline recovery effort focused on one single beach. More than 850 tonnes of debris and 12 con-tainers have been recovered from the beach line with minimal environmental and wild-life impact (the island is home to endan-gered New Zealand dotterel) on Matakana Island’s beautiful and unspoilt character.

In addition to the main salvage opera-tion, the significant cost of the operations coordinated by Braemar and their sub-contractors have been met by The Swedish Club, but without the huge volunteer effort

of the community and the invaluable assis-tance with all of the shoreline recovery this would have taken longer with more wildlife exposed to the oil. From the tip of the Co-romandel Peninsula, to the southeast, down past the islands of Matakana and Motiti, and along the coast line around Cape Runa-way towards the city of Gisborne. Tangata Whenua and community members have left a strong and lasting impression on everyone who has worked closely with the Rena re-covery.

Our ThanksThe owners of the Rena and the Club wish to recognise and pay tribute to the huge effort of the people of New Zealand and their response in collectively helping clean the beaches following the initial events of 5 October 2011, and then subsequently the storm of 8 and 9 January when the stern section sank. Thank you all.

Pollution | Cleanup operation

PHo

to: M

aritime N

ew Z

ealand

Volunteers cleaning Papamoa beach in the 100th volunteer cleanup operation held since Rena gounded on Astrolabe Reef.


3030

Club Information | Notice Board


New Average Adjuster in SwedentHE SwEDISH government has appointed Magnus Widebeck, as Sweden’s new Aver-age Adjuster. Magnus Widebeck is currently Chief Judge at Nyköping District Court. Phd Candidate Paula Bäckdén at the University of Gothenburg, Department of Law, has been appointed deputy Average Adjuster. Mag-nus Widebeck is taking over from Professor Svante O. Johansson who held the position

of Average Adjuster from 1998 to 2011. Svante O Johansson was appointed a Justice of the Supreme Court on 30 June 2011 by the Swedish government.

New General Correspondents for the French Atlantic and Channel CoastswE HAVE NOw completed our annual review of the List of Cor-respondents and the updated list is available online. You may have noted there is one significant change regarding correspondents along the French Atlantic and Channel coasts. As from 20 Febru-ary 2012, correspondents for each single port aren’t listed. Instead, we have listed McLeans (Paris) as our sole correspondent for the area. They will respond for both H&M and P&I matters. We be-lieve it is advantageous for the Club, our members and masters of insured ships to have one single correspondent to contact in case assistance is required. Also, in line with the common aim of all In-ternational Group clubs in supporting a number of correspondents in relation to work available, and to encourage investment in train-ing and succession planning of those listed, we strongly believe this is a step in the right direction. We look forward to many years of good cooperation with McLeans’staff.

Iran sanctions update – EUON 23 JANUARy 2012, the EU issued enhanced sanctions against Iran by way of Council Regulations 54/2012 and 56/2012. Notably, the Central Bank of Iran, Bank Tejerat and Tidewater Middle East Co are all added as designated persons generally pro-hibiting EU individuals and entities to engage in financial transac-tions with these parties. Since Tidewater operates a number of Ira-nian ports this has particular significance to the shipping industry.

In addition to the regulations set out above, Council Decision 2012/35/CFSP was adopted. This prohibits the import, purchase or transport of Iranian crude oil, petroleum and petrochemical products as well as the provision of financial assistance, insurance and reinsurance in relation to such products. These provisions are stated to be without prejudice to the execution (until 1 July 2012 for crude oil and petroleum products and 1 May 2012 for petro-chemical products) of certain contracts concluded before 23 Janu-ary 2012. The Council Decision also provides for the sale, supply or transfer of key equipment and technology for the petrochemical industry in Iran (or Iranian-owned enterprises engaged in that industry outside Iran) to be prohibited.

Council Decisions are only immediately effective against the governments of Member States. In order to have legal effect on companies and individuals, an implementation regulation is need-

ed. The implementing regulation, Council Regulation 267/2012, was issued just before this article was printed. The material provi-sions of the Regulation substantially reflect the corresponding provisions in the Decision. As a result, members are required to note in particular that there is no P&I cover available for the trans-portation of Iranian petroleum products after 1 July and Iranian petrochemical products after 1 May. Detailed and updated infor-mation about the Iranian sanctions can be found on the Club’s website.

Iran sanctions update – USAON 21 NOVEMBER 2011, the USA expanded its Iranian sanc-tions by way of Executive Order 13590 in particular lowering the dollar thresholds for prohibited activities such as transportation and insurance of Iranian refined petroleum products. Addition-ally, on 31 December, the National Defence Authorisation Act for fiscal year 2012 was issued, which in essence prohibits non-USA financial institutions to do business with Iranian financial institu-tions. Further sanctions are expected; inter alia, a limit of 180 days for vessels that have called into an Iranian port before calling at a USA port. Detailed and updated information about the Iranian sanctions, as well as other sanction regimes, can be found on the Club’s website.

SCOL – The Swedish Club On Line SINCE tHE LAUNCH of our new SCOL extranet site in July 2011, the number of SCOL users has constantly increased, and we have received a lot of – mainly positive - feedback from users.

Our ambition with the new extranet is to improve user-friend-liness, enable personal user settings and enhance the documenta-tion platform, all of which we take great pride in having achieved. But as with all systems, there is always room for improvement. We are keen to receive feedback from users on how to improve even more, which will be used in the development work. Examples of such suggestions, include a future release that will include multi-downloads of insurance documents, together with enhanced re-port functionality, enabling the user to make tailor-made reports on insurance, claims and records data. In the recent P&I renewal, SCOL has been put to the test as the main channel for providing insurance certificates and other insurance documentation to mem-bers and insurance brokers, which has worked out very well. When new documents are posted on the insurances you are involved in, you will receive a notification of this by email. Lately, we have however received a number of questions about how to limit these notifications to areas of interest only, and would therefore like to take the opportunity of informing all users that these settings are available under “My Settings” at the top of the page. Choose “Insurance” (directly below your username at the top of the page). Choices under the tab “Notification rules” will enable you to set the areas of interest you want to be notified about.

Annual General Meeting 2012tHE SwEDISH CLUB'S Annual General Meeting 2012 willbe held on 14 June at 2 p.m. at the Elite Park Avenue Hotel in Gothenburg.


31

the Swedish Club Academy | MRM

Martin HernqvistManaging directorthe Swedish Club Academy AB

As a result of the February meetings, the Club will organise a training event in Greece for new MRM Workshop Leaders on 29-30 May. Greek members interested in an MRM licence should get in touch with Martin Hernqvist at The Swedish Club Academy.

Rolling out MRM amongstthe Greek membership

tHE SwEDISH CLUB has run a training centre in Piraeus, Greece, since the 1980s for the use and benefit of the Greek ship-ping community. The courses have been really appreciated and MRM has been one of the courses on offer. Many of our Greek members - well ahead of any mandatory re-quirements - have taken part in the MRM courses, but the demand for MRM courses in Greece has been replaced by demand for these courses in other locations as well, such as the Philippines and the Ukraine. With an increasing number of Greek shipping com-panies employing foreign officers and crew, and with an increasing number of compa-nies who wish to get closer to their crew, for example by being in greater control of

their training activities (some operate their own in-house training centres), we have de-cided to promote direct access to the MRM training material through an MRM licence agreement among our Greek membership. In February this year we met a number of our Greek members to discuss this opportu-nity and the message was well received. The MRM training programme can not only be used to increase safety and efficiency but also to integrate the non-Greek officers and crew into the company’s culture and make them feel part of the “family”. The strong family feeling of many Greek shipowners in the past is believed to have been an important factor not only for loyalty and retention but also for good incident records.

SINCE tHE LAtESt ISSUE of The Swedish Club Triton, we have welcomed the following training establishments to the MRM network:

New MRM training providers

wE wELCOME all people interested in MRM issues to join the MRM discussion group on the internet site “LinkedIn”. LinkedIn is the world’s largest professional network with over 120 million members. Membership is free of charge. We hope that this group will be useful for discussing MRM issues both for those already using MRM and those who are new to the concept. The group can also help keeping MRM “alive” for the companies and people who

have done the course. All means of ensuring that the MRM mes-sages are implemented and not forgotten after training should be used as far as possible, and this may be one such means.

Two quick steps to join: First, set up your own LinkedIn account at www.linkedin.com. Then search for the group “Maritime Re-source Management (MRM)” and click Join Group.

MRM discussion group on

Fremantle Maritime Simulation Centre, Fremantle, Australiawärtsilä Land & Sea Academy, Busan, South koreaMaritime education and training Services Pte Ltd, Singaporehanseatic training Institute, Manila, PhilippinesMaritime State University, Vladivostok, russia ABB Marine Academy, helsinki, Finland

Martin, I fully endorse your view that high profile events such

as Costa Concordia should be reviewed from an MRM perspec-

tive so that lessons can be learned and such a terrible incident

is never repeated. In P&O Ferries we have found one of the

many benefits of MRM training is that it creates an open en-

vironment which encourages all the delegates to speak up as

they review case studies. In our company we have used inci-

dents that delegates are familiar with, such as the BRAER, but

also company related incidents. This is akin to “Open Heart

Surgery” for some delegates but once they get over their

reticence to contribute to the case study, we have found the

resulting group discussions to be excellent. We have put over

225 delegates through our MRM training in the last two years

and all delegates have said how beneficial the training was

and importantly it gives them “tools within their toolbox” to

use when they are back onboard their respective ships. Not

one delegate has raised any concerns or said the MRM

training was not beneficial.

Comment made by John Garner, Fleet director at P&O Ferries,on 21 January 2012 in the LinkedIn MrM discussion group


32


out and About with MRM

16-17 November 2011 Participants at the MRM Workshop Leader meeting held on 16-17 November 2011 at Southfield Agencies, Manila, Philippines. The following MRM training providers were represented at the meeting: Anglo-Eastern Maritime Training Centre, CMA Ships, IDESS Maritime Centre, Marlow Navigation, PHILCAMSAT, Southfield Maritime Train-ing Foundation and Wallem Maritime Training Centre Philippines.

21-22 November 2011 Participants at the MRM Workshop Leader meeting held on 21-22 November 2011 at Sirius Training & Education Institute (STEi) in Singapore. The fol-lowing training providers were represented at the meeting: Anglo-Eastern Ship Manage-ment, International Bunker Industry Association, Kuwait Oil Tanker Company S.A.K, Lanka Academy of Technological Studies, Malaysian Maritime Academy, Precious Shipping, Sin-gapore (Nan Tong) International Maritime Institute, Sirius Training & Education Institute and Wavelink Maritime Institute.

PHo

to: Th

e Swed

ish C

lub

PHo

to: Th

e Swed

ish C

lub


33

If wE ARE CORRECt, the Maritime Resource Management course is the first training programme to receive national accept-ance in accordance with the STCW Manila amendments. Since the STCW requirements are of major importance to seafarers, the shipping companies and training providers, the certification received by the Maritime Department of the Swedish Transport Agency in February 2012 made us both proud and happy.

The areas concerned for the STCW Convention are: Reg. A-II/1 for Bridge Resource ManagementReg. A-III/1 for Engine-room Resource Man agementReg. A-II/2 and A-III/2 for Use Leadership and Managerial

SkillsReg. A-II/1, A-III/1 and A-III/6 for Application of Leadership

and Teamworking Skills.

MRM theme for social events during 2012wItH A NUMBER of high-profile incidents taking place recently, the interest in Maritime Resource Management (MRM) issues has increased. To meet demand and give members and Club represent-atives an opportunity to discuss these preventative measures, The Swedish Club decided to make MRM the theme for a number of European Club events taking place in 2012.

The presentation of The Impact of Attitudes and Cultures on Ma-rine Accidents - How to manage risk through implementation of

Maritime Resources Management (MRM) will be held at the fol-lowing dates and locations:

28 March – Breakfast meeting in Oslo 18 April – Club Evening in Bremen 19 April – Club Evening in Hamburg 25 April – Lunch seminar in Piraeus 26 April – Lunch seminar in Istanbul 15 May – Seminar in Copenhagen

STCW Manila amendments


28 November 2011 On 28 November 2011, a three-hour "Introduction to MRM" seminar was held by Martin Hernqvist of The Swedish Club Academy at the Maritime State University named after admiral G.I. Nevelskoi in Vladivostok, Russia. The majority of the participants were University lecturers and people representing the local shipping community.

25 November 2011Employees of the first MRM training provider in South Korea, Wärtsilä Land & Sea Academy in Busan, received MRM Workshop Leader training on 25 November 2011.

PHo

to: Th

e Swed

ish C

lub

PHo

to: Th

e Swed

ish C

lub



34

Club Information | Staff presentations

A three-month internship can turn out to be a winning ticket to an in-teresting career with opportunities to work abroad and moving forward to a managerial position. At least if you have the right education, com-petence and ambitions. That is a car-bon copy of Johan Kahlmeter, our new Head of Marine Claims in Team Gothenburg.

Despite his fairly young age, Johan already has a wide experience from both time at sea and handling Marine and P&I claims in different parts of the world. But this is the first time he takes on a managerial po-sition which demands for a somewhat dif-ferent approach.

“I will handle claims as before but now my role is also to present the company

Johan Kahlmeter

From summertrainee to Marine Claims Manager

goals, coach co-workers and give them the environment to perform as well as pos-sible, Johan explains. It is on me to keep the team together and go through the rou-tines to see how they can be improved and updated to provide a better service to our members, he adds.”

Practice in New yorkWhen Johan turned 20 he moved to Nor-way to study nautical science at Vestfold Maritime University College. Directly thereafter he went to sea for a shorter time to work as a deck cadet on tankers and Ro-Ro ships.

“It came natural for me to be interested in navigation, shipping and the sea and to choose an occupation in the area, as my family and I have been sailing for as long as I can remember and we spent a great deal of the Summers on our boat, says Johan.”

During his time at sea, his interest for the legal and insurance aspects of shipping developed, so he decided to return to uni-versity, this time to study for a Master of Science in Shipping & Logistics at Chalm-ers in Gothenburg. When he finished in 2005 he didn’t think it was enough and followed up with a year in Oslo to study for an L.LM degree in Maritime Law. It turned out to be a good decision, as he here met his girlfriend, Tonje.

Fresh out of law school he was offered to take on a traineeship at the law firm De-Orchis, Wiener & Partners in New York, so in January 2007 he went off to the Big Apple.

“When I had been there for a couple of months, I was contacted by our HR di-rector, Helena Wallerius Dahlsten. She

Carola WeidenholmCorporate Communications



35

In the Summer of 2011 The Swed-ish Club decided to transform the organisation at the head office in Gothenburg. Two teams became one: “Team Gothenburg” and within that division a new depart-ment called P&I Claims was formed. The post of manager went to Maria Berndtsson, who has extensive ex-perience of claims handling from both Stena Rederi, Gard and since three years back The Swedish Club.

“I found the job too interesting not to ap-ply when I had the opportunity! I am in a position in life where I have gained a lot of experience, worked many different claims cases and my kids are grown up, so I have both the time and desire to take on some-thing new, tells Maria. It is also an interest-ing challenge to develop a P&I department

Maria Berndtsson

Our new P&I Claims Managerand have the opportunity to carry through ideas that have grown during my years as a claims executive,” she continues.

Curious of the insurance businessWhen Maria started her studies to become a Master of Law at Lund University in 1980, her aim was to work in finance or insurance, or to become a judge. For added experience, she went on directly to district-court practice for two and a half years. At that time her interest in the sea and ship-ping together with a curiosity about the insurance industry had taken over, so she decided to take up an offer from the insur-ance department at Stena Rederi. There she stayed for four years until it was time to move abroad.

“My husband Anders was offered a job in Switzerland so we moved to the Zürich area and stayed for five years. It was inter-

esting to get the experience of living in another country; even though Switzerland is pretty similar to Sweden, there are still many differences, says Maria”

In 1997 she, her husband and two sons moved back to Sweden. Maria soon started as a Claims Executive at Gard, where we found her and succeeded in getting her over to our team in 2009.

“As I had been at Gard Sweden for more than 12 years, I felt that the offer was in-teresting and it was time to move on for new experiences and a boost forward in my career, tells Maria. It is an opportunity to develop your skills when you move to an-other job; even if you have the same tasks, every company functions differently and there are new people to learn from.”


PHo

to: Th

e Swed

ish C

lub


36

wanted to meet me in New York for an interview – for a position at the head office – during the Clubs board meeting in the city, he explains.”

Two years in Hong KongHe came back in June 2007 for

a permanent position as Claims Executive at the head office in Gothenburg. In October two years later it was time for yet another move: Johan took over Tony Schröder’s position at our Hong Kong office, when he decided to move back to Gothenburg for the job as Area Manager.

“I have been an exchange student in Perth, Australia, studied in Oslo and was a trainee in New York, so for me it felt like a matter of course to take the opportunity to work in Hong Kong. The tim-ing was also pretty good, as my partner just finished her law stud-ies and got a job at Mannheimer Swartling in Hong Kong, Johan tells.”

In 2011 the team organisation in Gothenburg was transformed and a new position emerged – Head of Claims – Marine, Claims Manager.

“Tonje and I got on very well in Hong Kong, both with the culture, hustle and bustle, high pace and our jobs, but when the position as Head of Marine Claims came up I realised it was an opportunity that would not appear very often, so it became time to return home, he explains.”

Johan in briefName: Johan Kahlmeter

Title: Head of Marine Claims and Claims Manager team Gothenburg

Age: 32

Family: partner tonje who he met studying in oslo

Background: Johan opened with a Bachelor of Science (BSc) degree in Nautical Science at Vestfold Maritime University College, 2000–2003. He almost immediately moved on to study for a Master of Science (MSc) in Shipping & Logistics at Chalmers University of technology in Gothenburg, 2003–2005 and complementary studies at oslo Univer-sity to obtain a L.LM degree in Maritime Law. He also spent some time at sea on tankers and Ro-Ro-ships as well as traineeships at both the Swedish Club in Gothenburg and the law firm Deorchis, Wiener & Part-ners in New York. Before he took on his new position as Head of Claims – Marine and Claims Manager, he spent two years at our Hong Kong office as a Claims Executive.

Spare time: he and tonje sails a lot in their own boat during the sum-mer months. When there is time he also enjoys scuba diving. In winter they often go to tonje’s family cabin in the Norwegian mountains for skiing. this summer he hopes to find time to sail in both Denmark, Sweden and Norway for the entire holiday.

Of current interest: our new Head of Marine Claims and Claims Man-ager in team Gothenburg

At The Swedish Club since: June 2007

A skilled teamTwo years later it was time to take on the newly created position as Head of Claims – P&I, but she is also still working as a Senior Claims Executive.

“I think my role is a little different than many other managers, as I work my own P&I cases in parallel. For me it is an advantage as I keep in close contact with developments in the claims handling business and by that with the reality for the co-workers, she explains.

Being manager is not only about being the one who makes final decisions and manages things, according to Maria.

“Naturally, the role includes implementing the manage-ment’s strategy in a clear way, so we can all work towards the same goal. But I think it is just as important to be supportive and accessible for your co-workers and be able to build trust within the group. This is an organisation with very skilled spe-cialists, so my role as manager is not to always “know it all”, but to trust the co-workers, be a discussion partner and con-tribute with my experience in the area.

Maria in briefName: Maria Berndtsson

Title: Head of Claims – P&I, Senior Claims Manager

Age: 52

Family: married to Anders with two sons, Wilhelm 20 and Fredrik 18

Background: 1980-85 she studied at Lund University to become a Master of Law and then went on to district-court practice for two and a half years. In 1988 her interest in the insurance sector and maritime life took her to Stena’s insurance department, be-fore she moved to Switzerland for five years. Back in Sweden in 1997 she started at Gard as a Claims Executive and stayed until she moved to the Swedish Club almost three years ago.

Spare time: Marias major interest in sports is evident in many ways. In the winter she enjoys downhill as well as cross-country skiing and she has even done the 30 km women’s Vasa ski race three times! In summertime she and her family like to sail, and in 2011 they followed the coast of Norway for an unforgettable ex-perience of fjords, cliffs and midnight sun. Maria also takes time to run and in May she will run the Gothenburg half marathon for the fourth time.

Of current interest: our new Head of Claims – P&I, Senior Claims Manager in team Gothenburg

At The Swedish Club since: September 2009

9 continued from page 34 9 continuesdfrom page 35

Club Information | Staff presentations


37

yEt ANOtHER GREEk crisis was solved a few weeks ago when the coalition government decided to endorse the ECB/troika/EMU demands at the 11th hour. Actually, the deadline for the acceptance was moved back on a daily basis for more than a week. The EMU countries have now decided that they did not trust the Greek government to implement all the aus-terity measures that have been agreed and therefore will ask for tougher demands on delivery on the promises from the Greeks. At the same time when politicians, banks and lenders are trying to solve current financial problems people in Greece are starting to feel the pain and suffer as a result of increased income taxes, higher consumption taxes, higher real estate taxes and lower wages for public workers and people work-ing for troubled businesses. Shops are closing down, the grid-locked streets from three years ago are now less crowded and an increasing number of families have difficulties providing for themselves.

The frustration of the people against Greek politicians and against the people offering the restructuring of the Greek loans was seen recently when massive demonstrations resulted in buildings being set on fire and clashes with riot police in central Athens. And although the vandalism is, as always, the work of a small minority of people who believe it is their God-given right to destroy things, people in Greece seems to have had enough with the way the country is governed and what they have been offered as a solution. Investments are needed, restructuring of the public sector needs to be done and there needs to be a plan for how Greece will develop as an independ-ent, debt-free and forward looking country. Too much energy is being wasted looking back and not enough for the solutions of the future. Greece could be the Green Energy dynamo of Europe, but for that, laws need to be changed and investments in infrastructure are on the wish list. Shipping and tourism

are likely to continue to be cornerstones of the Greek economy going forward, provided the interests of these segments of the economy are dealt with properly.

On The Swedish Club front in Greece we have seen a big increase in the interest for our MRM program, both from our members and non-members. Two things are new. Firstly our MRM program has been approved by the Swedish Maritime Authority as complying with the Manila Annex to the STCW regulations. Secondly we are offering our MRM program in another suit more customized to owners own in-house training programs and at a cost which is difficult to beat. We hope to see an increasing number of people joining as we really feel that our MRM program has a lot to offer with regards to the safety of shipping.

We have just concluded the P&I renewal and we are happy to see new accounts coming in and the present one’s staying. Times are tough for our members and we have had a bit of a rocky year as well, with a higher than expected frequency of large claims (we were spared over the last three years) and with financial returns below expectations. Shipping fortunes seem to be in dire straits for the foreseeable future but we hope to bounce back pretty quickly as our business model is set-up to cater for years like 2011 without much affect on long-term de-velopments.

Club information | News from Piraeus

Tord NilssonGeneral Manager/Area Managerteam Piraeus

MRM hasa lot to offerto the safety of shipping

PHo

to: iSto

ckph

oto


38

Club information | News from Asia

the outcome of this renewal came as a vote of confidencep&I RENEwAL is never easy. This one for 2012/13 is par-ticularly difficult. The members of the Club, whether owners or operators, are under tremendous pressure to reduce costs as freight markets, whether dry, wet or container trade, have been at very low levels for a long time and probably will continue to be for a long time to come.

On the other hand P&I clubs need to increase premium levels in order to keep up higher claims payments due to ever-increasing owners’ liabilities and claims inflation. Pressure on both sides tends to put pressure on partnership relationships.

Nonetheless, the Club managed to achieve its target on the risks renewed thanks to the strong support from our loyal members. After all, the Club belongs to the members as a whole.

The charterer’s liability insurance class renewal was relatively uneventful, as was the FD&D class.

Business volumes fell slightly, while premium rates rose. The outcome of this renewal came as a vote of confidence. We not only managed to increase premiums, we also added a large number of committed new tonnage.

As members face lots of difficulties in 2012, the Club will also face challenges including managing sustainable growth whilst maintaining good services to the members by upholding adequate resources.

The freight markets are not expected to improve much dur-ing the year. A large number of newbuilding tonnage will be delivered, and the freight markets will continue to be under pressure. Recently BDI (Baltic Dry Index) hit a 26-year low at 647 points. For many shipowners freight income is not enough to pay operating costs.

Crew costs including compensation packages, bunkers, port charges etc are increasing. Many newbuilding deliveries will need to be manned, further exposing the problem of the short-age of quality crew. Financial pressure will affect ships’ mainte-nance and the ships’ condition in general.

All these factors in combination may lead to more claims and less premium income. As our members face difficulties particularly in claims, disputes or casualty situations, they will need the Club’s support and assistance even more. We will con-tinue to develop our competence.

Ruizong WangManaging director/Area Managerteam Asia


39

Club Information | News from Oslo

Verner RydningSenior Manager team Oslo energy

PHo

to: K

S Drillin

g

Reflections on our first 12 monthsof operationDURING OUR fIRSt 12 months of operation we gained some 30 accounts. The vast majority of these are “local” ac-counts produced to us by Norwegian-based brokers, but there have also been a few International accounts provided by Lon-don brokers. At the time of writing, we have written more than 30 accounts comprising some 250 units. We are very happy with our achievements so far which are also in line with our Business Plan. The first year’s underwriting results were also positive and satisfactory.

2012 started with the total loss of the rig “KS Endeavour”, where a blow-out and fire occurred on 16 January and melted the whole rig within a few days. The Hull & Machinery and Hull Interest Insurances were placed in March 2011 and led-off by the Norwegian Hull Club. We wrote a fairly modest “following” line so exposure was relatively limited.

2011 was not a great year for the whole Energy insurance sector (on and offshore) and lead insurers are now looking for increases. Competition between various markets has also

started to increase in particular on larger accounts with good loss records.

We also saw increased average deductible levels in 2011, which will hopefully become more permanent allowing insur-ers to build up stronger reserves to pay for future larger claims.

This year will be a year of consolidating existing accounts for The Swedish Club Energy Team, but we also expect to broaden our business with a few more high quality International Ac-counts. So overall we can safely say that things are looking positive.

The KS Endeavour on a Heavy Lift Vessel before the fire.


40

Club Information | Out and About

It is time to visit our last fortress in the annual report. We have already looked into Carlstens Fortress in spring of 2008, Älvsborgs Fortress dressed in heavy snow 2009, and Bohus Fortress in sparkling autumn colours 2010; for 2011 we look closer into Varbergs Fortress when the summer was at its fairest. Stand-ing on a cliff, this fortification has a great view out over the North Sea and was the perfect place to control the coast lines from less longed-for visitors from other countries armed forces.

It all started in 1287, when the Danish count Jacob Nielsen began to build the fortress as protection after he had been ac-cused of killing their king Erik Klipping a year earlier. In 1305 he decided to pass it on to Norway, who augmented it during the coming centuries until the area, after the Treaty of Brömsebro, in 1645 became Swedish. Around 1,000 farm labourers worked every day during 30 years to con-struct what, at the time, were classed as the most modern defenses. During the 18th century the fortress was maintained by the Swedish army, and when they no longer needed the building at the start of the 19th century, there were plans to blow the whole thing up.

Prison and warFrom the mountain where Jacob built his castle, there is not much handed down to posterity but a lot has been done since his time. The whole rock was covered with soil and four bastions were built – one in each corner and one more in the middle of the wall, facing the sea. The bastions have dif-ferent names. Clockwise you are first met by “The white monk” in northeast, then “The grey monk” in southeast, “The red monk” in southwest, “The dyke bastion” in west and “The forge bastion” in northwest. The fortification was reinforced in south and southwest as the enemy pretty easily could place canons at the facing Rantzau

rock, which occurred in 1565 during the Nordic seven-year war.

From the Middle Ages right up to 1931 the fortress also served as a prison, and both the medieval dungeon as well as the individual cells have been preserved. Today the visitors have a more pleasant stay (and can leave whenever they please!).

The views from the fortress out over the Cattegat is beautiful and in summertime you can see the sailing boats come and go from the marina near by. The walk along the ramparts also offers a magnificent panorama of the Varberg town and the coast, and inside the walls you will find a bed & breakfast, the county museum, a blacksmith’s workshop, a café and restau-rants. The ceremonial areas and premises are popular for a variety of festivities, for example balls and weddings. During the summer months both residents of Varberg and tourists gather in and around the for-tress for just a stroll or a picnic at sunset.

A poled man and a monsterThe County Museum of Varberg is located in the oldest parts of the castle, and has exhibitions about the fortress’ history, art from the ”Varberg School”, cultural his-

tory from the Halland county and, last but not least, the Bocksten’s Man. He is an extremely well preserved corpse of a man from The Middle Ages – even his real hair and clothes from the time remains! The discovery is the first one found with poles pegged through the body. He had been murdered and the poles should prevent him from haunting the village.

The history tells that the moat of the for-tress is to be inhabited by a small lake mon-ster. In August 2006, a couple of persons claimed to have seen the monster – de-scribed as brown, furless and with a 40 cm long tail – emerge from the dark water and devour a duck. Unfortunately, we didn’t have that luck when we visited the fortress with our camera!

The Annual Report will be printed and ready in the beginning of May but will be published at our website around mid-April.

Varbergs Fortress

– a history about kings, wars, prisoners and a monster

Carola WeidenholmCorporate Communications

PHo

to: A

nn

a Jolfo

rs


41

Cocktailsand golfin Singapore 29-30 March 2012Following the Club’s Board Meeting in Singapore on 29 March, a cocktail reception was held at the Singapore Cricket Club for board members and business associates.

On 30 March, The Swedish Club Singapore Grand Classic 2012 golf competition was held at the Tanah Merah Country Club.

Club information | Out and About

Breakfast Meeting in Oslo 28 March 2012

From left: The Swedish Ambassador to Singapore Ingemar Dolfe together with Jan Rydenfelt (The Swedish Club).

From left: Lawrence Lau (Cosco Hong Kong Insurance Brokers),Ruizong Wang (The Swedish Club Hong Kong) and James Wang Shuang (GC Tankers Pte Ltd).

From left: Lennart Simonsson (Chairman of The Swedish Club Board), Ng Siong Tee (Kontiki Shipping), his wife Roselyn andJun Yanagawa (Diamond Star Shipping Pte Ltd).

The Club hosted its established annual breakfast seminar at Ship-pingklubben in Oslo on 28 March. About 30 guests from the Nor-wegian shipping and energy community enjoyed a breakfast buffet before being briefed by Henric Gard on the Club’s current state of affairs and by Verner Rydning on the Club’s inaugural year of writ-ing energy business (a very successful start!). This was followed by

a presentation by Martin Hernqvist, The Swedish Club Academy, on this seminar’s main topic: “The Impact of Attitudes and Cultures on Marine Accidents. How to manage risk through implementation of Maritime Resources Management (MRM).” This was the fourth consecutive breakfast seminar in Oslo and with such a great turn-out, we will undoubtedly return next year.

From left: Jack Nilsen (Willis AS), Hogne Nesse (Höegh Autoliners AS ) and Tony Schröder (The Swedish Club).

From left: Lars Rhodin (The Swedish Club) together with Zhang Lansui (Da Sin Shipping Pte Ltd) exchanging their experiences from the golf competition.


42

Christmas Dinner in Piraeus8 December 2011The Club invited members and business associates to the tra-ditional Christmas Dinner at the Yacht Club in Piraeus on 8 December last year. The dinner, like many of the previous ones, was well attended and the guests were entertained (as in previous years as well) by the “Lucia” procession consisting of the Scandinavian Church Choir and parts of the Club’s man-agement team and staff.

Traditional Christmas Dinneron Donsö 14 December 2011The Club gathered members in Gothenburg’s southern archipelago for a traditional Christmas dinner at the Isbolaget restaurant in December last year.

The Swedish Club management and male staff from the Piraeus office entertained guests with the traditional Swedish drinking song “Helan går”.

Demetri Dragazis (to the left), Latsco (London) and member of The Swedish Club Board was welcomed by Managing Director Lars Rhodin.

Among the guests were Stavroula Serbesi, Arcadia Shipmanagement, Dimitrios Antonatos, Vasco Shipmanagement and Dimitris Dalacouras, Conbulk Shipping.

Club information | Out and About

PHo

toS: Th

e Swed

ish C

lub

PHo

toS: TSC

From left: Christian Nilsson (Rederi AB Älvtank) and Daniel Backman (Sirius Rederi AB).

From left: Dick Höglund (Tärntank Rederi), Sven-Olof Kristensson (Tarn Chartering), his wife Marianne and Runa-Britt Höglund.

Managing Director Lars Rhodin greeting all guests welcome to the traditional Christmas Dinner on Donsö.


43

Club information | Staff News / Club Quiz

Staff NewsHEAD OFFICE GOTHENBuRG

Daniel Brand, Claims Executive, FD&D, resigned from the Club on 11 March 2012, after two and a half years of service. We wish him all the best in his future career.

Caroline Stenman Dencker, Assistant Marine Claims Adjuster, joined Team Gothenburg on 5 December 2011. She has a BA in Political Science from San José State University in California and an LLM from the University in Gothenburg. She has also studied Maritime Law at Oslo University.

Fritiof Granberg, Marine Claims Adjuster, retired from the Club on 1 December 2011, after nearly 34 years of dedicated service to the Club and its members. We wish him all the best for the future and a happy retirement.

Malin Högberg, Assistant Claims Executive, joined Team Gothenburg on a one-year traineeship from 1 February 2012. She has studied Maritime Law at Oslo University and holds a Deck Officer Class VII Certificate.

Magnus Johansson, Senior Claims Executive, Marine, joined Team Gothenburg on 9 January 2012. He is an engineer with an MSc in Mechanical Engineering from Chalmers University, Gothenburg and holds an MBA from the Gothenburg School of Economics and Commercial law. He previously worked for Götaverken Cityvarvet AB.

Frida Wåhlin, Assistant Claims Executive, joined Team Gothenburg on a one-year traineeship from 23 January 2012. She graduated from Chalmers Technical University with a BSc in Shipping and Logistics.

PIRAEuS

Tejpal Dhesi, FD&D Manager, has resigned from the Club’s Piraeus office after more than 12 years of dedicated service to the Club and its members. We wish her all the best in her future career.

Manos Strongilos, Technical Manager Marine Claims, joined the Club’s Piraeus office on 1 February 2012. He has a Master of Science in Marine Engineering from the University of Newcastle and previously worked as Marine Superintendent/Fleet Manager for several shipowners in Greece.

when

did the Club start to underwrite P&I risks? 1 1872 X 1900 2 1910

what is the given name of Mr Plim-

soll? 1 Samuel

X Edward 2 Line

two ships insured by the Club got trapped

in the Suez canal in 1967 re-maining in the Great Bitter Lake for eight years. What are the name of the ships?

1 Kraka and Nanny X Nippon and Killara 2 Kolsnaren and Hallaren

Mail your answer [email protected] first right answer will be awarded a Club give-away.

CLU BQU i z

Club Quiz 3-2011winner of Club Quiz in triton No 3-2011 is John Samartzis of J.P. Samartzis Maritime enterprises Company S.A. in Piraeus. the right answers to the questions are:1. 1,4062 19823. 1982


44

CLUB CALeNdArFor further upcoming events, please refer towww.swedishclub.com/Club Calendar

2012

18 April Club evening Bremen

19 April Club evening hamburg

25 April Members' Luncheon Piraeus

26 April Members' Luncheon Istanbul

7-11 May Marine Insurance Course Gothenburg

12 May GöteborgsVarvet half Marathon Gothenburg

15 May Lunch Seminar Copenhagen

13 June Board Meeting Gothenburg

14 June Annual General Meeting Gothenburg

4 October Board Meeting Athens

6 December Board Meeting London

Date post:	05-Jan-2022
Category:	Documents
Upload:	others
View:	1 times
Download:	0 times

the media in a high-profile casualty situation

Documents