THE THRESHOLD QUESTION: SHOULD A "VESSEL" BE A PREREQUISITE FOR ADMIRALTY JURISDICTION TO APPLY IN SALVAGE CLAIMS?

Author:Lair, Alexander M.
 
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TABLE OF CONTENTS I. Introduction 331 II. Origins of the Law of Salvage 333 A. Marine Ordinance of Trani 333 B. English Origins and American Law 334 III. Modern General Maritime Law of Salvage 334 A. Pure Salvage v. Contract Salvage 334 B. The Elements of Pure Salvage Claims 335 1. Elements 335 2. Applying These Elements to the Hypothetical 336 3. Property Subject to Salvage and the Origin of the "Vessel" Classification 337 4. "Maritime Nexus" and the "Vessel" Classifications 338 a. Narrowing the "Maritime Nexus" Test Results in Broader Scope of Salvageable Property 339 b. Provost v. Huber 340 IV. The International Convention On Salvage (1989) 342 A. History 342 B. Defining Property Subject to Salvage under the International Convention on Salvage 343 1. Key Differences Between General Maritime Law of Salvage and the International Convention on Salvage 344 2. How General Maritime Law of Salvage Intersects with the International Convention on Salvage 344 3. Making a Choice When Facing an Impossible Question 345 4. Transitioning into Sunglory 346 V. Sunglory Mar. Ltd. v. Phi, Inc 347 A. Factual Background 347 B. PHI, Inc.'s Argument in Support of Dismissal 347 C. Court's Ultimate Disposition 348 D. How the Ruling in Sunglory Effects Established Salvage Law Jurisprudence 349 VI. Policy Arguments For Eliminating The Vessel' Classification 349 A. Two Simple Solutions to an Overcomplicated Problem 350 VII. Conclusion 350 I. INTRODUCTION

Imagine for a second, an imaginary person who owns and operates a seven-hundred-foot cargo vessel. The vessel is loaded with automobile parts in Brazil and subsequently sets sail for the Port of New Orleans. As the vessel is within a few miles of its destination, the captain notices a helicopter in distress off the starboard bow. This helicopter had just taken off from an oil platform, where it had dropped off a new crew for their two-week hitch. Shortly after takeoff, the engine begins making strange noises, and suddenly, the aircraft plunges into a downward spiral. The helicopter's pilot comes over the radio frantically requesting that the vessel render assistance and allow him to land onboard. What course of action should the owner of the vessel take? Should they save the helicopter and her crew, or should they avoid the risk to their own vessel?

Early in the development of American salvage law, fisherman and other vessel owners in certain parts of the country customarily "render[ed] service[s] to each other without obligation on the part of the aided vessel." (1) The Star court, however, found this custom to be contrary to public policy. (2) Essentially, it determined that the tenets of a "do unto others" (3) mentality did not provide enough motivation to ship-owners to engage in salvage operations. (4) "Good Samaritan" vessel-owners simply never knew if they would be on the receiving end of such an award. (5) Therefore, The Star court's holding was consistent with public policy, which favored a monetary award-driven approach over a "Golden Rule" approach. (6) This attitude still holds true today. Benedict on Admiralty summarizes it best by stating that the award should be seen "as a reward to persons participating and the owners of salving property, voluntarily rendering their services and to encourage others to similarly undertake the saving of life and property." (7) In other words, salvors are more likely to take on salvage operation if they know a monetary award awaits them.

Now, returning to the hypothetical situation, it is safe to assume that with the ever-increasing likelihood of death and/or great bodily injury occurring as a result of a helicopter crash, most vessel-owners under similar circumstance would render assistance. Thus, the captain rallies the crew in order to safely land the helicopter on the vessel. Eventually, the vessel arrives in the Port of New Orleans; the helicopter has been saved. Later, believing that he deserves some sort of compensation for putting his vessel at risk for the benefit of another, the vessel-owner petitions the court for a salvage award. However, the court dismisses the claim because the "property" that was saved was not properly considered a "vessel" under general maritime salvage law, and, as will be discussed later in this article, the classification of the term "vessel" has become synonymous with property subject to salvage. Therefore, while the vessel-owner may have saved the lives of the helicopter crew, this does little to compensate that same vessel-owner if something were to happen to the vessel or his crew while preforming this salvage operation.

This hypothetical highlights key issues pertaining to the general law of maritime salvage: (1) Should courts expand the definition of "vessel," as pertaining to the law of salvage, to include helicopters? (2) Is the classification of "vessel" necessary as it pertains to the law of salvage?

Some of these same issues were faced by the Supreme Court in Sunglory Mar. Ltd. v. PHI, Inc., one of the most important cases in this area of maritime law. Keep in mind that, as discussed earlier, salvage operations are driven by the public policy of dispensing monetary awards in exchange for the risk undertaken by the salvor. Benedict could not have captured this concept better then when he states: "[b]asically, this principle of reward for voluntary services rendered is the backbone of the liberal modern day law of marine salvage." (8) If the courts do not eliminate the classification of "vessel", or, in the alternative, expand the scope of "Property Subject to Salvage," (9) vessel-owners who encounter similar situations to those discussed in the hypo may begin averting the risk to their vessels because there is no guarantee that, should something happen to their vessels, they will be compensated under the current general maritime laws of salvage. Thus, the whole idea of implementing a monetary-based rewards system for salvage in order to encourage greater numbers of pure salvage operations would become counter-intuitive.

  1. ORIGINS OF THE LAW OF SALVAGE

    The Law of Salvage has its roots in the ancient Mediterranean seaport cities, such as Byzantium and Rhodes. (10) During this era, the salvor of wrecked property was awarded one-fifth of the value of the item salved, and could earn up to one-third or one-half of the value, depending on the underwater depth of the property. (11) This system of salvage awards continued into the age of the Roman Empire, when its laws on salvage resembled the concept known to modern civil law scholars as "unjust enrichment," (12) or the idea that a "volunteer who preserved or improved the property of another [acquires] a right of compensation from the owner, although the services were rendered without the owner's request or even without his knowledge." (13) Essentially, because the salvor has taken all the risk to 'enrich' the property-owner by returning the property without obligation, the party whose property was salved owes compensation.

    1. Marine Ordinance of Trani

      As the Romans did not codify their maritime laws, the first written ordinance pertaining to maritime salvage law can be found in the Marine Ordinances of Trani, an ancient Italian city. (14) According to this law, a finder of salved property had three days to bring the property into court and "give a written listing of goods recovered......" (15) If thirty days passed without the owner claiming the property, then the court allowed the salvor to keep all of the property. (16) However, if the owner of the salved property appeared, then the salvor was entitled to only half of the value of the salved property. (17) The Italian ordinance did not seek to change much in terms of how the salvage issues were dealt with in past societies; rather, it simply codified the existing, unwritten law of ancient Rome and Byzantium. Although the minutia of these codes of law differed, (18) the same basic premise of salvors being entitled to compensation for the risk undertaken stayed true in the Marine Ordinance of Trani.

    2. English Origins and American Law

      After the Marine Ordinances of Trani codified its Marine Salvage Law, references to these types of laws became more prevalent worldwide. For example, The Laws of Oleron (19) provided that, "where the shipmaster promised salvors a portion of the goods saved for their efforts in saving the vessel, the courts should consider their efforts and reward them accordingly without regard to promises made at the time of distress." (20) Again, these more modern codifications of salvage law simply restate the premise of the ancients, mainly that the award is the driving force behind the law of salvage. Moving forward a few hundred years, America has, essentially, followed suit. "In the United States, the law applicable to marine salvage is the general maritime law," which "can be considered as a part of the jus gentium, customary international law." (21)

  2. MODERN GENERAL MARITIME LAW OF SALVAGE

    1. Pure Salvage v. Contract Salvage

      Before getting into the substantive materials, analysis, and argument for the expansion of the term 'vessel' as it pertains to the law of salvage, it is important to understand that there are different types of salvage law. (22) The salvage of persons differs from the salvage of property, and even within the salvage of property, there are pure salvage claims and contract salvage claims. The term "pure salvage" simply means that, "there is no preexisting agreement between the parties." (23) On the other hand, "contract salvage" involves a salvor who acts to save maritime property pursuant to an agreement between the parties. (24) Initially, most salvage operations were performed without a contract. However, "the disparity in salvage awards and the risk of 'no cure-no pay' posed to potential salvors" made these salvors realize that entering into a contract was in their best interest. (25) The "no cure-no pay" aspect of pure salvage is...

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