Federal Court of Australia|1990-10-05|Before: Spender J

Re Colin Joseph Hodson; Sub-Ocean Pty Ltd; Lisa Gaye Cooper; David George Wilson and Captain Graeme William Ring v the Owners of the Ship 'Super Sport' [1990] FCA 383; 570 Admiralty 26 FCR 157 (5 October 1990)

Re: COLIN JOSEPH HODSON; SUB-OCEAN PTY LTD; LISA GAYE COOPER;

DAVID GEORGE WILSON and CAPTAIN GRAEME WILLIAM RING

Admiralty - salvage - salvage services incomplete - whether vessel left in position of comparable danger - effect of "release agreement" between master and insurer - quantum of salvage award - apportionment.

Solicitors for the plaintiffs: Lee Turnbull and Co.

Judgment be entered for the plaintiffs in the sum of

$50,000.00, in the apportionments of $8,000 to the first

plaintiff; $25,000.00 to the second plaintiff; $5,000.00

each to the third and fourth plaintiffs; $7,000.00 to the

The defendant is to pay the plaintiffs costs in the proceedings, to be taxed if not agreed.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

This is a claim for salvage, arising out of events when Cyclone Charlie was in the vicinity of the north Queensland coast on 28-29 February 1988.

2. By a writ filed 21 August 1989 the plaintiffs claim salvage in the sum of $1.5m in respect of the salvage of the motor vessel "Super Sport". The salvage is said to have occurred on the morning of 29 February 1988. The "Super Sport" is owned by Mike Ball Watersports Pty Ltd, and is based in and operates from the Port of Townsville. It is a twin-screw, twin-hulled aluminium motor vessel of approximately 24.5 metres in length, 11 metres in beam, which on the evening of 28-29 February 1988 was on a voyage between Bowl Reef and the port of Townsville. As the name of her owner suggests, the "Super Sport" was engaged in transporting members of the public on diving expeditions. The "Super Sport" had travelled to Bowl Reef from Townsville in the early hours of 28 February with 9 passengers and 5 crew, with Mr. Michael Keough as captain.

3. Colin Joseph Hodson at all relevant times was the owner and master of the motor vessel "Hero", which is a double-screw motor vessel of 82.4 tonnes gross, 19.6 metres in length and 5 metres in beam. It is particularly suited to towing in that it develops peak torque at low revolutions. According to Mr. Hodson, vessels of that kind are specially designed for towing other vessels.

4. Sub-Ocean Pty Ltd was the demised charterer of that vessel. In British Steamship Co. v. The King (1921) 1 AC 136, Lord Shaw of Dunfermline paraphrased the observations of Bailhache. J. in Admiralty Commissioners v. Page (1918) 2 KB 447 at 452, when his Lordship said at 145:

" The legal effect of a Charter Party which is by

way of demise is that if salvage services are rendered

by a vessel under such a Charter Party and an award is

made for such services, the money when an award is made

for such services goes not to the owners but to the

charterers, who have the vessel upon time charter. "

5. Lisa Gaye Cooper and David George Wilson sue as members of the crew of the "Hero" and the fifth plaintiff, Graeme William Ring, sues "as a gratuitous volunteer crew member" of the "Hero".

6. Mr. Hodson is also a director and shareholder of Sub-Ocean Pty Ltd, which company trades as "Coral Sea Wilderness Expeditions".

7. A cyclone warning was issued at 11 a.m. on 28 February 1988 and the "Super Sport" raised anchor from Bowl Reef and departed for Townsville with passengers on board. On the journey, the "Super Sport" developed engine trouble. Eventually, after both engines had lost function, the passengers on board the "Super Sport" were taken off that vessel by the motor vessel "Reef Link II". The crew of "Super Sport" remained on board. Subsequent to the taking off of the passengers from "Super Sport" by "Reef Link II", "Hero" and her crew voluntarily left the port of Townsville to go to the assistance of the "Super Sport" and her crew. There was no prior request for assistance from Michael Keough, or from any member of the crew of "Super Sport", although Mr. Mike Ball, the managing director of the owner of the "Super Sport" says that assistance was offered by the "Hero" over the radio on several occasions, and when "Super Sport" became without power, he "accepted their help".

8. It is admitted that after a number of unsuccessful attempts, a towline was passed from "Hero" to "Super Sport" in the early morning of 29 February 1988 and "Super Sport" was then taken in tow. After towing "Super Sport" for some distance and for some time, the crew of "Super Sport" transferred to "Hero". The position where the tow was commenced, and the position at which and circumstances in which it ended are important issues in these proceedings. The "Super Sport" was left anchored, with her cabin lights on. The "Hero" with the crew of "Super Sport" continued on to Townsville. "Super Sport" was reboarded late on 29 February 1988 by her crew and others connected with her owner and she returned to the port of Townsville under her own power after repairs had been effected.

9. The plaintiffs claim that but for their action the "Super Sport" would have been lost. Her salved value was claimed to be $1.5m.

10. There is a further aspect to the salvage claim . The defendant asserts that about 9 March 1988, Coral Sea Wilderness Expeditions on behalf of the plaintiffs "or one or some of them" made a claim on Mike Ball Watersports Pty Ltd for the costs of the "Hero" to go to the aid of "Super Sport". The defendant says that by a Release Agreement at Townsville on or about 8 April 1988, Colin Hodson, on his own behalf and on behalf of the other plaintiffs agreed to accept from C.I.C. Insurance Limited, which was the insurer of the "Super Sport" under a policy of insurance for the calendar year 1988, the sum of $531.95 in full and final payment for services rendered by himself and the "Hero" in assisting "Super Sport" on the morning of 29 February 1988, and that he would have no further claims on C.I.C. Insurance Limited in connection with that activity. The payment of $531.95 was paid by the insurance company to Mr. Hodson on or about 11 April 1988. It is said that the plaintiffs are estopped and precluded from claiming from the defendant any further sum as salvage.

11. The defendant denies that but for the actions of the plaintiffs the vessel would have been lost and denies the alleged value of the "Super Sport". While it was pleaded that the fifth plaintiff was at all material times a marine pilot for the port of Townsville, performing his duties as such a pilot and was not entitled to claim salvage from the defendant, this was not pressed. The fact that the fifth plaintiff is a pilot does not debar him from an award. In The "Driade" (1959) 2 Lloyd's Rep 311, it was held that a pilot had performed services which were not ordinary pilotage and that therefore he was entitled to an award. In this case the evidence is that Captain Ring was a pilot licensed for harbour limits only and was not under any obligation to go to sea on "Hero".

12. The essence of the plaintiffs' claims is that they meritoriously preserved or contributed to preserving the "Super Sport", towing her from danger to safety and anchor in relatively small seas.

13. In the 5th Edition of Kennedy's Law of Salvage, Stevens and Sons 1985, the learned authors state in the first paragraph:

"The law of salvage applies where (i) there is a

recognised subject of salvage (ii) which has come into

a position of danger necessitating a salvage service to

preserve it from loss or damage and (iii) a person

falling within the classification of salvors

(traditionally called a volunteer) (iv) is successful

or meritoriously contributes to success in preserving

the subject from danger."

"When salvage is finally effected, those who have

meritoriously contributed to that result are entitled

to a share in the reward, although the part they took,

standing by itself, would not have produced it. The

initial requirements of this entitlement are that some

services have been rendered, that the vessel has been

salved and that the services have played some part in

the salvage. This will commonly be so where the vessel

is brought into a position of greater comparative

safety than that in which it was found, although any

service will suffice if it minimises an increase in the

danger or in some way facilitates eventual salvage."

14. Lord Phillimore in Owners of S.S. Melanie v. Owners of S.S. San Onofre (1925) AC 246 said at 262-3:

"Success is necessary for a salvage reward.

Contributions to that success, or as it is sometimes

expressed meritorious contributions to that success,

give a title to salvage reward. Services, however

meritorious, which do not contribute to the ultimate

success, do not give a title to salvage reward.

Services which rescue a vessel from one danger but end

by leaving her in a position of as great or nearly as

great danger though of another kind, are held not to

contribute to the ultimate success and do not entitle

to salvage reward.

In considering these questions wherever the

service has been meritorious, the Court has leant

towards supporting a claim for salvage, as is shown by

the cases of The Jonge Bastiaan [1804] EngR 413; (1804) 5 C Rob 322;

The E.U.1 Spinks (E. and A.), 63; and The Santipore 1

Spinks (E. and A.), 231 among other authorities.

That partial or initial service, if it can be

shown to have been a factor of or contributory to

ultimate success, is a subject of salvage reward, is

shown by a line of cases of which the decision of the

Privy Council in The Atlas Lush 518 and of Sir James

Hannen in The Camellia 9 PD 27 are good examples.

That meritorious action which does not contribute

to ultimate success must go without reward is

shown by such instances as The India 1 Wm Rob 406;

The Edward Hawkins (1862) Lush 515 (a decision of the

Privy Council); The Killeena 6 PD 193; 4 Asp MLC

472; and my own decision, if I may quote it, in The

Dart 8 Asp MLC 481, and a recent decision of Hill

J. in The Tarbert 15 Asp MLC 423. "

15. Citing this case, the learned authors in Kennedy at para. 622 observe:

"Several cases shew that, if it is proved that

the services of the alleged salvors have been

meritorious in character but there is a doubt as to

whether they have in fact contributed to the ultimate

safety of the vessel in danger, the court, looking to

the general maritime and commercial interest in

inducing men to assist life and property in danger at

sea, has leant towards the view that in fact they have

so contributed and so towards supporting a claim for

salvage."

16. The defendant's case is that on a proper view of the evidence the "Super Sport" was not in danger and that in any event there was not a successful service in that, as a result of the efforts by those on the "Hero", the "Super Sport" was left in a position of as great or nearly as great danger as her position from which the tow was undertaken. It was also said on behalf of the defendant that the Release Agreement was a bar to the claim of the first and second plaintiffs, and finally there is the question of the amount of any salvage award.

17. The account advanced on behalf of the plaintiffs, substantially through Captain Ring, conflicts in a number of important respects with that on behalf of the defendant, which was advanced principally through Mr. Keough, and it is necessary to state my view concerning those accounts.

18. According to Mr. Keough, "Super Sport" was returning to port following the renewal of the cyclone warning at 1100 hrs. on 28 February 1988. At about 1500 hrs. on that day, after travelling through seas of 8 metres and winds of 50 knots, with seas continuously breaking over the wheelhouse, the port engine stopped and was unable to be restarted because of a faulty starter motor. Air in the fuel lines had required constant bleeding. At about that time, noises were heard from the foredeck which "sounded like metal ripping open" and cracks were seen appearing in the lounge with water coming in. The "Super Sport" was only holding her own. After some hours, she began making way. The "Reef Link II" was despatched to transfer passengers and according to "Super Sport"'s log arrived at 2055 hrs. Shortly thereafter the starboard engine of "Super Sport" was lost and all attempts to restart it also failed.

19. In a statutory declaration dated 28 February 1988 and signed at Townsville on 8 March 1988, Mr. Keough stated:

"The cracks were getting bigger and the aluminium

was flexing. After 4 1/2 hours of holding into the seas

"Super Sport" started making way again at 2/3 knots.

The second engine then failed with all attempts to

restart also failing."

That declaration recites that 8 passengers and 2 female crew were transferred to the "Reef Link II" which departed for Townsville, and continued:

" 'Hero', a dive charter vessel based in

Townsville was on its way to tow 'Super Sport' home.

We began to make slow progress towards Magnetic Island."

20. According to his evidence, Mr. Keough says the location of "Super Sport" at the time of the transfer of the passengers to "Reef Link II" was three miles to the east of Orchard Rocks and six miles from Cape Cleveland. For reasons to be given later I do not accept the correctness of this location. He said that he decided not to drop anchor because he would not be able to winch in due to broken hydraulic lines. As a consequence, the "Super Sport" drifted in a north-north-easterly direction for some 10.8 miles to a position he marked on a chart which became Exhibit 26. "Super Sport" was in this position when "Hero" eventually arrived and according to Mr. Keough made five attempts to pass towing lines and was successful on the fifth attempt and took "Super Sport" in tow at approximately 0400 hrs. on 29 February 1988. According to his entry in the logbook the seas at that time were increasing, winds were 40 knots, and there was a 5 metre swell. Again according to the logbook, at about 0645 on 29 February the "Hero" developed engine trouble and the tow was discontinued. Damage was occurring to "Super Sport" as "Hero" swung astern of "Super Sport". He says that he requested the lines to be cut on several occasions and eventually the tow lines were released and the port anchor was dropped. According to the logbook he noted:

"Decision to cut tow; secure and anchor

"Supersport" 5 n.m. off Magnetic Island. 20 mtrs: 130

mtrs of Anchor chain laid out; ship secured; gen set

running. Navigation lights left on: anchor light left

on."

The crew from "Super Sport" was transferred by her rubber dingy to "Hero" and "Hero" departed for Townsville at about 0730 hrs. on that day. Mr. Keough took the log from "Super Sport" and recorded that the crew arrived at Townsville at 1030 hrs. According to Mr. Keough the position at which "Super Sport" was left anchored with its generator on and bilge pumps and lights operating was a position identified as 5 nautical miles north-north-east of Orchard Rocks on Magnetic Island. At approximately 1630 hrs. on 29 February new starter motors, batteries and spares were taken to "Super Sport" on the "Water Sport". Mr. Keough says that "Super Sport" was located where she had been left anchored earlier that morning, and on transferring the crew to "Super Sport" and effecting some repairs, the port engine was made operational and in a short time the starboard engine was also made operational. The anchor was winched in by hand and "Super Sport" made her way to Townsville, arriving in the early hours of Tuesday, 1 March 1988.

21. The account by Captain Ring is different in a number of significant respects.

22. He says that at a time which appears to be approximately 15 minutes past midnight on 28 February, "Hero" left harbour. After attempts to locate "Super Sport" at the position that had been advised as her location had proved unsuccessful, the vessel was eventually located on radar and "Hero" steamed to her. He says the sea conditions were extreme with swells of 6 metres. "Super Sport" was lying beam on to the sea, the swell and the wind, which was all coming from the same direction. Her cabin lights and navigational lights were burning, but she was without power and lying prone to the sea.

23. "Hero" was continuously taking water over the bow and, when manoeuvring, was taking it over both sides as well, with the back deck continuously awash. Three attempts were made to throw a heaving line on to the bow of "Super Sport". As "Hero" was travelling into the sea, the weight of the towing lines attached to the heaving line, which were two 50 mm. polyprop lines 100 metres long, was too heavy for the crew on "Super Sport" to heave on board. After he claimed to have heard a plea from Mr. Keough not to leave the crew of the "Super Sport" at that stage, the decision was made to turn the vessel downwind and run along side the "Super Sport" and try and maintain the same speed as the rate of drift of "Super Sport" whilst the tow line was passed so as to keep all weight off the tow line until it was able to be secured to the bows of "Super Sport". He said of this manoeuvre:

"It is extremely dangerous to have the stern of

the vessel into a sea of that state."

Notwithstanding the danger and the risk of the vessel broaching to, the attempt was successful and tow lines were secured to bollards on the bow of "Super Sport". He says that immediately the tow was connected he located the position when the tow commenced as 18 50.7 S, 147 10.2 E at 0330 hrs., having earlier identified the position when the "Hero" arrived at 0230 hrs. to connect the tow line as 18 53.25 S, 147 06.5 E. The manoeuvres to connect the towline occupied an hour. In a map which identifies these positions, he also identifies a position as 19 01.5 S, 146 57.4 E as the position where "Super Sport" at 2330 hrs. lost all power and transferred eight passengers to the "Reef Link II". This position is a considerable distance from where Mr. Keough says that transfer occurred.

24. Mr. Ring says that during the tow the inside cabin lights could be seen through the decking between holes at the bottom of "Super Sport". He says that during the tow the cyclone continued its path towards Townsville and forward motion of the tow was becoming increasingly difficult with the increasing winds. He says that there was some partial loss of power in the port engine and that the tow was dropped at 0800 hrs. at a position he identifies as 19 08.5 S, 146 55.6 E. This position is to the east of Magnetic Island and much closer to Townsville than the position identified by Mr. Keough as where the tow concluded. According to Captain Ring, in the position where the tow stopped the waves were considerably less, the sea would be considered a 2 metre chop, though the wind strength was still quite strong, coming from the south-west. He says that the crew from "Super Sport" was transferred to "Hero" by "Hero's rubber dinghy and at 0830 hrs. the "Hero" set course for Townsville.

25. Notwithstanding an initial attraction to the precision of Captain Ring's identification of various positions, on consideration that precision is quite illusory. He says that he took radar distances and bearings which he jotted down on a piece of whatever was available. He made no notations on the chart on the "Hero" nor any entry in the logbook of the "Hero". He says that he last saw those pieces of paper during the tow back in and that he made a plan which recorded the various positions the day after the "Super Sport" was recovered. He claimed:

"I have, in my seagoing profession, always kept a

logbook, every watch. It is a requirement. It is just

something that a practised mariner qualified would do;

keep as much information of any of these sorts of

events as possible."

It is curious that no primary record of the kind of which he speaks now exists. Mr. Hodson indicated that the logbook on the "Hero", which was a loose leaf book, was lost overboard at about the time these proceedings were commenced in August 1989, more than a year after the events with which they are concerned. No entry in the logbook of any time, distance or position was made by anybody on the "Hero" at any time during the relevant events. Captain Ring says, by way of example, that at the time the tow lines were secured, he made a radar distance observation of Magnetic Island and:

when he drew up the plan. On his account in the conditions he described, the "Hero" would have travelled something like 25 nautical miles in 2 hrs.10 mins. He claimed its cruising speed in good conditions was 9 1/2 knots and he said: "There is every possibility that its cruising speed would be increased in steaming with the wind." but he also conceded the possibility that its cruising speed would be decreased because of the turbulence of the water. He said in cross-examination:

"I do still consider it a possibility that the

vessel travelled that distance in that time."

26. Mr. Henry Webster, the master of the "Reef Link II" on the evening of 28-29 February 1988, said that he attempted to locate "Super Sport" to transfer passengers to his vessel, and went originally to a position given by "Super Sport" as east of the hotel at John Brewer Reef but, on travelling to that location, he was unable to locate them but he eventually found them at a position approximately 16 miles north-east of Magnetic Island in very rough seas and with about 6-8 metre swells. That position he confirmed as approximately the position shown on Exhibit 2, the plan prepared by Captain Ring. The information for that location did not have its source in any observation by Captain Ring or anyone on the "Hero".

27. Given the evidence concerning the difficulties "Super Sport" was under, and the very slow progress towards Townsville she was able to make before the second engine failed, and conscious of the absence of any logbook notation indicating any position at which the transfer to the "Reef Link II" occurred, in my opinion, that transfer occurred at the approximate position identified by Mr. Webster, which was approximately 16 miles north-east of Magnetic Island.

28. I think it quite unlikely that "Hero" travelled the distance claimed by Captain Ring in the circumstances prevailing that evening, and prefer to accept that Mr. Keough's identification of where the tow line was passed from "Hero" to "Super Sport" as the more accurate. The inherent improbability that "Hero" travelled as far and as fast in the conditions prevailing on the evening of 28/29 February as was claimed by Captain Ring is underlined by the evidence of both Mr. Robson, a marine surveyor who investigated these events, and Mr. Webster.

29. The view of Mr. Robson was that the "Hero" would have a speed in the conditions prevailing on the trip from Townsville Harbour of about 6 or 7 knots, and a speed whilst towing of not more than 3 knots. Mr. Webster's estimate is about 7 or 8 knots, and that whilst towing it would be 3 knots at best.

30. I also do not accept that the position where the tow concluded was as indicated by Captain Ring. I am satisfied that that location was approximately as indicated by Mr. Keough, being some 5 miles north-north-east of Magnetic Island and as indicated on a chart, Exhibit 9, prepared shortly after by Mr. Robson. Such location, in my opinion, is corroborated by the evidence of Mr. Kielbaska and Mr. Maxwell, both of whom were on the "Water Sport" which went out to recover the "Super Sport". Both men were in a sense small players in the drama but their evidence I found impressive. The evidence of Mr. Ball was to a similar effect. I do not accept that the "Super Sport" was left in anchor in rather shallow water to the east of Magnetic Island.

31. In my opinion, at the time the "Hero" went to the assistance of "Super Sport", "Super Sport" was in danger. At that time it had lost both engines and was beam on to the sea. Mr. Francis James, the slipway manager of North Queensland Engineers and Agents, effected repairs on the "Super Sport". Those repairs cost $94,352.25. I accept his evidence that the forward plating on the bridging structure between the two holds was missing and that both transverse deep frames and longitudinals inside were damaged. He said that one of the frames on the main watertight bulkhead had fractured and water was entering the main accommodation area and the cracks in the aluminium were such that with continued pounding the area could have broken away from the hulls. There was a series of cracks over about 3 to 4 feet in the aluminium framing. He said there was no great damage inside the cabin area from salt water intrusion, but the extent of the risk to the vessel depended on how much more pounding the vessel may have sustained. Having regard to the evidence concerning the afterdeck of "Super Sport", I do not accept the evidence of Mr. Eldon-Roberts that the vessel with the afterdeck awash would have been momentarily unstable. In particular the evidence does not permit acceptance of the premise on which his rather broadbrush conclusions were based.

32. Mr. Geoffrey Glanville, a naval architect of impressive qualifications, did not examine the vessel itself but he saw drawings of "Super Sport" and examined the photographs of damage and heard Mr. James's evidence. He said that serious structural damage had occurred, and that there was no reason to believe that the damage that was sustained in that area of the hull would not have continued further aft. His view was that the watertight integrity of the vessel would have been at risk, and certainly there was no guarantee that it would survive a cyclone in that condition. He was of the opinion that there was a major reduction in the capacity of the beam for carrying the transverse loadings on the structure, but he did not believe that the vessel would have had a major structural failure from the point of view of the vessel breaking in two, at least not for a long period of time. If the vessel started taking water on both sides of the bulkhead, it would be in serious trouble. He did not accept the suggestion by Mr. J. S. Douglas QC for the defendant that the risk of that was "really quite small".

33. During that evening a vessel, the S.S. River Embley, was positioned 19 miles from Cape Cleveland at a bearing of 240 degrees. On that vessel, which was of some 80,000 tonnes, the Chief Officer, C.P. Stockings indicated that the wind steadily increased from force 8 on the Beaufort scale, which is gale force, to force 12 south-south-west, which is the highest notation on the Beaufort wind scale, reaching a peak shortly before 0700 on the morning of 29 February with an anemometer reading reaching a relative speed of 78 knots. At this time there was continuous rain and a very rough beam sea with moderate swell.

34. On that same evening, Captain Holmes, a Torres Strait pilot was on the vessel "Tomoe 325" anchored behind Great Palm Island. He testifies that in the course of that evening the wind increased to a maximum 70 knots and by 1000 hrs. the following morning had decreased to 30-40 knots. His position was 30 miles from Magnetic Island.

35. My conclusion that the "Super Sport" was in danger at the time "Hero" arrived to render assistance is also very strongly fortified by the evidence of Mr. Arthur Futcher, a retired Lieutenant-Commander of the Royal Navy who, after his retirement, was the operator of a diving company for five years and then Marine Superintendent of the Institute of Marine Science in Australia. Mr. Futcher has studied cyclones since 1976. He plotted the track of Cyclone Charlie over time from the information of its position as broadcast. There is a high degree of correlation between that plot and the path of the cyclone as revealed by an analysis of satellite photographic information by Mr. Ross Keith the officer in charge of the Townsville Meteorological Office. Mr. Futcher adopted a number of different assumptions as to the velocity of drift and the angle of indraught that might have applied to the "Super Sport" were it not taken under tow. His initial position for "Super Sport" is based on that identified by Captain Ring, which I do not accept was the position at which the tow commenced, which has the effect of qualifying the direct application of Mr. Futcher's labours. However, the effect of his evidence on the various postulated premises, applied to the position adopted in his last scenario which, in my view, adopts a position reasonably close to where the tow did in fact commence, leads me to conclude that unanchored and without assistance there was a real possibility that "Super Sport" would have been driven ashore somewhere between Bowling Green Point and Abbot Point.

36. My conclusion is that at the time "Hero" came upon "Super Sport", she was in real danger, a danger unlikely to be avoided by attempts to anchor in the position at which the tow commenced or further out to sea from that position. In my view, the possibility of securing the vessel by dropping the anchor was remote. It seems to me that that conclusion was implicitly accepted by Mr. Keough when he expressed the view that at the time when the tow was being attempted:

" I believe I had a chance of anchoring and holding."

37. As to whether there was a successful service rendered by the "Hero" and its crew, I have no doubt that the efforts by the plaintiffs were meritorious. On any view of the evidence, the sea conditions were very bad. The last unsuccessful attempt to transfer the tow lines was described by Mr. Keough as:

" ...a pretty dangerous one....I nearly came down

on the back of 'Hero'. "

and the attempt to transfer the two lines that was ultimately successful, being downwind with a dangerous following sea, called for courage and skill of a high order.

38. The question then is whether the service was successful or whether it had the effect merely of transferring the "Super Sport" from one position of danger to another position of comparable danger.

39. I have earlier expressed my finding that if "Super Sport" had not been taken in tow by "Hero" there was a real risk that it would have been driven ashore. I am also of the opinion that the position where "Super Sport" was towed was a position of greater safety than the position from which it was towed.

40. Mr. Futcher expressed the view that if the "Super Sport" was anchored in the position indicated by Mr. Keough, the position of the cyclone (which was stationary from 6 a.m. to 9 a.m.) would be south of east of that anchorage position, which would put the "Super Sport" in the lee of Magnetic Island. I accept his assessment that the two positions, being the position where Mr. Keough said the tow started, (but which I believe was somewhat further out and also more unsafe), and the position where Mr. Keough said the ship was anchored, (which I do accept), were not "much the same" or "comparable". Such a suggestion, Mr. Futcher said, would be "completely wrong", because "the wind speed would be much greater, the fetch is much, much greater, and the sea would build up to be much higher." In addition to this evidence, "Super Sport" was able to be anchored successfully where the tow concluded, and did in fact ride out the day.

41. In my opinion the tow was terminated for a combination of a number of reasons. First, I accept that "Hero" had lost engine power. She had swung astern of "Super Sport" causing pressure to the super-structure of that vessel from the tow ropes. Further, the radio information of the progress of the cyclone indicated that it was only some 30 mins. from hitting Townsville. For a combination of these reasons, Mr. Keough requested a number of times for the towline to be cut, and eventually the lines were released, "Super Sport" anchored by the port anchor, and the crew transferred to "Hero". The evidence points to the conclusion that the port anchor on "Super Sport" was some 160 metres in length and was sufficient to permit the vessel to ride out the cyclone without suffering further damage.

42. As to the Release Agreement, it was conceded that the crew members are not bound by a master entering into an agreement after services have been performed. In The "Inchmaree" (1899) P 111, Phillimore J. held that the crew are not bound by an agreement made by a master after services have been performed in respect of which a right to salvage reward has arisen.

43. Mr. George Robson is employed by the insurers of the "Super Sport" in respect of the damage it suffered during this time. He says that on the instruction of the insurers he went to see Mr. Hodson and told him that he was acting on behalf of the particular underwriters and "they are requesting an amount of moneys that was expended in mobilising 'Hero' and the crew - fuel to undertake that voyage to 'Super Sport' and back. " Mr. Robson recounts that Mr. Hodson said he felt his only claim would be for fuel costs and "he gave me a figure which I then passed on to the underwriters". Mr. Robson remembers seeing an invoice addressed to Mike Ball Watersports from Coral Sea Wilderness Expeditions dated 9 March 1988 which speaks of "costs to M.V. 'Hero' to go to aid of M.V. 'Super Sport'" and then lists:

" 2 Portholes/Glass 39.00

1 pr Door hinges 15.85

1 1150 Bundaberg Rum (full) broken

in bar 27.10

Fuel. 900 litres ' .50/litre 450.00

_______

$531.95 "

_______

44. Mr. Robson says he passed this invoice down to the insurers in Brisbane.

45. Mr. Robson's recollection was faulty in some respects in relation to these matters. It appears that he procured Mr. Hodson to execute a document headed "Release Agreement" in these terms:

"I, COLIN HODSON, OF 4/141 INGHAM ROAD, WEST END,

TOWNSVILLE, QUEENSLAND HEREBY AGREE TO ACCEPT FROM CIC

INSURANCE LIMDITED THE SUM OF $531.95 (FIVE THIRTY ONE AND

95c) IN FULL AND FINAL PAYMENT FOR SERVICES RENDERED BY

MYSELF AND MY VESSEL 'HERO' IN ASSISTING THE VESSEL

'SUPERSPORT' DURING HEAVY WEATHER ON 29 FEBRUARY 1988.

INSURANCE LIMITED IN CONNECTION WITH THE FOREGOING MATTER."

I ALSO AGREE THAT I WILL HAVE NO FURTHER CLAIMS ON CIC

INSURANCE LIMITED IN CONNECTION WITH THE FOREGOING MATTER."

This release is dated 8 April 1988 and a cheque made payable to Colin Hodson or bearer drawn by C.I.C. Insurance Limited dated 11 April 1988 was later paid into the bank account of Sub-Ocean Pty Ltd.

46. In my opinion, any such release cannot bind Sub-Ocean Pty Ltd. The release agreement speaks of an acceptance by Colin Hodson for respective services rendered by "myself and my vessel, 'Hero'". It does not expressly or by implication purport to be an acceptance by Colin Hodson on behalf of Sub-Ocean Pty Ltd. As to whether it bars Mr. Hodson, in my opinion, the release does not preclude a claim for salvage by him.

47. The learned authors in Kennedy at para. 685 and following address agreements excluding salvage. Lord Stowell in The Waterloo [1820] EngR 473; (1820) 2 Dods 433, at 435-436 said:

"It is what the law calls jus liquidissimum, the

clearest general right that they who have saved lives

and property at sea should be rewarded for such

salutary exertions; and those who say that they are not

bound to reward, ought to prove their exemption in very

definite terms, and by arguments of irresistible

cogency."

And in Clan Steam Trawling Co. Limited v. Aberdeen Steam Trawling and Fishing Co. Ltd., The Clan Grant (1908) SC 651, Lord Salvesen said:

"...I think it must be clear, from the agreement,

that the rendering of assistance to a vessel in

distress shall not found a claim for remuneration. The

right to obtain salvage remuneration is one very much

favoured in law, and therefore cannot be excluded

unless by express words or by very clear implication

from the language used."

48. In Fisher v. The "Oceanic Grandeur" [1972] HCA 51; (1972) 127 CLR 312, Stephen J. in delivering judgment of the High Court said at 334:

" ...what is said to be the agreement contains

nothing in express terms excluding a claim for salvage

reward let alone purporting to bind the master and crew

of the Leslie J. Thompson to such an exclusion. I see

no ground upon which it would be proper to imply into

the arrangement such a term as would exclude an

otherwise justifiable claim for salvage reward by them."

49. The release in the present case does not exclude a salvage reward in express terms and, in my opinion, does not do so by necessary implication. In the context in which it was obtained, the release is directed at claims for costs of the trip; so much follows from the identity of the amount for the release and the total of the items in the invoice raised at the invitation of Mr. Robson on behalf of the insurers of "Super Sport". In my opinion, the words "accept...full and final payment for services rendered by myself and my vessel in assisting the vessel 'Supersport'" do not plainly extend to a claim for salvage, and Mr. Hodson's agreement that "I will have no further claims on CIC Insurance Limited in connection with the foregoing matter", does not preclude Mr. Hodson from bringing a claim for salvage reward against the defendant.

50. Finally it is necessary to consider the quantum of the award and its apportionment.

51. The authorities recognise the difficulty of assessing the amount of an award for salvage. In Burley v. The Ship "Texaco Southampton" (1981) 2 NSWLR 238 (which in result was overturned on appeal: (1982) 2 NSWLR 336), Yeldham J. said at 247:

"Reference to amounts awarded in other cases must

be treated with considerable caution, having regard to

the difference between the circumstances of each act of

salvage and to alterations in the value of money, but

nonetheless I have gained some assistance from a

consideration of the cases discussed in The 'National

Defender' (1970) 1 Ll LR 40, and especially from the

judgment of Sheppard J. in this Court in Delosa v.

Clippers Anchorage Pty Ltd (Sheppard J, 6th November,

1978, unreported) where his Honour annexed to his

judgment a schedule of a number of salvage awards made

in Australia. I have re-read also the judgment of

Macfarlan J in Societe Maritime Caledonienne v. The

Ship Cythera and her Cargo (1965) NSWR 146, where the

general principles are discussed, and the judgment of

Taylor J in The 'Tudor' (1968) 1 Ll LR 500."

52. In Delosa v. Clippers Anchorage Pty Ltd, referred to by Yeldham J., Sheppard J. said at p 6 of that unreported judgment:

"Much has been written both in England and

Australia about the discretion which the judge has in

determining an award of salvage. It is not an easy

task and it is made more difficult in this country

because the action is not a common one and one does not

have, as one does have in other areas of the law,

guidelines in relation to what may be described as

current awards in respect of such claims."

Sheppard J. then referred to "a most useful exercise" performed by counsel for the defendant, who had digested from each of the cases reported in Australia where salvage awards had been made short information of the nature of the case, the value of the vessel and the amount awarded, which his Honour appended as a schedule to his judgment. Without repeating the schedule, the thirteen reported cases referred to were:

The Wotonga (1881) 2 NSWR Ad 5.

The Northampton (1882) 4 NSWR Ad 1.

The City of Brisbane (1884) 5 NSWR (P and D) 21.

Fenwick v. The "Glencairn" (1899) 15 WN

(NSW) 166.

North Coast S.N. Co. v. The Ship Eugene (1909) 9

SR (NSW) 246.

Brown v. The Ship "Darnholme" (1923) 23 SR

(NSW) 195.

Brown v. The Ship "Honolulu Maru" (1924) 24 SR

(NSW) 309.

The Korowa" [1948] SAStRp 44; (1949) SASR 45.

The "Walumba" (1964) 2 Lloyds Rep 382 - Supreme

Court of Victoria.

Societe Maritime Caledonienne v. The Cythera

(1965) NSWR 146.

The Tudor" (1968) 1 Lloyds Rep 500 - High Court

of Australia

The Loretta v. Bubb (1971) WAR 91.

The Oceanic Grandeur [1972] HCA 51; 127 CLR 312 (1972)

To this list may be added The Kirsty Mae v. The Santa Rita, unreported at first instance, but reported on appeal at (1984) WAR 95. In that case, Smith J. had awarded $7,000.00 as salvage reward but the appeal was successful because the trial judge had taken into account in the value of the salved property the value of a licence issued in respect of that vessel pursuant to the Fisheries Act. As a consequence the salved value placed by the trial judge was very much more than its relevant value. The matter was remitted for assessment on the basis that the salved property was not $130,000.00 but $35,000.00.

53. In Delosa v. Clippers Anchorage Pty Ltd (supra) his Honour, of course, took into account the very great fall in the value of money in the period which the cases span but, as he rightly observed at p 7:

"...the difficulty which this poses can be

overcome by comparing the amount awarded with the value

of the vessel salved in each case."

He made it clear that the value of the vessel salved is only one circumstance to be taken into account, referring to the speech of the Privy Council in "The Am rique" LR 6 PC 468 at 475, where Lord Colvile on behalf of the Board said:

"This rule seems to be that though the value of

the property salved is to be considered in the estimate

of the remuneration, it must not be allowed to raise

the quantum to an amount altogether out of proportion

to the services actually rendered. And this is

consistent with what is said by Lord Stowell in The

Blenden Hall, 1 Dodson, 421: 'In fixing a proportion of

the value the Court is in the habit of giving a smaller

proportion where the property is large, and a higher

proportion where the value is small, and for this

obvious reason, that in property of small value a small

proportion would not hold out a sufficient

consideration; whereas in cases of considerable value a

smaller proportion would afford no inadequate

compensation.'"

54. As Kennedy points out at para. 1115, the "many and diverse ingredients of a salvage service" include:

(1) The degree of danger, if any, to human

life.

(2) The degree of danger to the property.

(3) The value of the property as salved.

B. As regards the salvors:

(1) The degree of danger, if any, to human

life.

(2) The salvors' (a) classification, (b) skill

and (c) conduct.

(3) The degree of danger, if any, to property

employed in the salvage service and its value.

(4) The (a) time occupied and (b) work done in

the performance of the salvage service.

(5) Responsibilities incurred in the

performance of the salvage service, such e.g. as risk

to the insurance, and liability to passengers or

freighters through deviation or delay.

(6) Loss or expense incurred in the performance

of the salvage service, such, e.g. as detention, loss

of profitable trade, repair of damage caused to ship,

boats, or gear, fuel consumed, etc. "

55. The evidence of Mr. Robson as to value of the vessels is not in dispute. He valued the "Super Sport" undamaged at between $1.2m and $1.5m. The repairs were of the order of $100,000.00, but he valued the vessel in its damaged state at approximately $1m. It is this last figure, rather than the undamaged value less the cost of repairs, which is the value to which regard should be had.

57. I have earlier expressed the view that there was a real risk that the "Super Sport" might be lost, but such loss was by no means certain. I think there was also some risk to those on board "Super Sport" as well as those on board "Hero" in these events. The manoeuvring of "Hero" to permit tow lines to be placed involved a significant degree of danger to both life and property and called for skill and courage. The task of bringing the "Super Sport" to the wharf was incomplete, the attempt to tow "Super Sport" into Townsville having to be abandoned because of the combination of loss of engine power in the "Hero" and damage being caused by the tow ropes to the superstructure of "Super Sport", as well as the imminence of the arrival of the cyclone at Townsville. However, the efforts of "Hero" and her crew contributed to preserving "Super Sport", in that those efforts permitted "Super Sport" to secure an anchorage in a position safer than that from which she had been towed and where the possibility of securing an anchorage was very small. On the other hand, the length of time involved by the "Hero" in actually towing the "Super Sport" was only of the order of three hours and, apart from the skills to take the vessel in tow, there were no further skills involved such as having to take cargo off the vessel or repair her. The expenses of the "Hero" have been paid. A claim for repainting of "Hero" is wholly without merit.

58. In all the circumstances, an appropriate award is the sum of $50,000.00 which I apportion $25,000.00 to the second plaintiff, Sub-Ocean Pty Ltd; $8,000.00 to her master, the first plaintiff; $7,000.00 to the fifth plaintiff; and $5,000.00 each to the third and fourth plaintiffs. I direct that judgment be entered for each of the plaintiffs in those respective amounts. I will hear the parties on costs.

Re Colin Joseph Hodson; Sub-Ocean Pty Ltd; Lisa Gaye Cooper; David George Wilson and Captain Graeme William Ring v the Owners of the Ship 'Super Sport' [1990] FCA 383; 570 Admiralty 26 FCR 157

At a glance

Court

Decision date

Before

Source

Judgment (107 paragraphs)

Re Colin Joseph Hodson; Sub-Ocean Pty Ltd; Lisa Gaye Cooper; David George Wilson and Captain Graeme William Ring v the Owners of the Ship 'Super Sport' [1990] FCA 383; 570 Admiralty 26 FCR 157 (5 October 1990)

Parties

Cases Cited (3)