German shipping line Hapag-Lloyd has declared General Average on the Yantian Express containership.
General Average is a principle of maritime law under which all parties who are involved in a voyage proportionally share the losses resulting from the voluntary sacrifice of the ship or cargo to save the whole. When General Average is declared, not only are ocean carriers not liable for loss of or damage to cargo, but every cargo owner on the voyage is responsible for the cargo of others and for the ship itself.
Hapag-Lloyd has appointed UK-based Richards Hogg Lindley as the General Average and Salvage Adjuster. Richards Hogg Lindley will be responsible for coordinating the collection of securities and required documentation from each of the parties concerned in the cargo onboard. Hapag-Lloyd has requested that cargo interests (or their insurance companies) contact Richards Hogg Lindley directly in regards to all matters pertaining to the General Average.
In a customer advisory, Hapag-Lloyd asked “that all U.S. consignees and brokers retract their U.S. customs entries, if previously made for the MV Yantian Express on the intended port calls. This should be performed as soon as possible, however no later than January 28, 2019… As Hapag-Lloyd, we intend to remove the manifest for this vessel from the USCBP/ACE files on January 29, 2019. Any subsequent customs handling instructions will be provided once more details are available.”
Further details of the general average process will be provided in the customer information section of Hapag-Lloyd’s website, located at www.hapag-lloyd.com.
Shippers Should Brace for Costly Repatriation of Salvageable Cargo
Shippers with salvageable cargo should be prepared to incur substantial costs and should expect significant delays in obtaining their containers, as cargo cannot be released until all cargo owners contribute to the General Average fund – and it could be many weeks before Richards Hogg Lindley is able to set the required security amount.
Shippers may also be required to pay the cost of the relay of their containers to their bill of lading destination, although no announcement has yet been made.
Shippers who did not take out a marine cargo insurance policy and who are unable to provide adjusters with the acceptable security could find their cargo auctioned off to recover the residual value of the cargo or be sued for costs and consequences. One marine cargo insurer has suggested that only about half of the shippers had purchased marine cargo insurance. This should serve as a reminder to shippers of the importance of obtaining marine cargo insurance.
About the Yantian Express
On January 3, 2019, a fire broke out in a container on the deck of the Yantian Express as she made her way from Sri Lanka to Nova Scotia and quickly spread to additional containers. Heavy weather hampered the firefighting efforts of the crew, who were forced to abandon ship the following day. Ocean-tugs spent the subsequent weeks trying to bring the fire under control. No injuries to the crew were reported, and the cause of the fire has yet to be determined. Industry experts anticipate hundreds of shipping containers have either been destroyed or damaged as a result of the fire and efforts to extinguish the fire.
The Yantian Express is currently headed to the Bahamas, where recovery and damage assessment efforts will be resumed. The vessel is expected to arrive in Freeport Harbor the middle of this week.
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Sources:
- Hapag-Lloyd
- World Maritime News, Hapag-Lloyd Declares General Average on Yantian Express, January 29, 2019
- CBC News, Canada, Likely hundreds of cargo containers damaged by fire aboard Halifax-bound ship, January 14, 2019
- The Loadstar, Shippers brace for costly repatriation of salvageable Yantian Express cargo, January 29, 2019
