London Club Stresses Value of Cohesive Claims Defense

August 3, 2004

The London P&I Club reported the successful outcome of a recent dispute in the London High Court involving one of its members is an example of the critical value of swift and detailed claims investigations conducted by shipowners and the Club working together as a team.

An allegation of cargo contamination was made against a tanker entered with the Club. The claimant traders alleged that the vessel was responsible for contamination of a fuel oil cargo by seawater remaining in the cargo tanks and lines upon loading, and by fresh water leaking through defective heating coils. Security for the claim was provided by a Club Letter of Undertaking for $1.1m.

Meantime, lawyers and experts for the tanker owner reviewed comprehensive evidence, which had been promptly collected from the vessel and concluded that allegations made by the claimants should fail. The claimants showed no interest in finding an amicable solution, so the case was tried and the judge found that the vessel was not responsible for any contamination.

In the latest issue of its StopLoss Bulletin, the Club said that, while it is keenly aware of the potential expense, risk and delay that can be involved in litigating or arbitrating P&I claims, this was a case where there was little option but to proceed to court. It added that the teamwork and co-operation between the Club and its member enabled key technical evidence to be developed to its optimum degree, so laying foundations for the positive impression made at the trial by the member’s technical manager and expert witness, the importance of which was also reflected in the judgment.

The London P&I Club, managed by A Bilbrough & Co, is a member of the International Group of P&I Clubs.

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