Handling Ffo Damage Claims
One
of
the
most
frequently
encountered
cases
are
claims
for
damage
caused
to
fixed
and
floating
objects
(FFO).
Shipowners
are
aware
that
the
extent
of
the
damage
for
fixed
and
floating
objects
claims
can
be
very
different
and
evaluate
to
several
hundred
thousand
Dollars.
Usually
fixed
and
floating
objects
claims
include
2
categories:
actual
damage
and
consequential
or
auxiliary
losses.
Sometimes
the
second
category
of
losses
might be much more than actual losses. We mostly faced with claims which consist of the following points:
• Costs of actual damage caused, such as repair costs, costs of materials, spare parts, tools, and costs of the labor force.
•
Non-received
profit
from
damaged
objects,
for
instance,
when
the
pier
is
out
of
operational
readiness
for
commercial
purposes
for
the
period of repair. • Taxes on the value of repair costs (for instance, VAT, etc.).
•
Costs
for
auxiliary
operations
(tugs,
transport,
office
and
communication
expenses,
payments
for
re-birthing,
shifting
operations
from
the
damaged
pier,
etc.).
In
FFO
claims
damage
is
caused
to
port
objects
(piers,
berths,
floating
cranes,
barges,
port
constructions
and
installations,
pilot
tug-boats,
navigational
buoys,
and
other
equipment,
etc.).
The
damage
is
determined
and
evaluated
by
the
Port
Authority
or
other
bodies.
It
is
quite
a
common
situation
when
the
amount
of
damage
caused
is
extremely
exaggerated
by
the
claimants
at
the
initial
stage
of
claim
assessment.
Meanwhile,
the
participation
of
P&I
Correspondents
on
the
initial
stage
of
the
claim
is
the
condition
of
its
successful
settlement,
reducing
and
releasing the ship in case of detention.
Case study
During
loading
operations
at
the
port
terminal,
the
vessel
crane
damaged
the
loader.
The
loading
was
stopped,
damaged
objects
were
inspected,
and
terminal
prepared
a
statement
of
claim
which
included
not
only
the
actual
loss
but
also
auxiliary
losses,
including
non-received
profit
due to the damaged loader. The vessel was detained till completion the investigation and claims settlement.
Result
Due
to
our
involvement,
the
vessel
sailed
without
delay
in
exchange
of
P&I
Correspondent
Letter
of
Guarantee.
After
the
joint
assessment
of
damage
and
mitigation
the
claim
the
sum
of
claim
was
reduced,
a
relevant
settlement
agreement
has
been
signed
between
the
terminal
administration and P&I Correspondent, and Release Letter was obtained.
P&I Correspondents recommendations:
•
The
Shipowners
should
approach
P&I
Correspondent
in
order
to
obtain
the
first
information
regarding
the
incident
and
extent
of
damage
caused by agents, crews, PSC, port administration.
• Discuss proper security to the Port Authority.
•
Appoint
a
surveyor
for
inspection
the
cause
and
damage
assessment,
repair
costs
with
the
participation
of
technician
or
experts,
if
necessary.
• Lodge Master’s Letter of Protest addressed to claimants.
•
Arrange
investigation
of
the
incident
and
collect
appropriate
evidence
for
further
claim
assessment
(weather
reports,
records
of
the
all-
weather
forecast,
navigational
charts,
radio
log,
reports/records
of
communication
with
port
state
control,
pilot
station,
agents,
other
vessels,
inspect log book and make photocopies of relevant extracts, etc.).
• Request ship sailing in exchange for proper security – Club’s LOU or P&I Correspondent’s Guarantee Letter.
•
Carry
out
inspection
of
damaged
objects
and
the
surrounding
area
in
order
to
determine
the
absence
of
pre-existing
damage
with
relevant
photos (buoys, berths, fenders, etc.). Based on these findings, request reducing the amount of claim if pre-existing damage is identified.
• Obtain the Release Letter from claimants upon claim settlement.
