Lloyd's Maritime and Commercial Law Quarterly
THE LLOYD’S OPEN FORM AND CONTRACTUAL REMEDIES
By N. J. J. Gaskell.*
1. The nature of a salvage contract
The circumstances which give rise to a salvage award are so well settled in most countries that there is little need to give much thought to the juridical basis for that remuneration. The standard textbooks in the common law countries make reference to the Roman law origins of salvage, but it is not usually necessary in practice to become involved in technical theories. There still seems to be some disagreement in Continental writings about whether salvage is based on the concept of negotiorum gestio, or on some form of agreement or quasi-agreement. However, confusion sometimes occurs when the phrase “salvage agreement” is used, for it is often not made clear exactly what sort of relationship there is between the concepts of “salvage” and “contract”.
Kennedy stated somewhat generally that: “While the nature of the service or, in rare cases, the amount of its reward may be fixed by agreement, the right of the salvor is, essentially, independent of contract”.1
Brice is more precise: “Most salvage services are in practice rendered pursuant to an informal or formal salvage agreement or contract; but the existence of an agreement or contract is not, and never has been a prerequisite to the right to recover salvage if salvage services have in fact been performed without an agreement or contract”.2 Because it has never usually been necessary to assert a contract in order to obtain a salvage reward there has been comparatively little discussion of when (or if) an agreement to salve does result in a contract. Discussion of salvage agreements (particularly by non-lawyers) sometimes fails to make clear if an ordinary contract (with all the legal consequences) is being asserted.
There is an impression among some that an agreement such as the Lloyd’s Standard Form of Salvage Agreement (L.O.F.3) is a somewhat mystical document, perhaps coloured by the hazy images of the sea. It is perhaps surprising that there was not more theoretical discussion about the nature of salvage in England in the days when the law was practised and administered by those trained in the civil law (such as Dr Lushington). That the common lawyers, with their empirical training, would be less interested in theory is not so surprising. It was enough for them to know that, in
* Institute of Maritime Law, University of Southampton. I am grateful to my colleague Professor John Wilson for his comments on an early draft of this article, which is based on a paper presented to the Lloyd’s of London Press Seminar on Salvage in November 1984.
1 Kennedy’s Civil Salvage (4th edn., 1958), p. 9. The intention of the passage was to show that the salvor could obtain remuneration in the absence of contract, not that the service was in no sense based on agreement. See now Kennedy’s Law of Salvage, (5th edn., 1985) by D. W. Steel and F. D. Rose, pp. 14–16. The new edition became available at a late stage in the production of this article.
2 G. Brice, Maritime Law of Salvage (1983), pp. 5–6. See also the opinion of S. Braekhus in “Competing Salvors” [1967] Scandinavian Studies in Law 63, 112 which is cited in 9 (iii), “Compensation”, infra.
3 The common abbreviation for the “Lloyd’s Open Form” is a reference to the fact that the amount of salvage reward is left “open” for the arbitrator to decide.
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