The Owners, Charterer, Master & Crew of the Ship Margaret Phillipa v The Ship, M.V. Santo Rocco Di Bagnara

Re: THE OWNERS, CHARTERER, MASTER AND CREW OF THE SHIP "MARGARET PHILIPPA"
And: THE SHIP, M.V. "SANTO ROCCO DI BAGNARA"
No. V G407 of 1989
FED No. 250
Shipping and Navigation
101 ALR 491

COURT

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY
IN ADMIRALTY
Ryan J.(1)

CATCHWORDS

Shipping and Navigation - Salvage - Voluntary nature of services - Effect of alleged custom and usage in fishing industry - Obligation imposed by contract of insurance to render assistance to vessels entered in the same company - Effect on respective rights of owners and charterers and of master and crew to salvage reward - Considerations relevant to assessment of reward.

The "Charlotte" (1848) 3 Wm Rob 68

The "Troilus" (1950) p 92

Fisher v The "Oceanic Grandeur" (1972) 127 CLR 312

The Ship "Texaco Southampton" v Burley (1982) 2 NSWLR 336

The "Waterloo" (1820) 2 Dods 433

The Clan Steam Trawling Co. Limited v Aberdeen Steam Trawling and Fishing Co. Limited (1908) SC 651

The "Sappho" (1870) LR 3 A and E 142

The Ship "Korowa" v The Ship "Kooraka" (1949) SASR 45

Societe Maritime Caledonienne v The "Cythera" (1965) NSWR 146

The "Kristy Mae" v The "Santa Rita" (1984) WAR 95

The "Loretta" v Bubb (1971) WAR 91

The "City of Chester" (1884) 9 PD 182

HEARING

MELBOURNE

#DATE 9:5:1991

Counsel for Plaintiffs: Mr T.D. Wood

Solicitors for Plaintiffs: Messrs Doyle Considine

Counsel for Defendant: Mr P. Willee

Solicitors for Defendant: Phillips Fox

ORDER

That there be judgment for the master and crew of the Margaret Philippa in the sum of $32,000.

That liberty be reserved to the master or any member of the crew of the Margaret Philippa to apply for an order apportioning the said sum of $32,000 between the persons entitled thereto.

That the question of costs be reserved for argument before Ryan J on a date to be fixed.

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

JUDGE1

This is an action by the owners, master and crew of the ship, Margaret Philippa for salvage services rendered by them to the motor vessel Santo Rocco di Bagnara ("the Santo Rocco"). The essential facts are not seriously in dispute although there have been differences in degree, detail or emphasis in the testimony of those witnesses who participated in the events giving rise to the claim or who had knowledge of the relevant circumstances.

At about 1630 hours on 8 September 1989, the Santo Rocco, a trawler of 156 tonnes and about 29 metres in length, was fishing approximately 27 miles south-southwest of Sandy Cape on the north-west coast of Tasmania when her variable pitch propeller control shaft sheared and the propeller pitch changed from forward to full speed astern causing the main engine to stall. The master of the Santo Rocco, Mr Murray Stevenson, then contacted by radio telephone Mr Paul Jobe, the master of the Margaret Philippa, who was previously known to him. The Margaret Philippa at that time had finished fishing and was stowing her net preparatory to returning to her home port of Geelong.
At the time of Mr Stevenson's call, the Margaret Philippa was roughly due west of Sandy Cape and about 15 miles north of the Santo Rocco. Mr Stevenson told Mr Jobe that he had a problem with his shaft and requested him to stand by. After his crew had investigated the condition of the Santo Rocco as far as they could, Mr Stevenson concluded that she was disabled and nothing could be done about it as she lay. Accordingly, Mr Stevenson spoke again to Mr Jobe, told him in more detail what was wrong with the Santo Rocco, including the fact that water had been found in a compartment in the forward section, and said that she would need a tow. Early in the course of his radio telephone conversations with Mr Jobe, Mr Stevenson gave the position of the Santo Rocco as 41 degrees 50 minutes south, 144 degrees 26 minutes east.
As requested, the Margaret Philippa proceeded south and after about one and a half hours came within view of the Santo Rocco. Whether the Santo Rocco had by then drifted appreciably away from the position where she became disabled, and in what direction, is a matter which has been the subject of some dispute. However, Mr Stevenson was inclined to think that his vessel had drifted for two or three miles in a generally southerly direction.
Mr Jobe spent some time making an appreciation of the situation and continued his discussions by radio telephone with Mr Stevenson about techniques for establishing the tow. There has been conflicting evidence about the positions of the vessels in relation to each other when attempts were made to pass a line from one to the other. However, it is clear that after two or three unsuccessful attempts to heave a line from the Margaret Philippa to the Santo Rocco, the Margaret Philippa reversed towards the bow of the Santo Rocco and a twine line with a heavy shackle attached to it was thrown from the Santo Rocco to the Margaret Philippa. In the course of these manoeuvres, the Margaret Philippa came as close as 20 feet to the Santo Rocco. There are some discrepancies in the evidence about the weather conditions at the time when the tow commenced. Mr Jobe estimated that there was a wind of 35 knots from the north-west gusting up to 40 knots and that a swell was running at a height of about 40 feet. Mr Stevenson, on the other hand, suggested a wind speed of around 30 knots and a swell of about 20 feet high, but accepted that later on the night of 8 September the swell had increased to 30-40 feet and the wind speed had built up to 45 knots at times.
By the time when the line was passed from the Santo Rocco, it had become dark and the operation was illuminated by the deck lights of both vessels. After the first, twine, line had been passed it was attached to a heavier rope which in turn was attached to the steel fishing warps of the Margaret Philippa which were passed back to the Santo Rocco. The ends of the fishing warps were secured to two automotive tires in the belief that the presence in the line of the tires would absorb some of the shock imparted by the tow. The line was completed by shackling the Santo Rocco's anchor chain to the tires. The tow then commenced, but almost immediately the brake on the capstan winch, around which the Santo Rocco's anchor chain was wound, failed to hold, and the hydraulic motor which drove the winch was destroyed. A chain was then fixed by means of a hammer lock to a cleat on the bow of the Santo Rocco and the tow proceeded.
After the two vessels had been under way for a relatively short time, the two tires were torn in half by the strain of the tow. Because her capstan winch was disabled, the Santo Rocco used her fishing warp drum winch to pull her anchor chain back on board. A heaving line was again passed to the Margaret Philippa and the tow was re-established by effecting a direct link on this occasion between the steel warp from the Margaret Philippa and the anchor chain of the Santo Rocco. Although the wind had freshened and the sea had become higher, Mr Stevenson considered that the second tow was established more easily because of the experience gained in the earlier manoeuvres.
After the tow line had been re-established, Mr Stevenson spoke by radio telephone to Mr Rocco Musumeci, one of the owners of the Santo Rocco. However, a decision on the destination to which the Santo Rocco should be towed was deferred until the morning of the following day, Saturday, 9 September, when instructions were given that she was to be towed to Geelong. That arrangement was confirmed, also on Saturday morning, at Mr Jobe's request, in a telephone conversation between Mr Musumeci and Mr Nicholls, one of the owners of the Margaret Philippa.
The two vessels then continued on a generally northerly course until they reached the vicinity of the Black Pyramid Rock which is roughly equidistant from the north-western tip of the Tasmanian coast and the southernmost point of King Island. In that area, the tow line became fouled on the sea bed. Either immediately or shortly thereafter, the Santo Rocco's anchor chain broke as a result of friction at the point where it emerged from the bottom of the hawser pipe. The tow was again re-established, this time in more moderate conditions prevailing in the lee of King Island, by passing lines as before, letting out more of the Santo Rocco's anchor chain and connecting the Margaret Philippa's steel warp to it. With the further experience thus gained, a close watch was subsequently kept on the condition of the anchor chain which was taken in from time to time to avoid undue wear from friction at any particular point.
The two vessels then proceeded without any further notable incident across Bass Strait and passed, in slack water on the first of the flood tide, through the Heads of Port Phillip Bay at about 2120 hours on the evening of Sunday, 10 September. The tow then proceeded uneventfully up the western channel and the two vessels came alongside at Corio Quay, Geelong, early on the morning of 11 September.
As a result of towing the Santo Rocco, the Margaret Philippa lost 168 boxes of fish having an agreed value of $20,428.80, being part of the catch she had on board on the evening of 8 September. She also lost two days' fishing, the value of which is agreed to be $19,010. As well, the amount necessary to reimburse her for damaged warp, rope and a shackle, telephone calls, extra fuel and sundry expenses has been agreed in the sum of $25,255.75. Thus the total agreed losses and expenses incurred by the Margaret Philippa by reason of having towed the Santo Rocco amount to $45,684.55.
Mr Willee for the defendant contended that all that had been concluded on the evening of 8 September 1989 was an agreement for towage, an implied term of which was that the Margaret Philippa should receive a reasonable fee or price for the provision of towing services to the Santo Rocco.
I am satisfied that in the disabled condition in which she was on that evening, having regard to the location and the state of the sea and the weather, the services rendered to the Santo Rocco by the Margaret Philippa were, prima facie, services of salvage. In coming to this conclusion, I have applied the principles enunciated by Dr Lushington in The "Charlotte" (1848) 3 Wm Rob 68 at 71, and by Bucknill L.J. in The "Troilus" (1950) P 92 at 102-103 as approved by Stephen J. in Fisher v The "Oceanic Grandeur" (1972) 127 CLR 312 at 323-327. I am also satisfied on the evidence that no specific contract for the Margaret Philippa to provide towing services was concluded at or about the time when the tow commenced, and that the services rendered by the master and crew of the Margaret Philippa lay outside the scope of their contracts of employment to serve the owners of a fishing vessel. Accordingly, subject to what appears below, the towing services rendered by the Margaret Philippa and her crew were voluntary and not contractual according to the distinction enunciated by the New South Wales Court of Appeal in The Ship "Texaco Southampton" v Burley (1982) 2 NSWLR 336.
Mr Willee next contended that it was an implied term of the agreement concluded between the masters of the two vessels that the Margaret Philippa would provide the services requested of her for no other reward than an amount necessary to compensate her for the actual loss and expense incurred in providing those services. That term was said to be implied by the existence of a custom or usage amongst Australian fishing vessels. The existence of such custom or usage must be proved by clear and convincing evidence of consistent adherence to the alleged custom in the relevant circumstances. See e.g. The "Waterloo" (1820) 2 Dods 433 at 436. The evidence which is relied on in the present case is not of that character, and I am not satisfied of the existence of a custom or usage to the effect alleged between fishing vessels in the relation which the Margaret Philippa and the Santo Rocco had to each other off the west coast of Tasmania on the night in question.
Another basis on which it was contended that the services rendered by the Margaret Philippa were not voluntary was raised by an amendment to the defence made by leave at the outset of the trial. That amendment involved the insertion of a new sub-paragraph in these terms:

"1.1 The defendant says further that: ...

1.1.2 both the owner of the `Margaret Philippa' (hereinafter called `the Owner') and the owner of the `Santo Rocco di Bagnara' were by virtue of separate contracts of insurance members, and subject to the Articles and Rules, of the Sunderland Marine Mutual Insurance Company Limited (hereinafter called `the insurer') and by virtue of the provisions of Clause 22 of section A of schedule 1 of the said Rules the Owner was legally bound by means of the `Margaret Philippa' to render assistance to the `Santo Rocco di Bagnara'.

On 20 February 1987, Mr W.H. Nicholls as owner had made a proposal to the Sunderland Marine Mutual Insurance Company Limited ("Sunderland Marine Mutual") for marine insurance of the "Margaret Philippa". Section 6 of that proposal was in these terms:

"SECTION 6 AGREEMENT/DECLARATION

The insurance covered by this Proposal is subject to the Articles and Rules of the Sunderland Marine Mutual Insurance Company Limited, and upon acceptance, the Owners shall become Members of, and the vessel shall be entered in the Sunderland Marine Mutual Insurance Company Limited. Signing this form does not bind the Proposer or Insurer to complete the Insurance, but it is agreed that the Proposal and Skippers Questionnaire(s) (where applicable) shall be the basis of the Insurance contract entered into with the Company.

I hereby declare that the particulars and answers given in this Proposal are in every respect true and correct and that I have not withheld any information which could influence the decision of the Company in regard to acceptance of the Proposal.

Signed: W.H. Nicholls Status: Owner Date: 20/2/87"

Apparently as a result of the acceptance of that proposal, there was in force in September 1989 a certificate of insurance issued by Sunderland Marine Mutual in respect of the Margaret Philippa which included these provisions:

"THIS IS TO CERTIFY that in consideration of the payment of Premiums as agreed Insurances have been effected the details of which are as follows:

...

CERTIFICATE OF INSURANCE Name of vessel : `Margaret Philippa' Insured : W.H. and C.A. Nicholls T/as Sam Blue Seafoods Pty. Ltd.(Owners) and State Bank of South Australia (1st Mortgagee) and J.H. and M.P. Nicholls (2nd Mortgagee) Period of Insurance : 20th February 1989 to 20th February 1990 at 4.00 pm EST Sum Insured : $1,280,000 H and M $320,000 I/V $70,000 Gear Unlimited P and I Including Crew and Nets Conditions : As per schedule attached."

The Rules of Sunderland Marine Mutual are embodied in a printed document of some thirty pages and include as part of Section A of Schedule 1 the following clause:

"22 Members undertake with the Company that they will by means of their ships entered in the Company render assistance to any other ship entered in the Company which may be in distress or require assistance, and the reward for so doing shall be such sum as shall be determined by the Company. In case any Member shall be dissatisfied with the determination of the Company, he shall be at liberty within a period of three months of the communication of the determination to him by notice in writing to the Company to appeal against the same and the matter shall thereupon be submitted to arbitration under Rule 15 of Part IV. In that case the Member shall be entitled to such amount as a reward as shall be awarded in such arbitration proceedings." Rule 15 of Part IV of the Rules is in these terms: "ARBITRATION AND LAW OF CONTRACT

If any difference or dispute arises between the Company and any Member, his representative or assigns, except as to any matter which is by these Rules or the Articles of Association of the Company left to the final determination, decision or discretion of the Directors or Managers, such difference or dispute shall, unless it is mutually agreed to the contrary, be referred to two Arbitrators (one to be appointed by the Company and the other by the Member) and an Umpire to be appointed by the Arbitrators. Such Arbitration shall be a condition precedent to the commencement of action at law. These Rules and any contract between a Member and the Company thereunder shall be governed by English law and construed accordingly."

Other relevant provisions of the Rules of Sunderland Marine Mutual are contained in Parts I and II thereof under the respective sub-headings "PRELIMINARY" and "MEMBERSHIP, ENTRY, WITHDRAWALS AND TERMINATION OF INSURANCE" as follows:

"1. These Rules and those contained in the Schedules hereto (which Schedules are deemed to be part of these Rules) and all contracts between a Member and the Company are subject to the Memorandum and Articles of Association of Sunderland Marine Mutual Insurance Company Limited and shall become binding on all Members.

2. In these Rules the words and phrases hereinafter set out shall have the following meaning and effect if not inconsistent with the subject or context:- THE COMPANY

Sunderland Marine Mutual Insurance Company Limited. ...

CERTIFICATE OF INSURANCE

The document which is issued annually referring to the terms and conditions of insurance for a policy year. ...

ENTERED SHIP

A ship which has been entered for any risks enumerated in these Rules and accepted by the Company in the manner hereinafter provided.

...

MEMBER

Every person who has agreed to become a Member of the Company and whose name is entered in the Register of Members.

...

PERIOD OF INSURANCE

The period of time during which (according to the terms of any contract of insurance) the Company is at risk as regards the occurrence of events in relation to an entered ship which may give rise to liability on the part of the Company to indemnify a Member. ...

MEMBERS

1.1 Subject to Rule 2 every owner who enters any ship in the Company for insurance shall (if not already a Member) be and become a Member of the Company as from the date of the commencement of such entry. Each Member by so entering a ship in the Company agrees with the Company for himself, his heirs, executors, administrators, assigns and successors, that both he and they and each and all of them are bound by the Memorandum and Articles of the Company. 1.2 Membership shall not be transferable. 2 ENTRY OF SHIPS

2.1 Application for entry of a ship may be made at any time. Such application shall be made upon the appropriate entry or proposal form in current use by the Company duly completed and signed by or on behalf of the Owner. Upon acceptance of the entry by the Company, the Managers shall issue a Policy or Certificate of Insurance in such form as the Directors shall from time to time decide and the ship shall be deemed to be entered in the Company at the time stated in the Policy or Certificate until midnight of the 31st December next following and thereafter from policy year to policy year, unless notice to the contrary be given as provided in Rules 6 and 7 of this Part."

It was first contended on behalf of the plaintiffs that the contractual obligation imposed on the owners of the Margaret Philippa did not deprive the assistance rendered to the Santo Rocco (which was also insured by Sunderland Marine Mutual) of the voluntary character essential to sustain a claim for salvage because Mr Nicholls gave the instruction to render that assistance in "total ignorance" of the obligation. Support for a finding that such was Mr Nicholls' state of mind is provided by his evidence that on the evening of 8 September 1989 he telephoned Mr Roberts, a representative of Sunderland Marine Mutual, to obtain his assurance that the proposed tow would not invalidate the Margaret Philippa's insurance cover. Mr Roberts replied that the Margaret Philippa should go ahead with the tow and advised Mr Nicholls that the Santo Rocco was also insured with Sunderland Marine Mutual. However, it has not been suggested that Mr Roberts referred to cl.22 of Section A of Schedule 1 to the Rules of Sunderland Marine Mutual, or otherwise intimated that the owners of the Margaret Philippa were contractually bound to render assistance to the Santo Rocco. Nevertheless, I must conclude that as a result of the signing by Mr Nicholls, a person of full age and understanding, of a proposal acknowledging that the insurance covered by it was subject to the Rules of Sunderland Marine Mutual and incorporating an agreement to be bound by those Rules, together with the renewal of the contract of insurance on 20 February 1989, the owners of the Margaret Philippa were under a continuing obligation to comply with those Rules, including cl.22 of Schedule 1. Indeed, Mr Nicholls appeared to accept, when cross-examined, that a consequence of his signing the proposal was, that upon acceptance of it by Sunderland Marine Mutual, he and the other owners became bound by the Rules even though he had never seen, or been supplied with, a copy of them. In my view, the mere objective existence of the obligation without any need for the presumptive salvor to have adverted to it, prevents a tow, in circumstances like the present, from being voluntary in the requisite sense.
It was next contended that on its proper construction, cl.22 of Schedule 1 to the Rules of Sunderland Marine Mutual conferred an option on the presumptive salvor to seek either the reward or to claim salvage at law. I do not construe the Rule in that way. I consider that the Rule, first of all, imposes an obligation on the insured owner to render assistance to any other ship entered in the Company which may require assistance. The effect of that obligation, as I have already suggested, is to make a claim for salvage unavailable because of the absence of voluntariness. The Rule then goes on to provide, in lieu of entitlement to salvage, a right to a reward to be determined in the absolute discretion of Sunderland Marine Mutual. That discretion, of course, must be exercised reasonably, and is reviewable by arbitration in the manner provided in cl.22 itself.
Support for the view which I have taken of the incorporation of the Rules of Sunderland Marine Mutual in the contract of insurance to which the owners of the Margaret Philippa were parties, is provided by the reasoning of the Court of Session in The Clan Steam Trawling Co. Limited v Aberdeen Steam Trawling and Fishing Co. Limited (1908) SC 651.
In that case, both vessels were insured in the same company, the Rules of which provided, amongst other things, that:

"30. Ships insured in this company shall give assistance to any steamer broken down or in distress, which is insured either in this company or in the Total Loss Mutual Steamship Insurance Company (Sunderland), or the United Kingdom Steam Tug and Trawler Insurance and Indemnity Association

(Shields), or any other Association with which an agreement is or may be entered into...."

The corresponding Rule of the Total Loss Mutual Steamship Insurance Company was in these terms:

"92. Steamers insured in this association bind themselves to give assistance to any vessel broken down or in distress, insured in this association, or in the associations of the United Kingdom Steam Tug and Trawlers Insurance and Indemnity Association (North Shields), Tyne Steam Tug Towing Mutual (Shields), Percy Mutual (Newcastle), Forth and North Sea Steamboat Mutual (Leith), it having been arranged that the vessels in these associations shall be bound to like conditions, and that the compensation for services rendered be decided and determined by the committees of the association or associations in which the vessels were insured."

On reclaimer from the decision of the Lord Ordinary upholding the existence of a right to salvage, the Lord Justice-Clerk (Sir John Macdonald) observed, at 656:

"It does not appear to me that the services rendered by the `Clan Grant' to the `Strathclyde' fall under the description of salvage services. The whole tone of the authorities is to be found in the expression `voluntary'. Services to be rendered by one vessel to another in distress are services for which salvage is exigible when the service is not a service of contract or obligation, but is a service which those rendering it could refuse to render without committing any breach of contract or duty undertaken as matter of obligation. It is of course true that there is a duty in the sense of the moral law to render succour as far as may be possible to those in distress at sea. This moral obligation applies on land as well as on sea, and its force as a moral obligation is only greater in the case of sea perils because these are in the general case more clamant in their call for aid because of their exceptionally dangerous character. But this is an obligation which applies not to seafaring matters only, but to all circumstances in which the citizen can by timely assistance save others from danger; and even that obligation can hardly be held to exist as regards saving of corporeal subjects. It applies only to persons. But whatever be the extent of it, it is plainly not an obligation in law. Its non-fulfilment cannot be visited with either public official censure or give claim in civil suit in respect of failure. Salvage in its true sense is suitable reward for services voluntarily rendered in circumstances where by the services offered on the one hand and accepted on the other there is saving of what otherwise was in risk of perishing or being lost.

It seems to me quite clear that the word `salvage' does not apply to services which those rendering them had by contract undertaken to render.

Here, in this case, the insurance conditions were that the vessels mutually insured gave, as part of the consideration for the insurance, an obligation to render assistance to vessels mutually insured with them. It may be taken to be quite certain that this obligation was as much a part of the premium of insurance as the money paid by the insurer. Each insured bargained for the assistance of the others, and undertook to render assistance to the others, when any two vessels came to be the one in the position of being a vessel in distress, and the other a vessel able to render assistance. It was a perfectly intelligible and efficient contract for benefit, which the one had a right to claim and the other hand contracted to give."

To similar effect, Lord Ardwall concluded at 661: "It is obvious from the above contract of insurance taken along with the articles and rules, which are declared to be incorporated therewith, that there was established a mutuality of obligation between all the members of the insurance company - all the members had an interest in keeping down claims for loss, because the fewer of these the smaller would be the contribution periodically demanded from the various members, and while each member was bound by the rules to give assistance to ships of other members of the company, he was on his part entitled to receive assistance from them, and if a ship belonging to any member of the company failed to give assistance to any other ship insured in the company which was broken down or in distress it is, I think, clear, first, that the owners of the former ship would be guilty of a breach of contract, in consequence of which their own policy would be invalid, and they might in addition be subjected to an action for damages. I therefore think that it is perfectly plain that in the present case the `Clan Grant' was bound to give assistance to the `Strathclyde,' which was in distress at the time the services condescended on were rendered. If this is so, it appears to me that there is an end of the pursuers' case, so far as at the instance of the owners of the `Clan Grant,' because there was a pre-existing contract under which that vessel was bound in the circumstances to give assistance to the `Strathclyde,' in other words, the services which were rendered by the `Clan Grant' to the `Strathclyde' were not in law salvage services at all, but were services rendered in pursuance of the contract between the owners of the `Clan Grant' and the Mutual Insurance Company, in which the owners of the `Strathclyde' had a jus quaesitum. This being so, it is irrelevant and unnecessary to inquire whether the owners of the `Clan Grant' are barred by the contract from claiming remuneration as for salvage services, there being no salvage services for which remuneration can be claimed. But it is satisfactory to notice that the conclusion I have arrived at as matter of law is truly in accordance with the special contract, because I think it clearly appears from Article 25 that no remuneration for services was contemplated by the contract except for charges and expenses, and Rule 92 of the Total Loss Mutual Steamship Insurance Company, which was referred to by the pursuers as aiding their argument, is, I think, equally clear to the effect that salvage remuneration is not contemplated as a reward to steamers insured in that association giving assistance to vessels in distress, but only such `compensation' as may be determined by the committees of the association, and I need hardly point out that compensation and salvage remuneration, or `reward' as it is sometimes termed, are two very different things, and are arrived at in very different ways. To take one point of difference, the value of the property salved falls to be taken into account in salvage remuneration, whereas it has no place in a claim for compensation."

That last passage, in particular, provides, I consider, a conclusive answer to the argument of Mr Wood of Counsel for the plaintiffs that cl.22 of Schedule 1 to the Rules in the present case conferred on the owners of the assisting vessel an election either to claim salvage at law, or pursue the compensation or reward contemplated by the Rule as allowable in the discretion of Sunderland Marine Mutual.
It is accepted by Counsel for the defendant that the contractual obligation which I have held precluded the owners (including the charterer) of the Margaret Philippa from establishing the voluntariness necessary to maintain a claim for salvage, did not have that effect on the claim by the master and crew of the Margaret Philippa. In The "Sappho" (1870) LR 3 A and E 142 Sir Robert Phillimore upheld a claim for salvage of a sister ship by the boatswain and part of the crew of the salvor vessel, citing with approval the reasoning of Lord Stowell in The "Waterloo" 2 Dods 433 at 435. By similar reasoning I am led to uphold the claim advanced in this case on behalf of the master and crew of the Margaret Philippa.
It therefore remains to assess the amount to which the master and crew of the Margaret Philippa are entitled. In doing so I have had regard, in accordance with the approach taken, for example, in The Ship "Korowa" v The Ship "Kooraka" (1949) SASR 45 at 52, and in Societe Maritime Caledonienne v The "Cythera" (1965) NSWR 146 at 158, to the material circumstances (so far as they obtain in the present case) which are set out and discussed in Kennedy, The Law of Salvage 5th Edn pp 458-476.
I find that the Santo Rocco and her crew were both in serious, although not imminent, danger of being lost had the Margaret Philippa not effected the tow. The Santo Rocco had lost all motive power and was drifting appreciably in a southerly direction. Had she continued to drift in that way, she could well have fetched upon rocks or reefs on the west coast of Tasmania south of Cape Sorell. There is no evidence of the existence, or seaworthiness of any lifeboat which the Santo Rocco may have carried. Nor can I confidently infer what would have been the prospects of the crew's reaching safety unaided had they been forced to abandon their vessel. In the circumstances, I regard the peril from which the Santo Rocco was rescued as entailing a significant risk of loss of life, and of the loss of, or substantial damage to, the vessel herself. At its lowest, the salvage operation significantly curtailed the loss of use of the Santo Rocco which would otherwise have been incurred and been quantifiable in the order of $10,000 a working day. It is common ground that, at the relevant time, the value of the Santo Rocco, exclusive of fishing licences was at least $1.9 m. Authority for the proposition that fishing licences are not reflected in the value of a salved vessel for present purposes is provided by the judgment of the Full Court of the Supreme Court of Western Australia in The "Kristy Mae" v The "Santa Rita" (1984) WAR 95 overruling The "Loretta" v Bubb (1971) WAR 91.
There was also a significant degree of danger to those on board the Margaret Philippa. That arose during the manoeuvres undertaken to establish and re-establish the tow, when, on the evidence, the two vessels came as close as twenty feet to each other. Less immediately, the Margaret Philippa was at increased risk of herself becoming immobilized as a result of the extra strain thrown on to her engine. Had that happened, danger to her crew would have been similar to that to which the crew of the Santo Rocco would have been exposed but for the tow.
Although not governed by considerations such as those which have been reflected in generous awards to tugs maintained and operated especially for salvage purposes, the position of the master and crew of a fishing vessel also invites a measure of generosity. In my view, an award to salvors in that category should encourage them to go unhesitatingly to the aid of a vessel in distress without regard to their own loss of fishing time or any likely or possible depreciation in the value of their own catch.
A related consideration is the skill promptitude, courage and energy displayed by the crew, and the particularly the master, of the Margaret Philippa. Some criticisms were made in the course of cross-examination of Mr Jobe, and in the evidence of Captain Joyce, a professional salvage tugmaster, of the decision to introduce the automotive tires into the tow-line. However, any suggestion that the skill or expertise displayed in a salvage operation fell short of that to be expected of professional salvors, cuts both ways. Lack of knowledge or experience should certainly not be used to discount the award which a court otherwise considers proper. In some circumstances, the readiness of non-professional, inexperienced salvors to render assistance should receive special recognition in the calculation of the award. In the present case I consider that the master and crew of the Margaret Philippa exhibited more than the ordinary level of skill and seamanship to be expected of those manning a fishing vessel and the award should reflect that appreciation. Nor do I consider that the deficiencies of Mr Jobe's record-keeping, to which Mr Willee drew attention in the course of his submission, should be allowed any effect in reduction of the award.
I have also had regard to the time by which the return to port of the Margaret Philippa and her crew was delayed by answering the call for assistance and effecting the tow. One consequence of that delay was the diminution in the value of the Margaret Philippa's catch which has been agreed in the sum of $20,429 and two days loss of future fishing, the value of which is agreed to be $19,010. The share of the catch apportioned to the master and crew by Sam Blue Seafoods Pty Ltd as charterer of the Margaret Philippa was 37% in all.
Exercising, in the light of the considerations canvassed above, the discretion conferred by what Sir William Brett, M.R. called in The "City of Chester" (1884) 9 PD 182 at 187 "the large equity of Admiralty law", I have assessed an appropriate award for the master and crew of the Margaret Philippa to be in the sum of $32,000. Since I have heard no submissions on the apportionment of the award between the master and the five other persons (including one supernumerary) on board the salving vessel, I shall reserve liberty to apply on that question in default of agreement.
Although the owners and charterers have failed in their claim for salvage because of the obligation imposed by their contract of insurance with Sunderland Marine Mutual, that point was only raised by a late amendment to the defence. Nor does it appear that any determination of a reward for the assistance rendered to the Santo Rocco was ever made by Sunderland Marine Mutual or communicated to the owners of the Margaret Philippa as contemplated by cl.22 of the rules of the insurer. Moreover, the costs of the hearing and the action generally have not, as I see it, been appreciably increased by argument or evidence directed to the point on which the owners have failed. Accordingly, there will be one order for costs (including any reserved costs) in favour of the plaintiffs without distinguishing between them.

[1991] FCA 250

09 MAY 1991