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XII. The Environmental Factor

One of the most interesting developments in salvage law has been the growing attention paid to the environment. Ironically, the 1990 revision to the Lloyd's Open Form has helped significantly in this regard.

With increasing government intervention into salvage situations which posed a threat to the environment, salvors found themselves faced with problems ranging from denial of access to ports to decisions to bomb the vessel into splinters. Salvors became increasingly reluctant to expend time and money on salving a vessel with little hope of receiving a reward.

In 1981, discussions were first held in Montreal to resolve the problem. A draft convention on salvage was adopted to address this issue. The 1980 revision to the LOF provided the unsuccessful salvor who attempted to salve a "tanker laden or partly laden with a cargo of oil" with his expenses plus fifteen per cent as a reward if he attempted to prevent or mitigate damage to the environment.

Subsequently, the International Convention on Salvage was adopted and ratified by the United States. The 1990 revision to the LOF incorporates articles 1, 8, 13 and 14 of 1989 Salvage Convention, and provides that the unsuccessful salvor can receive, as a reward for his efforts to prevent or mitigate damage to the environment, his expenses plus up to 200% of his expenses. Additionally, the successful salvor can have his award enhanced as a result of efforts to protect the environment. This concept shifts burden of costs of prevention and mitigation efforts from public to vessel owners and insurers. Availability of a reward for environmental efforts should encourage salvors to outfit vessels for environmental efforts and spare taxpayers costs of vessels, personnel, training and standby. Special compensation encourages salvors to "roll the dice" and undertake both salvage and environmental protection when the probability of success of salvage is slim.

The overall concept encourages environmental protection as a whole. Several courts have found this argument persuasive and enhanced a salvor's award for efforts to protect the environment. To obtain such an award, the salvor must prove by a preponderance of evidence that damage to the environment would have occurred but for salvage efforts. Potential problems exist with regard to the definition of "substantial physical damage" to the environment, especially in cases where no damage occurs, as well as with the definition of "major" incidents. Other definitions within the treaty will also require judicial interpretation. Valuation of marine resources is also a problem. Another problem will be the fact that the hull underwriters usually pay salvage awards while Protection and Indemnity ("P & I") underwriters pay for clean-up costs and environmental damage. Under the Cresci doctrine, this may result in P & I underwriters becoming directly liable for the environmental portion of the salvage award. While the concept will probably require much litigation and interpretation, it should prove useful for both salvors and the environment.

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