Here’s what Insurer can do, if shipowner abandons wrecked ship

Here’s the story of an accident in Japanese waters, which could develop into disaster, if not Insurer’s responsible actions.

Russian cargo ship beached by typhoon in Fushiki, Japan
October 23, 2017
Typhoon Lan which battered Japan, tore off moorings Russian general cargo ship REAL in Fushiki port, Toyama, Honshu, Japan sea, early in the morning Oct 23. The ship was berthed at Fushiki with 19 crew on board, to depart to Russia on Oct 27. REAL drifted in harbor and grounded on breakwater. 1 crew was rescued by emergency rescuers, 18 left the ship by own means, all 19 are safe. Photo Sankei News.
General cargo ship REAL, IMO 7130153, dwt 2230, built 1971, flag Togo, manager EAST MARINE CO LTD, Vladivostok, Russia.

The ship suffered hull breach when she grounded onto a breakwater, with ensuing fuel leak.
Shipowner’s legal liabilities to third parties were covered by AMT-Insurance Company (, which Company is duly accredited with Ministry of Land, Infrastructure, Transport and Tourism of Japan (MLIT).
All concerned parties immediately after accident established a joint working group, which includes, beside Insurer’s lawyers and surveyors, representative of Coast Guard, Port Authority, Fishery Communities, and local Trade Unions.

Prevention of further fuel leak was given a top priority during the first stage of salvage and wreck removal operation, to avoid claims from Coast Guard and local fishermen. Fuel leak was sealed, fuel and oil were siphoned from the wreck.
MAP of Toyama port and Coast Guard, on the other hand, were more worried about ship’s removal, because if the ship slides from breakwater, it could block the fairway.
All works carried out during first stage of salvage/wreck removal operation cost the Insurer some $200,000, with Insurer being directly responsible for preventing pollution and losses cover.

Wreck removal was the Shipowner’s responsibility, but Shipowner meanwhile, abdicated from his responsibilities, which, for all purposes, could be considered as abandonment. Inevitably, wreck removal was to be effected and covered by Insurer, or else Company could face Japan’s official claim.
Contract on wreck removal was signed with “The Nippon Salvage Co. Ltd”, which won competitive bidding, thanks to its’ wreck removal plan, found to be most effective. Insurer paid more than $2 mil for wreck removal works.
The ship was to be put on even keel with ensuing holes sealing, hull strengthening and towage, to dismantling facilities. After recovering stability and sealing off holes, the ship was taken to a Ship Yard in Toyama, to strengthen her hull for towage. Hull was strengthened with H Beams, and as of now, is ready in all respects for towage to dismantling site.

Investigation as to the root causes of this accident is still ongoing, the results will be reported in due course. As for present stage, it is obvious, that joint and effective work of all concerned and involved parties, including Insurer, Coast Guard, Toyama Port Authorities and local community, is to be merited for avoiding and mitigating negative consequences, which could lead, otherwise, to a full-scale disaster.

February 2018

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