One of the most comprehensive definitions of “salvage” is offered by Geoffrey Brice, QC: “The right to salvage arises when a person, acting as a volunteer, preserves or contributes to preserving at sea any vessel, cargo, freight or other recognised subject of salvage in danger.”
Despite various interpretations, four essential elements remain consistent: (1) the salvor must act voluntarily, (2) with intent to preserve, (3) a recognised subject of salvage, (4) that is in danger. Importantly, altruism is not required—salvors are often driven by financial incentive and still qualify for awards, as affirmed in The Lee (1884) and the 1989 Salvage Convention.
A notable example is the 1994 rescue by the tanker Cherry Valley, which saved the tug J.A. Orgeron and its $50 million NASA fuel cell cargo during Tropical Storm Gordon. This operation became the largest salvage award in US history and was chronicled in In Peril.
Insurers’ roles in salvage
Property insurers have a vested interest in salvage because they indemnify owners of salved property. Liability insurers, on the other hand, are concerned with maintaining incentives for professional salvors, particularly to prevent third-party damage such as environmental disasters.
Indemnity for salvage is similar to general average, though property insurers only pay up to the insured value. Most jurisdictions calculate salvage awards based on values at the conclusion of the operation, regardless of any later total loss.
Towage versus salvage
Historically, differentiating towage from salvage was critical. Today, contracts clearly distinguish between the two, but services outside a towage contract—especially in emergencies—may be treated as salvage.
The 1989 Salvage Convention clarified this, allowing additional compensation only when services exceed contractual expectations, such as re-floating a grounded ship.
Beyond “No Cure – No Pay”
While traditional salvage law rewarded only successful efforts, modern conventions introduced exceptions. The 1989 Convention and the Lloyd’s Open Form (LOF) incorporated “special compensation” for salvors who protect the environment, even if the operation isn’t fully successful.
The SCOPIC clause
Introduced in LOF 2000, the SCOPIC clause simplified special compensation by using a fixed tariff and 25% uplift, bypassing the need to prove environmental risk. It also introduced Special Casualty Representatives to monitor fairness and ensure transparency.
Conclusion
Salvage law has evolved from profit-driven recovery to a more holistic approach focused on public interest and environmental protection. With insurers playing a pivotal role in shaping fair compensation, the doctrine of salvage continues to adapt to modern maritime needs.
