Abstract
Within the maritime jurisdiction, the law of salvage rewards volunteers who render valuable services to a vessel, cargo, or other recognised subject of salvage in danger. The nature of this legal right, and the corresponding liability of the salved party to pay the salvage reward, is not consent-based, nor is it contractual in nature. The laws of salvage often appear antithetical to the law of contract, being heavily grounded in public policy and equitable considerations. Nevertheless, in modern times contracts have been used in salvage operations with such frequency that contractual salvage has become the norm within the maritime industry, governed by a standard form contract known colloquially as the Lloyd’s Open Form.
However, despite this widespread use, there is little discussion to be found in the case law or academic writings on the interrelationship between the law of salvage and the law of contract when the two co-exist together. This has led to theoretical uncertainty in areas where the two jurisdictions apply different rules to the same concepts, particularly in the area of duress. While the approach of contract law is procedural, focussing on the quality of the parties’ consent to the putative agreement between them, salvage law combines an objective procedural approach with an enquiry into the substantive fairness of the contractual terms, in order to determine whether an agreement should be enforced against the party alleging the duress.
After consideration of two alternative models, where each regime overrides the other, it is argued that a scenario where the two regimes co-exist is to be preferred. Within this setting, it is argued that, based on the common rationales for controlling illegitimate behaviour in both jurisdictions, the procedural element of contract law should be incorporated into the approach of salvage law, and the substantive requirements correspondingly relaxed. This proposition is considered in light of the policy considerations behind salvage awards, and the current international regime that has been effected to give effect to these considerations, so that the values inherent in the existence of the salvage doctrine are preserved.