CMA CMG Libra – passage planning for tugs in the light of the English Supreme Court decision

2nd February 2022

Passage planning is an important aspect of any commercial voyage by sea. There could be many hazards during the voyage through congested waterways, with awkward turns through outlying archipelagos, crossing traffic separation schemes and narrow and tidal waterways to navigate. 

Understandably, when a client contracts for the tow, they would rightly be aggrieved if, following a grounding, it transpires the tug owner and crew had not given proper thought to the route they were planning to take.  

The English Supreme Court has now affirmed where the contract in question requires an owner to exercise due diligence to make his vessel seaworthy, that obligation extends to ensuring, as part of the voyage planning exercise and prior to the commencement of the voyage, the crew are supplied with, and duly consult, up-to-date charts, notices to mariners and electronic navigational information if used on board. 

In the case in question, the CMA CGM Libra, the crew deviated from the planned passageway, a buoyed fairway, while leaving Xiamen, China and grounded in nearby shallows. 

Had they had correct and up to date information, they would have become aware when they planned the voyage before departure, that the depths shown on the out-of-date chart were unreliable and the waters were shallower than recorded on the chart.

When they deviated from the fairway, they were not able to anticipate the dangers in question. As this was a cargo ship, the Hague Visby Rules applied, and owners were not able, in the circumstances, to invoke the defence of ’error of navigation’. The large costs of the grounding rested entirely with the owners.

What are the implications for tug owners if defective passage planning similarly were to render the tug unseaworthy and lead to catastrophe? 

One might sympathise with tug crews and their owners. Oceangoing tugs navigate similar routes to large vessels, often to ports not visited before. They have fewer crew and seldom time prior to departure when the passage might be planned at comparative leisure.  

Towage planning for large projects is sophisticated and is most often performed at the office, not on the bridge. Tugs, however, are often engaged at short notice. The tug happens to be the right tug, at the right time and in the right place for the task.  

That might include a rescue tow in circumstances where otherwise a salvage might be applicable. Finally, each tow presents its own unique features in terms of draughts, heights, width, speed and so on. 

Under TOWCON and TOWHIRE there is indeed a contractual obligation to exercise due diligence to tender the tug at the place of departure is in a seaworthy condition and in all respects ready to perform the towage.  

There is no doubt the Supreme Court would apply here the above principles discussed in the CMA CGM Libra in the context of voyage planning. The big difference lies in the knock-for-knock (or liability and indemnity) clauses.  

This results in a very different regime to that under a commercial charterparty or under the Hague Visby Rules which apply to the carriage of cargo under bills of lading.  

Under the towage forms, the parties agree to bring no claims against each other where physical damage or loss has resulted to their property, and that extends to consequential losses such as loss of future revenue.  

The tug owner is, in effect, exonerated from his wrongdoing “whether or not the same is due to any breach of contract (including as to the seaworthiness of the tug), negligence or other fault on the part of the tug owner…”.  

Surely, that is a non-sequitur: why create such an obligation but give it no teeth to ensure its performance, nor sanction for bad behaviour when ignoring it? 

There is no easy answer for this. It might be said that tugs are small and should not be liable for enormous losses. It might also be said towage rates reflect lower costs of liability insurance from which hirers benefit. 

But then the knock-for-knock regime applies in many other offshore sectors, not least heavy lift. Moreover, tugs also benefit from the international limitation of liability convention (most tugs can limit liability to around US$2M).  

It will not, however, prevent a tug master or owner from being prosecuted by the authorities in the jurisdiction where the accident happens, an unpleasant prospect.  

Nor would it necessarily please insurers. Most policies of marine insurance contain a provision to the effect that where with the knowledge (privity) of the assured, the ship is sent to sea in an unseaworthy state, the insurer is not liable for any loss attributable to unseaworthiness. This sets a lower threshold than the towage contract itself and no self-respecting tug owner surely would wish to find himself without cover.

Simon Tatham is a partner at Tatham & Co and founder member of the www.tugadvise.com service. He has more than 30 years’ experience of shipping law.

Reproduced with kind permission of International Towage and Salvage magazine.