Here it is to be noted that the common adventure must be actually be in peril , the act must be voluntarily that it must be deliberately committed to avoid the actual peril, it must be reasonable , extra ordinary in its nature done with the sole object of preserving the property imperiled and lastly the loss must be direct result of the sacrifice. Examples of a general average sacrifice are the cutting away of masts , spars and sails to right a right on its beam ends damage done to the propeller by deliberately working the engines in order to refloat the vessel aground in a position of peril damage done in scuttling a vessel by admitting sea water to extinguish a fire , the jettison of cargo to lighten a vessel in peril of foundering and so on.
EXPENDITURE-
This comprises all extraordinary expenditure properly incurred in time of peril in order to preserve the common adventure. Examples of such expenditure are inward port charges , piloting , harbor dues etc incurred in putting into a port of refuge , expenses of ware housing and reloading the cargo and of leaving the port to resume the voyage, cost of sacrifice etc In cases when a vessel has put into a port of refuge , it may be cheaper to tow her port of destination and repair her there than to defray all the expenses that would be incurred by repairing her at her port of refuge. In such cases the cheaper course is rightly followed and the expenses incurred are known as Substituted Expenses. Example of adjusted general average, a vessel
Carrying cargo strands and sustains damage to the extent of 1,000 dollars; this is a particular average loss on the ship. To refloat her cargo is jettisoned to the value of 1,000dollars and the engines are worked causing damage to the ship machinery to the extent of 1,000dollars . The first is a general average sacrifice of cargo, the second a general average damage to the ship. What if further that 3,000 dollars represents the cost assistance by tugs in refloating the vessel and the freight sacrificed by the loss of 1,000 dollars worth of cargo is 50 dollars.
AIR FREIGHT INSURANCE-
Air freight insurance is conducted on the same lines as marine insurance ; in fact the Lloyd’s form of marine cargo policy is generally used for air freight with the term Air freight being used instead of a ship’s name. General average or particular average does not enter into shipments by aircraft. Agreement on legal position covering carriage by air was reached by Warsaw convention on the 12th of October , 1929 which became law in Great Britain by the carriage by air Act,1932.
York Antwerp Rules- These rules , originally eighteen in number , were agreed upon by English and foreign jurist average adjusters , ship owners and others at meetings held in the cities of York , Antwerp and Liverpool 1890 in order to secure uniformity of practice among st the maritime nations of the world in the principles to be observed in the adjustment of general average. The rules were revised and extended in the year 1924 and again in 1950.They are now a complete and comprehensive code of general average which is almost invariably incorporated by reference in contracts of affreightment and in policies of marine insurance. Reference has already been made to some of the rules normally applied in assessing general average, but the main ones incorporated in the York – Antwerp rules are
a) Expenses incurred at a port of refuge should be admitted as general average.
b) Deck cargo jettisoned should not be admitted as general average.
c) Damage resulting from the extinguishing of a fire should be made good as general average
d) Loss of freight should be allowed as general average unless the vessel would have been lost in any case.
e) Except in the case of temporary repairs claims for repairs admitted as general average are subject to deductions new or old.
f) The contribution to a general average loss should be made upon the basis of the actual values of the property at the termination of the adventure plus any amounts made good as general average for property sacrificed , less certain deductions.
Warranties-Warranties are of two kinds which are Expressed and Implied warranties , the implied warranties are unexpressed and are two in numbers(a)In every voyage policy , that the vessel shall be seaworthy when the risk commences (b) that the adventure shall in all respects be a lawful one. There is an implied warranty in a voyage policy on goods that the ship is not only seaworthy as a ship but also that she is reasonably fit to carry the goods to their destination but there is no implied warranty that the goods are seaworthy. The unexpressed warranties are more numerous for example in time of war , that the insurable property shall be neutral or that the subject –matter is well or in good safety on a particular day or that a vessel shall sail from a specified port on a certain day or that part value of the subject matter at risk remains uninsured and so on. In all these cases breach of the warranty invalidates the contract. In connection with discharge from the liability under a contract of marine insurance , it may be mentioned that matters of vessels are bound to follow the course of the voyage specifically set out in the policy or if not mentioned , the usual and customary course. Any unauthorized departure from such customary or declared course is known as Deviation and deviation avoids a marine policy as from the time when it occurs. Nowadays the institute cargo clauses which are used on almost all policies concerning cargo contain a clause known as the Deviation clause. This clause provides for deviation to be covered under conditions at a premium to arranged.
Indent Business-Instead of ordering for goods direct from the manufacturers , foreign merchants sometimes order indirectly through agents who maintain offices in the foreign country. These agents are not merely receiving and forwarding agents but through their offices in New York, London or even Lagos , port Harcourt are ready to buy any kind of goods for foreign merchants who commission them to do so. Such agents may not even have a branch office in the foreign country but may operate entirely from their offices in the foreign country. Usually however they do maintain a branch office in each country where they seek business. The orders received by these agents are known as Indents . An indent directs that the person who receives it is to procure goods from the third party , whereas an order is a request for the receiver’ s own goods . Commonly however the words indent and order are used indiscriminately. An indent may be an open or closed indent. An open indent allows full liberty to the agent to obtain the required goods from any firm he/she to deal with but a closed indent specifies the goods of a particular manufacturer from whom they must be obtained.In such transactions these agents act as principals . The British suppliers invoice the goods to them and look to them for payment. In many cases the British manufacturers are unaware of the identity of the agent’s customers. The agent in turn re-invoices the goods to the foreign buyer under his own name charging him in addition to the cost of the goods all shipping and insurance expenses that he has to defray and also an agreed commission.
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