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Lloyd's Open Form

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In the 1960s and 1970s, there were a number of ageing single-skinned tankers coming to grief and letting huge slicks of crude oil escape. While passing ships were obliged to offer reasonable assistance to save life, they were reluctant to offer salvage services on a seeming reckless adventure to save
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Traditionally, the salvage reward has been subject to the salvor successfully saving the ship or cargo, and if neither is saved, the salvor gets nothing, however much time and money has been spent on the project. This harsh principle is called "No cure – no pay"; and at the top of page one of
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a reward provided that the salvor had exercised due diligence in attempting to save the marine environment from pollution. This innovation proved very successful, and the international community was so delighted and impressed that only a few years later the 1989 Salvage Convention came into force,
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After a stricken ship accepts an offer of salvage from a salvor, a binding contract is created. It is then normal to agree upon the LOF in the interests of certainty of terms. The LOF is called "open" because it specifies no particular sum for the salvage job. Indeed it may not specify a sum, as
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a low value hulk where third party liability risks might be enormous. Instead, salvors preferred to work where there were richer pickings and fewer dangers. This situation alarmed coastal states (whose beaches were liable to pollution from oil slicks) and
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showed that it had been poorly drafted in places, and did not always provide adequate reimbursement to salvors. The international maritime industry joined with P&I Clubs in 2000 to develop the new
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and is the most commonly used form for international salvage. Innovations in the LOF 1980 have engendered a major change in environmental salvage.
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salvage is not a "contract for services", but an agreement to provide a service in the hope of a "reward" to be determined later by an
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adopting this new LOF idea. Specifically, articles 13 and 14 of the Convention lay down the modern basis for making the award.
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To remedy the position, the Lloyd's Open Form (LOF) 1980 made provision for a stricken tanker to engage salvage services and
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The "marine environment" being protected is purely "coastal"; mid-oceanic pollution is not catered for.
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the LOF, beneath the title "Salvage Agreement" is a statement of this fundamental premise.
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which could be annexed to the LOF to redress the shortcomings of the 1989 Convention.
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There are several recent versions of the LOF: 1980, 1990, 1995, 2000, 2010
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operation. Originating in the late 19th century, the form is published by
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The Salvage Convention 1989 is now incorporated into the UK's
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When determining the salvage award, an arbitrator follows the
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Semco Salvage & Marine Pte Ltd v. Lancer Navigation
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Although the 1989 Convention has been a success, the
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Index

standard form contract
marine salvage
Lloyd's of London
arbitration hearing
KCs
Admiralty Bar
English law
Salvage Convention 1989
P&I Clubs
House of Lords
The Nagasaki Spirit
SCOPIC
codicil
double-hulled tanker
Torrey Canyon
Amoco Cadiz
Exxon Valdez
Merchant Shipping Act 1995
The "Undaunted"
1860 Lush. 90
ISBN
1843118238
[1997] UKHL 2
The 2020 version of the form
Lloyd's of London LOF page
Categories
Admiralty law
Admiralty law in the United Kingdom
Marine salvage

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