Towage or salvage : what is the difference?

Abstract

Every year, hundreds of mariners’ experience first-hand the difference between a contract of towage and salvage. In many cases, the difference is discovered when the ship owner receives the bill for a salvage reward rather than a bill for a towage since the difference between the two can be huge.

Foremost, this thesis will explain what is a towage service. Briefly, the Common-law definition for towage was given in The Princess Alice case in 18491 as “the employment of one vessel to expedite the voyage of another when nothing more is required than the accelerating of her progress.” Thus, in towage operations there is the involvement of two boats; the tug and the tow. The thesis will also consider some of the towage contracts namely those used for harbour towage and long-distance towage.

On the other hand, one may find various definitions on the concept of salvage. In fact, Geoffrey Brice2 holds that under English law, a salvage operation is a right where a person acts voluntarily to preserve or to aid in the preservation of any vessel, cargo, freight or other recognised subject of salvage from danger of sea. Unlike towage operation, salvage is not a pre-contracted agreement since it arises in cases of emergency. Salvage operations require four fundamental principles which are essential in determining whether there was a salvage operation or not. These principles consist of: the subject of salvage, danger, voluntariness on behalf of the salvor and a successful operation. Each and every one of the concepts will be considered separately throughout the thesis.

Traditionally, the concept of ‘no cure, no pay’ which emanated from the International Salvage Convention and the Lloyd’s Open Forms (LOF’s) agreements was a fundamental issue in rewarding the salvor for the operation of salvage. In fact, this concept entailed that a salvage reward was granted upon the success of the salvage operation.

An analysis will be further carried out with regard to the tug as salvor of the tow. In this case, the thesis will delve into the matter as to when towage service becomes a salvage operation and whether a tug owner can claim salvage and whether such tug will be entitled to claim a salvage reward. When a towage service is transformed into a salvage operation, thus, needing extraordinary service of salvage nature which are not within the scope of the contract of towage, or in emergency situations under no towage contract, a tug will be able to claim for a salvage reward.

In conclusion, after putting together all the information presented in the thesis, the main differences between the concept of towage and salvage will be identified to better understand the difference between the two which after all are the main aims and objectives of this thesis.