Guangzhou Maritime Court Closed a Maritime Injunction Case by Introducing a Hearing Procedure

2013-07-17
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    On 17 January, 2013, M/V "Quan Shun Li", loaded with more than 3,000 tons of sugar on her voyage from Fangcheng Port to Shanghai, was stranded in the sea area of Guangdong Huilai, leading to water ingress into her cargo holds which damaged the cargo onboard. The ship instructed a salvaging company to salvage the subject cargo; however, a dispute over the salvage costs occurred, Salvage Company, the ship and the merchant. The salvor intended to dispose of the cargo by exercising its lien thereon; while the merchant applied with Guangzhou Maritime Court for an injunction to order the salvor and the ship to deliver the cargo.

 

    On 19 April, Guangzhou Maritime Court convened a hearing participated by the three parties and heard the views of each party. Through a review, the Court decided that the act of salvage shall be encouraged and the salvor is entitled to detain the salvaged cargo, provided that the lien is exercised to a reasonable extent without devaluing the cargo or expanding loss of the cargo. Since the sugar cargo dissolves easily and had been subjected to water immersion, it released a large amount of water and increasingly devalued with the weather getting warmer day by day. Ultimately, Guangzhou Maritime Court ruled according to law to approve the merchant’s application for maritime injunction on the condition that the merchant provides a satisfactory counter-guarantee sufficient to secure payment for the salvage costs and to order the salvor to deliver the cargo to the merchant.

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