DIPLOMA IN MARINE SURVEYING 2011 / 2012 MODULE 1
The Maritime Industry and Marine Survey Practice AUTHOR
Captain Rodger MacDonald MA, FNI, MM Secretary General of the International Federation of Shipmasters’ Associations, UK
Lloyd's and the Lloyd's crest are the registered trademarks of the society incorporated by the Lloyd's Act 1871 by the name of ‘Lloyd's’
CONTENTS
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PART ONE THE MARINE SURVEYOR’S CUSTOMER BASE
6
1
THE STRUCTURE OF THE MARITIME INDUSTRY
1.1 1.2 1.3 1.4 1.5
The Main Components . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 The Cargo Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 The Vessel Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8 The Management of Ships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 The Charterers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
2
THE PURPOSE OF MARITIME TRANSPORT
2.1 2.2 2.3 2.4 2.5
Shipping Sophistication and Diversification . . . . . . . . . . . . . . . . . . . . . . . . . .16 Cargo and the Transfer of Risk and Title . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Cargo Documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 Seaworthiness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 Cargoworthiness and the Term “Carefully to Carry” . . . . . . . . . . . . . . . . . . .25
3
THE PURPOSE OF MARITIME STRATEGY AND SAFETY
3.1 3.2 3.3 3.4 3.5
The Role of the IMO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 Maritime Losses: Their Impact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28 Maritime Losses: Their Quantum and Cost . . . . . . . . . . . . . . . . . . . . . . . . . .30 International Strategy for Safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35 International Strategy for Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
4
OCCUPATIONAL HEALTH AND SAFETY
4.1 4.2 4.3 4.4
The Role of ILO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Shipboard Safety and Safety Committees . . . . . . . . . . . . . . . . . . . . . . . . . . .43 Health, Fatigue and Quality of Life . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 Shore-based Safety Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
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QUALITY AND AUDITS
47
5.1 5.2 5.3 5.4
Audits, Inspections and Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47 Quality Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Undertaking Audits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 International Ship Managers’ Association (ISMA) Code . . . . . . . . . . . . . . . .54
6
INTERNATIONAL SAFETY MANAGEMENT (ISM) CODE
6.1 6.2 6.3
The Origin and Objectives of the ISM Code . . . . . . . . . . . . . . . . . . . . . . . . .57 The Safety Management System (SMS) . . . . . . . . . . . . . . . . . . . . . . . . . . . .59 The Implementation and Operation of the ISM Code . . . . . . . . . . . . . . . . . .60
7
PORT STATE CONTROL (PSC)
7.1 7.2 7.3
The PSC Organisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .63 The PSC Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66 PSC and the ISM Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73
8
RISK MANAGEMENT AND FORMAL SAFETY ASSESSMENT (FSA)
8.1 8.2
Risk Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75 Formal Safety Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81
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PART TWO MARINE SURVEYING PRACTICE 9
9.1 9.2 9.3 9.4 9.5 9.6 9.7 9.8
1-2
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MARINE SURVEYORS, SURVEY ORGANISATIONS AND HOW TO DEFINE THEM
75
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88
Types of Survey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88 Surveyors as Policemen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92 Surveyors as Fact Finders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93 Marine Surveyors as Advisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93 Marine Surveyors Acting in the Owner’s Interests . . . . . . . . . . . . . . . . . . . . .93 Surveyors as Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94 The Marine Surveyor as an Expert Witness . . . . . . . . . . . . . . . . . . . . . . . . .94 The Traditional Source of Marine Surveyors . . . . . . . . . . . . . . . . . . . . . . . . .94
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Individuals and Companies Who are not Classification and Government Surveyors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96 Defining a Marine Surveyor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .98
10
KNOW YOUR CUSTOMERS
10.1 10.2 10.3 10.4 10.5
Who Instructs Surveyors? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .100 How does Your Principal Know You? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .101 Understand Your Contractual Obligations . . . . . . . . . . . . . . . . . . . . . . . . . .101 For Whom does the Surveyor Act? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102 Surveys “Without Prejudice” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103
11
TYPES OF SURVEY – HULL AND MACHINERY
11.1 11.2 11.3 11.4
Hull and Machinery in General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105 Classification Society Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105 Statutory Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .111 Condition Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112
12
TYPES OF SURVEY – CARGO-RELATED SURVEYS
12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10
Cargo-related Surveys in General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118 Is the Ship Cargoworthy? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118 Preparation of Cargo Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .120 Surveying the Cargoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .121 General Cargoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .121 Dry Bulk Cargo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124 Supervisory/Overseeing Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .130 Timber Deck Cargoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .134 Bulk, Liquid Cargo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .135 Quantity Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .139
13
WARRANTY AND OTHER COMMERCIAL TYPES OF SURVEY
13.1 13.2 13.3 13.4 13.5
Warranty Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .142 Performance Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .145 Commercial Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .145 Quality Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .146 Conformity with Letter of Credit (Before Shipment) . . . . . . . . . . . . . . . . . . .146
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13.6 13.7
Conformity with Specification or Sample (After Shipment) . . . . . . . . . . . . .147 P&I Club Entry Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .147
14
TYPES OF SURVEY – WHEN THINGS GO WRONG
14.1 14.2 14.3 14.4 14.5 14.6
General Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .149 Insurance Cargo Loss Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .149 Damage and Repair Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .153 Accident Investigation Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .155 Third Party Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .156 Investigation by Administrations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .157
15
GOING ABOUT A SURVEY
15.1 15.2 15.3 15.4 15.5 15.6 15.7 15.8
Preparation and Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .159 Planning and Organising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .159 The Surveyor and the Health & Safety Legislation . . . . . . . . . . . . . . . . . . .160 Personal Safety Gear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .161 The Marine Surveyor’s Tools of the Trade . . . . . . . . . . . . . . . . . . . . . . . . . .162 The Follow-up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .165 Giving Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .166 Consultancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .167
16
SETTING UP IN BUSINESS AS A MARINE SURVEYOR
16.1 16.2 16.3
First We Define What Type of Marine Surveyor This Applies to . . . . . . . . .168 The Essential Elements of a Marine Survey Company . . . . . . . . . . . . . . . .168 Management and Human Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . .174
RECOMMENDED READING
149
158
168
178
Useful Websites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .179
1-4
TUTOR-MARKED ASSIGNMENT
180
APPENDICES
182
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PLEASE NOTE
©
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Self-Assessment Questions have been provided periodically throughout this module. These questions are designed to help you with your study. The questions are for your personal study only; do not send in your answers to these questions as they will not be assessed.
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For candidates taking the Diploma option, your TutorMarked Assignment is at the rear of this module. Your worked Assignment should be sent to the TMA Administrator (details are given at the end of the TutorMarked Assignment) for processing.
Copyright IIR Limited 2011. All rights reserved. These materials are protected by international copyright laws. This manual is only for the use of course participants undertaking this course. Unauthorised use, distribution, reproduction or copying of these materials either in whole or in part, in any shape or form or by any means electronically, mechanically, by photocopying, recording or otherwise, including, without limitation, using the manual for any commercial purpose whatsoever is strictly forbidden without prior written consent of IIR Limited. This manual shall not affect the legal relationship or liability of IIR Limited with, or to, any third party and neither shall such third party be entitled to rely upon it. All information and content in this manual is provided on an "as is" basis and you assume total responsibility and risk for your use of such information and content. IIR Limited shall have no liability for technical errors, editorial errors or omissions in this manual; nor any damage including but not limited to direct, punitive, incidental or consequential damages resulting from or arising out of its use.
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PART ONE THE MARINE SURVEYOR’S CUSTOMER BASE
GENERAL INTRODUCTION This introductory module covers two important facets involving the work of the marine surveyors. These are the maritime industry or the environment in which the survey will be working and how surveyors should go about their work. The module covers a lot of ground and is somewhat larger than the average module, so do not feel daunted by its size. It does contain some essential details, particularly for those intending to start off in this fascinating profession. The first part of Module 1 introduces the environment in which today’s marine surveyor operates with reference to the rules and codes by which the industry works. We explore the customer base of the marine surveyor and consider the problems of conflict between different potential customers. We also explore some marine incidents and show how these have helped to influence international and national institutions in shaping the industry codes both for today and the future.
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THE STRUCTURE OF THE MARITIME INDUSTRY
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
name at least two different customers the survey or will serve;
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state the relationship between the various customers; and
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describe the main types of charterparty.
1.1
THE MAIN COMPONENTS
1-001
This introduction looks at the main components of the shipping industry from the perspective of those individuals, companies and organisations that may require the services of a marine surveyor. They can be divided broadly into the following four categories: ●
Firstly, there are those potential customers who have an interest in the services provided by a vessel. These services may range from towage or hydrographic services through the transportation of cargo to the carriage of passengers. The principal focus in this module is on the vessel as a means of transporting cargo.
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Secondly, there is the vessel and its owner and/or manager. The owner/ manager’s interest ranges from the quality of a vessel as a potential investment, through its preparedness and ability to carry a particular cargo or undertake a specific voyage, to its ability to comply with statutory regulations.
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Thirdly, there is the insurer, either of the vessel or the cargo, who wishes to match premium with risk and exposure.
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Fourthly, there are the organisations that impose and monitor safety standards, both governmental and non-governmental. These include classification societies, national governments and international organisations such as the International Maritime Organization (IMO) and the International Labour Organization (ILO).
1.2
THE CARGO OWNERS
1-002
The marine surveyor should never forget that the shipping industry exists to provide a service to its customers. This service is encapsulated in the well-known
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phrase “carefully to load, stow, carry and deliver” the cargo within the master’s control. Arguably, the cargo owner is the most important element in the structure of the maritime industry for without the cargo owner, the international trader, there is no demand for shipping services. 1-003
The cargo owner can, and frequently does, change during the course of the voyage. A marine surveyor will need to know whether he is providing a service for the buyer or the seller, the shipper or the receiver, the consignee or even one of a number of intermediaries who may have taken and resold title in the cargo during the course of a given voyage.
1-004
Therefore, the marine surveyor needs an understanding of the way in which cargoes are bought and sold and how maritime transport is contracted. The interests of the cargo owner are discussed more fully in Chapter 2 of this module.
1.3
THE VESSEL OWNERS
1-005
The “vessel”, which is the vehicle used for the marine transportation of cargo or the delivery of a range of other maritime services, can be provided by many different organisations and for a number of different reasons. In the complex interplay of influences that surround the multi-million dollar transactions that characterise the maritime industry, it is important for the marine surveyor to be clear about the rights and responsibilities of the different organisations and individuals involved.
1-006
Vessels are owned and operated in many different ways across a spectrum of three main types of organisation. At one end is the cargo owner who owns and/or manages his own vessels. Oil companies are a prime example, although the extent of their ownership of the means of transporting their cargoes is diminishing. The central core of vessel provision is by the shipowner, who both owns and manages his vessels. Management in this context means undertaking the commercial as well as the technical operation and container operators provide a good example of the modern shipowner. Thirdly, there are those owners whose interest in shipowning is primarily as a financial investment and who subcontract some or all of the operational functions.
1-007
Shipowners make their vessels available to the market through one of two broad routes. One arises from what was traditionally known as the common carrier where the shipowner operates owned and chartered vessels on a fixed and published schedule; a system frequently referred to as the liner trade. This sector of the industry is now characterised by a complex network of scheduling and freight rate agreements between shipowners and service providers (such as the non-vessel owning container operator), pooling resources in freight conferences. Frequently, the shipping companies’ services are extended beyond the ports to provide a through transport service.
1-008
Operating in a more open market are the tramp owners who move their vessels between commodities and trading areas with relative freedom. The freedom of entry into these markets ensures that there is an amplifying effect on the normal world trade cycles. Linked to this sector are the more specialised vessels. These are designed, built and operated against a long-term charter or contract of affreightment. Liquid natural gas carriers are a prime example of these vessels.
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Here, the main method of engaging the services of a vessel is the charterparty, voyage, time or even bareboat. 1-009
The surveyor may also become involved with the vast array of specialist organisations that provide and operate service vessels, ranging from tugs, pilot vessels and bunker barges through survey and seismic vessel to offshore support and cable-laying vessels. All vessels have the same fundamental requirement of needing to “keep the water out” while protecting the crew and enabling their operational role to be carried out safely and economically. Nevertheless, the function of the vessel can greatly affect the detail of the operation and the structure of the vessel and the marine surveyor needs an understanding of the ways in which different vessels operate.
1-010
A final sector which arguably provides more technological change than any other is driven by a resurgence of the carriage of passengers at sea. This sector covers cruiseships and ferries, and particularly high-speed ferries where formal safety assessment (see Chapter 8) is leading a more risk-based approach to regulation and thus to surveying.
1-011
Behind the vessel owner there will inevitably be the institutions which have provided all or part of the funding for the purchase of the vessel. Banks and other financing institutions are also potential customers for the marine surveyor. Their interest in a vessel may be in the form of: ●
Equity, which tends to reflect ownership of the asset, is not a loan that is repaid by instalment but the return on investment depends upon the profitable trading – or sale – of the vessel. Shareholders providing the equity may be arm’s length investors, with little or no knowledge of the shipping industry, or owners reinvesting in their own fleet.
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Debt is a loan that must be paid back against a fixed schedule. A lender will generally secure its exposure through a mortgage on the vessel, as well as an assignment of earnings and insurance. The prime lender will secure its debt through a first preferred mortgage – a security that is only superseded by a maritime lien. Other lenders might provide finance, at a higher risk and rate of interest but against a lower level of security – this is sometimes referred to as mezzanine finance.
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A Mortgage is, for a lending bank, the most important evidence of its interest in a vessel and of the way in which the vessel provides security since: – – – –
1-012
it gives the lender in rem rights against the mortgaged vessel (ie rights against the vessel itself and not just against the owner); it gives security (ie priority) against unsecured creditors; it enables the lender (the mortgagee) to take possession of the vessel in the event of a default by the owner (the mortgagor); and it allows the mortgagor to sell the vessel to raise funds to satisfy his debt.
Loan agreements may give the lender the right to appoint surveyors to inspect a vessel in order to ensure that it is being properly managed and maintained. In certain circumstances it will be important for the marine surveyor to know who
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has a beneficial interest in a vessel and to be aware of potentially conflicting interests. Mortgages, for example, may be ranked, with a first preferred mortgage taking preference over second mortgages or unsecured mortgages. Mortgages may, in turn, be superseded by maritime liens (especially when the lien secures the crew’s wages). Evidence of secured mortgages at least can be found by requesting a transcript of register from the flag state. 1.4
THE MANAGEMENT OF SHIPS
1-013
There has been a trend over the past three decades for the beneficial owners of a vessel to sub-contract part or all of its management and operation. This divergence of responsibility has played a central role in the implementation of the International Safety Management (ISM) Code. This is discussed in Chapter 6 of this module.
1-014
There are many reasons for the growth of management companies. The globalisation of trade and finance and economic pressure to reduce vessel operating costs frequently finds its expression in an unremitting search for lower manning costs. A direct effect of this has been that established corporate or company values have been replaced by contractual relationships having varying degrees of effectiveness. A major effect of this trend is to make the ship’s master the servant of many different masters. It is important for the surveyor to know where responsibility, and authority, for different aspects of a vessel’s operation lies.
1-015
The Baltic and International Maritime Council (BIMCO) Standard Management Agreement (Shipman) is one of the most commonly used contracts for engaging ship managers. Under Shipman the vessel’s overall operation is divided into nine functions. These are: ●
Crewing Undertaken by either manager or owner and from their own resources or under the auspices of a crew manager. Indeed, more than one crew manager may be involved and it is common for the master and senior management team to be direct employees whilst the remainder of the crew are hired through sub-contractors. Amongst other things, a surveyor will want to know how familiar the crew is with the vessel and its operation, how well the crew can communicate with each other as well as their level of competence.
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Technical Management This includes: – – –
1-10
supervision of the maintenance, repair and general efficiency of the vessel, the provision of stores and spares, ensuring that all the vessel’s international trading certificates are in order and that the vessel meets international and national safety standards.
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Insurance Frequently surveys are for insurance damage and it is important to know who it is that is insured and also who is co-insured or named on the policy. This applies to both loss or damage risk insurance (hull and machinery) and liability insurance (protection & indemnity).
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Freight Management Important aspects of freight management, which may involve the marine surveyor, are: – – –
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on and off-hire surveys, hold and/or tank surveys connected to delivering notice of readiness (to commence cargo operations), and despatch and demurrage calculations.
Accounting An important consideration in so far as the surveyor needs to know who is engaging his or her services and where to send the resultant invoice.
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Chartering Charterparties, one of the principal methods of making a vessel available for employment, are discussed later in this module. Although closely allied to freight management, the chartering function may be undertaken by a separate organisation with the owner frequently keeping close control of this activity. Poor co-ordination or co-operation between fixture (chartering) and post-fixture (freight management and vessel operation) can give rise to disputes – and require the services of a surveyor.
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Vessel Sales and Purchase An activity where the classification surveyor has a pivotal role and where marine surveyors may be used to assess the condition of a vessel at the commencement of negotiations, both for buyer and for financing bank.
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Provisions and Bunkering Bunkering often becomes a difficult area of dispute particularly where bunkering barges are used. The transfer of liquid from one tank to another creates an opportunity for measurement variations and the sounding of tanks is an imperfect method of measurement. Quality can be hard to confirm in the time available for bunkering and surveyors may well become involved in resolving disputes of this nature.
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Operation This includes the issue of voyage instructions and the arrangements for surveying cargoes, undertaking draught surveys etc.
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1.5
THE CHARTERERS
1-016
Apart from the obvious need for on and off-hire surveys, the relevance of the charter status of a vessel lies, to a large extent, in determining who has the right to instruct the vessel with regard to operational matters.
1.5.1
Bareboat Charters
1-017
Here the beneficial owner passes his operational rights and responsibilities on to the charterer although he may retain some or all of the responsibilities for insuring the vessel and the right to inspect the vessel from time to time in order to ensure that the charterer’s husbandry (ie care of the vessel) is in accordance with the terms of the charter.
1.5.2
Time Charters
1-018
A time charter has two important features:
1-019
●
It is a contract for the whole use of a vessel, not just the hire of hold or tank capacity within the vessel; and
●
It passes to the charterer the right, and indeed duty, to give instructions to the master with regard to the employment of the vessel.
Both features give rise to a number of specific survey requirements which will be explored more fully later in this and other modules. The most important are: ●
On-hire survey which, as well as establishing that the vessel complies with its charter description, is a comparative survey. Part of its purpose is to establish a benchmark against which the condition of the vessel, and the time charterer’s care of the vessel, can be measured (fair wear and tear excepted) at some (possibly considerable) later date. The on-hire survey also raises the question of seaworthiness that will be discussed in more detail in Section 2.4;
●
Off-hire survey where the surveyor must depend to a very great extent on the previous work of a fellow surveyor. It is an area where much may be learnt about the preparation of effective survey reports;
●
Speed and consumption claims are a perennial source of dispute between owner and charterer and, if involving a surveyor, can involve him in some interesting detective work.
1-020
The master of a time-chartered vessel will want to be very sure about who has appointed a surveyor. Since the time-chartered vessel may be fixed on a voyage charter, and then sub-chartered again, the master becomes the servant of many interests: owner, time charterer, voyage charterer, shipper and receiver (see Figure 1). He has both to serve and protect all their interests. He will undoubtedly want to know whose interests a surveyor is representing and a competent surveyor should also always be aware how his or her activities fit into the complex matrix of international trade, an exciting and challenging global business.
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The Structure of the Maritime Industry
1-021
This leads one to an important ethical consideration for the professional surveyor. On the one hand, a surveyor’s task is to make a factual report about the subject matter under consideration. On the other hand he has been retained by a principal who has a specific interest in, for example, a vessel or its cargo and may look to the surveyor’s report to enable him to achieve a particular (legal or commercial) outcome. Balancing these two potentially conflicting forces can be a challenge and is the hallmark of a truly professional surveyor.
1.5.3
Voyage Charter
1-022
Under a voyage charter, the charterer’s rights and responsibilities are very different and so is the master’s role. The charterer, or cargo owner, is in effect requiring the master to:
1-023
●
load a nominated cargo or several parcels of cargo in the nominated port(s) or berth(s) between specified dates;
●
take responsibility for it by signing a set of bills of lading;
●
transport the cargo or parcels of cargo safely;
●
deliver the same quality and quantity of cargo to the named destination(s);
●
take responsibility that it is delivered to the right consignee/receiver (even if the charterer has not arranged for receivers to be able to present an original bill of lading).
In contracting the vessel to undertake this assignment the charterer is not issuing the master with detailed instructions but relying on his professional competence to prosecute the voyage expeditiously and with due despatch. This scenario obviously throws up a number of areas in which the surveyor’s professional services may be required. Some of the main areas are: 1.
Arrival and Notice of Readiness (NOR) While voyage charters do not specify speeds or consumptions (this being the master’s area of responsibility), the vessel is expected to present itself, ready for loading, at the specified place between specified dates. Before the cancelling date (the cut-off date after which the charterer may decline to accept the vessel for the contracted voyage or series of voyages), is a specified period of time – the laydays – during which the charterer is bound to accept the vessel. The master’s ability to arrive at the specified position (be it within the port limits or alongside a particular berth), and tender a valid NOR, depends upon, amongst other things: ●
the availability of a berth or anchorage;
●
presenting a seaworthy vessel; and
●
presenting a cargoworthy vessel, especially with regard to the condition of the holds or tanks. Disputes often arise over the readiness
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The Structure of the Maritime Industry
Module 1
of the cargo spaces for the intended cargo, especially if the shipper’s cargo is not yet in the port and ready for loading. 2.
Safe Port / Safe Berth The question of what is a safe port may also be raised, as the charterer has an obligation to ensure that the port towards which a vessel is directed is safe for that vessel, on that voyage, at that time of year or, as was stated in the case of the Eastern City [1958]: “A port will not be safe unless, in the relevant period of time, the particular ship can reach it, use it and return from it without, in the absence of some abnormal occurrence, being exposed to danger which cannot be avoided by good navigation and seamanship.” It is interesting to note how often wise judges return to the benchmark of “good navigation and seamanship” and it is not a bad touchstone for marine surveyors either. In assessing whether a port is unsafe, three factors should be considered: ●
Is the port physically safe? For example, is there sufficient water depth, what are the anticipated weather conditions, has war broken out?
●
Is the basic set-up of the port safe? For example, are the aids to navigation, tugs etc of a satisfactory nature for the vessel in question?
●
Can the event or occurrence that appears to make the port (or berth) unsafe be described as abnormal or could it reasonably be foreseen?
The issue is complex and, if involved, the surveyor should ensure that he or she receives very clear instructions as to the issues in question. 3.
Loading/Discharging and Demurrage/Despatch Time is a most valuable commodity in shipping, both for the shipowner and the cargo owner. If it is wasted by, for example, delays to the vessel or unavailability of berth or cargo, then it is necessary to determine who should bear the financial penalty for the delay or reap the benefit arising out of the saving of time. Surveyors are frequently involved in determining the details to support claims of delay or detention. Laydays (or laytime) are the time allowed for loading and/or discharging the vessel and may be calculated in one of two basic ways: either by stating a specific time or by stating a loading (or discharging) rate against a given tonnage. They may be combined for load and discharge ports (reversible) or separate. Laytime has a start time and date for each port and a date after which, if the vessel has not arrived and presented valid
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The Structure of the Maritime Industry
notice of readiness, the charterer may cancel the charter. This may well happen at times of falling charter rates. Conversely, a financial penalty can be imposed upon the charterer for exceeding the agreed laytime. This is called demurrage. Demurrage disputes are common occurrences, especially in difficult freight markets, and can be particularly difficult to resolve since they are frequently not addressed until after the voyage is complete, ie after the cargo is discharged. Despatch, a bonus to the charterer for completion within less than the allotted period, causes less of a problem since it is more easily deducted from the freight payment. The whole area of proper arrival and tendering of notice of readiness and the calculation of demurrage requires: ●
a good understanding of the relevant documentation, particularly the wording of the charterparty for that voyage;
●
the ability to arrive at an accurate reconstruction of events from diverse information; and
●
the ability to draw accurate information from people with conflicting interests.
These are all prime qualities of the good marine surveyor. 1-024
Pooling arrangements and contracts of affreightment are used either to increase market presence and negotiating power, or to enable owners or charterers to bid for major movements of freight. Many owners will commit their vessels to a pool of similar vessels run by one of the owners, or by a third party. One aspect of this arrangement is that it provides yet another organisation that will be relying upon the master to carry out its requirements and which he must balance against other demands on his time and resources.
1-025
This potentially complex matrix of contracts and charterparties, with its conflicting interests, is a good illustration of the need for a surveyor to do his or her homework before commencing whatever survey work may be required.
SELF-ASSESSMENT QUESTION Assume that you have been asked by a bank to advise on a strategy for investing in shipping. Describe the various different ship investment and ship operating structures that you might recommend and explain how the bank might protect its investment.
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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2.
THE PURPOSE OF MARITIME TRANSPORT
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
state the different terms of trade;
●
describe the more common elements of cargo documentation; and
●
describe what is meant by seaworthiness and cargoworthiness.
2.1
SHIPPING SOPHISTICATION AND DIVERSIFICATION
1-026
The changes to the ownership and operational structure of the shipping industry discussed in Chapter 1 have been matched by a change in the diversity and complexity of the cargoes which these vessels are called on to transport. This, in turn, has affected the sophistication and diversification of vessel design.
1-027
While the ubiquitous container may have disguised the wide variety of cargoes carried in the liner trades, its contents – and those of a large sector of the liquid bulk trades – require ever more precise containment and carriage. One reason for this is the unprecedented ability of an increasing range of cargoes to cause serious damage to the marine environment and/or to those who come into contact with them.
1-028
The globalisation of the world’s economy has also had its effect on ship specialisation, whether it be the pure car carrier, multi-parcel, multi-coated chemical tanker, roll-on roll-off freight ferry, high-speed passenger ferry or, indeed, the recent generation of cruise vessels.
1-029
This, too, has affected the training requirements of the officers who manage and operate these vessels. No longer is a general maritime knowledge, with dry cargo or tanker experience, sufficient and this is reflected in the 1995 Amendments to the 1978 Standards of Training, Certification and Watchkeeping Convention (STCW 95). Increasingly, specialised vessels carrying specialised cargoes are requiring officers with specialised skills.
1-030
This is reflected in the certificate endorsements and training requirements set out in STCW 95.
1-031
Just as this specialisation and requirement for specialised knowledge or training affects the crews on board, so too does it have implications for the marine surveyor.
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The Purpose of Maritime Transport
2.2
CARGO AND THE TRANSFER OF RISK AND TITLE
1-032
As stated at the beginning of Chapter 1, the purpose of merchant shipping is to provide a service and by far the greatest user of the services of the industry is the cargo owner. Some of the aspects introduced in this section are developed further in Chapters 10 to 13 of Module 5.
1-033
The “cargo owner” may change a number of times during the course of a voyage and, with containerisation leading the continual increase of through transport, the “voyage” may extend well beyond the vessel and the ports. A cargo owner’s interest in the cargo may also change during the voyage as the risk in the cargo (the responsibility for insuring the cargo or bearing the cost of its loss or damage) will frequently pass at a different time from the title, or ownership, of the cargo. As well as the cargo owner and the insurer, there is likely to be a financing bank with its own interests to protect.
1-034
The first stage in the ultimate movement of a cargo by sea is the negotiation of a sales contract that will establish the terms of trade. This will involve a buyer and a seller, and the seller may be a trader planning to sell on the cargo.
1-035
A range of influences, including the relative negotiating strengths of the buyer and seller, and, indeed, their negotiating skills, will affect the terms under which the sale is contracted. The most commonly used terms of trade have been codified by the International Chamber of Commerce and are known as Incoterms 1990.
1-036
There are 13 different terms of trade, falling into four groups, and they address the following 10 considerations that must be undertaken by either buyer or seller in order to execute a successful transaction: 1a.
Provision of the goods in conformity with the contract (seller).
1b.
Payment of the price (buyer).
2.
Provision of necessary licences, authorisations and other formalities.
3.
Contract of carriage (and insurance).
4.
Giving (or taking) delivery (title).
5.
Moment of transfer of risk.
6.
Division of costs.
7.
Notices.
8.
Proof of delivery and presentation of transport documentation.
9a.
Marking, checking and packing (seller).
9b.
Inspection (buyer).
10.
Other miscellaneous obligations.
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The Purpose of Maritime Transport
1-037
Module 1
Item 3 above will decide whether it is the buyer or the seller who arranges the sea transport and this will be defined by the selection of the appropriate Incoterm. Item 9 has obvious import for the marine surveyor. The marine surveyor, especially if involved in cargo or hold/tank survey work, should be familiar with the 13 Incoterms summarised below: Group B: Departure EXW
Ex Works
(named place)
Group F: Main Carriage Unpaid F signifies that the seller must hand over the goods to the nominated carrier free of risk and expense to the buyer: FCA FAS
Free Carrier Free Alongside Ship
FOB
Free On Board
(named place) (named port of shipment) (named port of shipment)
Group C: Main Carriage Paid C signifies that the seller must bear certain costs even after the critical point for the division of risk for loss or damage has been reached. CFR
Cost & Freight (C & F)
CIF
Cost, Insurance and Freight
CPT
Carriage Paid to
CIP
Carriage and Insurance Paid to
(named port of destination) (named port of destination) (named port of destination) (named port of destination)
Group D: Arrival D signifies that it is the seller’s responsibility that the goods arrive at the stated destination.
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DAF DES
Deliver at Frontier Delivery ex Ship
DEQ
Delivery ex Quay (Duty Paid)
DDU
Delivery Duty Unpaid
DDP
Delivery Duty Paid
(named place) (named port of destination) (named port of destination) (named port of destination) (named port of destination)
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The Purpose of Maritime Transport
Closely linked to virtually all commodity transactions are insurance (this subject will be discussed in Module 5) and finance. By far the greatest majority of trade finance is provided by a process known as a documentary credit. The process of establishing a documentary credit is relatively straightforward and has the advantage to the seller of providing a confirmed method of payment. ●
The buyer and seller conclude a sales contract providing for payment by documentary credit.
●
The buyer instructs his bank (the issuing bank) to issue a credit in favour of the seller (the beneficiary).
●
The issuing bank asks another bank, usually in the country of the seller, to advise and perhaps also add its confirmation to the documentary credit.
●
The advising or confirming bank informs the seller that the credit has been issued.
1-039
For settlement, the seller sends the documents evidencing the shipment to the nominated bank where the credit is available. After checking the documents, the bank then pays the seller and passes the documents on to the issuing bank to ensure that its payment to the seller is reimbursed. Finally, the issuing bank uses the documents to secure its reimbursement from the buyer.
1-040
From this brief description, it is clear why this method of finance is called a documentary credit and a central document is the bill of lading, possibly supported by a survey report on the cargo. This goes a long way to explain why banks will generally only accept clean bills of lading, that is, bills of lading that normally stipulate that the goods were “in apparent good order and condition when accepted”.
1-041
Thus, dry cargo (Specialist Module A) and liquid cargo (Specialist Module B) surveys play a key role in trading and financing of cargoes.
2.3
CARGO DOCUMENTATION
1-042
A wide range of documents can be involved in the international trading and transportation of cargoes. Since the marine surveyor’s task is frequently to distil the facts from a complex, contractual dispute, an understanding of the principal documentation is essential.
1-043
Figure 1 provides a simplified illustration of a cargo transaction and voyage charter. As stated, especially if time charters are involved or if vessels are subchartered, carrying parcels of cargo for different interests, or the cargo is traded during the voyage, the situation becomes much more complex. A diagrammatic approach to depicting the contractual relationships is often a useful first step in analysing a situation.
2.3.1
Sales Contract
1-044
The transaction which leads to the transportation of goods by sea is initiated by a sales contract. Although this is rarely, if ever, seen by the master or even the
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The Purpose of Maritime Transport
Module 1
shipowner or his chartering department, it contains the basic data against which the (voyage) charterparty is constructed. 1-045
Sales contracts may be complex and detailed, documents relating to specific cargoes sold on specific terms (for example, the Grain and Feed Trade Association (GAFTA) provides a range of standard sales contracts) or much more abbreviated telex or electronic data transmissions which are common in the oil industry. The sales contract should provide the basic information about: ●
the origin and place of loading of the cargo together with the dates on which it will be ready for loading. This can be of critical importance as there may be a contractual requirement to ship a certain quantity within a specified period or the sales price may be decided by an (end of month) index relating to the month in which the cargo was loaded and bills of lading issued;
●
the quality and quantity of cargo and possibly the agreed method of testing for quality;
●
the terms of trade and documentation requirements;
●
details of insurance requirements.
2.3.2
Certificate of Origin
1-046
With complex, international trade agreements and export/import quotas, not to mention trade sanctions, this is an important document. It should not affect the vessel directly but unfortunately it has been known for the contravention of export or import regulations to result in the detention of, or a fine on, the vessel rather than the errant charterer.
2.3.3
Certificate of Inspection/Quantity/Quality
1-047
The key point to understand here is that the buyer may have survey reports reflecting a quantity and/or quality which is different from that pertaining at the point of loading when the vessel’s responsibility commences.
2.3.4
Commercial Invoice
1-048
This will establish the value of the cargo which will be important in any dispute about, for example, short delivery. The invoice value may, however, be substantially different from the commodities’ open market value.
2.3.5
Cargo/Customs Manifests
1-049
This is the document that contains the complete specifications of the cargo with the intended destination that has been loaded by a vessel. This is a useful source of information, especially if many parcels of cargo (or containers) are being carried.
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The Purpose of Maritime Transport
2.3.6
Certificate of Insurance
1-050
This has been introduced to substitute the original floating policies for individual shipments which are normally held by the bank or consignee. The certificate of insurance will show proof that the responsibility for insuring the cargo has been established under the terms of trade.
SELF-ASSESSMENT QUESTIONS A cargo of television sets being shipped in a container under CIF terms is damaged when being handled in the yard of the destination terminal. Is this a problem for the buyer or seller? Or perhaps both parties?
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The Purpose of Maritime Transport
Module 1
Figure 1 Cargo Transaction and Voyage Charter
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The Purpose of Maritime Transport
2.3.7
Bill of Lading
1-051
The traditional route of tally sheets being used to prepare a mate’s receipt with the mate’s receipts being exchanged for the bill(s) of lading is a logical and wellestablished practice, if not one which is always followed. Nevertheless, evidence from “original” sources such as a tally sheet can be compelling evidence in a court of law or arbitration and every effort should at all times be made to trace source documents.
1-052
The three basic functions of a bill of lading are:
1-053
1-054
●
as evidence of the terms of a contract of affreightment;
●
as evidence of shipment of the goods;
●
as a document of title.
There are a number of different bills of lading (and seaway bills where, basically, the function as a document of title does not exist) which meet the requirements of different trades, and a good reference document for definitions is UCP 500 (Uniform Customs and Practice). It is important to know whether the bill of lading which the master is to sign and against which he will later deliver the cargo is: ●
an open bill whereby the cargo is deliverable to the bearer of the bill of lading without formal need for identification;
●
a straight bill where only the named consignee may take delivery of the cargo; or
●
a negotiable bill where the goods are deliverable to a consignee whereby it can be endorsed to a third party if they buy the cargo.
The other main division is between: ●
a marine or ocean bill of lading, sometimes referred to as a port to port bill, and used extensively in the liner trades (in which case, it is the basic contract of carriage); and
●
a charterparty bill of lading which specifies that it is subject to a charterparty (which, in this case, is the contract of carriage).
1-055
The inter-relationship between bill of lading and charterparty is a complex issue which has given rise to much litigation. The starting point for determining this relationship is the incorporation clause in the bill of lading.
1-056
It is the bill of lading, too, which brings into the contract of carriage the overall, international conventions which control the conditions of carriage. The effect and impact of the Hague, Hague-Visby and Hamburg Rules will be discussed in Module 5.
2.4
SEAWORTHINESS
1-057
The concept of seaworthiness is important in a legal context because it relates directly to the shipowner’s right to limit his liability. From a starting point, under
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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The Purpose of Maritime Transport
Module 1
English common law, whereby the common carrier has an absolute liability for the safety of the cargo entrusted to his care, the shipowner has consistently endeavoured to widen his right to limit his liability over and above the basic exemptions of:
1-058
●
act of God;
●
Queen’s enemies;
●
inherent vice of the goods.
The Hague Rules and their successors are an attempt to find an equitable balance between the shipowner’s and the cargo owner’s rights, responsibilities and risks. Rule 1 of Article III of the Hague-Visby Rules states: “The carrier shall be bounden, before and at the beginning of the voyage, to exercise due diligence to: (a)
make the ship seaworthy;
(b)
properly man, equip and supply the ship;
(c)
make the holds, refrigeration and cold chambers, and all other parts of the ship in which goods are carried, fit and safe for their reception, carriage and preservation.”
1-059
To invoke his right to limit liability, the shipowner must be able to demonstrate that both he and his servants exercised due diligence in the responsibilities set out above. The cargo owner, shipper or receiver who has suffered loss or damage to his cargo can be expected to challenge the shipowner’s right to limit liability by proving that he has failed to exercise due diligence in these matters.
1-060
Cargo claims which are resolved in court or through arbitration generally take a number of years to resolve. The marine surveyor who is involved in gathering evidence in order to establish whether due diligence had, or had not, been exercised in ensuring that a vessel was seaworthy at a particular point in time will first need to clarify the precise, contractual context of the seaworthiness requirement.
1-061
The court or arbitrator will want to know: ●
Was the vessel seaworthy (at the commencement of the voyage and at the time in question)?
●
If not, did the owner exercise due diligence to make the vessel seaworthy?
●
If not, did the unseaworthiness cause the loss or damage?
1-062
The third point raises the issue of causa proxima or the direct, as opposed to the indirect (causa remota), cause of an incident or loss. In the words of Scrutton (Scrutton on Charterparties and Bills of Lading, first edition published in 1886): “The seaworthiness required is relative to the nature of the ship, to the particular voyage contracted for and the particular stage of that voyage being different
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The Purpose of Maritime Transport
for summer or winter voyages, whilst loading in harbour and when sailing, and varies with the particular cargo contracted to be carried.” 1-063
The sometimes elusive concept of seaworthiness also affects hull insurance (covered in Module 5) and the (British) Marine Insurance Act 1906 (Section 39–40) stated: “A ship is deemed seaworthy when she is reasonably fit in all respects to encounter the ordinary perils of the seas of the adventure insured.”
1-064
In other words, if a marine surveyor is commissioned to investigate the seaworthiness of a vessel in connection with a cargo dispute or insurance claim, it is essential that precise instructions are received setting out the contractual situation.
2.5
CARGOWORTHINESS AND THE TERM “CAREFULLY TO CARRY”
1-065
The Hague (and associated) Rules also introduce the concept of cargoworthiness and this is an important consideration which is discussed in Module 2 (Sections 4.4 to 4.7) which cover fitness for purpose and commercial surveys. It is sufficient here to state that the vessel’s function and the master’s duty is to carefully load, stow, carry, discharge and deliver the cargo entrusted to the vessel through a variety of inter-related contracts. It is important always to bear in mind that the eventual receiver of the cargo may well not be a party to many of the contracts involved, but have purchased the cargo on the basis of a bill of lading, possibly supplemented by an inspection report on the particular goods which was made some time before the goods were delivered for shipment.
1-066
On the other hand, although modern communications and data transmission technology is making inroads into this, for the major part of the marine transportation in the transfer of goods from buyer to seller, the master and his crew have sole care and custody of those goods.
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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3.
THE PURPOSE OF MARITIME STRATEGY AND SAFETY
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
describe the role of the International Maritime Organization (IMO);
●
consider the magnitude of marine accidents; and
●
state how the IMO tends to react to these accidents.
3.1
THE ROLE OF THE IMO
1-067
The previous two sections have concentrated on the commercial aspects of shipping which are governed by what is generally termed private law. In other words, the law relates to the rights and responsibilities of those who choose to become contractually involved.
1-068
Considerations of safety involve both those who are contractually involved but to whom the shipowner (as employee) owes a duty of care, such as the crew, as well as innocent third parties. This area is generally referred to as public law and one of the earliest examples of the modern era was the introduction of the requirement for load lines into the Merchant Shipping Acts in 1876 following the publication by Samuel Plimsoll of Our Seamen; An Appeal in 1873, and Coffin Ships in 1876.
1-069
In the 1950s each shipping nation had its own maritime laws and there were comparatively few international treaties addressing maritime safety. Standards and requirements varied considerably and were sometimes even contradictory. In the following years, the world fleet grew at a considerable rate, from some 118 million tons in 1958, the year that conventions establishing IMO came into force, to 406 million tons by 1978. At the same time vessels became more specialised, more complex and larger. Safety was becoming a global issue and IMO was the forum in which international standards were established.
1-070
IMO’s governing body is its Assembly, which meets once every two years and which consists of representatives from all member states (in excess of 150). Between sessions, a Council consisting of 32 member governments, elected by the Assembly, acts as its governing body.
1-071
The legal vehicles through which IMO achieves its objective of internationally enforceable safety standards are conventions and protocols. Established by Convention in 1948, the Intergovernmental Maritime Consultative Organisation
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Module 1
The Purpose of Maritime Strategy and Safety
(its name until 1982) met formally for the first time in 1959. Since then, IMO has promoted the adoption of some 30 conventions and protocols, supplemented by over 700 codes and recommendations concerning maritime safety, the prevention of pollution and related matters. 1-072
IMO works through specialist committees and sub-committees composed of representatives of member states. They are advised and assisted by appropriate bodies of the United Nations as well as more than 30 inter-governmental organisations and nearly 50 non-governmental international organisations. These organisations have consultative status but cannot vote.
1-073
The initial work on a convention is done by the appropriate committee or subcommittee; the resultant draft is submitted to a conference which all member states are invited to attend. The final text is then presented to governments for ratification. The convention comes into effect when it has been ratified by an agreed number of member states representing an agreed percentage of world tonnage.
1-074
In addition to the conventions and protocols, through which major amendments and extensions are made to original conventions, are the many codes, guidelines and recommended practices. These are not usually legally binding, although they are frequently used in framing national laws and some, such as the International Safety Management (ISM) Code, are made mandatory by including the appropriate reference within a convention.
1-075
Most of the conventions now include a “tacit acceptance” provision. Under “tacit acceptance” an amendment to the convention enters into force on a specified date (usually about two years after the amendment is adopted) unless it is rejected by one-third of contracting parties or contracting parties whose combined fleets represent 50% of world tonnage.
1-076
Adopting conventions, codes and recommendations is important but they mean nothing if they are not enforced. This is the responsibility of governments rather than IMO and, not surprisingly perhaps, the way regulations are implemented varies from country to country.
1-077
One step which IMO has taken to improve implementation and eliminate the differences in standards and interpretation is to establish a technical co-operation programme. An extension of this is the World Maritime University, established in Malmo, Sweden in 1982. More recently, a sub-committee on flag state implementation has been established and a regime of port state control introduced, allowing governments to inspect foreign vessels visiting their ports for compliance with conventions and recommendations.
1-078
IMO is a technical organisation and most of its work is carried out in a number of committees and sub-committees.
1-079
The Maritime Safety Committee (MSC) is the most senior of the committees that carry out the organisation’s technical work. It has a number of sub-committees whose titles indicate the subjects they deal with: ●
Safety of Navigation;
●
Radio Communications;
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The Purpose of Maritime Strategy and Safety
Module 1
●
Life-Saving, Search and Rescue;
●
Training and Watchkeeping;
●
Carriage of Dangerous Goods;
●
Ship Design and Equipment;
●
Fire Protection;
●
Stability and Load Lines and Fishing Vessel Safety;
●
Containers and Cargoes;
●
Flag State Implementation; and
●
Bulk Chemicals.
1-080
The Marine Environment Protection Committee (MEPC) was established by the Assembly in November 1973. It is responsible for co-ordinating the organisation’s activities in the prevention and control of pollution of the marine environment from ships. The sub-committees on Bulk Chemicals and Flag State Implementation are also sub-committees of the MEPC.
1-081
The Legal Committee was originally established to deal with the legal problems arising from the Torrey Canyon accident of 1967, but it was subsequently made a permanent committee. It is responsible for considering any legal matters within the scope of the organisation.
1-082
The Technical Co-operation Committee is responsible for co-ordinating the work of the organisation in the provision of technical assistance in the maritime field, in particular to developing countries. The importance of technical assistance in IMO’s work is shown by the fact that it is the first organisation in the United Nations system formally to recognise a Technical Co-operation Committee in its convention.
1-083
The Facilitation Committee is responsible for IMO’s activities and functions relating to the facilitation of international maritime traffic. These are aimed at reducing the formalities and simplifying the documentation required of ships when entering or leaving ports or other terminals.
1-084
All the committees of IMO are open to participation by all member governments on an equal basis.
1-085
The committees are supported by a secretariat of some 300 international civil servants headed by the secretary-general.
3.2
MARITIME LOSSES: THEIR IMPACT
1-086
Maritime loss is used generically to cover both:
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●
accidents for which a specific error or malfunction can be found in the causal chain of events; and
●
casualties which can be equated to acts of God.
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The Purpose of Maritime Strategy and Safety
Maritime losses can be grouped into four categories with the categories being defined largely by the particular stakeholders who are most affected by the loss. The concept of stakeholder interest is being used increasingly in assessing the impact of accidents and casualties and it will be discussed further in Chapter 8. The four categories are: (i)
loss of vessel, primarily affecting the beneficial owner and his insurer;
(ii)
loss of cargo, primarily affecting the shipper or receiver and their insurer(s);
(iii)
loss of life or personal injury, primarily affecting the injured parties and their families and dependants;
(iv)
damage to the marine environment where, beyond the immediate loss of livelihood and annuity, the loss is being seen as affecting the wider public interest.
1-088
Public reaction must be considered an integral part of a marine safety regime since it is frequently public reaction which drives the political will to change the status quo. This is not the place to discuss whether it is the press (or media) which drives public opinion or the opposite. Nevertheless, the often overpowering impact of press and public opinion should be borne in mind by any marine surveyor involved in an accident or casualty which attracts public attention.
1-089
Public pressure can undoubtedly be an important vehicle for change, especially against the resistance of vested interests and entrenched bureaucracy. Conversely one major, but often overlooked, advantage of having international safety standards is that safety has largely been removed from the control of the commercial arena. Although safety does vary from country to country, as is indicated by annual casualty statistics, most ships engaged in foreign trade are built, maintained and operated according to standards laid down by IMO.
1-090
Two of the main criticisms levelled at the international/inter-governmental endeavours to raise global safety standards, now primarily the responsibility of IMO, are that: ●
major advances or changes are only generated in response to a major casualty; and
●
the changes take too long to implement.
1-091
Although the international conference convened by the United Kingdom in 1914, in response to the 1912 Titanic disaster, adopted the first Safety of Life at Sea (SOLAS) Convention, it did not enter into force because of the outbreak of the First World War. A second SOLAS Convention was then not adopted until 1929 and did not come into force until 1933, some 20 years after the incident which brought it about.
1-092
In 1967 the Torrey Canyon went aground and spilled an unprecedented 120,000 tonnes of oil into the sea off the coast of England – the world’s first major pollution disaster. Faced with demands from politicians, press and public, the British government came to IMO with a series of proposals. These evolved into
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The Purpose of Maritime Strategy and Safety
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a comprehensive action plan which saw major changes being made to regulations concerning pollution. 1-093
Almost exactly 20 years later, the Herald of Free Enterprise tragedy, with the loss of 188 lives, again saw the United Kingdom approach IMO and, just over a year later, a series of amendments to SOLAS 1974 were adopted. They came into force in October 1989 with a further set of amendments entering force in April 1990.
1-094
IMO’s response to another major ro-ro ferry disaster, the Estonia, which sank with the loss of 912 lives in September 1994, was a major review of all aspects of ro-ro safety. This led to further significant amendments to SOLAS, many of which were already in force by the time the official report of the disaster was published in 1997.
1-095
There are other examples of marine disasters which have triggered changes and amendments to IMO’s conventions and codes of practice, such as the Amoco Cadiz and Exxon Valdez oil spills. IMO’s reaction time and ability to incorporate corrective measures into international treaties has undoubtedly improved. However, the impetus for the re-examination of and improvement to safety standards has, all too often, been in response to a major accident or casualty. It can also be argued that the resultant recommendations driven by public pressure sometimes address the specifics of a particular incident rather than the fundamental causes of the problem.
1-096
There is, within the international maritime community, a growing recognition of this problem. One initiative, again piloted by the United Kingdom, is to introduce a risk management approach to establishing safety standards. This approach, referred to as Formal Safety Assessment, is discussed in Chapter 8.
1-097
Another problem of the current system is that it depends largely on the active technical and political input of interested and involved member states. It is noticeable that while the sinking of both the Herald of Free Enterprise and Estonia, with the loss of 188 and 912 lives respectively, generated relatively prompt amendments to IMO conventions, the loss of the Philippines ferry Dona Paz, with the loss of 4,375 lives, did not generate a similar level of international activity.
3.3
MARITIME LOSSES: THEIR QUANTUM AND COST
1-098
The meaningful analysis of the statistics of maritime losses is a complex exercise which must be undertaken against a background of major changes which can be summarised under the following headings: (i)
Growth in Tonnage In 1958 the world fleet totalled 118 million tons and the world’s shipyards were delivering 9.2 million tons. In 1975 the world’s shipyards delivered a peak figure of 34 million tons and in 1978 the world fleet was 406 million tons. By 1996, after some years of negative growth, the size of the world fleet was 497 million gross tons (ships over 500 gt). In 2006, gross tonnage was 710 million
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The Purpose of Maritime Strategy and Safety
tons, consisting of 49,213 vessels (with a further 45,723 vessels under 500 gross tons, with a total gross tonnage of 11 million tons). (ii)
Specialisation of Tonnage Whereas once the major part of the merchant fleet could be divided into tankers, bulk carriers, dry cargo vessels and passenger liners, this is no longer so. Liquefied gas carriers and chemical tankers, container vessels and a wide range of roll-on roll-off ferries, both monohull and catamaran, as well as a major fleet of offshore support vessels, are but some of the changes. All these vessels demand, to a greater or lesser degree, specialised knowledge and skills from the seafarers who man them. At the same time, vessels have grown rapidly in size so that the world fleet now contains vessels capable of transporting up to half a million tonnes of crude oil and over 8,000 twenty foot equivalent (TEU) containers and vessels of 12,000 TEU capacity being designed.
(iii)
Economic Conditions The shipping industry is a notoriously cyclical industry requiring a heavy capital investment which needs to be made against an uncertain and often erratic income forecast. Wildly optimistic forecasts of economic growth, and especially the demand for oil, in the late 1960s and early 1970s generated an explosion of shipbuilding capacity and excess tonnage which is only just working its way out of the system. Freight rates have, in general terms, failed to keep pace with the general inflation of costs and this has had a direct impact on the structure of the industry.
(iv)
Industry Structure Financing costs and operating costs are two of the variables where shipowners and operators can counter the real term reduction in freight rates and achieve a competitive edge. Within the area of financing, the search for favourable tax regimes for large, capital investments played a significant part in the major move of shipowning from traditional flags to what are now commonly referred to as flags of convenience. The desire of many developing countries, encouraged by the policies of the United Nations Conference on Trade and Development (UNCTAD), also moved resources away from the traditional – and experienced – shipping nations.
1-099
In the area of ship operating costs, one item which was seen as offering potential for reduction was crew costs. Over the last 20 years, there has been a major move from the employment of experienced seafarers, generally from traditional shipowning nations, with their high social costs and sometimes over-unionised work practices, to almost anywhere that can offer cheap manpower.
1-100
Coupled with this has been the decline of the owner/operator and the rise of the international ship manager. With the fierce competition for ship management contracts in the global arena, crew costs have remained under pressure and, despite the use of fewer and fewer experienced crew on more and more specialised vessels, training costs have frequently been an early casualty of the search for economical operation.
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The Purpose of Maritime Strategy and Safety
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Against this background, the bare statistics for ships lost each year (based on figures issued by the London Underwriters Association) show the following percentages of world tonnage:
1950 – 1959
Under 0.30%
1960 – 1969
Rising to 0.40% by 1969
1970 – 1979
Dropping to 0.31% in 1977 but rising to 0.56% in 1979
1980 – 1989
Eventually decreasing to 0.20% by 1989
1990 – 1996
Up to 0.40% in 1991 but down to 0.13% by 1996
Unfortunately, these statistics are no longer presented in the same way, but casualty statistics are available on IMO’s website (www.imo.org/circulars). Circular MSC 953 defines casualties as follows: “Very serious casualties” are casualties to ships which involve total loss of the ship, loss of life, or severe pollution, the definition of which, as agreed by the Marine Environment Protection Committee as its 37th session (MEPC 37/22, paragraph 5.8) is as follows: “Severe pollution” is a case of pollution which, as evaluated by the coastal state(s) affected or the flag state, as appropriate, produces a major deleterious effect upon the environment, or which would have produced such an effect without preventative action. “Serious casualties” are casualties to ships which do not qualify as “very serious casualties” and which involve a fire, explosion, collision, grounding, contact, heavy weather damage, ice damage, hull cracking, or suspected hull defect etc, resulting in: ●
immobilisation of main engines, extensive accommodation damage, severe structural damage, such as penetration of the hull under water etc, rendering the ship unfit to proceed; or
●
pollution (regardless of quantity); and/or
●
a breakdown necessitating towage or shore assistance.
“Less serious casualties” are casualties to ships which do not qualify as “very serious casualties” or “serious casualties” and, for the purpose of recording useful information, also include “marine incidents” which themselves include “hazardous incidents” and “near misses”.
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The Purpose of Maritime Strategy and Safety
The following table is an extract that illustrates the recent trend for “very serious” casualties and the preponderance of serious casualties linked to hull or watertight door failure. Many of these are linked to bulk carrier losses and the reason for the current review of bulk carrier design by IMO.
Very Serious Casualties
Number of Lives Lost
‘95
‘96
‘97
‘98
‘99
‘95
‘96
‘97
‘98
‘99
Collision / contact
20
28
31
20
25
96
48
74
19
50
Stranding / grounding
24
23
17
24
8
5
9
8
19
15
Capsizing / listing
6
6
13
14
6
14
543
259
61
13
Fire / explosion
23
18
19
12
21
51
30
54
18
84
Hull and watertight door failure
93
80
43
70
58
194
204
78
367
232
Other
–
1
4
8
27
–
–
1
11
60
Total
166
156
127
148
145
360
834
474
495
484
Severe Pollution
1-104
Actual Total Losses
‘95
‘96
‘97
‘98
‘99
‘95
‘96
‘97
‘98
‘99
Collision / contact
5
9
5
5
2
19
26
23
15
21
Stranding / grounding
9
3
6
3
–
24
23
17
24
8
Capsizing / listing
–
1
–
1
1
4
4
12
13
12
Fire / explosion
–
–
2
–
–
17
9
12
11
11
Hull and watertight door failure
1
3
3
2
3
93
80
43
70
56
Other
–
–
–
–
–
–
1
4
6
11
Total
15
16
16
11
6
157
143
111
139
119
Within these overall statistics, age, type of vessel and flag are perhaps the most relevant areas for analysis. Detailed figures are produced by IMO, as well as other sources such as the P&I clubs.
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The Purpose of Maritime Strategy and Safety
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Another measure of safety is the number of lives lost at sea and accidents to ships over 500 gt. The 1989 to 1999 figures are:
Year
Lives Lost
1989
810
1990
807
1991
1,389
1992
386
1993
615
1994
1,418
1995
328
1996
1,437
Single Incident Over 250 Lives
Salem Express – 464
This total appears to exclude over 1,700 lives lost on Neptune Estonia – 912
Bukoba – 869 Gurita – 338
1997
474
1998
495
1999
484
Although the IMO statistics only show 835 lives lost
It is a stark fact that an average of nearly 800 people are lost at sea in (supposedly) well-found commercial vessels every year. 1-106
With the growing number of cruise vessels, as well as the increase in size, number and speed of passenger ferries, it is to be sincerely hoped that the toll of lives lost is kept under control by the effective implementation of the international safety strategy which is focused on IMO.
1-107
These figures ignore the additional incidents of personal injury, damage or loss to cargo and pollution damage which are reflected in the liability insurance returns of the protection and indemnity associations. Careful study of the annual
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reports and published analyses of the P & I clubs should be considered as essential reading by the marine surveyor. 1-108
On the following table, a breakdown of the class and causes of 94 high-value claims in excess of $1,600,000 each, gives an indication of the information available.
Type
%
Cause
Cargo
20
Bad handling
Injury
7
Bad stowage
Other
3
Damage prior to loading
Collision
17
Fire
Property Damage
26
Grounding
Pollution
14
Inadequate coatings
Wreck Removal
5
Sank
Injury (non-crew)
7
Shell plate failure
Unrecoverable G A
1
Ship machinery failure
3.4
INTERNATIONAL STRATEGY FOR SAFETY
1-109
The international strategy for safety is largely reflected in the range and scope of IMO conventions and recommendations. It is also reflected in the way in which the process of generating these instruments, together with amendments to existing conventions, is changing and adapting to the demands of the industry and the public and nowhere more so than in concern over pollution.
1-110
The full range of IMO conventions and subsidiary instruments, together with their status (with regard to ratification and implementation) can be obtained from the headquarters of the International Maritime Organisation in London and can also be accessed through their website (http://www.imo.org). The main conventions for which IMO is responsible are:
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International Convention for the Safety of Life at Sea 1974 Protocols 1978, 1988 Convention on the International Regulations for Preventing Collision at Sea 1972 International Convention for the Prevention of Pollution from Ships 1973 Protocols 1978, 1997
Convention on Facilitation of International Marine Traffic 1965
International Load Line Convention 1966 Protocol 1988
1-36
SOLAS 1974
COLREGS 1972
MARPOL 1973
FAL 1965
LL 1966
International Convention on Tonnage Measurement of Ships 1969
TONNAGE 1969
International Convention Relating to Intervention on the High Seas in Cases of Oil Pollution Casualties 1969 Protocol 1973
INTERVENTION 1969
International Convention on Civil Liability for Oil Pollution Damage 1969 Protocols 1976, 1992
CLC 1969
Special Trade Passenger Ships Agreement 1971 Protocol on Space Requirements 1973
STP 1971
Convention relating to Civil Liability in the Field of Maritime Carriage of Nuclear Fuels 1971
NUCLEAR 1971
International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage 1971 Protocols 1976, 1992
FUND 1971
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The Purpose of Maritime Strategy and Safety
International Convention for Safe Containers 1972
CSC 1972
Athens Convention relating to the Carriage of Passengers and their Luggage by Sea 1974 Protocols 1976, 1990
PAL 1974
Convention on International Mobile Satellite Organisation plus Operating Agreement
INMARSAT
Convention on Limitation of Liability for Marine Claim 1976 – Protocol 1996
LLMC 1976
International Convention on Standards of Training, Certification and Watchkeeping for Seafarers 1978 – Amendments 1995*
STCW ‘95
International Convention on Standards of Training, Certification and Watchkeeping for Fishing Vessel Personnel 1995
STCW-F 1995
International Convention on Search and Rescue 1979
SAR 1979
Convention for the Suppression of Unlawful Acts against the Safety of Maritime Navigation 1988 – Protocol relating to Fixed Platforms 1988
SUA 1988
International COSPAS-SARSAT Programme Agreement 1988
COS-SAR 1988
International Convention on Salvage 1989
SALVAGE 1989
International Convention on Oil Preparedness, Response and Co-operation 1990 with Hazardous and Noxious Substances Protocol
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OPRC 1990
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The Purpose of Maritime Strategy and Safety
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Torremolinos International Convention for the Safety of Fishing Vessels 1977 – Protocol 1999
SFV 1997
International Convention on Liability and Compensation for Damage in connection with the Carriage of Hazardous and Noxious Substances by Sea 1996
HNS 1996
Convention on the Prevention of Marine Pollution by Dumping of Wastes and other Matter (London Dumping Convention) 1972 Protocol 1996
LC 1972
Bunker Convention
BC 2001
Anti-Fouling Systems
AFS 2001
In addition, a number of the codes of practice have also been made mandatory under either SOLAS or MARPOL and these are: ●
International Gas Carrier Code 1983
●
International Bulk Chemicals Code 1983
●
International Code for the Safe Carriage of Grain in Bulk 1991
●
International Safety Management Code 1993
●
International Code of Safety for High-speed Craft 1994
●
International Code for Safe Loading and Unloading of Bulk Carriers 1997 (BLU Code)
●
International Ship and Port Facility Security (ISPS) Code 2004
1-112
It is clear that IMO is becoming more aware that increasing regulation alone will not ensure an adequate level of safety. The ability (and tendency by many) to classify 80% of accidents as human error on the part of the seafarer did little in itself to promote safety. It did, however, focus attention on the need to address both the educational and training needs of the seafarer and the deteriorating state of maritime management in a number of areas, frequently but not exclusively linked to flags of convenience.
1-113
The response has been swift and pragmatic considering the fact that IMO depends on international agreement for the adoption of its conventions and then
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a commitment, by the member states, to implement the meaning as well as the letter of the convention. 1-114
The virtual re-writing of the Convention of Standards of Training, Certification and Watchkeeping as an amendment in 1995 (STCW 95) in order to speed adoption and implementation is a prime example. So too is the concept of a “white list” of member states who have complied with STCW 95 implementation requirements – the closest IMO has moved to what could be termed as sanctions.
1-115
The focus on management contained within the compulsory International Safety Management (ISM) Code is another example of the recognition that technical regulation alone is not the route to safety.
1-116
The application of the ISM Code is discussed in Chapter 6.
1-117
IMO is also looking at ways in which it can be even more pro-active and not find itself reacting to major marine casualties as has happened in the past. The investigation of Formal Safety Assessment, explored in Chapter 8, is a demonstration of this.
1-118
In 2000, regulations were introduced under SOLAS that require the phased introduction of voyage data recorders (VDR) (beginning with the new passenger vessels built after 1 July 2001) and automatic information systems (AIS), transponders that transmit information on the carrying vessel, commencing with all passenger ships on 1 July 2001.
1-119
Other areas of current attention include the design, buoyancy and strength requirements of bulk carriers, especially in way of the fore part of the vessel and security. Here, the development of technology and specifically the ability of remotely operated vehicles (ROVs) to inspect sunken vessels at great depths has significantly widened the scope of casualty investigation. Security is a twopart concern, covering both piracy and international terrorism, and new security measures are currently under discussion in the Maritime Safety Committee.
1-120
Finally, IMO is finding stronger ways of ensuring implementation and compliance with its conventions. The IMO Sub-Committee on Flag State Implementation (FSI) recognised the need for a single, comprehensive document which would provide basic guidance on the conduct of port state control (PSC). The recommendations of the FSI Sub-Committee, made at its January 1996 session, were given effect by Assembly Resolution A.787(19) and the effect of this is discussed in Chapter 7.
3.5
INTERNATIONAL STRATEGY FOR SECURITY
1-121
Following the terrorist attack on the World Trade Centre in New York on 11 September 2001, the United States proceeded rapidly with what became a Home Security initiative that included ships as well as aeroplanes. Rather than see regional initiatives, IMO moved quickly to put in place a global, maritime security system. Using SOLAS, an existing convention, IMO adopted new regulations in Chapter XI of SOLAS 74 in December 2002 in co-operation with other organisations such as:
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The Purpose of Maritime Strategy and Safety
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●
the International Labour Organisation (ILO); and
●
World Customs Organisation (WCO).
This enabled IMO to publish the International Ship and Port Facility Security (ISPS) Code with an implementation date of 1 July 2004. 1-122
The unique aspect of the ISPS Code is that, for the first time, IMO produced legislation that, when implemented by “contracting governments” (effectively flag states), imposed obligations upon ports and not just ships. There are two main thrusts to the ISPS Code. The first is to improve the information available about ships, their recent trading pattern and their ownership history. All ships, therefore, in addition to clearly displaying their ship’s identification number, must provide a port with a continuous synopsis record containing such information as: ●
flag state;
●
date of registration;
●
ID number;
●
name and port of registry;
●
registered owners (and bareboat charterers) and address;
●
name of company (under ISM Code);
●
class;
●
administration issuing Document of Compliance (DOC) and Safety Management Certificate (SMC);
●
name of administration issuing International Ship Security Certificate (ISSC); and
●
the date when the vessel ceased registration with a flag state.
In addition, a port will demand to know the last 10 ports of call of the vessel and may deny entry if one of those ports has not met ISPS Code requirements. Finally, the date for the provision of Automatic Identification Systems (AIS) was brought forward to 31 December 2004 for most ships trading internationally. 1-123
Ports also have an obligation to put in place security plans, procedures and training, most ports being divided into individual “port facilities” or distinct terminal areas for this purpose. Both ships and ports require qualified security officers and security plans that have been approved by their governments. Security operates on three levels: ●
Security Level 1 The level for which minimum protective measures shall be maintained at all times. The port or ship may make a declaration of security.
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●
Security Level 2 Appropriate additional protective security measures shall be maintained for a period of time as a result of heightened risk of a security incident.
●
Security Level 3 Further specific protective security measures shall be maintained for a limited time when a security incident is probable or imminent, although it may not be possible to identify the specific target.
1-124
In parallel with the development of the ISPS Code, measures were also being developed to enhance the security of the global supply chain and especially the 232 million container movements through some 4,000 ports involving a large proportion of the 46,000 internationally trading merchant ships. In addition to this are the security issues attaching to some 1.2 million seafarers.
1-125
The WCO took the lead co-ordinating role with regard to cargo supply chain security with Customs-Trade Partnership Against Terrorism (C-TPAT), a joint government-business initiative to build co-operative relationships that strengthen overall supply chain and border security as one of the outcomes. The ILO is co-ordinating the initiative to develop seafarer identification documents with considerable discussion surrounding the use of biometric identification cards and the restriction on shore leave for seafarers.
1-126
Of particular importance to the marine surveyor is the need to ensure that proper arrangements have been put in place that will ensure that he or she has access to the port and to the ship.
SELF-ASSESSMENT QUESTION Discuss the pros and cons of international laws governing ship operation against the current system of international conventions that are then interpreted into national laws.
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4.
OCCUPATIONAL HEALTH AND SAFETY
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
state the guiding principles of health and safety;
●
describe how local occupational health and safety laws need to dovetail with international maritime laws and conventions; and
●
be aware that in your occupation as a marine surveyor you will also have to look after your own health and safety.
4.1
THE ROLE OF ILO
1-127
Like IMO, the International Labour Organisation, based in Geneva, is an agency of the United Nations. However, it has a much wider remit, and maritime labour issues only form part of its responsibilities. It also differs from IMO in its constitution. While IMO consists of two contributing parties: ●
the flag states (ie governments); and
●
the NGOs (non-government organisations such as Class, IFSMA, INTERTANKO, ISF, Friends of the Earth and many others).
ILO has three constituent parts: ●
government;
●
employers; and
●
employees.
Furthermore, while in IMO only flag states can vote, all three elements of ILO can vote. 1-128
Understandably, ILO is primarily interested in labour standards and human rights and specifically in seafarers’ working conditions, including such issues as remuneration, diet, health, repatriation and increasingly fatigue as crews get smaller and paperwork and inspections increase. In addition, ILO takes an active role in promoting good accommodation standards and, in this area especially, its requirements may well affect marine surveyors (www.ilo.org).
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4.2
SHIPBOARD SAFETY AND SAFETY COMMITTEES
1-129
Every flag state will have its own domestic health and safety regulations covering both the procedures to be followed to prevent accidents as well as the actions to be taken in the event of accidents. In this area, the reporting of accidents and subsequent statistical analysis are important aids in focusing accident prevention resources. Another important aspect of accident prevention is the development of a “no blame” reporting culture. Much can be learnt from near misses, which, under a “who is to blame” culture, would be suppressed as well, as from an open examination of the cause of an accident.
1-130
The guiding principles of health and safety are that:
1-131
●
employers have to look after the health and safety of their employees;
●
employees and the self-employed have to look after their own health and safety; and
●
all have to take care of the health and safety of others, such as their fellow workers or members of the public who may be affected by their work activities.
Increasingly, health and safety regulations are led by: ●
international law and conventions (such as IMO); and
●
regional organisations (such as the European Union).
Recent revisions to the British Merchant Shipping (Safety and Health at Work) Regulations, for example, have introduced the concept of a formal application of risk assessment in order to minimise accidents. 1-132
Health and safety regulations should, in general terms, impose the following obligations upon an employer: ●
the avoidance of risks;
●
the evaluation of unavoidable risk;
●
the adoption of work patterns and procedures which take into account the capacity of the individual especially with respect to the design of the workplace and the choice of work equipment, with a view to alleviating monotonous work and to reducing any consequent adverse effect on workers’ health and safety;
●
the adoption of a coherent approach to management of a vessel or undertaking, taking account of health and safety at every level of the organisation;
●
to give collective protective measures priority over individual protective measures;
●
to provide appropriate and relevant information and instruction for workers.
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1-133
A suitable and sufficient assessment should be made of the risks to the health and safety of workers arising from the normal course of their activities or duties, for the purpose of identifying groups of workers at particular risk.
1-134
Increasingly, where workers aboard a vessel are not employed by the company, the company has an obligation to co-ordinate the arrangements for the protection of workers with the employer of those workers. This also reflects the requirements of the International Safety Management Code.
1-135
As part of the health and safety regime on board, a safety committee should be established and a safety officer appointed. The safety officer should use his best endeavours to improve safety consciousness amongst the crew and investigate every accident or dangerous occurrence, potential hazard to health and safety and all reasonable complaints by the crew. He should have a direct reporting route to the master and should also carry out health and safety inspections of the vessel at regular intervals.
1-136
He can be assisted in his duties by safety representatives and a safety committee, which, to be fully effective, should be chaired by the master. This committee should have the power and the duty to make representations to the company on potential hazards and dangerous occurrences at the workplace.
1-137
The proceedings and records of the Shipboard Safety Committee should provide important evidence in the event of an accident or incident investigation by a marine surveyor.
1-138
Finally, it is important that the marine surveyor is conscious of and complies with, and is seen to comply with, all relevant health and safety legislation in the course of their work. The first and most outwardly obvious expression of this is wearing appropriate protective clothing.
4.3
HEALTH, FATIGUE AND QUALITY OF LIFE
1-139
Although not directly the concern of the marine surveyor, an understanding of crucial – and topical – issues such as fatigue and, increasingly, quality of life are essential. To carry out his or her role effectively, the marine surveyor needs the co-operation of the ship’s staff and in port, almost inevitably, they are under pressure. Increased paperwork and high levels of audits, surveys and inspections, to which the marine surveyor contributes, together with the reduced numbers of crew, all contribute to a situation that a surveyor may need to navigate with tact and understanding.
1-140
Current regulations specify 77 hours non-working time per week, in other words a minimum of 10-hour rest per day. On smaller coastal ships with a master and mate of six-on and six-off watches, the 84-hour watchkeeping time leaves little slack for arrivals and departures, let alone all the other calls on their time.
4.4
SHORE-BASED SAFETY REQUIREMENTS
1-141
On entering into any port, a vessel will also be entering into the area of jurisdiction of that state’s national, and possibly local, health and safety regulations. Ports
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where cargo operations are undertaken, and more especially dry docks and repair yards, are intrinsically hazardous environments and are likely to have established safety procedures. How these inter-relate with the vessel’s own regulations and procedures, especially as workers from ashore undertake their duties on board, is an area of potential conflict. However, safety has a strong underlying core of common sense and both the vessel and the port should ensure that they are providing a safe working environment in which others can undertake their rightful duties. 1-142
1-143
1-144
In the United Kingdom, recent legislation reflects the directives emanating from the EU and is the responsibility of the Health and Safety Executive (HSE). The HSE’s responsibilities cover developing new safety laws and standards, representing the United Kingdom in international developments, especially in the European Union, and: ●
inspecting workplaces;
●
investigating accidents and cases of ill health;
●
enforcing good standards through advice, orders and, if necessary, prosecution;
●
publishing guidance and advice;
●
providing an information service;
●
carrying out research;
●
carrying out various other activities such as nuclear site licensing and the assessment of offshore installation safety cases.
In the United Kingdom, the HSE’s work is supplemented by the local authorities whose responsibilities cover: ●
retailing and some warehousing;
●
most offices;
●
hotels and catering;
●
sports;
●
leisure;
●
consumer activities; and
●
places of worship.
Under the umbrella legislation Management of Health and Safety at Work (1992) which, as with the maritime legislation, introduces a much greater obligation to apply risk management, the following daughter regulations cover the main areas: ●
Use of Equipment
●
Lifting Operations and Lifting Equipment (which covers cranes)
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●
Personal Protective Equipment
●
Manual Handling Equipment
●
Provision and Use of Work Equipment
●
Workplace Health and Safety and Welfare
1-145
These supplement the 1974 Health and Safety at Work Act, with the Docks (1988) and Shipbuilding and Ship Repair (1960) Acts as well as the 1988 Care of Substances Hazardous to Health (COSHH) provisions.
1-146
If it is necessary to refer to or to use health and safety legislation, it is often more useful to refer to the associated codes of practice. As well as containing the legislation, these codes also give advice on how the legislation should be interpreted. Up-to-date information on health and safety matters and legislation can be found on the Health and Safety Executive’s website (http://www.open.gov.uk/ hse/hsehome.htm).
SELF-ASSESSMENT QUESTION Assume you wish to set up as a self-employed marine surveyor in your country of choice. Investigate the H&S regulations that you will be required to adhere to.
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5.
QUALITY AND AUDITS
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
describe today’s international structure of quality assurance;
●
state the purpose and method of auditing quality; and
●
outline a surveyor’s role in the inspection and audit.
5.1
AUDITS, INSPECTIONS AND SURVEYS
1-147
Inspections, surveys and audits have, to a degree, a parallel with the management cultures of blame, compliance and of self-regulation. Inspections are used, particularly in manufacturing, to ensure that the end product meets a defined specification. Failure to pass inspection results in rejection. It is, in general terms, a static and reactive approach to ensuring quality.
1-148
A survey, on the other hand, tends to incorporate a view of an object’s ability to meet certain standards, not just at the time of survey but on into the future (for the defined survey period at the very least). As such, it is a more pro-active approach to ensuring continued compliance with regulations.
1-149
Auditing tends to take into account the human factor and the dynamics of management to a much greater extent. The International Standards Organisation (in ISO 10011 – Guidelines for Auditing Quality Systems) defines a (quality) audit as:
1-150
●
“a systematic and independent examination to determine whether quality activities and related results comply with planned arrangements”; and
●
“whether these activities are implemented effectively and are suitable to achieve the stated objectives.”
IRCA, the International Register of Certificated Auditors, part of the London-based Institute of Quality Assurance, defines the following types of audit: ●
first party (internal) audits performed within an organisation by that organisation’s auditing organisation;
●
second party audits where, for example, an organisation audits a supplier or contractor;
●
third party audits undertaken by an independent certification body (such as the flag state administration in the case of the ISM Code).
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Quality and Audits
Module 1
1-151
Oil Companies International Marine Forum (OCIMF) introduced a new programme of “best practice” within the ship operations to provide a method of identifying quality ship operators.
1-152
The Tanker Manager Self Assessment programme provides a comprehensive instrument to assist ship operators to measure and improve their management systems. Further, the programme encourages ship operators to assess their safety-management systems against listed key performance indicators (KPI), and provide a measure of best practice.
5.2
QUALITY SYSTEMS
1-153
Quality systems evolved as it became increasingly apparent that output inspection was not achieving the desired result. For a start, it depends too much on identifying and rejecting faulty products or components. This is inherently wasteful and the aim of the quality systems approach, frequently referred to as quality assurance, was to prevent the production of faulty products, services or components. The development of this philosophy, to increase the degree of involvement of all staff in achieving improved quality, moves the business in the direction of total quality management.
1-154
The other essential dimension of quality management is the recognition of the customer and the customer’s expectations. This is perhaps best encapsulated by the expression: “The customer does not depend upon us, it is we who depend upon the customer.”
1-155
Thus, a quality management system (QMS) is required to demonstrate that a company has implemented procedures which enable it to: ●
improve customer satisfaction – an important consideration for shipping companies as the perceived quality and safety of the shipping industry deteriorates;
●
eliminate waste and errors;
●
reduce operating costs – by the elimination of errors and through improved efficiency, sometimes a difficult concept for short-term, bottom-line oriented management contemplating the cost of implementation;
●
increased motivation and commitment from employers – a benefit which requires skilled management (both sympathetic and determined) and an understanding of how to manage change; and
●
increased profitability and competitiveness.
1-156
Quality management systems need to be designed with all stakeholders in mind, remembering that different stakeholders will have different and sometimes possibly conflicting interests. The list of stakeholders can be extensive (although they can be grouped) and may include:
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Equity shareholders
Shore-based employees
Flag state
Mortgagees
Sea-based employees
Class
Insurers
Charterers
Public (environmental)
Cargo owners
Ports
1-157
A well designed quality management system can also be useful in developing inter-departmental understanding and co-operation, particularly across the shipshore interface. Conversely, a badly designed and/or imposed QMS can have precisely the opposite effect.
1-158
The ISO 9000 and ISO 14000 families are among the most widely known and successful quality standards ever. ISO 9000 has become an international reference for quality requirements in business to business dealings, and ISO 14000 looks set to achieve at least as much, if not more, in helping organisations to meet their environmental challenges.
1-159
The standards that have earned the ISO 9000 and ISO 14000 families a worldwide reputation are known as “generic management system standards”. “Generic” means that the same standards can be applied to any organisation, large or small, whatever its product – including whether its “product” is actually a service – in any sector of activity, and whether it is a business enterprise, a public administration or a government department. “Management system” refers to what the organisation does to manage its processes, or activities. “Generic” also signifies that no matter what the organisation is or does, if it wants to establish a quality management system or an environmental management system, then such a system has a number of essential features that are spelled out in the relevant standards of the ISO 9000 or ISO 14000 families.
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ISO 9000 is concerned with “quality management”. This means what the organisation does to enhance customer satisfaction by meeting customer and applicable regulatory requirements and continually improving its performance in this regard. ISO 14000 is primarily concerned with “environmental management”. This means what the organisation does to minimise harmful effects on the environment caused by its activities, and continually to improve its environmental performance.
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Module 1
At the core of all quality and safety management systems is the need for documentation. The challenge is to design documentation which facilitates the system rather than producing an additional and de-motivating paper chase for those staff involved at the delivery (to customers) end of the business. It is generally agreed that there should be four tiers of documentation:
Tier 1
The Quality Manual which includes the company’s quality policy describes the organisation, procedures and practices of the company.
Tier 2
Procedures which describe what is done and by whom and how, when, where and why an activity is to be carried out. In other words how the business process is controlled. It is at this level that the standards of quality (or safety) which the company aims to achieve are established.
Tier 3
Job instructions which direct a person in a single activity and are subordinate documents to Procedures.
Tier 4
Forms and records which, amongst other documents, should include the record of internal audits and the status of any non-conformities (q v).
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All of the above are controlled documents which must be formally issued, under signature, by the correct issuing authority within the company and withdrawn and destroyed when no longer relevant or when updated. Good quality systems are designed to keep this task as manageable as possible which is another way of saying that the amount of documentation should be kept as low as possible.
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ISO 9001:1994 quality management system was the backbone on which the ISM Code developed. It has now been replaced by ISO 9001–2000 (while ISO 9004–2000 provides a wider range of objectives of a quality management system with an emphasis on the pursuit of continual improvement of performance). The requirements of ISO 9001–2000 are set out in the table on the following page together with the related requirements of the ISM Code as well as the code produced by the International Ship Managers’ Association (ISMA) discussed in Section 5.4.
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ISO 9001 1994
ISO 9001 2000
IMO ISM
ISMA
Management Responsibility and Authority
4.1
5.5
*
*
Quality Management System
4.2
4.1/2
*
*
Contract Review
4.3
7.2
Design Control
4.4
7.3
Document and Data Control
4.5
4.2.3
Purchasing
4.6
7.4.1/3
*
Customer (Owner/Charterer) Supplied Product
4.7
7.5.4
*
Identification and Traceability
4.8
7.5.3
*
*
Process Control (Core Activities)
4.9
6.3/4 & 7.5
*
*
Safety Management System
4.9
”
*
*
Contingency Plans and Environment Protection (EVP)
4.9
”
*
*
Vessel Certification and Trading Readiness
4.9
”
*
*
Maintenance and Repair/Drydocking
4.9
”
*
*
Manning/Personnel
4.9
”
*
*
Communications
4.9
”
*
*
Insurance
4.9
”
Accounting
4.9
Inspection and Testing of Vessels and Equipment
4.10
7.1/4/5 & 8.2
Inspection, Measurement and Testing
4.11
7.6
Inspection and Test Status
4.12
7.5
*
*
Control of Non-conformances
4.13
8.3
*
*
Corrective and Preventative Action
4.14
8.5
*
*
Handling, Storage, Packaging Preservation and Delivery (Cargo)
4.15
7.5.5
*
*
Control of Quality Records
4.16
4.2.4
*
*
Internal Quality Audits and System Review
4.17
8.2.2/3
*
*
Training
4.18
6.2.2
*
*
Servicing
4.19
7.5.1
Statistical Techniques
4.20
8.1/2/4
Health, Safety and Environmental Policy
*
*
Alcohol and Drug Abuse Policy
*
*
Procedure Title
Marketing Policy
Diploma in Marine Surveying 2011 / 2012 (LP0058)
*
*
*
* * *
* *
*
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5.3
UNDERTAKING AUDITS
1-164
Audits, especially those related to ISO 9000 or the ISM Code, have a well-established procedure which is designed to take into account the objective of continual improvement. Thus, quality (and safety) management audits are an ongoing process, incorporating both the company’s own internal audits (as required under section 12.1. of the ISM Code) and formal third party audits by the relevant administrations.
1-165
As with all activities, and especially those that depend upon the co-operation of others, the auditee, careful planning is essential. The essential steps of an audit are outlined below, more detailed advice and guidance is contained within the recommended references. (a)
Establishing the Objectives of the Audit This can be described in terms of both the depth and scope of an audit. A relatively superficial or “shallow” audit may be appropriate in order to get the feel of whether the quality or safety management system is operating effectively. Alternatively, a “deep” audit looks more comprehensively at the details of “adherence” or “compliance”. The scope of the audit defines those activities or part of an organisation which are to be audited; it is not unusual in internal audits, for example, for one department to audit another as part of the process of continual improvement or for a specific activity, such as contingency planning, to be audited.
(b)
Planning and Scheduling Especially in the confined windows of opportunity offered by a vessel in port, scheduling the audit in conjunction with the master is essential. The objective is to audit the operation rather than just the documentation but this places obvious strains on the auditees. Whenever possible, it is beneficial to identify, obtain and review as much documentation as possible relevant to the audit, prior to involving the ship’s or office staff in the audit of the operation.
(c)
Preparation of Checklists This can be a contentious issue since a management audit is very different from an inspection, and, to a degree, a survey. It cannot be carried out by checklist, but there is no doubt that a good checklist provides an invaluable aide mémoire and can improve the efficiency, continuity and depth of the audit process.
(d)
Performance of the Audit This falls into five distinct phases:
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1.
The entry meeting.
2.
The audit.
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Quality and Audits
3.
Evaluation of results.
4.
The exit meeting.
5.
The audit report.
The purpose of the entry meeting is to: ●
introduce the auditor/audit team to the representatives of the auditees;
●
reconfirm the purpose and scope of the audit;
●
provide a short summary of the audit procedures and methods;
●
review any non-conformities carried forward from the previous audit;
●
finalise the time scale and arrange for escorts to accompany the audit team;
●
discuss the method by which any non-conformities (qv) will be addressed;
●
agree a provisional time for the exit meeting.
1-167
The audit focuses on obtaining objective evidence not only that procedures are being followed but that there is evidence of a genuine endeavour to improve the existing standards. Quality and safety management systems should be dynamic rather than static. Open questions should be used as much as possible so that “Has this lifeboat been maintained?” becomes “Describe how this lifeboat is maintained” or a passage is planned or contingency plan exercised.
1-168
When a procedure is not being followed, or followed incorrectly, a non-conformity occurs. Non-conformances are classed as follows: Category 1 or Major Non-conformance ●
An element of the system standard which is not addressed.
●
An activity which is in direct contravention of the standard.
●
An activity which is in direct contravention of a procedure and will have a consequential effect on quality or safety (as defined by the appropriate code).
Category 2 or Minor Non-conformance ●
An isolated incidence of a non-conformance with a system or procedural requirement which has no direct consequential effect on quality of safety.
●
Trends of minor non-conformances, such as three incidences of the same deficiency, which could lead to a major non-conformance.
Category 3 or Observations ●
Comments on the quality or safety management system with a view to improvement.
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Immediately after the audit and prior to the exit meeting, the auditor or audit team must evaluate the evidence generated during the audit. The objective evidence related to any non-conformances must be rigorously tested.
1-170
At the exit meeting the lead auditor presents an overview of the audit and then any non-conformances being presented in the form of a corrective action request (CAR). The auditee should acknowledge, though not necessarily accept, the CAR by signing it. The objective is for the auditee to formally return the CAR, containing the following information, before the audit report is finalised (usually within two working weeks): ●
the corrective action which is to be taken to correct the deficiency; and
●
the corrective action which is to be taken to prevent a recurrence of the deficiency.
1-171
The audit report should incorporate the feedback from the auditee on the action taken with regard to CARs and will, in due course, be the starting point for the preparation of the next audit plan.
5.4
INTERNATIONAL SHIP MANAGERS’ ASSOCIATION (ISMA) CODE
1-172
During 1988, five leading ship management companies met to discuss the possibility of improving standards within the ship management sector and the shipping industry in general. Five major and competing ship managers drafted a Code of Ship Management Standards and encouraged the formation of the International Ship Managers Association (ISMA). At its inaugural meeting in April 1991, the code was unanimously accepted. ISMA is now a company, limited by guarantee, registered in Limassol. It operates through four sub-committees covering the code, manpower supply and training, legal and insurance matters and an IMO committee.
1-173
In 1996, ISMA estimated that its membership represented in excess of 60% of the total world third party managed fleet amounting to some 2,315 vessels of just under 49 million gross tonnage of which some 47% were under full management, 46% under crew management and 7% under some other form of management. This covered 47,528 crew members currently employed and a further 18,000 (approx.) retained or on leave. Twenty-nine percent of the vessels were under a national register, a further 29% under a second or international register (eg NIS, Kerguelen, Isle of Man) and 42% under an open register.
1-174
A particular aspect of the ISMA Code is that it goes wider than the requirements of a safety or quality code and addresses the commercial business aspects of the ship manager’s relationship with the vessel owner. The comprehensive nature of the code is indicated by its coverage, embracing the following 22 subjects:
1-54
●
General
●
Business Ethics
●
Organisation
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Quality and Audits
●
Personnel
●
Safety
●
Environmental Protection
●
Contingency Planning
●
Operational Capability
●
Cost Efficiency, Purchasing and Contracting
●
Maintenance and Maintenance Standard
●
Technical Support
●
Insurance
●
Accounting
●
Certification and Compliance with Rules and Regulations
●
Cargo Handling and Cargo Care
●
Communication Procedures
●
Management Agreement
●
Records
●
Auditing Body
●
Quality System
●
Document Control
●
Internal Quality Audits
A major consideration is the auditing of a code which has been drawn up with the objectives of self-regulation and, in a strategic sense, marketing and business promotion. This had been solved by establishing an independent organisation consisting of four classification societies, American Bureau of Shipping (ABS), Det Norske Veritas (DNV), Germanischer Lloyd (GL) and Lloyd’s Register of Shipping (LR). An audit is carried out by three auditors, drawn separately from each of these societies by rotation and therefore at random. The audit will be performed for the following classes of ship types: ●
Container Vessels
●
Bulk/Dry Cargo Vessels
●
Tankers
●
Gas Carriers
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●
Chemical Carriers
●
Reefers
●
Passenger Ships
●
Special Types
External audits of the ISMA Code, which incorporates the requirements of ISO 9002, are valid for a period of three years, subject to annual intermediate audits. The company is also required to establish a regime of internal audits.
SELF-ASSESSMENT QUESTION Consider what quality standard would best suit an international marine surveying company.
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Diploma in Marine Surveying 2011 / 2012 (LP0058)
6.
INTERNATIONAL SAFETY MANAGEMENT (ISM) CODE
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
outline the ISM Code and how it is implemented;
●
specify the shipowner’s responsibilities under this code;
●
state the meaning of safety management certificate (SMC) and document of compliance (DOC); and
●
describe the standards of competence required to audit safety management systems.
6.1
THE ORIGIN AND OBJECTIVES OF THE ISM CODE
1-177
Chapters 1 and 3 outlined how merchant shipping has become increasingly complex and specialised and is increasingly governed by comprehensive rules and regulations developed by national and international authorities. At the same time, less experienced crews have been used, increasingly managed through short-term contractual, rather than established company relationships. A third influence has been the technical development of global communications capability which fostered the belief in part of the industry that vessels could effectively be managed from ashore.
1-178
Many of these factors, especially in the face of continuing low freight rates, gave the illusion of lower, more competitive operating costs. The down side of this was the increase in maritime loss and damage which was increasingly attributed to “human error” of the master and crew.
1-179
An initial reaction to this was an increase in regulations and procedures and an endeavour to implant the quality systems discussed in Chapter 5. The introduction of quality-based systems represents an advance from a culture of blame – 80% of all accidents are caused by [your] human error – to a culture of compliance. A culture of compliance approach requires that: ●
the rules and regulations address comprehensively all the problems, dangers and challenges that may be met by a vessel during the course of its tracking; and
●
the crew on board have basically the same knowledge base and cultural approach to dealing with both standard operational and dangerous situations.
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International Safety Management (ISM) Code
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Both of these conditions patently did not apply to the management of ships during the 1970s and 1980s. This led to the increasing realisation of the need to move towards the creation of a culture of self-regulation (sometimes called a safety culture) which concentrates on internal management and organisation for safety and encourages individual industries and companies to establish ever better targets for safety performance. It is this realisation which led towards the adoption, in November 1993, of the ISM Code which was made mandatory, as from 1 July 1998 for certain classes of vessel, by the entry into force of SOLAS Chapter IX on the Management for the Safe Operation of Ships.
1-181
The title for SOLAS Chapter IX is important since it introduces management as a means of achieving an objective which is the safe operation of ships. Under a culture of compliance the title could well have been “Regulations for Safety and Pollution Prevention on Board Ships”.
1-182
A fundamental strength and effectiveness of the ISM Code is that it addresses two key issues affecting the safe operation of merchant vessels: (i)
Within the complex inter-relationship of ownership and management, crew supply and commercial and charter operations, it requires that the company be formally identified as “the owner of the ship or any other organisation or person such as the manager, or the bareboat charterer who has assumed the responsibility for the operation of the ship from the owner of the ship and who on assuming such responsibility has agreed to take over all duties and responsibilities imposed by the International Safety Management Code”. Furthermore, it requires the appointment of a designated person(s) who “is a person or persons ashore with direct access to the highest levels of management who has or have the responsibility and the authority to monitor the safety and the pollution prevention aspects of the operation of each ship, and to ensure that adequate resources and shore-based support are applied as required”.
(ii)
The code recognises that it is vital that the management philosophies and procedures of sea and shore staff are bound together as one cohesive unit and it defines and reinforces the master’s role, establishing that he must have: ●
“the overriding authority and responsibility to make decisions with respect to safety and pollution prevention and to request the company’s assistance as may be necessary”; and that
●
the company must provide the ship with the proper resources in terms of competent personnel.
1-183
One other core element of the code is that it is a dynamic operational procedure rather than a static regulatory rule and that it incorporates the requirements [specified in Resolution A.788(19)] “to continuously improve the safety management skills of personnel ashore and aboard, including preparing for emergencies related both to safety and environmental protection”.
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Module 1
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International Safety Management (ISM) Code
Chapter IX of SOLAS specifies that the requirements of the ISM Code apply: (i)
to passenger ships, including high-speed craft, not later than 1 July 1998;
(ii)
to oil tankers, chemical tankers, gas carriers, bulk carriers and cargo highspeed craft of 500 gross tonnage and upwards, not later than 1 July 1998; and
(iii)
other cargo ships and mobile/drilling offshore units of 500 gross tonnage and upwards, not later than 1 July 2002.
1-185
The challenge for the maritime community with the passing of the 1 July 2002 deadline is the need to ensure that the balance of the compliant world fleet meets the requirements of the ISM Code. Under both the Paris and Tokyo Port State Control MOUs (see Chapter 7) a three-month concentrated inspection campaign commenced on 1 July 2002, with an anticipated 3,500 inspections in the Paris MOU region alone.
6.2
THE SAFETY MANAGEMENT SYSTEM (SMS)
1-186
In terms of the ISM Code, a safety management system means a structured and documented system enabling company personnel to effectively implement the company safety and environmental protection policy. To be effective, the SMS should enable a company to measure its performances allowing for areas for improvement to be identified and implemented.
1-187
The elements of the code from which the SMS is constructed are: Preamble 1.
General covering definitions, objectives and application.
2.
Safety and Environmental Protection Policy.
3.
Company Responsibilities and Authority, including the provision of adequate resources.
4.
Designated Person(s).
5.
Master’s Responsibility and Authority.
6.
Resources and Personnel, including requirements for familiarisation with shipboard duties and the need for a common working language.
7.
Development of Plans for Shipboard Operations, a recognition of the importance of establishing safe procedures for the normal operation of a ship.
8.
Emergency Preparedness, including contingency planning.
9.
Reports and Analysis of Non-Conformities, Accidents and Hazardous Occurrences with “the objective of improving safety and pollution prevention”.
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International Safety Management (ISM) Code
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10.
Maintenance of the Ship and Equipment.
11.
Documentation.
12.
Company Verification, Review and Evaluation making regular internal audits an essential part of the SMS.
13.
Certification, Verification and Control specifying that a company must have in place a valid document of compliance (DOC) and each ship a safety management certificate (SMC).
1-188
The ISM Code, SOLAS Chapter IX and IMO Resolution A.788(19) adopted on 23 November 1995 can be obtained from the Publications Department at the IMO head office in London. They are all contained, together with comprehensive explanatory notes, in Guidelines on the Application of the IMO International Safety Management Code (Third Edition) published jointly by the International Shipping Federation (ISF), and International Chamber of Shipping (ICS) also in London.
6.3
THE IMPLEMENTATION AND OPERATION OF THE ISM CODE
1-189
As with all systems and procedures, the introduction of a safety management system compliant with the ISM Code requires proper planning and resources, commitment from the top and the involvement of all concerned, both ashore and aboard. It is, as stated before, a dynamic, operational system and should, to a large extent, refine and improve the way a company is already operating rather than require radical re-organisation. Casualty statistics and the resultant requirement for the code does, however, indicate that there are companies which will require major reorganisation.
1-190
Rule 13 of the ISM Code states that: “1.
The ship should be operated by a company which is issued a document of compliance relevant to that ship.
4.
A certificate, called a safety management certificate, should be issued to a ship by the administration or organisation recognised by the administration. The administration should, when issuing a certificate, verify that the company and its shipboard management operate in accordance with the approved SMS.”
And in Rule 12: “1.
The company should carry out internal audits to verify whether safety and pollution prevention activities comply with the SMS.
2.
The company should periodically evaluate the efficiency of and, when needed, review the safety management system in accordance with procedures established by the company.”
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These four sub-clauses effectively encapsulate the implementation and operation of the code. The administration referred to means the government of the state
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whose flag the ship is entitled to fly. A “recognised organisation”, is, effectively, a member of the International Association of Classification Societies and there are only very limited areas where flag states have involved other organisations in the official auditing of SMSs. 1-192
As discussed in Chapter 5, the requirement is for auditing skills and IMO Resolution A.788(19), in Appendix 1, Clause 3, Standards of Competence, sets out the basic requirements for auditor competence. These can be summarised as: ●
relevant educational qualifications from a tertiary (high educational) institution or a nautical college linked to seagoing experience;
●
practical experience of marine operations;
●
practical knowledge of appropriate ship types;
●
knowledge of ISM Code;
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knowledge of company and/or shipboard SMS; and
●
audit experience and training.
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These criteria are developed and expanded within the IRCA requirements for auditor registration set out in Chapter 5, with a particular emphasis being given to the need for practical experience of marine operations, both commercial as well as technical. A central reason for this is because much of the time pressure which raises the risk profile of an operational vessel arises from its need to meet commercial objectives and deadlines (see Chapter 8).
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Before applying to its administration, a company should have in place an SMS which will meet the general objectives of Resolution A 788(19) by having: ●
provided for safe practices in ship operation and a safe working environment;
●
established safeguards against all identified risks; and
●
established a procedure to continuously improve the safety management skills of personnel ashore and aboard, including preparation for emergencies related both to safety and environmental protection.
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The starting point is the company’s document of compliance (DOC). The audit for this should identify objective evidence demonstrating that the company SMS has been in operation for at least three months and an SMS has been in operation on at least one ship of each type operated by the company for at least three months. Objective evidence should, inter alia, include records from internal audits.
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A DOC is issued for specific ship types which are defined, in SOLAS Chapter IX as: ●
Oil tanker
●
Chemical tanker
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Gas carrier
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Bulk carrier
●
Passenger ships including passenger high-speed craft
●
Mobile offshore drilling units
●
Other cargo ships of 500 gross tonnage and upwards
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The DOC is initially valid for five years and is subject to annual verification within three months before or after its anniversary date. The validity of a DOC may be extended to include additional types of ship after verification of the company’s capability to comply with the requirements of the ISM Code for such ship types. Alternatively, a large, international company, or ship management group, may well require two or more DOCs which could well be issued by different administrations.
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Once the relevant DOC is in place, the shipboard SMS may be audited and the audit will, as previously mentioned, require evidence that it has been functioning for three months. The SMC is valid for five years and will be subject to at least one intermediate verification. If the intermediate verification is not requested, or if there is evidence of major non-conformity, the issuing administration may withdraw the SMC.
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Interim certificates may be issued under certain conditions, valid for 12 months in the case of a DOC and six months for an SMC.
SELF-ASSESSMENT QUESTIONS What are the qualifications and the essential requirements needed for the designated person ashore to be able to work effectively?
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7.
PORT STATE CONTROL (PSC)
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
state what is meant by port state control;
●
describe how PSC is regionalised; and
●
review how the US targets PSC inspections on a Boarding Criteria Matrix arrangement.
7.1
THE PSC ORGANISATION
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Unlike a normal convention, port state control grew out of regional initiatives using an amalgam of existing IMO (and International Labour Organisation – ILO) convention provisions. Under the provisions of these major IMO conventions: “the administration” (ie the government of the flag state): “is responsible for promulgating laws and regulations and for taking all other steps which may be necessary to give the applicable conventions full and complete effect so as to ensure that from the point of view of safety of life and pollution prevention, a ship is fit for the service for which it is intended and seafarers are qualified and fit for their duties”. [Procedures for Port State Control, London 1997]
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In the diplomatic language of international organisations: “In some cases is may be difficult for the [flag] administration to exercise full and continuous control over some ships . . . ”
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The problem can and has been partly overcome by appointing inspectors at foreign ports and/or authorising recognised organisations to act on behalf of flag state administrations.
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The main conventions are listed below, together with a reference to the regulations which provide for the port state control procedures: ●
International Convention on Load Lines, as amended and its 1988 Protocol (Loadlines 66/88) – Article 21.
●
International Convention for the Safety of Life at Sea (SOLAS) 1974, its Protocol of 1978, as amended and the Protocol of 1988 (SOLAS 74/78/88) – Regulation 19 of Chapter I and Regulation 4 of Chapter XI).
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International Convention for the Prevention of Pollution from Ships 1973, as modified by the Protocol of 1978, as amended (MARPOL 73/78) – Regulation 8A of Annex I, Regulation 15 of Annex II, Regulation 8 of Annex III, Regulation 8 of Annex V.
●
International Convention on Standards of Training, Certification and Watchkeeping for Seafarers 1978, as amended 1995 (STCW 78/95) – Article X.
●
Convention on the International Regulations for Preventing Collision at Sea 1972, as amended (COLREGS 72).
●
International Convention on Tonnage Measurement of Ships 1969 (TONNAGE 69) – Article 12.
●
In addition, the International Labour Organisation, Merchant Shipping (Minimum Standards) Convention 1976 (ILO Convention No 147) also applies.
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The application of port state control inspections is effected through regional “understandings”. In 1978 the Hague Memorandum of Understanding between a number of maritime authorities in Western Europe was developed, focusing on the shipboard living and working conditions required by ILO Convention No 147. However, the oil spill which resulted from the grounding of the tanker Amoco Cadiz off the coast of France in 1978 resulted in a major reappraisal.
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This reappraisal incorporated safety of life at sea and the prevention of pollution from ships into the requirements of the Hague Memorandum and it became the Paris Memorandum of Understanding which entered operation in July 1982. The geographical scope of the Paris MoU region covers the European coastal states (including Russia) and the Atlantic coast of North America.
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Other regional port state control memoranda of understanding are: ●
the Latin American Agreement (Acuerdo de Viña del Mar) – Chile, November 1992;
●
The Tokyo MoU, covering the Asia-Pacific region, signed in December 1993;
●
the Caribbean MoU, signed in Barbados February 1996; and
●
the Mediterranean MoU, signed in Malta in July 1997.
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Further regions within which port state institutions are being developed include the Indian Ocean, linking India, Australia and East Africa, as well as the Persian Gulf and West and Central Africa.
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The IMO initiative to promote the establishment of port state regimes is Resolution A [682(17)] Regional Co-operation in the Control of Ships and Discharges and the objective is the eradication of sub-standard shipping.
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Under the Paris MoU, the port state control regime is organised as follows: ●
Port State Control Committee (PSCC) (This is the political forum where all member states are represented.)
●
–
The PSCC will meet with intervals of nine to 12 months (previously six months) and the meetings will take five days.
–
The chairman of the PSCC will be elected for a term of three meetings.
MoU Advisory Body (MAB) This consists of two European Union (EU) representatives, two non-EU representatives and the PSCC chairman, serving for a two-year term. The MAB acts as a Secretariat for the PSCC with a particular responsibility for strategic policy.
●
Technical Evaluation Group (TEG) The TEG evaluates reports from the task forces and prepares reports for the MAB. The main purpose is to obtain consensus amongst member countries.
●
Task Forces Task forces are established by the PSCC whenever there is a need for the development of new detailed guidelines, preparation and evaluation of concentrated inspection campaigns etc. The task force will normally consist of six to eight member countries and will work in the most effective way in order to achieve their task. Typical tasks include: ISM implementation, bulk carrier safety, training of port state control officers (PSCO), Highspeed Craft Code, etc.
●
IMO and ILO Both these organisations have observer status at PSCC level.
●
MoU Secretariat A permanent secretariat is responsible for the ongoing administrative requirements of the regime. In the case of the Paris MoU, the secretariat is located in the Netherlands.
●
SIReNac This is the central information system which is used by member states to assist them in selecting ships for inspection. It is essential that ships with a poor inspection record can be tracked and targeted while it is also important that the operation of PSC inspections is transparent and seen to be fair. Further information can be found on the Paris MoU website (www.parismou.org).
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Ship Inspection Services Below the MoU level, the organisation and operation of a port state control regime rests with individual member states’ maritime authorities which establish ship inspection services.
7.2
THE PSC INSPECTION
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Before inspections can be undertaken in a manner which will contribute effectively to the elimination of sub-standard ships, it is necessary to identify which ships should be inspected. Formally, ships may be inspected on the basis of: (i)
the initiative of the party (port state);
(ii)
at the request of, or on the basis of information regarding a ship provided by another port; or
(iii)
information provided by a member of the crew, professional body (and passengers), or for the protection of the marine environment.
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Statistical evidence covering the Paris MoU region over the past three years has indicated a steep increase in safety management defects (150% over the last three years). In particular, older ships (15 years) show 14 times as many nonconformities when compared to younger ships (5 years). In 2001, half of the total number of inspections (9,313) were carried out on general dry cargo ships. These ships have the highest detention percentage (12%) when compared with the total number of inspections and made up 65% of all detentions in 2001. They must now demonstrate their compliance with the ISM Code since 1 July 2002.
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Port state control officers have the difficult task in assessing whether the management system on board is a “paper exercise” or whether the master is “fully conversant” with the SMS and ship’s personnel are able to “communicate effectively” in the execution of their duties related to the SMS. It is for this reason that it is important that PSC officers, as well as ISM Code auditors, have a good understanding of the commercial as well as the technical operation of merchant ships.
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Whilst other MOUs are improving the focus of port State control the Paris MOU is continuing its work to fill in the details of a new approach to port State control and in 2006 new main principles of the New Inspection Regime (NIR) have been agreed. While low-risk ships will be rewarded with a 24 month interval, the high risk ships will be subject to a more rigorous inspection regime with an inspection every 6 months. During 2006 the discussion on the NIR had to take into account what happened at the European Community level on the proposed recast Directive on port State control. Work has also started on the details of the NIR and a Task Force is preparing proposals for the level and scope of inspections. These inspection matrices should provide a more harmonized approach to the levels to which different ship types are inspected. This would then also provide more accurate data on the results of the inspections and the level of responsibility. A new element in the NIR will measure the performance of the company of the ships. It is anticipated that the European decision making process will be finalized by the end of 2007. This would mean that the NIR will enter into force in 2010 or 2011 at the latest.
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BOARDING CRITERIA MATRIX
OWNER
FLAG
CLASS
HISTORY
SHIP TYPE
5 Points
7 Points
Priority 1
5 Points Each
1 Point
Listed owner or operator
Listed flag state
A detention ratio equal to or greater than 2%
Detention within the previous 12 months
Oil or chemical tanker
5 Points
1 Point Each
1 Point
A detention ratio equal to 1% or less than 2%
Other operational control within the previous 12 months
Gas carrier
3 Points
1 Point Each
2 Points
A detention ratio equal to 0.5% or less than 1%
Casualty within the previous 12 months
Bulk cargoship over 10 years old
0 Points
1 Point Each
1 Point
A detention ratio less than 0.5%
Violation within the previous 12 months
Passenger ship
1 Point Each
2 Points
Not boarded within the previous six months
Carrying low value commodities in bulk
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7.2.1
Boarding Criteria and Black Grey White Lists
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Port state control regimes require a procedure to target those vessels most likely to be below the ISM Code standards. In the US, a Boarding Criteria Matrix, built up on a points system, takes into account the criteria on the previous page.
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Ships are then awarded a priority rating, running from: Priority I 17 or more points, or ship involved in a marine casualty, or USCG (US Coast Guard) captain of the port determines a vessel to be a potential hazard to the port or environment. Port entry may be restricted until the vessel is examined by the Coast Guard. through to: Priority IV Three or fewer points on matrix. Vessel will not be boarded. The results of all PSC inspections are co-ordinated and great efforts are being made to ensure that the information becomes rapidly available to all port state control officers. Flag states are ranked by an excess factor that takes into account the number of vessels within the register and the level of non-conformities.
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The Paris MoU operates a target factor calculator on its website (www.parismou.org) that takes into account:
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It will be apparent from the information required to operate this targeting system how important it is that an up-to-date central database is maintained which can be accessed by all ports within the MoU region. 1-217
The Flag States appearing within the very high risk category of the Paris MOU 2006 Black grey White List are: ●
Korea, DPR
●
Albania
●
Bolivia
●
Comoros
●
Georgia
●
Slovakia
●
St Kitts and Nevis
●
Syrian Arab Republic
●
Honduras
●
St Vincent and the Grenadines
●
Cambodia
●
Lebanon
●
Brazil
●
Egypt
●
Belize
●
Monacco
7.2.2
Definitions
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Among the more important definitions relating to port state control are: ●
Port State Control Officer (PSCO) A person duly authorised by the competent authority of a party to a relevant convention to carry out port state control inspections, and responsible exclusively to that party.
●
Clear Grounds Evidence that the ship, its equipment or its crew does not correspond substantially with the requirements of the relevant convention or that the master or crew members are not familiar with essential shipboard procedures relating to the safety of ships or the prevention of pollution.
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●
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Inspection A visit on board a ship to check both the validity of relevant certificates and other documents, and the overall condition of the ship, its equipment and the crew.
●
More Detailed Inspection An inspection conducted when there are clear grounds for believing that the condition of the ship, its equipment, or its crew does not correspond substantially to the particulars of the certificate.
●
Deficiency A condition found not to be in compliance with the requirements of the relevant condition.
●
Stoppage of an Operation Formal prohibition against a ship to continue an operation due to an identified deficiency(ies) which, singly or together, render the continuation of such operation hazardous.
●
Sub-standard Ship A ship whose hull, machinery, equipment or operational safety is substantially below the standards required by the relevant convention or whose crew is not in conformance with the safe manning document.
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It is the task of the PSCO to translate these definitions into an effective inspection which does not unduly delay or detain a vessel that does not fall within the sub-standard category.
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A port state control visit on board a ship will normally start with verification of the following certificates and documents:
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●
Certificates and documents issued in accordance with the provisions of the relevant instruments;
●
oil record book;
●
record of construction and equipment;
●
international tonnage certificate (1969);
●
minimum safe manning document;
●
certificates of competency;
●
international certificates of fitness for the carriage of liquefied gases in bulk or dangerous chemicals in bulk (if relevant);
●
medical certificates (see ILO Convention 73);
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Port State Control (PSC)
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stability information;
●
cargo record book (if relevant);
●
if appropriate, class certificates as to the ship’s hull strength and machinery installations.
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In addition the PSCO conducts a general inspection of several areas on board to verify that the condition of the ship complies with that required by the various certificates.
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If valid certificates or documents are not on board, or if there are “clear grounds” to believe that the condition of a ship, its equipment or its crew does not substantially meet the requirements of a relevant convention, a more detailed inspection will be carried out.
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If the ship is found to comply, the PSCO will issue a “clean” inspection report to the master. Importantly this information is also recorded in the central database. For the purpose of control on compliance with on-board operational requirements, examples of “clear grounds” are, amongst others, the following: ●
evidence of operational shortcomings revealed during port state control procedures in accordance with SOLAS 74/78/88, MARPOL 73/78 or STCW 78/95 and the ISM Code;
●
evidence of cargo operations or other procedures not being conducted safely or in accordance with IMO guidelines;
●
involvement of the ship in incidents due to failure to comply with operational requirements;
●
evidence, from the witnessing of fire or abandon ship drills, that the crew are not familiar with essential procedures;
●
absence of an up-to-date muster list;
●
indications that key crew members may not be able to communicate with each other or with other persons on board.
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Furthermore, control on compliance with on board operational requirements may be included in the control procedures, particularly if the PSCO has reason to believe that the crew demonstrates insufficient proficiency in that area.
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Clear grounds for a more detailed inspection are, amongst others: ●
a report or notification by another authority;
●
a report or complaint by the master, a crew member, or any person or organisation with a legitimate interest in the safe operation of the ship, unless this complaint is clearly deemed to be unfounded;
●
other indications of serious deficiencies.
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In addition there are requirements for expanded inspections for bulk carriers and tankers above a certain age and for passenger ships.
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With regard to complaints received from masters or crew members the port state control authority receiving such a complaint has the obligation not to disclose the source of information.
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As well as checking that the ship’s documentation and manning is in order, the PSCO needs to assess whether the ship and/or crew, throughout its forthcoming voyage, is able to: ●
navigate safely;
●
safely handle, carry and monitor the condition of the cargo;
●
operate the engine room safely;
●
maintain proper propulsion and steering;
●
fight fires effectively in any part of the ship if necessary;
●
abandon ship speedily and safely and effect rescue if necessary;
●
prevent pollution of the environment;
●
maintain adequate stability;
●
maintain adequate watertight integrity;
●
communicate in distress situations if necessary; and
●
provide safe and healthy conditions on board.
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If deficiencies are found, both the central MoU database and the flag state administration are advised. In principle, all deficiencies should be rectified before departure. It is up to the professional judgment of the PSCO to decide whether he has to board the vessel a second time to check if the deficiencies have been remedied. A ship which is considered unsafe to proceed to sea will be detained, and if necessary the PSCO can require an operation to be stopped (eg cargo operations, bunkering) if it is clearly hazardous.
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When a ship has been detained, all costs accrued by the port state will be charged to the owner/operator, as will the additional port costs. Although detention is obviously essential in some cases, it does produce obvious problems for the port involved since this vessel may, unless there are sufficient lay-by facilities, block commercial berths. There is the opportunity for the vessel to be allowed to another, agreed port, especially if the deficiencies can be better rectified there.
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An indication of the cause of ship detentions is given by the table on the following page showing detention deficiencies recorded in the US during 1997.
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Code Number
Designation
% of Vessels Detained
100
Certificates and documents
3
200
Crew
1
600
Life saving appliances
19
700
Fire fighting appliances
22
900
Safety in general
13
1200
Load lines
6
1400
Propulsion and auxiliary machinery
1
1500
Navigation
2
1700
Marine pollution
4
2000
SOLAS-related operational (includes drills)
20
9800
Other
9
Total
100
7.3
PSC AND THE ISM CODE
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SOLAS Chapter XI incorporates the ISM Code into the ambit of port state control inspections; from 1 July 1998 for tankers, bulk carriers, passenger vessels and high-speed craft and from 1 July 2002 for other ships over 500 gt. The advent of the ISM Code offers three effective enhancements to the PSCO’s inspection armoury and poses problems to PSC regimes and the IMO and international maritime community’s endeavours to pursue the philosophy of “Safer Ships, Cleaner Seas”.
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Documentary proof of ISM Code compliance (the dates of the company’s DOC, the ship’s SMC and, probably, the name of the organisation issuing these certificates) can be incorporated into the ship’s notification of arrival papers. A number of port states are already incorporating into their national law the ability to order ships determined not to be in compliance (no certification) to leave national waters and not to return until proof of compliance can be provided.
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This takes us on to the core of too much reliance on a reactive system of port state control to eliminate sub-standard shipping – the very ships which, by their failure to be able to present a legally required SMC, fall into the class of substandard. While refusal of port entry prevents them from, commercially, plying their trade, they are not removed from the high seas where they may continue to navigate unsafely, probably with little attention to the need to prevent marine pollution, until they find a port which will allow them entry.
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PSC is undoubtedly an essential and, mainly, effective weapon in the elimination of sub-standard shipping. It remains essential that IMO and the (responsible) shipping nations continue to exert pressure on those flag states with a poor record to play a (pro) active and effective role in the drive towards improved standards.
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Another aspect of any safety (or quality management system) which must be understood – there is no “quick fix”. A safety management system, depending upon the organisation’s start state, takes many months of committed effort, both on board and ashore, to put into place. IMO recognises this in so far as one of the requirements for certification is that there is evidence of the safety management system having been in operation for three months prior to audit. It is a difficult decision for any port and PSC regime to elect between detaining a vessel until a safety management system is introduced, inevitably holding the vessel in port for many months, and sending it back to sea, theoretically at least, in an unseaworthy state.
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For a ship with a valid SMC, the ISM Code offers very positive assistance to the PSCO. The first area of inspection is also documentary and focuses on audits, both third party and internal, and any record of non-compliances. These, or in the case of internal audits, their absence, will give a good indication of how effective the ship’s safety management system is.
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The ISM Code’s other great strength is that it is very much a “show me” code which can, and should, incorporate all of the crew. Show me, linked to the standard open questions of how, where, when, why will effectively reveal the way in which the vessel operates and is managed. Show me how “you plan your next passage”, “prepare to take bunkers” or “where your fire station is” can all be part of the PSCO’s approach.
SELF-ASSESSMENT QUESTION Consider the US Boarding Criteria Matrix and discuss the advantages against the disadvantages of this system.
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8.
RISK MANAGEMENT AND FORMAL SAFETY ASSESSMENT (FSA)
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
state what is meant by FSA; and
●
describe how IMO and in the UK how MCA are looking at FSA as a means of prioritising the development of regulations.
8.1
RISK MANAGEMENT
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A risk-based approach has been used for a number of years by the nuclear, chemical and offshore industries and is increasingly being used in the shipping industry, partly because it is a useful and practical tool at the operational level and partly because it is being introduced by legislation. European Union regulations on health and safety require the application of risk assessment as discussed in section 4.2. and risk management is implicit in the application of the ISM Code (Chapter 6). Furthermore, IMO is exploring the potential for using the risk-based approach for managing international legislation and this is discussed in this chapter. The intention here is to give an overview of the risk management tool kit, so that the marine surveyor can understand its application and consider its use as a powerful management tool for his own professional work.
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The application of risk management techniques ranges from relatively complex mathematical modelling to applied common sense and therein lies part of its problem. At one end of the scale it is too complex for the untrained practitioner and at the other, because it is so straightforward, it can be difficult to explain because . . . “it is so like common sense”. It is perhaps best thought of as a management discipline which will improve decision-making, providing an invaluable tool box of techniques which can support the proficient manager. Risk management is closely aligned with planning – if the manager takes time to plan he can use risk management effectively.
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To understand the formal process of risk assessment and risk management it is essential to understand the difference between hazard and risk. This is best done by illustration. Assume a vacuum cleaner safely stowed in a locker. It is in the public area of a ferry, or passenger ship, and there is little risk of any harm or injury.
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If the vacuum cleaner is left unattended, outside its locker and with a trailing lead, the likelihood of an accident increases in terms of frequency, although the consequences are not likely to be serious.
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If the vacuum cleaner is being used with its flex stretched across the floor of a public area, the risk of an accident is even higher and the possible injury more severe – a broken arm or badly twisted ankle. Assume that the flex leads across the steps down to the dining saloon – now the potential seriousness of an accident is heightened, even to the possibility of a fatality.
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If the steward is late in his work and the vacuum cleaner is in this position as lunch is announced, both the probability as well as the severity of an accident will be high.
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There is little doubt that in the last scenario the vacuum cleaner is the hazard. It is however the same vacuum cleaner and the same hazard as when it was stowed in its locker. It is the level of risk that changes. This understanding is critical when concerned with hazard identification, the first step in the risk management process. The five commonly defined steps in the risk management process are:
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●
Step One – Hazard identification (HAZID)
●
Step Two – Risk evaluation or assessment
●
Step Three – Development of risk management plan
●
Step Four – Implementation
●
Step Five – Risk monitoring
This section will explore the first three steps using the approach which parallels the formal safety assessment process described in section 8.2. ●
Hazard Identification This is the essential first step and is often the one which causes the most difficulty because it calls for time, commitment to the process and planning. In the time pressured life of a ship’s officer or a marine surveyor, it is easy to commence at Step Two – the evaluation of risk based on the assumed hazards. To be effective time has to be allocated to the consideration of all relevant hazards and herein lies much of the strength of risk management – the avoidance of “we didn’t think about that”. Hazard identification (HAZID) is probably best undertaken using a controlled brainstorming session; it is an area where lateral thinking can be useful and where everybody’s opinion is relevant. The hazards are often better understood by those who undertake the work rather than those who manage it. Some of the more formalised HAZID techniques are described briefly on the following page. (i)
Hazard and Operability Studies (HAZOP) This methodology involves a structured, systematic and comprehensive examination of installation/facility layouts and procedures, activity descriptions and/or process flowsheets. The study is usually
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undertaken by a multi-disciplinary team who are familiar with the process under an independent chairman. HAZOPs have the benefit of being particularly appropriate for identifying hazards in “soft” systems involving activities and operations. (ii)
Failure Mode and Effects Analysis (FMEA) Again a systematic approach, usually undertaken by small teams, undertaking a “bottom up” process, beginning with a system component and looking at the effect on the overall system. This may well result in a range of possible effects from a single failure. Thus a FMEA may examine component failure in a cooling water pump and at a different stage, the effect of pump failure on the machinery plant. Above that there is the effect of machinery failure on the vessel as a whole. FMEA is mainly applicable to “hard” (or hardware) systems and can, for example, have a beneficial influence on the selection of ships.
(iii)
Structured What-if Techniques (SWIFT) “What if” is probably the most important question in the whole field of safety management. SWIFT is a group brainstorming based around a prepared hazard checklist, considering unplanned deviations from normal operations.
●
Risk Assessment Here, form and evaluation is given to the hazards, they are assessed as risks and their consequences identified. There are both qualitative and quantitative methods of evaluating the risk posed by the identified hazards and the process involves considering the likelihood of occurrence in combination with their consequences. This information can then be ranked in a matrix of likelihood against consequence. Again, a simplified example of this can be to consider the risk of accidents to pedestrians crossing a road. In a city centre street many pedestrians cross at random rather than waiting at a controlled crossing point, but since the speed of traffic is fairly low the pedestrians can normally avoid being hit by cars. However, since there are a lot of both cars and pedestrians the number of accidents will be correspondingly high although the injuries incurred will generally not be too serious. At the other end of the scale, few people attempt to cross a motorway or autobahn on foot so the frequency is low but, due to the speed of the traffic, if there is an accident the consequence is serious. A typical ranking scale is shown on the following page.
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From this scale, a risk matrix would appear as depicted on the following page.
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The risk matrix gives rise to a fundamental concept of risk management, the fact that all risks cannot be avoided. Thus there is an area of risk where the level of risk is unacceptable – (something must be done) – and an area where the level of risk is tolerable and tolerated. Between these areas is the region where risk is As Low As Reasonably Practicable (the ALARP region). Risk management is
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about moving from the region of unacceptable risk into the ALARP area as cost effectively as possible. 1-248
In order to do this it is important to know the cause and effect of the incidents of risk and two techniques which are commonly used to assist this process are: (i)
Event Tree Analysis (ETA) These use inductive, forward-looking reasoning commencing with an initiating event. Event trees tend to use a true/false logic and give a good pictorial display of event sequences. A range of outcomes can be accommodated on one event tree and a given outcome can be the result of more than one event tree sequence.
(ii)
Fault Tree Analysis (FTA) The basic process in the techniques of fault tree analysis is to identify a particular effect or outcome from the system and trace this back into the system along the logical routes to the prime cause. FTA works “backdown” after an accident or unwanted failure has been identified ie EFFECT ® CAUSE mainly using AND/OR logic gates.
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Thus it can be seen that ETA feeds forward from a given event whilst FTA works backwards from that event giving a detailed analysis of cause. An example where these techniques could be useful to a surveyor might be in the event of a vessel with a problem which could take it outside its class or other survey condition. Can it be safely accepted to sail to a more suitable port for repair? – a common request with which a surveyor will have to deal. The surveyor will want to know what caused the problem, for example was it an isolated incident or was it symptomatic of more serious problems? Equally, it is essential to know the possible consequences which might flow from the defect if the vessel is allowed to sail. While risk assessment does not provide the answer, the processes improve the ability to select the best solution. Risk Management When the risk has been assessed, its cause identified and its potential consequence identified, it is time to look at ways of controlling or avoiding the risk and/or its consequences. There are four main ways of doing this: Terminate Either by eliminating the potential for the event to occur or removing the exposed personnel. An example of elimination in the shipping industry might be to stop trading in certain areas or with certain types of vessel – an approach explored by some of the major oil companies with regard to transportation of their own cargoes on their own vessels. Transfer One of the most common approaches is to take out insurance to cover the potential losses, probably not a viable or tenable solution on its own. Another
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form of transfer can be found in the charter market, and again the example of the oil majors transferring the risk (of oil pollution) by chartering third party tonnage is a good illustration. Tolerate By considering the risk acceptable if it cannot be reduced further in a costeffective manner. This has major implications in the area of personal safety and the promotion of a safety culture. Just as it is common to tolerate the crossing of the road without walking 100 metres to the pedestrian crossing, so many people working at sea tolerate potential danger of not wearing the proper safety equipment or using proper procedures. Treat By identifying reduction measures with the ideal being to lower the frequency of the accident first and to reduce the consequence second. This can be a most cost-effective approach because the cause can often be addressed by improved procedures and through improved education and training. The ISM Code can be described as falling within this solution. 1-250
A key element in the process is the economic assessment of the preventative action against the potential consequence. A cost benefit analysis is frequently used in order to compare the various solutions. The assessment of benefit or at least its translation into a comparative monetary value requires a degree of subjective judgment, and it is here that consistency is particularly important. It is difficult enough to agree on the value of the environment in a single, relatively cohesive social group (consider the inquiries into new road building schemes and the strong protest against cutting woodland to allow way for the new road). It can be much more complex in a supra national context where the value attributed to life and liberty may vary dramatically.
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Once a risk control method, or more usually, a package of measures has been identified, assessed and selected, the next stage is implementation. This needs to be handled with a degree of forethought and planning since frequently it will involve change. Change needs both planning and managing. In addition the effect will need monitoring and this may be a complex process since the implementation may change more than one parameter. Nevertheless risk management, whether it is simply a technique used when addressing operational problems in management or a safety case designed to assess safety measures in a complex offshore unit, is a valuable discipline which more than any other can prevent or help to cope with the unexpected.
8.2
FORMAL SAFETY ASSESSMENT
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The FSA approach differs from the safety case approach in that its intention is to provide a generic approach across the whole field of safety legislation rather than address a specific operation. Thus, the approach proposed to IMO by the UK’s Marine Safety Agency (now part of the Marine and Coastguard Agency – MCA) takes a generic approach to vessel operation and to those involved in and affected by its operation, either directly or potentially.
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The benefits of adopting FSA as a regulatory tool within IMO were outlined in MSC/65/24/2 and include: ●
a consistent regulatory regime which addresses all aspects of safety in an integrated way;
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cost effectiveness, whereby safety investment is targeted where it will achieve the greatest benefit;
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a pro-active approach, enabling hazards that have not yet given rise to accidents to be properly considered;
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confidence that regulatory requirements are in proportion to the severity of the risks; and
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a rational basis for addressing new risks posed by ever changing marine technology.
In developing the methodology, several studies were carried out to define comprehensive generic approaches to the methodology as follows: ●
those features, characteristics and attributes of ships and shipping common to the operation of vessels engaged in international trade;
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those people, organisations, countries or other entities affected by the risks associated with international shipping and having a stake (financial, personal safety, environmental or a combination) in shipping which may be affected by such risks or by changes in regulations affecting these risks (see Stakeholders below);
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the range of accident types which could impair generic ship or shipping functions (FSA Step One – Identification of Hazards); and
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various underlying risk exposure sources from which life-threatening hazards may develop (FSA Step Two – Risk Assessment).
This resulted in the identification of 14 generic ship functions which consider the full life cycle of the generic ship. This starts with conceptual design, including all operational stages in port, on passage and in dry dock as well as decommissioning and disposal. The generic ship functions are: ●
Mooring/towing
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Payload
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Bunkering/storing
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Navigation
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Emergency response/control
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Communications
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Habitable environment
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Manoeuvrability
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Power/propulsion
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Stability
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Pollution prevention
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Anchoring
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Structure
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Others
Equipment and system categories have been defined (eg control, human, management, machinery, safety etc) and hazardous substances, ignition sources and hazards to personnel have been identified. The generic ship encompasses all aspects of international shipping affecting safety of life.
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The concept of stakeholders is particularly important at the stage of cost benefit analysis where the (conceptual) objective is that:
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The principal stakeholders in the shipping industry are taken to be: ●
Designer/constructor
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Flag state
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Cargo owner
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Crew
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Passengers
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Coastal state
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Crew provider/trainer
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Classification society
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Owner/charterer operator
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Port of call
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Port state
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Other vessels
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Others
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Examples of stakeholder costs, benefits and risks are:
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The generic accident categories have been identified which could impair the function of the generic ship. These generic accident categories are used as an aid to the hazard identification process (FSA Step One) and, in alphabetical order, they are: ●
Contact or collision
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Explosion
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External hazards
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Fire (flame, heat, smoke and fumes)
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Flooding
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Grounding or stranding
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Hazardous substances
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Loss of hull integrity
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Machinery failure (computer, equipment and system faults)
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Payload related
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In FSA Step Two, Risk Assessment, preliminary and unquantified fault and event tree analysis resulting from Step One’s hazard identification and screening are developed into a risk contribution tree from which risk control options are identified within FSA Step Three. These options are then subjected, within FSA Step Four, to a process of cost-benefit analysis, mainly based around standard net present value calculations, which generates a cost per unit reduction in risk (CURR). Benefits from risk control options which can be valued include reductions in losses or damage to vessels, cargo and infrastructure, reduced environmental clean-up and reduced loss of environmental amenity. Other benefits, such as reduced ecological damage (say, from improved flue gas emissions) are more difficult to value. They may be taken into account in FSA Step Five, the decision-making process.
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Another area which causes some difficulty is finding a universally acceptable benchmark for the value of injury or loss of life and this has yet (1998) to be satisfactorily resolved. The philosophy underlying Step Five, Decision Making, may, unofficially, be described as a pro-active approach to maritime legislation which pre-empts media-driven reactions to major marine casualties and achieves an equitable cost/benefit balance for all stakeholders. The main steps
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involved in examining various risk control options as solutions to the various safety problems, identified in FSA Steps One and Two, are as follows: ●
prioritising IMO’s work programme to identify areas where regulations should be reviewed and developed, using input from FSA Steps One and Two;
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focusing data collection on the basis of needs identified from other FSA steps;
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deciding between alternative risk control options;
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examining the effects of proposed regulatory changes on stakeholders’ costs and benefits; and
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reviewing the basis and framework of rules for the future (eg balance between goal setting and prescription).
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There is still more work to be undertaken before FSA can be used as an effective tool within the IMO armoury of weapons for improving safety. Nevertheless, there is little doubt that risk appraisal and risk management has an important role to play at all levels of the shipping industry, including within the everyday management of ship operations.
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The increasing use of risk-based as opposed to prescriptive legislation will undoubtedly affect the ways in which marine surveyors work and new skills will have to be learnt. An example of this is the recent decision by the International Association of Classification Societies (IACS) to start applying FSA techniques, where possible, in IACS’ working party tasks. Thus IACS will give training to the chairmen of working groups and this appears to be a valuable step in implementing FSA at a level nearer to the operational level and also in contributing to a common standard of application across the member classification societies.
SELF-ASSESSMENT QUESTIONS Carry out a risk assessment of a day in your life.
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PART TWO MARINE SURVEYING PRACTICE
GENERAL INTRODUCTION Having discussed the marine industry in general terms in Part 1, the second part of this module focuses more on the work of the individual marine surveyor in general. Of course, the range of activities carried out by Marine Surveyors is so diverse that each subject cannot be covered in depth in this module. Whilst each student should focus on their individual disciplines, it is important to have a general all-round knowledge of the tasks undertaken by all types of marine surveyors. International shipping is a competitive industry and while there should be encouragement to improve efficiencies and reduce costs, this should never be done by reducing safety standards. Marine surveyors should be aware of the international and national laws that are in force to ensure that minimum standards are maintained. As shipping is international, there is a requirement for international agreement on those standards and these are set by the International Maritime Organization (IMO). Amendments to existing conventions and indeed new conventions are continuously being debated and will be applied by all administrations to create a higher standard of operations in the shipping industry. Concern over structural problems has prompted the IMO to consider introducing ‘goal-based standards’. This concept will not reduce the essential role of classification societies which is to approve the design of ships and machinery as well as surveying them to ensure they are correctly maintained to prescribed standards. However it is intended to focus the mind of naval architects and ship builders to produce ships that are fit for purpose over their intended life. The marine surveyor has a responsibility to help the industry see that these standards are reached and maintained.
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MARINE SURVEYORS, SURVEY ORGANISATIONS AND HOW TO DEFINE THEM
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
outline the various types of survey carried out in the marine industry;
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compare the different types of work carried out by marine surveyors;
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recognise the various organisations involved in marine surveying; and
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define the meaning of the term ‘marine surveyor’.
9.1
TYPES OF SURVEY
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Marine surveying performs an essential role within not just the shipping industry but also within the whole logistic link between buyer and seller. As such, it has many customers and the product that the marine surveyor or surveying company will deliver will be crafted to meet the requirements of the surveyor’s principal. For professional surveyors this can frequently mean that they are called to make a judgment between the requirements and objectives of their principal and their professional integrity and the facts that are revealed by their survey.
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Surveys can range from the predominantly factual to those that are based largely on the surveyor’s professional interpretation of a range of what may be far from complete facts and evidence. It is important, in preparing for a survey, that surveyors are aware of the type of survey which they are about to undertake. In Part One (Section 5.1) the differences between inspection, surveys and audits were explored. Here, the focus is on the purpose of the survey in so far as it dictates the approach which the surveyor will need to take.
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At one end of the scale is the factual survey. A documentary survey is a prime example of this – either the documents are in place, valid and in date, or they are not. There is little room for negotiation and here a parallel can be drawn with the examination of documents undertaken by the confirming bank in a documentary credit transaction (Part One, Chapter 1). Here, the printed and duly authenticated word is all.
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Surveys against precise specifications, such as hull and machinery surveys against statutory or classification rules, are another area where precise and
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factual surveys can be achieved with evidence frequently being available from precise measurements such as, for example, ultra-sonic measuring equipment. Here, the variable element arises from the extent of measurement which the surveyor is able to undertake within the constraints of the time and resources available to him. Even if the minimum percentage of measurements required is specified, problems of access and the surveyor’s experience and professional ability to concentrate resources on the critical areas or aspects will directly affect the quality of the survey.
Figure 2 Lloyd’s Register Surveyor Overviewing a New Building at Daewoo Shipyard in South Korea. March 2002 1-269
Cargo surveys are another example of surveys where, although precise survey requirements may be stated, the dimension of the task and often the very quantity of material to be surveyed means that the quality of the survey depends upon the surveyor’s ability to base the resultant report on a truly representative selection of discrete samples.
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As the surveyor moves closer towards an audit of performance, such as in the case of an ISM Code audit, so value judgment, backed by experience, plays an increasing role. To take an obvious example, even if a vessel is able to lower and launch a lifeboat in port, or don and deploy fire fighting equipment, to what extent does this mean that the crew could fight a fire effectively or rescue a man lost overboard?
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The other important element which the surveyor must always bear in mind is the quality of the evidence on which he is basing his findings. Is, for example, the document which he is checking an original, a true photocopy or to a greater or lesser extent, modified or fabricated? In the case of electronic or mechanical measurements the surveyor needs to know how well the equipment is calibrated and how accurately it is functioning in the (often adverse) conditions of the survey. Finally, there is the evidence and information provided by the people involved – ship’s crew, stevedores, etc. The surveyor must develop his or her
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abilities to evaluate the human input and to penetrate beyond the evidence that may be first presented. Open questioning, the how, when, why, where and who, is critical to this aspect of a surveyor’s task and should be practised and developed just as one practises and develops one’s ability to use the other tools of one’s trade. 1-272
In recent recorded history we can trace the work of the marine surveyor through Classification Societies for well over 200 years. They were first conceived in London when it became apparent that cargo owners and underwriters had no knowledge of the condition of the ships to which they were committing their goods and commercial future. The first Register of Ships encompassed simple details of the ship, its builder, owner and master, backed by rules for the construction of wooden hulls and equipment. The rules have evolved from sail to steam to diesel power and from wood to iron to steel. The rules have been developed continuously from that day into the present sophisticated rules and regulations of the 10 main class societies today. These rules have traditionally addressed the hull structure and the essential engineering systems – machinery, piping, electrical and propulsion. Thus, even before the turn of the 20th century, when various national administrations first contemplated statutory legislation concerning the safety of life at sea, the classification rules for these fundamental items of ship safety were already well established. Unified Requirements are adopted resolutions on matters directly connected to or covered by specific rule requirements and practices of classification societies and the general philosophy on which the rules and practices of classification societies are established.
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Subject to ratification by the governing body of each member society and associate, Unified Requirements shall be incorporated in the rules and practices of the member societies and the associates, within one year of approval by the IACS Council. The existence of a UR does not oblige a member society or an associate to issue respective rules if it chooses not to have rules for the type of ship or marine structure concerned.
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Until the last decade of the 20th century, marine classification societies were almost solely involved in design and maintenance of the structure of ships, responsible for development, maintenance and application of rules for hull and machinery. The Classification Societies in general directly employ their own marine surveyors to carry out the periodic surveys.
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However, the principal jurisdiction, responsibility and duty for the enforcement of technical regulation pertaining to ships lies with the maritime administrations under which a ship is registered, or as they are more popularly called, the flag states. The role of the flag state, as defined under UNCLOS relating to technical matters, is clearly defined under Article 94, on the construction, equipment and seaworthiness of ships. 164 flag states have delegated the making and publishing of international regulation to the International Maritime Organization.
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IMO is, therefore responsible for development and maintenance of marine safety regulations. However, the application of IMO legislation now is mainly delegated to classification societies as few national administrations have the resources or international network to perform the necessary periodic inspections to ensure continual compliance with international convention requirements.
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It may be argued that the maritime industry is not a proactive one and only reacts to disasters. It is generally accepted that the sinking of the Titanic and the resulting high cost in human tragedy caused the authorities to take the necessary action to prevent this happening again. The outcome was what we now know as the Convention for the Safety of Life at Sea (SOLAS).
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SOLAS is the most important of the IMO conventions dealing with safety at sea and will be dealt with in detail in Module 8. Since its adoption in 1914, there have been four more conventions and the current convention was adopted in 1974 and entered into force in 1980. However, SOLAS is dynamic and amendments are being added all the time. Two important recent additions to SOLAS have been introduced – the ISM Code and the International Ship and Port Facility (ISPS) Code.
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A new Chapter IX of SOLAS 74 on Management for the Safe Operation of Ships, entered into force on 1 July 1998, making the ISM Code mandatory to all vessels that fall within the SOLAS convention requirements.
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In response to the terrorist attacks of 11 September 2001, and the perceived risks to ships and the danger of ships being used for terrorist purposes, IMO modified the SOLAS requirements to include security. The new amendments to SOLAS included a new Chapter XI-2 to address ship security. From this developed the ISPS Code.
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The introduction of the ISM Code brought about a fundamental change in the work of Classification Societies and their surveyors. The implementation and audit of the ISM code was delegated by most flag states to Recognised Organizations to carry out the audits ensuring that ships and shipping companies were adhering to the ISM Code. Recognised Organisations are in almost every case classification societies. As there is a fundamental difference in the approach to surveying structure and equipment on the one hand, and auditing a system that is working on a ship this meant a major change in the responsibilities of Classification Society Surveyors. From 2004 the role has further expanded with Classification societies accepting the added responsibility of auditing the ISPS Code.
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Whilst the classification societies have a large and important place in the surveying of ships, the flag state authority retains its pre-eminence, and will often maintain its own survey department with competent surveyors Furthermore, ships are also subject to the control of port states. Referred to as Port State Control (PSC), its authority is codified under UNCLOS Articles 94(6), 218(1) and 219.
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For further information on the role of PSC you may wish to refer to Appendix 2 of the module. In addition, the IMO conventions clearly refer to PSC, for example in SOLAS Chapter I, Regulation 19(a) which states that: “every ship when in a port of another party is subject to control . . . ”
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Many PSCs around the world co-operate at a regional level by belonging to a group that adheres to a memorandum of understanding (MOU). For example, in Europe there is the Paris MOU.
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Figure 3 US Coastguard Inspecting a Vessel’s Machinery Space for Potential Security Risks
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One of the strengths of PSC Is that it provides a check on the system, providing much statistical evidence of substandard practice and of stakeholders associated with such practice. However, despite the growing strength of PSC it has its limitations, particularly with regard to the technical aspects of shipping. The time available for inspection is limited and, unless sufficient “clear grounds” can be found, ships pass through the PSC net quickly with a review of documentation and a relatively superficial inspection. The penalty imposed for failure to meet the appropriate standard is limited to detentions while any defect is corrected – in general punitive measures have not so far been applied.
9.2
SURVEYORS AS POLICEMEN
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Although it is not a term that many surveyors like to call themselves, in the case of surveyors acting for classification societies, Flag and Port states, it is a term that best describes their role. The laws of the industry have been clearly established, so the surveyors are there to ensure the players keep to the rules. As there are those who do not always abide by the rules, so there are penalties against the lawbreakers.
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When a country becomes a signatory to an international maritime convention it is obliged to enact its own national legislation to bring its provisions into effect. Amongst other things it undertakes that its ships will be built and operated to the requisite standard. However not all national legislation is the result of international conventions. In order to ensure compliance with such regulations it is necessary to use surveyors to carry out regular surveys. However, tasks traditionally carried out by government surveyors are, more and more, being carried out by class surveyors in order to reduce government expenditure, with government surveyors now being largely used to audit the work of class surveyors and others. However the policeman’s role is not the only responsibility that marine surveyors undertake.
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9.3
SURVEYORS AS FACT FINDERS
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By the very nature of the maritime industry, those with a vested interest in ships and the work they do rarely have the opportunity to see for themselves the conditions or circumstances that may affect their interests.
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An interested party whom we will call the principal, may employ the services of a marine surveyor to represents the principal’s interests. The marine surveyor becomes the eyes and ears of the interested parties and using his or her skills will report on the facts as they are found.
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It is essential here to understand that in the role of Marine Surveyor, the principal does not seek opinions unless specifically asked. As will be explained later a marine surveyor must be careful if he or she expresses those opinions. Fundamentally the role of surveyors is to carry out the survey and report on its findings. They should not assume otherwise unless instructed otherwise and if any doubt exists they should always clarify their instructions in writing before commencing each new assignment.
9.4
MARINE SURVEYORS AS ADVISERS
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There is a different responsibility that a principal may seek from a competent marine surveyor and that is as a consultant. There is an EU directive concerning the requirements for a consultant and we would define a consultant as: A person who uses his or her particular skill and expertise (based on established competence of ships, boats, cargoes and the sea) to give an opinion on the condition of any ship, cargo or thing appertaining to ships, cargoes and their respective environment.
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The clearly stated difference between a surveyor and a consultant expressed in the EU directive does not apply in many parts of the world where there is no such clear line of demarcation.
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In general we may be prepared to accept that a surveyor is, or may be, expected to express an opinion on his observations where appropriate. EU surveyors instructed by principals based outside the EU would be wise to check their principal’s expectations in this respect.
9.5
MARINE SURVEYORS ACTING IN THE OWNER’S INTERESTS
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This may happen on a number of occasions but a common occurrence is for the attendance of the owner’s representative during building or major repairs. For the convenience of both owner and builder (and for the protection of the owner’s interests) it is important to have the attendance of an owner’s representative at the shipyard and the engine works during the term of the actual construction of both ship and main engine, to monitor the work of construction.
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This also ensures a ready channel of contact between the owner, the shipyard and the engine works, and the Class Surveyors in attendance. How this is to be arranged will be a matter for discussion between the consultant, owner and builder. While there may be a reluctance on the part of owner’s accountants
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(and on the part of the builders!) to accept the necessity of this requirement it is a matter of technical prudence, and it also has economic advantages in minimising risks of costly delays, etc. Efforts to dispense with such arrangements should be resisted on financial and technical grounds. Many occasions will arise during the course of development and construction in which prompt technical decisions will be required, and resident representatives will either be able to deal with these themselves immediately, or if not, will be able to obtain prompt attention from the consultant or owner’s technical staff, thus preventing costly delays, and also misunderstandings, which might later lead to expensive legal consequences. 9.6
SURVEYORS AS AUDITORS
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It has already been stated that the Classification Societies as Recognized Organizations normally carry out the external audits for the ISM code. However, there are opportunities for surveyors to act for and on behalf of classification societies and they may also be called to act as internal auditors for shipping companies.
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It is important to understand that the auditing process is not the same as carrying out a survey. A good auditor is able to communicate and be empathetic towards the auditee in a helpful although judicious manner. The auditor must be able to keep control of the audit and cause the least disruption to the normal operation. The auditor can give guidance but should not make recommendations to ship or its owner. Any corrective actions to non-conformities must be in accordance with the company’s own policy.
9.7
THE MARINE SURVEYOR AS AN EXPERT WITNESS
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Marine surveyors are on occasions invited to act as expert witnesses in a court of law. However strong you may feel about your professional judgment, an expert witness must be prepared to face tough cross-examination. This requires skill and should the invitation be offered for the first time, a potential expert witness should seek advice from those who have had a good track record of handling this particular skill.
9.8
THE TRADITIONAL SOURCE OF MARINE SURVEYORS
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Traditionally, the vast majority of marine surveyors may be grouped into five categories, each having distinct disciplines. These may be grouped as
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Naval Architects
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Marine Engineers
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Nautical or Deck Officers
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Commodity Specialists
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Other Specialist Surveyors and Auditors
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However, in recent years, mainly due to the fact that there is a global shortage of experienced mariners being available to work ashore, there is a growing number of people who are using their particular work experience to practise the role of marine surveyor. This is especially true in the rapidly growing pleasure craft industry.
9.8.1
Naval Architects
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Having gained the necessary university qualifications, and the shipyard experience in ship design, naval architect surveyors are mostly found in classification societies or other authorities mainly concerned with vessel design and performance. Often their key role is to carry out plan approval for both new buildings and major modifications. So you may question whether naval architects do act as surveyors in the practical sense. In fact they do where their expertise is appropriate.
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In recent years, in Lloyd’s Register of Shipping for example there has been a move away from differentiating between kinds of surveyors by name and all are simply now referred to as “surveyor”, “senior surveyor” or “principal surveyor”. Care is taken to record their experience to ensure that they are not assigned to work which is outside their competence.
9.8.2
Marine Engineers
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Where hull and machinery surveys are undertaken, the marine engineer has generally been the most likely source. The background experience, as with most nautical surveyors, has also been principally that of the mercantile marine and usually, but not always, these surveyors hold a certificate of competency as chief engineer. Ex-naval engineer officers are sometimes to be found amongst their ranks.
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As previously mentioned, with the reduction in the fleets of the traditional seafaring nations there has been a need to turn more to university engineering graduates, and the larger classification societies now carry out significant training within their organisations to make up for the lack of practical seagoing experience. Historically marine engineer surveyors have been the flag states’ primary source of surveyors.
9.8.3
Nautical or Deck Officers
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Deck officers in the mercantile marine and, to some extent, from the ranks of naval officers have traditionally provided professional expertise for nautical surveyors. The traditional, but by no means mandatory, qualification for a nautical surveyor is a master’s certificate although, in some cases, others with a sound knowledge of the subjects in the syllabus for senior deck officer’s qualifications may have the necessary skills provided they have had adequate experience too. The subjects which comprise the majority of nautical surveys require experience with navigation, seamanship, ship handling, fire and life-saving equipment, weather and sea conditions, the carriage of cargo and the environment. Nautical surveys often extend beyond the purely physical examination of ships and cargoes and involve a study of the wider aspects of ship operations.
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9.8.4
Commodity Surveyors and specialist Cargo Surveyors
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The complex and vast range of today’s cargoes include chemicals, dangerous goods, the food chain, chilled and refrigerated cargoes and so on will frequently need a surveyor with knowledge of particular cargoes and commodities.
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One of the particularly strange results of the rapid development of containerisation is that nowhere in the world is there a qualification for the competent stuffing of containers. When a container arrives at the terminal it is accepted as a box which is said to contain certain items. How those items have been stowed and whether or not sufficient protection for the cargo has been made is left to chance. The problem is that stuffing a container on dry land for road or rail transport does not mean that the container is prepared for the movements on board in bad weather, the potentially large changes in climate and the environmental elements containers, particularly those on deck, have to meet. Claims against cargo damaged in this way have been growing and are a large percentage of payments to shippers. P&I clubs in particular are beginning to address this problem by having containers inspected at the stuffing stage.
9.8.5
Other Specialist Surveyors
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In the last few decades major changes to the propulsion of ships and the fitting of complex machinery and electrical and electronic equipment requires specialist surveyors in these areas. In the principal shipbuilding and repair countries such surveyors are often likely to be employees of government agencies and classification societies but elsewhere they may be more widely employed in industry and only involved as surveyors when there is a specific need for their services.
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The ISM Code and, more recently, the ISPS Code have seen a need to have expertise in the style of quality assurance specialists available to the industry. This applies both to the external auditors and the shipping companies that wish to avoid the costly possibilities of their ships being found non-compliant, Compliance has required suitably qualified and experienced persons to be trained to carry out these audits which must be considered under the general heading of “marine surveys”.
9.9
INDIVIDUALS AND COMPANIES WHO ARE NOT CLASSIFCATION AND GOVERNMENT SURVEYORS
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The majority of the world’s surveyors fall into the category of independent or specialist surveyors; that is to say, they are not employed by governments or classification societies.
9.9.1
Individuals
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Many surveyors are self-employed and work on their own, without corporate support other than secretarial, and do not belong to any commercial organisation. They are frequently sole operators and their principals are often involved in only a restricted geographical region. Many are cargo surveyors, but
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other fields have attracted them too. Some who have made successful careers in surveying as sole operator do not aspire to building larger businesses and they often prefer not to lose some of their identity by becoming members of a larger surveying company. 9.9.2
Companies
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There are a number of international surveying companies. There are also many national ones in the larger countries which have strong import and export trades or shipbuilding industries. These range from those employing a substantial number of surveyors to the smaller ones with only two or three. Generally the larger companies will offer a wide range of surveying services and will have surveyors on their staff who are able to cover a variety of survey work.
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Cargo Surveys. While local surveying companies provide an essential service, international trade relies heavily on large, international surveying companies. These are companies which can establish the quality (and quantity) of a diverse range of natural and manufactured products to a common standard across the trade routes of the world. Very specific specialisations are required to provide the necessary range of service with some of the obvious examples being hydrocarbons and chemicals, perishable products and agricultural produce, edible oils and fats, steel and manufactured goods. The scope of the survey requirement may be wide too, incorporating a requirement to undertake the survey work, not just on shipment or discharge, but at its point of origin, be it field or factory, and at destination.
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Operational Surveys. The term operational survey is used to encompass the extensive range of surveys which are required before an operation is undertaken. One example of this is the hold or tank survey needed before a vessel may commence loading or discharging. Another, now very significant, area of survey work revolves around the survey requirements prior to such major operational activities as moving drilling regulations or floating out platforms in the exploration and production of oil and gas offshore.
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Insurance Surveys. There are two areas that fall under this general heading. The first is the condition survey required, sometimes by hull and machinery insurers but increasingly frequently by protection and indemnity associations (P&I clubs). Especially in the case of P&I club condition surveys, these can be exceedingly wide-ranging and cover both the fabric of the vessel from an operational viewpoint (eg are the hatch covers watertight?) to the surveyor’s view of the crew’s ability to operate the vessel not just safely, but efficiently too.
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An extension of the condition survey is the increasing requirement by major charterers for companies and their ships to meet the charterer’s operational standards before being accredited as suitable for charter.
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The other aspect of insurance-related surveying is the claim survey. Again, this can be diverse, ranging from a personal injury accident through a wide variety of cargo claims to claims for structural damage by third parties or the elements. Particularly when undertaking surveys in this area, the surveyor needs some of the investigatory abilities of a good detective.
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On and Off-hire Surveys. This is an interesting and active sector of the market, which is the stock in trade of many, if not most, surveying companies. A particular aspect of these surveys is that they make a pair that will inevitably be separated by time and probably by principal (with the charterer appointing the on-hire surveyor and the owner the off-hire surveyor). It is important for the on-hire surveyor to understand that that survey report will be used as the basis of a comparison with a second report prepared at a different time and in a different place.
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General Average. This is an area of surveying where a marine surveyor may be employed over an extended period in order to monitor and record the series of operations necessary to minimise loss. Here a surveyor will not just be an external observer, but can become an integral part of the operating team, acting either for an underwriter or the average assessor. A description of the process of general average is given in Chapter 11 of Commercial Management for Shipmasters.
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Salvage. Hull underwriters, especially those at Lloyd’s, rely primarily on the London-based Salvage Association surveyors in the event of a major casualty. One of the interesting aspects of this area of survey work, apart from the need for an understanding of the operation of Lloyd’s Open Form (LOF 1995), is an understanding of the concept of sue and labour and the mitigation of loss. The insured’s responsibility to take such reasonable actions as necessary to reduce the impact of a loss or potential loss is an underlying principle of all insurance which comes strongly to the fore in the event of a major accident.
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This review of some of the different aspects of marine surveying is neither formal nor fully comprehensive but is intended to illustrate some of the range and challenge offered by the profession. It is important that the prospective surveyor thinks hard about his or her skills and aptitudes against the background outlined here, when deciding upon which areas to focus their expertise and in choosing the type of company with which he or she could most satisfactorily work.
9.10
DEFINING A MARINE SURVEYOR
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To conclude this chapter, in which we have considered a vast range of types of surveyors and the various reasons they may be employed, let us try to define “a marine surveyor”. If we refer to the Concise Oxford Dictionary we will find: (a)
A surveyor is defined as: (i)
(b)
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official inspector, person professionally engaged in surveying.
Survey is defined as: (i)
let the eyes pass over, take a general view of form, general idea of arrangement and chief features of: examine condition of, collect by measurement etc all facts needed for determining the boundaries, size, position, shape, colour etc;
(ii)
general view, casting of eye or mind over something; inspection of condition, amount etc of something, account given as a result of this.
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Marine Surveyors, Survey Organisations and How to Define Them
(c)
Marine is defined as: (i)
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of, found in, produced by, the sea: of shipping and naval matters.
In referring to the Marine Encyclopaedic Dictionary we will find: (a)
A surveyor is defined as: (i)
(b)
a person employed by a shipping association or a private person to inspect cargoes, ships etc. He may be a Lloyd’s Register surveyor who undertakes to inspect ships and issue the appropriate classification certificates. He may also be asked to inspect and report on a damaged ship or a ship for delivery or redelivery in a time charterparty.
Survey is defined as: (i)
to view and examine the condition of an object and determine the recommendation needed, if any, to update its standard according to the classification needed by the authorities or any authorised corporation;
(ii)
the act of examining by an independent impartial group of persons on behalf of others. Surveys may be effected on request by insurance companies when insurance claims are submitted for damaged cargoes or ships.
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Considering these various definitions we would define a marine surveyor as: A person who uses his or her particular skill and expertise (based on established competence of ships, boats, cargoes and the sea) to look at and report on the factual condition of any ship, cargo or thing appertaining to ships, cargoes and their respective environment.
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In creating this definition care has been taken to avoid placing any particular category on the type of work a marine surveyor might undertake, eg cargo, engine, naval architecture etc whilst remaining very specific about the observation and recording of facts. This definition should clearly differentiate between a surveyor and a consultant.
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Having gone to the trouble of defining a marine surveyor, you may have already come to the conclusion that a marine surveyor may be called to act as a consultant, auditor, representative or an expert witness.
SELF-ASSESSMENT QUESTION Does the definition of the marine surveyor describe how you see yourself in this profession?
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10.
KNOW YOUR CUSTOMERS
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
understand the importance of knowing your customer;
●
understand the importance of having clear instructions; and
●
know the meaning of surveys without prejudice.
Figure 4 RINA’s Surveyor Inspecting Costa Atlantica in Helsinki Photo by Gero Mylius 11/4/2000
10.1
WHO INSTRUCTS SURVEYORS?
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Your customers are the parties who give you instructions. We will refer to them as the principals. They are the most important people as far as the marine surveyor is concerned and when you are carrying out their instructions never forget who you are working for and who ultimately will pay for your services.
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There is a wide range of potential principals looking for the services of marine surveyors but it in general the most popular groups of principals are shipowners, charterers, cargo receivers and shippers, underwriters (hull and cargo) and P&I clubs. Some surveyors deliberately restrict their principals to one class of operator; for example, many are retained only by shipowners and charterers and they do
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not accept instructions for underwriters, and vice versa. (While this segregation of principals was prevalent a few years ago it is much less so today and it is now quite likely that a surveyor will receive instructions from either party, but of course not both in any one particular case for fear of involving a conflict of interest.) 1-329
One golden rule to follow is that when you undertake work for a principal ensure that the work does not involve a conflict of interest with another principal. Generally, as a surveyor becomes established, there is a likelihood that surveyors or surveying companies become best known for acting for one particular type of principal, ie as shipowners’ or underwriters’ surveyors, although those who act unselectively for any party seeking their services may be seen as being the most truly independent and impartial.
10.2
HOW DOES YOUR PRINCIPAL KNOW YOU?
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The demands of the industry, the distances involved and the speed of business in today’s world mean that the relationship between the principal and the marine surveyor is, in most cases, a distant one. The communication is normally electronic and a principal will invariably depend on previous experience with the marine surveyor or a recommendation from another customer who has received good service. This recommendation will in almost every case be dependent on the impression the surveyor has given from the report that that the marine surveyor has produced. This part of the surveyor’s service to the principal is so important that the diploma devotes Module 3 to report writing.
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So it is important to always remember that the two key elements of the customer’s relationship with the marine surveyor are two written documents: The Instruction and The Report.
10.3
UNDERSTAND YOUR CONTRACTUAL OBLIGATIONS
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The marine surveyor should always seek clear instructions and once they have been received, surveyors must keep within their parameters and not extend beyond them without reference back to their principals. Failure to comply fully with instructions can have serious consequences, but so too can overstepping them and perhaps thereby committing a principal to unwanted costs or liabilities. (In some cases too much can be said in a report where the surveyor covers more than was requested in the original instructions.)
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There may be understandable reasons why the principal’s instructions cannot be exactly fulfilled. In this case the surveyor should take appropriate steps to advise the principal and, most importantly, ensure that the report (and the certificate where appropriate) includes the shortcomings of the survey. The report should also contain the reasons for them.
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If such a survey is for, say, cleanliness of a hold, the shipper then has the option of accepting the limitations or ensuring that suitable steps are taken to enable the surveyor to carry out the instructions to the full. However, such a practice cannot be applied to some warranty surveys, as for example a towage approval survey. Here the instructions are for the surveyor to be fully satisfied that the towage risks are acceptable in all respects.
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In a towage approval case any qualifications to the certificate indicate that the surveyor is not, or cannot be, fully satisfied that these risks are acceptable. It is usually then too late for reference to principals and it may be unreasonable to expect the tug and tow to delay a passage while awaiting any further instructions to the surveyor. If there is uncertainty due to some limitation beyond the surveyor’s ability to have it rectified, the towage approval certificate cannot be issued since the tow can be expected to commence as soon as the certificate and towage recommendations are issued.
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As a general rule survey reports should outline what has been done, when it was done, with whom and where. If something important has not been done (when there is a requirement for it to be done), the reason for its omission should be stated. If applicable there should also be a statement as to how the information was gathered, under what conditions, and what degree of reliance can be placed on it.
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Marine surveyors often receive very sketchy instructions and are left to figure out exactly what is required of them. In these cases it may be prudent to write out your understanding of the instructions you have received and send it back to the principal asking for confirmation. Fax or e-mail is one fast way of dealing with this.
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In the absence of detailed instructions it may be acceptable for the surveyor to follow the “usual industry practice” but this can still leave some debate as to what is actually expected from the survey. Sometimes misunderstandings will occur and where instructions cross international borders complications can arise because of different practices in different countries. There is no substitute for clear written instructions at the outset.
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Sometimes, where a surveyor has been retained regularly by a party, there is a mutual understanding of the requirement, and consequently there may be no need for specific instructions to be given each time. Where this is not the case surveyors should be wary of vague instructions and should seek more detailed ones although, in some cases, they may be able to rely upon accepted industry standards.
10.4
FOR WHOM DOES THE SURVEYOR ACT?
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A Marine Surveyor may be instructed to “look after the interests of the party appointing them”. Looking after the instructing party’s interests will not, of itself, create an agency relationship, although it will almost certainly impact upon their impartiality. Once the instructions go further, and include any authority to negotiate a settlement or commit the instructing party to a course of action, then the position is very different and they will clearly be entering into a principal and agent relationship. For this reason, surveyors need to be cautious about how they approach a survey and what they say. This is necessary to ensure that they do not give a wrong impression as to their role. When performing their customary role, care is required not to imply that the surveyor has any authority which is not expressed or implied in their instructions. While they would almost certainly not wish to do this deliberately, the important thing is to explode any myths as to any ostensible authority.
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There are some safeguards that the surveyor must take before a survey commences, or at least as soon as possible afterwards, if they are not to leave any false impressions.
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The first, an ethical one, is that surveyors must always make it clear to those present at the survey on whose instructions they are acting. There should never be any misunderstanding on this important point. Here it is worth commenting on the need for practising ship-visiting courtesies. Before proceeding, even if the Marine surveyor has been retained by the shipowner, It is important for him to remember that, despite the fact that he has the owners’ authority to attend the vessel, the surveyor should always ask the Master for his permission to board. Ship-masters are legally responsible for all that happens on board their ship. They are, therefore, entitled to know at any time just who is on board and for what purpose.
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Next comes the important matter of explaining the surveyor’s role to the party most affected by their attendance. This may be the party who has actually appointed the surveyor (many are unfamiliar with the surveyor’s customary role or of the variations that can be requested in it) or it may be another party who may possibly also be significantly affected by the surveyor’s attendance. Where, for example, the surveyor has been appointed by an underwriter, some explanation may be necessary to a cargo consignee, or to a ship owner’s or charterer’s representative. (Representatives of commercial shipowners and charterers usually do understand the position, but pleasure craft owners and cargo receivers frequently have little or no understanding of the usual procedures.)
10.5
SURVEYS “WITHOUT PREJUDICE”
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Marine surveyors often become involved in surveys that are carried out in order to provide a basis for a settlement between two parties and it is important, from a legal perspective, that nothing a surveyor writes or says when attending upon the instructions of one of the parties is seen as committing that party in any way to any particular basis of settlement, unless the principal’s instructions specifically include a requirement for them to negotiate a settlement. This is a rare occurrence.
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Therefore, surveys almost always need to be carried out “without prejudice” to any settlement eventually concluded, and this fact needs to be understood by those involved. The surveyor should always state to the parties at the outset that the survey is “without prejudice”, and it is usual to state this fact in the report too.
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Surveyors’ reports are often seen to contain a statement “report issued without prejudice” which, at the stage of their writing, means they have no association with any settlement. This has little real meaning in these circumstances but, if anything, it probably means that the survey was carried out, and the report written, without prejudice to the liability of the instructing principal.
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In most common law countries, a report prepared in anticipation of, or after the commencement of, litigation and for this dominant purpose will usually be “privileged”. This means that it is not “discoverable” in subsequent legal proceedings and is not required to be shown to the other side in the dispute. It is effectively confidential between the writer and the recipient.
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It is not unusual to see a statement at the head of a survey report that it is “Privileged – for the advice of legal advisers only”. This statement has no legal
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Know Your Customers
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standing, but when the survey is required in the circumstances outlined above the report can become privileged. The statement on the report does nothing to make it so but the fact of the dispute having arisen in this situation will usually give it legal protection. Conversely the absence of such a statement on the report does not prevent it becoming privileged if the above test is satisfied. 1-349
It is important that surveyors do not express unnecessary and uncalled-for opinions, especially those for which they are not well-qualified, particularly in reports that are not privileged. Such action can be detrimental to their principal’s interests in subsequent litigation, and even where litigation does not follow the report may, for some reason, fall into other hands and the remarks prove detrimental to the principal’s satisfactory resolution of the matter. In particular, repudiations of liability, whether under insurance policies, contracts of carriage or simply in cases involving tort, often become more difficult where a surveyor has expressed an opinion on liability.
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There may be occasions when a surveyor considers that certain information, not specifically called for in the original instructions, is of importance and will be of significant value to the instructing principal. In this case, a telephone call passing on this information may be all that is required. If appropriate it may be conveyed in a separate confidential letter, always bearing in mind that there is a possibility of its discovery in the event of the matter going to court. The information should not appear in the report unless specifically requested to appear there.
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Following on from the previous paragraph it sometimes occurs that an “aside” letter which is quite separate from the report is desirable. To protect the surveyor’s interests, the principals should instruct their solicitor to expect a letter from the surveyor. Sending an aside letter through the principal’s solicitors helps to ensure that it is legally privileged.
SELF-ASSESSMENT QUESTION Whilst we have discussed privilege, what is meant by disclosure in a legal case?
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11.
TYPES OF SURVEY – HULL AND MACHINERY
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
fully understand the different types of Hull and Machinery surveys;
●
have a clear understanding of the Unified Requirements of IACS;
●
understand the requirements of Statutory surveys; and
●
know what is meant by Condition Surveys and their different applications.
11.1
HULL AND MACHINERY IN GENERAL
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Hull and Machinery surveys may be regarded as those that are involved in seeing that the structure of the ship, its machinery and equipment, allow the vessel to regarded as seaworthy. The surveys relating to ship’s hull and machinery can be further reduced to the following types ●
Classification Surveys
●
Statutory Surveys
●
Condition Surveys
11.2
CLASSIFICATION SOCIETY SURVEYS
11.2.1
Periodic and Routine Surveys
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Initially for insurance purposes, shipowners usually choose to have their ships and craft built to independently approved designs and under independent survey to ensure compliance with those designs and also with good shipbuilding practice. From their underwriters’ point of view this should ensure that they are only insuring sound vessels which purport to be what their owners say they are. If the owners of the ships to be built wish to have them classed with classification societies, first they have to submit plans for approval and then provide access to the ships by the societies’ surveyors throughout the period of construction. Once classed they have to continue to make their ships available from time to time while in service for subsequent surveys to ensure that they remain in a satisfactory condition to warrant continuation in class.
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Surveyors working for classification societies regularly carry out routine surveys for the purpose of seeing that the vessel has been maintained and remains ‘in class’. These surveys cover different parts of the vessel, including machinery, being surveyed at varying intervals determined by the societies’ rules which are based on experience of ships in service. Intervals of time between surveys of different parts of the ship are well-documented and to avoid the need to cover too much at any one time, thereby causing disruption to the ships’ trading pattern, specific areas are designated for survey at intervals within the overall approved time span. This time staggering of areas surveyed takes place within a specified time limit so that survey of all parts of the ship is completed within the accepted time span. (Normally four years but sometimes this may be extended to five). These surveys are known as periodic surveys and they are carried out in a routine manner, as closely to time as the ship’s operating pattern allows. There is usually a short period of grace.
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On some occasions due to lack of appropriate repair facilities in a port, or because of other time constraints, temporary repairs are carried out. These too have to be to the satisfaction of the class surveyor who will then issue a “condition of class”. This will require that permanent repairs are carried out by a certain date if the vessel is to be allowed to remain in class.
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In the case of Class and Statutory surveys the surveyor will either be satisfied with the state of the survey-subject equipment being examined or not. If he is not satisfied he will recommend action required to restore Class or Statutory condition (in the case of Statutory items requirements are mandatory and owners must comply). It will then be the owner’s responsibility to act on the recommendations.
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It is possible that shipowners may appoint an independent Marine Surveyor to act on their behalf. As the owner’s representative the surveyor should always attend Class and Statutory Surveys in order to be fully informed about requirements arising from the survey, and so be in a position to discuss with the Surveyor any desired amendment or postponement of action which may be requested to suit the shipowner’s convenience.
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In this case all parties involved should have a clear appreciation at all times of the objectives aimed at in the construction programme. The interpretation of an agreed approved specification requires care, application, and close co-operation between all concerned.
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The final stage in dealing with a new building is the observation and assessment of the trials of ship and machinery. Acting as the Shipowner’s representative for the newbuilding the task requires organising his own and the ship’s staff as a team to examine the performance of the vessel and all equipment, outfit and machinery to ensure that this complies with the requirements of the specification. This is a major task, and, if it is to be successfully accomplished, must be carefully planned and executed. The number of staff which the consultant can commit to the exercise will not be large, not only from considerations of cost, but also because the Shipbuilder will have many of his own staff engaged in running the trials who will have to be accommodated on board in what will be limited space.
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Figure 5 Classification Surveyors Preparing to Survey a Vessel in Drydock
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It is important to know how the classification process works in practice. To start with, a ship is contracted to be built such that it will comply with the provisions of the IMO conventions (MARPOL, SOLAS and Load Line), the classification rules and regulations and the relevant national regulations and standards (ISO, IEC, ASME, BSI, DIN etc).
SELF-ASSESSMENT QUESTIONS List the types of survey relating to hull and machinery that an independent surveyor may be required to undertake.
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The shipyard will develop the design to meet these and the trading requirements of the shipowner. Plans and documentation are submitted to the class society and amended and approved. Class society surveyors attend each stage of the construction and verify compliance. This may involve inspections in different countries where surveyors attend the steel mills, inspect forgings and castings for crankshafts, rudder horns and propeller bosses; main engine works and propeller manufacturers; subcontractors for pipes, pumps and auxiliary machinery; through to the main shipyard where the surveyor attends the subassembly and block erections of the various parts.
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The ship will be launched and the surveyor will attend throughout the outfitting up to delivery, at which time the class society will supply both class and statutory certification. The ship will enter service and be subjected to an ever increasing scope of periodic inspection as the ship ages; comprising annual docking (every three years), intermediate (every 21/2 years) and special surveys (every five years) to ensure continued compliance with class and statutory requirements.
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All the data collected during survey is held on the class society’s central database and reviewed for trends that indicate that further research or amendments need to be made to the existing rules. This is supplemented by inhouse research. New rules and design criteria are then applied to the next generation of ships leaving the building yards. If design faults are found within the existing fleet then reinforcements are carried out and similar ships kept under observation. This information is shared with other class societies who class sister or similar ships under an Early Warning System set up by the International Association of Classification Societies (IACS). Classification societies have requirements for:
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(a)
manufacture, testing and certification of materials;
(b)
ship structures;
(c)
main and auxiliary machinery;
(d)
control, electrical, refrigeration and fire safety; and
(e)
survey procedures.
The class rules cover the strength aspects of the IMO conventions and, under delegated authority, certify the ship for the remaining aspects of the conventions. Hull classification rules and regulations, in particular, are derived from first principles with specific corrosion margins and factors of safety based on experience in service. Each classification society maintains a research and development department comprising experts in marine related disciplines dedicated to rule development. Survey reports of ships in service from field surveyors provide a continual feedback of information on the performance of structures and machinery allowing trend analysis and review of rules by the research departments.
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Types of Survey – Hull and Machinery
In 1969, the major class societies formed IACS to provide a central body for the purpose of unifying key elements of the classification rules and regulations. There are 10 member societies: ●
American Bureau of Shipping
●
Bureau Veritas
●
Chinese Classification Society
●
Det Norske Veritas
●
Germanischer Lloyd
●
Korean Register
●
Lloyd’s Register of Shipping
●
Nippon Kaiji Kyokai
●
Registro Italiano Navale
●
Russian Maritime Register of Shipping
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Experts from each classification society take the knowledge gained from their classed fleet into the various IACS working parties that are established for the purpose of creating Unified Requirements. IACS is structured with seven working parties and, currently, 19 ad-hoc groups and correspondence groups that have been created for a single major study. Their draft unified requirements are reviewed by the IACS General Policy Group and then forwarded to IACS Council for approval before being adopted by each member society in a similar manner to the IMO approval and adoption process. These classification rules cover all the main ship types – oil tankers, chemical tankers, LNG and LPG ships, containerships, bulk carriers, passenger ships, high-speed craft and, now, naval ships for some class societies. Currently, IACS is working on over 120 projects concerning the safety of ships.
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Unified Requirements are minimum requirements. Each member and associate remains free to set more stringent requirements. A
Mooring and Anchoring
D
Mobile Offshore Drilling Units
E
Electricity
F
Fire Protection
G
Gas Tankers
K
Propellers
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L
Sub-division, Stability and Load Line
M
Machinery Installations
N
Navigation
P
Pipes and Pressure Vessels
S
Strength of Ships
W
Materials and Welding
Z
Survey and Certification
Figure 6 DNV’s Surveyor at Work on Lcat 033 Stena Sealink in Hobart. DNV May 2000
1-368
Although IACS is concerned with all types of vessels in class it has been the frequent loss of bulk carriers, with appalling loss of life, which has prompted much of the association’s activity. As a result useful research has been undertaken and many improvements achieved.
1-369
Classification society surveyors tend to come largely from the engineering and naval architecture disciplines though some have a nautical surveyor background. This is to be expected as class is principally concerned with design, structure and condition rather than with equipment and operation although recent years have seen safety and environmental issues come to the fore, much of it calling for attention by nautical surveyors.
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Types of Survey – Hull and Machinery
1-370
Not all classification society surveyors are full-time employees of those societies (known as “exclusive surveyors”) and some are consultant surveyors retained on an “as required” basis. The involvement of these extra surveyors is carefully regulated and may arise when a survey is required at a port where there is no exclusive surveyor. In this case a non-exclusive/acting surveyor (privately employed) may be instructed.
11.3
STATUTORY SURVEYS
1-371
It is the responsibility of each government administration to ensure that each and every ship registered under its flag meet the requirements as agreed by international convention through the IMO.
1-372
In the past administrations carried out their responsibilities by directly employing their own surveyors to carry out their responsibility both as a flag state and a port state. Surveyors would physically inspect ships and their equipment to ensure compliance with the wide range of regulations and their surveys are carried out largely at fixed time intervals, many once per year. In recent years, the responsibility for some statutory surveys, the International Load Line Survey being a prime example, has been delegated to approved classification societies.
1-373
These societies act as agents for the governments appointing them and some governments are rightly very selective over which classification societies they are prepared to appoint for these statutory surveys. Recent years have seen wider delegation of powers by governments to class surveyors and more certificates can now be issued by them than was previously the case. Some countries, Japan being one of them, delegate work only to the country’s own classification society.
1-374
As classification societies have an ongoing association with ships which they class there is considerable merit in their surveyors being able to carry out these surveys and issue the appropriate certificates. The fact that they can be expected to be familiar with a particular vessel’s strengths and weaknesses should place the societies in a strong position to conduct the necessary surveys for issuing the certificates with the minimal amount of wasted effort and cost.
1-375
Having successfully completed their statutory surveys ships are issued with certificates which evidence their compliance with the requirements. There is frequently a need for them to be publicly displayed on board and “original” copies are therefore also issued for convenience, with one being held by the master in a file for easy reference by flag state control, port state control and other surveyors when they board. There is usually a third copy held at the shipowner’s head office.
1-376
In Appendix 1 of this module you will see the list of all the mandatory certificates that ships are required to carry. (It is important to note that this is the current list at the time this module went to press and a revised list is likely to be made in the near future.)
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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Types of Survey – Hull and Machinery
Module 1
1-377
As mentioned in paragraph 1-011 administrations of many countries have agreed to work together to check that vessels under their flag, and also foreign flag vessels entering their ports, comply with the standards set by international agreements. Port inspections of “own” country vessels are known as flag state inspections (FSI) and those of other nationalities are known as port state inspections (PSI). Government surveyors have wide powers to detain substandard ships until they correct the defects which are of concern and to enforce regulations within their waters. In recent years there appears to have been some success in raising the standards of some of the vessels which fly so-called flags of convenience.
11.4
CONDITION SURVEYS
1-378
This type of survey covers a number of investigations for the purpose of determining the condition of a vessel or equipment at the time of the survey. While this is the requirement for all condition surveys they do not all share the same reason for the requirement. The reasons vary markedly and this is why the extent of the survey, or the emphasis of the survey, can vary considerably. This will become apparent as each survey is discussed below.
1-379
Condition surveys should be conducted in daylight and, where cargo spaces are concerned, with the holds empty. It can be difficult enough for a surveyor to cover all the requirements of the survey under favourable conditions without adding unnecessary hindrances such as lighting.
1-380
Condition surveys may be grouped into the following categories Sale and Purchase Surveys On and Off-hire surveys Structural and/or Damage Surveys Cargoworthiness surveys P&I club entry surveys
11.4.1
Sale and Purchase Surveys
1-381
A prospective purchaser of a secondhand vessel will often not wish to rely upon the information obtained from a vessel’s classification society (which will only be given with the vendor’s permission) and, in the case of surveys by some societies, will almost certainly seek information upon which greater reliance can be placed. In any event class does not cover some of the information that may be required when considering a vessel’s overall condition and value.
1-382
Sale and purchase surveys require the surveyor to look for all defects in the hull, machinery and equipment. Surveyors should state whether these defects are due to wear and tear (“ordinary”, or exceptional due to some unsatisfactory working conditions), to a casualty, a fault in design, or defect in manufacture in the case of a component. Some purchasers may only require the surveyor to report the bare facts concerning present condition and leave them to consider
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the ramifications, but more often than not an expert opinion, giving a wider appraisal and providing the conclusions mentioned above, will greatly assist the purchaser to make appropriate decisions regarding the suitability of the vessel. 1-383
The extent to which surveyors will need in-depth inspections of various items will depend to some extent upon their initial findings, the evidence of a planned maintenance scheme in operation and the completeness of the maintenance records.
1-384
The following are the areas principally requiring the surveyor’s attention: (a)
Vessel’s description, history where possible, details of owners, master and chief engineer.
(b)
Listing of all certificates including dates of issue and expiry.
(c)
Hull (i)
Hull and decks including structural condition of all stiffeners (ultra-sonic testing of the plating to measure its thickness may be warranted).
(ii)
Double bottom, deep and other tanks.
(iii)
Hatch covers and all hold’s fixtures and fittings.
(iv)
Cargo handling equipment.
(v)
Fire and life saving equipment and life boats, liferafts and davits.
(vi)
Deck houses, superstructure, galley, storerooms and accommodation.
(vii) Steering gear. (d)
(e)
Engine Room (i)
Main and auxiliary machinery, boilers.
(ii)
All pumping arrangements and associated valves.
(iii)
Fire and watertight integrity closing devices inside the hull and engine room.
(iv)
Engine room fire-fighting appliances, storeroom and workshops.
Bridge (i)
Navigation equipment (radar, echo sounders, GPS, chronometer, sextants etc).
(ii)
Bridge instruments (rudder and engine revolution indicators, telegraphs, steering gear, compasses etc).
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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(f)
Module 1
(iii)
Charts and publications (adequate and kept up to date).
(iv)
Radio equipment (GMDSS) and signalling lights and equipment.
Drydocking To check the underwater condition of the hull, propeller, shaft and rudder.
(g)
Records No survey is complete without reference to the ship’s records which will include: (i)
Deck and engine room log books.
(ii)
Ship manoeuvring diagrams and data.
(iii)
Radar, gyro and other equipment operation and servicing records.
(iv)
Ship’s register.
(v)
Chain register and test certificates for lifting gear (cranes, derricks, shackles, wires.
(vi)
Plans of the vessel and equipment etc.
(vii) Stability data book and other essential manuals. 1-385
A surveyor carrying out this type of survey needs to keep a sense of balance and proportion when reporting upon defects. All secondhand vessels will have defects. Some of them may be simply commensurate with the vessel’s age but others may be from other causes and the surveyor should seek out the reasons as they may influence the buyer in making his decision whether to purchase or not. Some classes of ships or machinery have recognised weaknesses and where a vessel or item of machinery in such a category is being considered by a prospective purchaser the surveyors should check for these likely weaknesses and report upon them.
1-386
Where defects are noted during the survey there should be suggestions in the report on how they can be rectified and perhaps also an indication of likely cost, although not all surveyors will be sufficiently conversant with costs to comment authoritatively. This especially applies where the surveyor is not on his own home ground and the survey is carried out in an unfamiliar port.
1-387
Try to present a fair and reasonable report on the condition of a vessel. Avoid the temptation to over emphasise the inevitable defects that every vessel has. Even if numerous, these defects may not be material for the kind of use to which the prospective owner may wish to put the vessel. Clearly a surveyor who fails to find the defects is failing to do his job but if he blows them up out of all proportion to their importance he is doing a great disservice to both vendor and purchaser.
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And no surveyor of integrity will allow his report, although perhaps factual, to be deliberately unbalanced so as to give a false overall impression simply for the purchaser’s benefit as an unfair negotiating tool. 1-388
On occasions a potential purchaser may ask the surveyor to express an opinion on more issues than simply that of condition, especially seeking advice on whether or not the vessel is suitable for a particular trade or purpose. If the surveyor is competent to do this then it is a reasonable request and the surveyor may respond following clear instructions to this effect. However, ship valuations are rarely within a surveyor’s area of expertise and are best left to a shipbroker.
11.4.2
Small Craft
1-389
Sale and purchase surveys are not restricted to major vessels and they commonly take place prior to yachts or other small craft changing hands. In these cases they are usually surveyed by those possessing very different qualifications and skills from those involved with ships. Such surveyors will frequently have a background as shipwrights and boat builders or designers who, in many cases, need to be versed in non-traditional materials such as GRP, aluminium and steel. Particularly when the subject of the survey is a sailing yacht the rigging forms an important part of the survey, and it is desirable that the surveyor should be a practising yachtsman.
Figure 7 The Pier Marketplace and Yacht Marina in Cairns, Australia Typifies the Small Craft Leisure Industry that has Sprung up Around the World in Recent Years
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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Types of Survey – Hull and Machinery
Module 1
1-390
While there are rules for pleasure craft published by most classification societies, comparatively few are classed. A growing number of large sailing and motor yachts are in class, having been built under survey and since maintained in class. There are provisions in some societies’ rules for GRP mass-produced yachts to have their hull and deck moulding processes approved and a type approval certificate issued.
1-391
Sometimes a difficulty with pleasure craft is in getting them properly prepared for survey. This requires opening up areas for close inspection, removal of ballast and gear and often the drawing of the odd keel bolt. Costs of this preparation, like those of the survey, are usually for the prospective purchaser’s account.
1-392
A limited condition survey will frequently be required by an insurance company when asked to insure small craft. In these cases safety features in the equipment will rate of major importance as many small craft become total losses from fire and explosion and so engine, fuel and gas installations require careful attention. Thefts of equipment are common and a requirement of the surveyor is also likely to be to verify that equipment, often expensive items attractive to thieves, is present on board the craft at the inception of the insurance policy, and is of the type and quality stated.
1-393
The extent of small craft regulation and surveys varies considerably from country to country. Most international conventions do not become the subject of legislation for craft which only operate in local waters (the Collision Regulations would be an exception) and the extent of the regulations applying to small craft is then almost entirely dependent on a government’s own prescription.
1-394
Some countries have very few regulations affecting their pleasure craft whereas others have been obliged to address the subject very fully and provide welldocumented procedures to enable their government surveyors to fulfill their survey role. New Zealand is an example of the former and the US, through its Coast Guard, of the latter. However where pleasure craft are involved and matters proceed less formally, with the owner usually understanding little about insurance or repairs, surveyors are generally expected to give more assistance to the claimant in determining the cause of loss and repair costs, reporting accordingly to underwriters.
1-395
Small commercial craft however fall into an entirely different category and statutory surveys are almost always a requirement. The extent of these surveys and the standard that is expected of charter yachts, small passenger carrying ferries, tugs and other work boats varies considerably between countries. Many of these surveys are carried out by government surveyors, but in some countries there has recently been a trend away from the use of government surveyors and many approved private surveyors carry out this work. Just as there is now a requirement for shipowners to be more directly involved with maintaining their vessels in seaworthy condition (International Safety Management Code) so too has there been a somewhat parallel movement to introduce a limited but similar arrangement with small commercial craft.
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Types of Survey – Hull and Machinery
11.4.3
On / Off-Hire Surveys
1-396
Where a charterer wishes to charter a ship and man and operate the ship for a specific period of time it is called a bare boat charter. In doing this the charterer becomes the owner by demise and carries all the responsibility of caring for and managing that vessel under the contract terms. The actual owner now has no control over the vessel, but does wish to have it returned in the same condition, wear and tear accepted. It is important therefore that a full on-hire survey is carried out so that at the completion of the charter there is a record of how the vessel was at the time the charterers took possession. Where the surveyor is carrying out an “off-hire” survey and can access the “on-hire” report it will greatly assist the comparison of past and present condition if the same order of reporting defects is followed.
1-397
On voyage and time charters, a similar type of on-hire survey is necessary under the terms of most charter parties. Although in this case the charterer is generally hiring the cargo space or the service a ship offers rather than taking over the vessel. This on-hire survey is carried out to safeguard the owner against potential damage caused during the charter by the cargo or any other part of the operation. For example, in the oil industry, exploration companies may charter an anchor-handling tug to carry out rig moves. This can be quite heavy work for the tug to carry out and any damage caused may be claimed by the owners.
1-398
Part of the on/off-hire survey requirements is to measure the consumables at the start and completion of the charter, For example the charterparty may state that the charterer has to pay for fuel oil and lubes. In this case there will a balance between how much bunkers the vessel had at the beginning and completion of the charter. The surveyor will also ensure that the statutory certificates are all in order (dates of issue and expiry should be recorded against each). A tally of cargo lashing gear is also generally included in the surveyor’s report.
1-399
In both of the above types of charter, the charterers will have a responsibility for returning the ship, and principally the cargo spaces, to the owner in much the same condition as they were in at the beginning of the charter. Or if they are unable to do this then at least they have to meet the costs of any necessary repairs. In many cases the owner and the charterer may employ the same charterer to represent both parties.
1-400
On completion of the survey the surveyor submits a report stating what has been done, what has been sighted and, where there is significant damage, the extent of that damage or at least the present condition. This must be factual and generally does not call for opinion. Included in APPENDIX 6 is a glossary of IACS standard reporting terms and these should be followed. It makes the reader more comfortable to see recognisable terms that are understood in the industry. The report may also include remarks on the general condition of the vessel’s engine room and accommodation and the amount of rust in the holds.
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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12.
TYPES OF SURVEY – CARGO-RELATED SURVEYS
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
fully understand the importance of cargoworthiness;
●
understand the importance in the preparation of cargo spaces;
●
understand the surveyors’ role in surveying cargo;
●
understand what is meant by draught surveys; and
●
know how to carry out quantity surveys.
12.1
CARGO-RELATED SURVEYS IN GENERAL
1-401
In the previous chapter, ensuring the seaworthiness of the vessel was the underlying reason for various surveys that are undertaken by various types of surveyor. In this chapter we consider the cargo-related surveys that ensure the vessel is cargoworthy and the need to ensure that the interests of both shipper and shipowner are covered to meet the laws covering the carriage of goods at sea. It is not just to see that the cargo is safely and securely stowed for the voyage, but the cargo is what it says it is and does not endanger the ship.
12.2
IS THE SHIP CARGOWORTHY?
1-402
In the tramp trade, particularly with regard to time or voyage charters, the shipper or charterer will call upon a surveyor to determine the condition of the spaces and equipment used for the carriage of the charterer’s cargo and the adjacent parts of the ship’s structure.
1-403
These surveys can be quite extensive and will cover cargo spaces and their closing devices, the adjacent weather deck, ship side rails and/or bulwarks, deck and mast houses and any part of the ship which is likely to become damaged in cargo operations. Within the holds the access ladders, ventilator trunking, service water and other pipes, and sounding pipes are very vulnerable to damage. Tank tops frequently receive a severe pounding from grabs in ships carrying bulk cargoes. Bulkheads, frames, wing tanks and ship side plating are similarly susceptible to damage from grabs and from any cargo which may strike them while loading or discharging.
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Types of Survey – Cargo-related Surveys
1-404
It is good practice for the surveyor to cover the items on deck and then work through each hold in turn. This is best achieved by working from port to starboard and upper to lower. This is not a hard and fast rule but the surveyor should get into a reasonably regular routine and, if access can be obtained to past survey reports, to observe the system used for them provided they have a measure of uniformity.
1-405
The shipowner and the charterer may agree to the appointment of only one surveyor to carry out an independent survey on behalf of them both or each party may appoint their own surveyor. In the latter case it is usual for the two surveyors to work together and co-operate as closely as is compatible with their duty to act for the party appointing them. It is certainly important that at the “onhire” survey, before the cargo is loaded, they should be in agreement as to the condition of relevant parts of the vessel as any differences can almost certainly not be reconciled later. It is not quite as important at the “off-hire” survey as there is then still an opportunity for all concerned to make their own observations provided the vessel does not immediately leave the final discharging port or commence to load another cargo.
1-406
Where a survey is carried out with a surveyor acting for each party then agreement on the routine for inspection and reporting will assist all those who have access to these reports. In practice it is not usually too difficult to get surveyors to reach agreement as both are likely to be competent, practical persons and are usually very familiar with the need to co-operate for the benefit of their principals.
12.2.1
Tanker Surveys
1-407
In recent years the bad publicity surrounding oil tanker disasters, and the potential for the charterer to be held responsible for oil spillage along with everyone else, means that oil majors in particular are careful to know the condition of the ships they hire to carry their cargo. The once vast fleets of oil tankers owned by the world’s principal oil companies have long gone and, although some oil majors still operate some vessels of their own, they have turned to the charter market for the majority of their ocean transport requirements.
1-408
Most oil majors have formed an association called OCIMF (Oil Companies International Marine Forum). One of the most significant safety initiatives to be introduced by OCIMF is the Ship Inspection Report Programme (SIRE). This programme was originally launched in 1993 to specifically address concerns about sub-standard shipping. The SIRE Programme is a unique tanker risk assessment tool of value to charterers, ship operators, terminal operators and government bodies concerned with ship safety.
1-409
The SIRE system is a very large database of up-to-date information about tankers. Essentially, SIRE has focused tanker industry awareness on the importance of meeting satisfactory tanker quality and ship safety standards. Inspection reports are maintained on the index for a period of 12 months from the date of receipt and are maintained on the database for two years. SIRE access is available, at a nominal cost, to OCIMF members, bulk oil terminal operators, port authorities, canal authorities, oil, power, industrial or oil trader companies which charter tankers as a normal part of their business. It is also
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available, free of charge, to governmental bodies which supervise safety and/or pollution prevention in respect of oil tankers (eg port state control authorities, MOUs, etc). Applicants wishing to participate in the SIRE Programme are required to obtain formal applications and are asked to submit their request via e-mail or fax. Please include your full style mailing address. 1-410
So most oil majors have their own checklists which are based upon the OCIMF inspection routine for the various classes of tanker. Rather than rely upon unknown surveyors the principal chartering oil companies will often carry out their own surveys, or at least retain surveyors in whom they have long standing confidence.They will quite readily incur the expense of flying them around the world to conduct their surveys – the price of an air fare is cheap compared with the costs which can result from an unreliable survey before a long-term charter.
12.3
PREPARATION OF CARGO SPACES
1-411
Relating to the cargoworthiness explained in 12.2 there is another common type of survey which is one in which surveyors certify that, as independent parties, they have inspected a cargo space before loading and are satisfied that it has been cleaned and otherwise prepared as required for the reception and satisfactory carriage of a specific type of cargo. Examples of this survey involve cargo spaces intended for the reception of refrigerated cargoes, grain and other bulk commodities, tallow, latex, vegetable and other oils. The survey thus involves holds, refrigerated chambers and cargo tanks and may often also be required for containers before stuffing.
1-412
In the case of refrigerated cargoes the approval will involve not only cleanliness but also suitable dunnaging and, above all, correct opening temperatures and confirmation that the refrigeration machinery is capable of providing the requisite temperatures.
1-413
The instructions from the principal to the Surveyor should clearly state the standards of cleanliness that are be required for a particular cargo to be carried. It often happens that principals do not provide sufficient information and the available time for survey is often limited. An added difficulty is that some areas of a hold may be nearly inaccessible. Where such limitations are placed upon the standard of a survey the report must indicate them.
1-414
For ballast holds the suction and inlet pipes should be blanked off. Also all hatch covers should be hose tested unless the surveyor can be otherwise satisfied that they are in good order and watertight. Hold bilge suctions need to be tested to ensure that any moisture finding its way to the bilge area can be pumped clear. Some filtering cover (such as burlap) should be placed over them to prevent quantities of cargo getting into the bilges.
1-415
Surveys must be particularly careful when inspecting tanks internally for oil and petroleum products. These spaces should only be entered when it is safe to do so. With regard to edible oils and fats the current FOSFA (Federation of Oils Seeds and Fats Association) recommendations are the guide to survey requirements. Cleanliness, freedom from moisture and rust are the principal considerations, together with lack of damage to surface coatings. For some cargoes the removal of brass, copper, galvanised and alloy fittings is necessary.
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Where heating coils are fitted they should either be tested, if required for heating the particular product, or removed and blanked off. There will also be a requirement to certify the cleanliness of pumping arrangements, including the loading and discharge lines to the shore facility. 12.4
SURVEYING THE CARGOES
1-416
It is perhaps true to say that independent surveyors are mostly employed as cargo surveyors throughout the world. Shipowners, charterers, cargo owners and underwriters often require the attention of surveyors for almost every facet of their handling. This can sometimes be from the point of origin, which may be well inland in the country of origin, to the place of destination, similarly well inland in the country of destination, or it may, more commonly, be at the port of shipment or discharge. Particularly when things go wrong and cargo becomes damaged several parties with an interest in it may all call for independent surveys.
1-417
While cargo surveying is usually the province of nautical surveyors, who alone may be suitable for some surveys, it is by no means exclusively so and many very competent cargo surveyors have had little or no actual seagoing experience. In these cases they probably attribute their expertise to having served in the appropriate industry which has equipped them with a specialised knowledge of a particular commodity or manufactured item such as a complex computer.
12.5
GENERAL CARGOES
1-418
The tonnage of general cargo being shipped worldwide has increased by an average of 3.5% over the last 25 years. However, the average growth in containerisation during the period 1980–2001 has grown by 8.5 %. What is even more dramatic is that containerisation as a percentage of non-bulk cargo has risen from 46.7% in 1980 to 83% in 2001. So we can see the method of transportation has changed dramatically with the growth of container operations. To some extent this has changed the pattern of general cargo surveys, and much of the cargo is now not seen at the ports through which it is exported and imported.
1-419
Containerisation has also had a dramatic effect on refrigerated and chilled cargoes which are carried in large quantities in specially built vessels. The term general cargo applies to a very wide variety of items, much of it manufactured or processed in some form and almost certainly of diverse sizes and weights. The term is used largely to differentiate this type of cargo from cargo consisting of a homogeneous mass of material, all of which is similar in nature.
12.5.1
Container Surveys
1-420
Some ports have a Container Service Facility (CSF) where containers may be stuffed or unstuffed within the security of a port facility. Usually competent cargo handlers are available who can see that this work is properly carried out. However the vast majority of containers are stuffed at some distance from the marine terminals that will load them on to the ship. What has been loaded and how it has been loaded is not always clear, and ports and ships rely on the documents accompanying the container. This does cause concern.
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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Module 1
1-421
Furthermore containers are susceptible to handling damage and to damage from cargoes loaded into them. There may be a need in the case of leased containers for a survey when the containers go “on-hire” and survey again when they come “off-hire”. Marine surveyors will often be called upon to carry out these surveys, although this has become something of an area of specialisation and many containers are surveyed by those with an engineering background, not necessarily marine, and who have often been employed in firms carrying out container manufacture or repair work.
1-422
Generally only one container surveyor will be involved as the values at stake will usually leave each party prepared to accept the findings of one surveyor acting independently. Where both parties have confidence in an agreed repair firm and the extent of damage is not high it is not uncommon for them to dispense with the services of an independent surveyor and accept the repair firm’s quote after having made it quite clear that only “recent” damage, and no wear and tear, is to be covered. It has now become common practice for container surveyors to have passed the examinations of the Institute of International Container Lessors (IICL).
1-423
Containers are used for a large number of commodities in addition to the normal general dry cargo such as edible oils and small parcels of special oils and chemicals etc. Some of these commodities require containers to be cleaned and approved before loading. When used for general cargo there is not usually the same requirement but as they are often carried on deck and, in any event, are likely to be exposed to rain in the terminals, watertight integrity is important. From time to time surveyors are required to survey them before stuffing and the following points require attention: (a)
Rubber door seals present, intact and watertight.
(b)
Door securing devices in good order.
(c)
Free of holes or other damage (particularly on top, adjacent to the corner posts where spreader twistlocks commonly puncture them).
(d)
Insulation in good condition (reefer containers).
1-424
Watertightness can usually be checked satisfactorily by the surveyor entering the container and having it closed behind him. Light will penetrate most holes but a further check can be made by hose testing. Surveyors will generally be expected to check that reefer containers have been pre-cooled before stuffing and then, on completion, that they are tightly closed, possibly sealed for security and that the correct settings have been applied to the refrigeration equipment, with recorder charts in place and correctly lined up.
1-425
It should also be noted that containers are now frequently used for the carriage of small quantities of industrial gases and bulk liquids. They have tended to replace deep tanks for this purpose as they have the obvious benefits of portability and ease of access for cleanliness.
12.5.2
Container Stuffing Surveys
1-426
As has been mentioned containers are normally stuffed inland, then conveyed to the port of shipment, carried by the ship from port to port and then dispatched inland
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to the final destination. From the point of view of the cargo owners this is intended to reduce time, eliminate much of the handling of individual items and, as a consequence, reduce both the handling time/cost involved and the potential for damage. 1-427
The term FCL, the abbreviation for “full container load”, is used to describe a method of conveyance in which a container is stuffed with the cargo of one shipper, often directly from its own premises and then delivered into a consignee’s premises at destination.
1-428
A considerable amount of cargo is also delivered to and from depots operated by shipping companies or freight forwarders. They may be inland, or in the vicinity of the port areas, and here the cargo is consolidated/deconsolidated and the containers stuffed/unstuffed with cargo offered by a number of shippers before/after being conveyed to and from the ships. It is then known as LCL – “less than container load”.
1-429
The obvious benefits to cargo handling arising out of container transport have been effective and they have also changed the pattern of surveys considerably. Although a surveyor may attend at the shipping companies’ request when the containers are handled on board the ships there is frequently little opportunity to sight the contents. Ship’s surveyors rarely attend at the point where container s are stuffed or unstuffed of cargo unless there is reason to expect stowage difficulties or cargo damage. However P&I clubs have been taking a stronger interest in this in recent years.
1-430
Cargo surveyors acting for underwriters may sometimes be requested to attend at the shippers’ premises or loading depots to sight the cargo’s condition and securing within the container. When damage has been discovered at destination surveys are very likely to be required and, as a consequence, it is not uncommon for insurance loss adjusters, many of whom have very limited marine cargo knowledge, to be appointed if there is no recognised surveyor within reasonable travelling distance.
1-431
Much of the world’s general cargo is today handled in containers and the “break bulk” carriage in conventional cargo ships is very much reduced. However, there are some marked exceptions to this where specialised cargoes, such as refrigerated meat and fruit, will often be carried in specialised ships fitted for the purpose. Although containers are also used extensively for refrigerated cargo there is still a place for the purpose-built ’tween deck vessel employed worldwide in these trades. Car and livestock carriers are also special types of vessels designed or converted for their specialised trades.
1-432
A number of containers are frequently stowed on deck in general cargo ships and almost always in dedicated containerships. These containers must be very carefully secured in place and this is achieved almost invariably by means of special securing hooks, rods and rigging screws in addition to relying upon the twist-locks. A manual covering this should be provided in each such ship and must be carefully adhered to.
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Figure 8 In the UK Both the MCA and the HSE are Calling for More Attention to be Paid to Lashing on Container Ships. The Lack of Suitable Access to Lashing Work Stations is a Common Cause of Accidents to Stevedores as it Causes Unorthodox and Unsafe Practices. Marine Surveyors who have the Important Task of Seeing that Containers have been Properly Lashed should be Aware of this Hazard. Picture Feb 2004
12.6
DRY BULK CARGO
1-433
Bulk carriers (or bulkers as they are often called) have had a sad history in recent years with one being lost on average every month. They are also perhaps the most hazardous vessel for a marine surveyor to encounter. They have been designed to minimise their registered tonnage measurements and usually have no raised forecastle. The loss of the Derbyshire highlighted the problem to the world at large. This was because it was a British ship with British crew and the UK press seized onto the human loss element. This is fair enough, and yet the world has generally ignored the other 300 or so losses of these vessels. The scantlings of these vessels has also been set to a minimum, the lighter the hull the more cargo you can carry. In the hands of uncaring owners and poorly paid crews, these workhorses in the industry soon deteriorate and become a risk to themselves and those that board them.
1-434
The various bulk cargoes these ships carry also create problems for the ships which carry them, and damage is often caused by corrosion and damage caused by unsuitable loading. Too often this damage went unnoticed, having been undetected due to inadequate surveying standards. In short the losses have arisen where commercial rather than safety interests have been the overriding factor.
1-435
IMO and IACS have been very hard at work in improving bulk carrier safety, with improved design and increased structural requirements. There has been a great deal of debate about compulsory double hulls for bulkers, but at present this remains optional.
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Types of Survey – Cargo-related Surveys
1-436
IMO also has produced the BLU Code which is the Code of Practice for the Safe Loading and Unloading of Bulk Carriers and should be complied with by both ship and terminal operators. (This is an essential document for those regularly involved in the trade. Others would be wise to make themselves familiar with its existence. Refer to the Appendix 5 to this module for a list of its contents.)
1-437
Marine Surveyors with experience also as ships’ officers on bulk ships can be very effective in ensuring that the essential co-operation between the ship and the port personnel will ensure the utmost care and attention concerning the planning of the loading and discharging operation. This will require suitable distribution of weights in each hold and the speed of the loading operation. Always be aware that often the terminal operators are more concerned with getting the ship off the berth than with the ship’s overall safety.
1-438
A prime consideration must be the loading/discharging plan. It needs to cover: (a)
Distribution of cargo within the holds (taking into account its suitability at both the loading and discharging port/s).
(b)
Speed of loading/discharging of each hold.
(c)
The ship’s capability of ballasting/deballasting (considered in association with above).
1-439
Attention must be paid to the requirements of any ballast or de-ballasting operation. The same problems apply to ballasting and deballasting as mentioned in 1-348 above concerning the rate of loading/discharging and to distribution of cargo. Both operations can materially affect the vessel’s structure by imposing severe stresses, causing significant damage. In giving proper consideration to these matters the terminal administration should sign and accept the IMO approved ship/shore checklist and provide the ship with instructions, in the appropriate language, regarding its conduct at the terminal.
1-440
Another area of concern is that of damage done to the ship during cargo operations by handling equipment. This damage is specially serious when caused to hatches and hatch coamings but it also applies to fittings in the hold. Ships’ officers, and the surveyor too, are generally required to monitor this and liaise with the terminal operators to minimise any damage caused by grabs and machinery, principally bulldozers, operated within the hold. Provision of a GA hatch plan, showing the location of hold ladders, pipes and other fittings prior to commencing will facilitate this. Marine surveyors should also consider the cleanliness and fitness to receive the cargo, and the taking of samples during loading or prior to discharge.
1-441
The most common types of bulk cargoes are grain, iron ore, coal, sugar, scrap steel, chemicals and fertilisers. They are conveyed across the oceans in vast quantities and generally do not present major problems for their receivers but many are susceptible to contamination from the residue of previously carried cargoes, rust from the ship’s structure, moisture from sweat, rain during loading, sea water ingress through leaking hatches and fresh/salt water from leaking pipes.
1-442
Be particularly concerned with coal and some chemicals that require careful temperature monitoring as they are susceptible to heating damage and in some
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cases to spontaneous combustion. The IMO Code of Safe Practice for Solid Bulk Cargoes provides information on the stowage and carriage of most common, and many uncommon, bulk cargoes. 1-443
With bulk cargoes the quantity out-turned, sometimes with unexplained shortages exceeding an acceptable percentage, can present difficulty in determining where the losses occurred and will result in substantial claims for these losses. On some occasions they may be no more than paper losses and, where surveyors are not involved until after the discharge, it is often very difficult to detect where the losses have really occurred.
1-444
Sampling usually plays a large part in the role of the surveyor during the loading and discharging of bulk cargoes and is commonly required to determine the quality, moisture content, and possibly temperature of the cargo to be loaded or on board. But it is not always as simple and straightforward as it may appear as samples are usually required to be representative samples of the whole. They may also sometimes need to be more specific of those at any place or time during a cargo operation, particularly if a problem is met at any stage.
Figure 9 The 2,100 gt General Cargo Vessel Scotia Being Loaded with Grain at UK the Port of Dover. The Scotia is Owned by Baum and Company and was Built in 1987. Photographed in October 2002
1-445
1-126
Grain cargoes have, for many years, engaged surveyors’ attention in the grain loading ports of the world.The regulations imposed by the SOLAS convention on the carriage of grain are extensive although recent years have seen some simplification. This has been assisted by the design of modern bulk carriers and it is the more conventional cargo ship that presents the most problems. As a consequence they are rarely “fixed” for grain cargoes as bulkers are generally readily available.
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Types of Survey – Cargo-related Surveys
1-446
Loading will have to comply with the requirements of the International Grain Code (except where exemptions have been granted, in which case the stability report should say so) and charterparties will usually also have some specific requirements relating to the loading of a grain cargo. Surveyor’s instructions should include reference to them. In many cases there will be a requirement for, and a restriction to, the involvement of certain specific approved surveyors. Although private surveyors may attend to much of the planning and overseeing of a grain loading there will usually be a requirement for a government surveyor to approve the overall plan.
12.6.1
Draught Surveys
1-447
Draught marks are permanently indicated on the ships’ side, both forward and aft. Conducting draught surveys is one popular method used to determine the quantity of cargo loaded or discharged particularly in the case of bulk cargoes such as that carried by the vessel pictured below. They are convenient and reasonably reliable and are carried out by comparing the vessel’s draught before and after the loading or discharging operation.
1-448
By taking the draught of a vessel the marine surveyor can measure the displacement of the ship at the start and completion of the cargo operation. The difference between the two measurements will represent the weight of cargo added or removed. Of course other allowances will have to be made if the vessel has loaded fuel oil, water, or other items. Simple as all this may seem it is actually quite a complicated and often difficult process as so many factors can affect the accuracy of the two comparative draught readings obtained. There are other difficulties to overcome.
Figure 10 A Typical Panamax Bulk Carrier, the Desert Eagle, Owned by Atlantic Bulk Carriers Built in 2002 in South Korea and Registered in Greece, the Vessel is 74,630 dwt.
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1-449
The accuracy of draught surveys increases with the quantity of cargo being carried by the vessel. Up to about 5,000 tonnes actual weighing of the cargo will probably be more accurate but, as the quantity increases so does the accuracy of the draught survey. At about 10,000 tonnes, and with good conditions for taking the measurements, accuracy can be of the order of between 1% and 2%. Even for the smaller quantities draught surveys may provide a useful check upon other methods. The following points are mentioned to give some indication of the requirements in carrying out draught surveys but they touch only very lightly on the subject. Draught surveys should not be embarked upon by novice surveyors without some first hand guidance from experienced surveyors.
1-450
The surveyor has first to observe the draught readings at which the ship is floating and these have to be reasonably accurate. They can be complicated by many basic factors including: (a)
The clarity of the paint on the draught marks.
(b)
The adequacy of the light falling on them.
(c)
The surveyor’s proximity to the marks (hanging from a rope ladder from the overhang of the offside quarter in a strong wind can be exciting but not very productive! Sighting from a boat is usually the best method).
(d)
The disturbance at the water level (by wind and swell).
(e)
When in a strong current, whether the ship is “squatting” and/or has a build up of water at its stem or stern.
(f)
Whether the ship, as a longitudinal girder, is deformed due to its condition of loading, or due to ambient temperature.
1-451
The effect of weather disturbance on draught readings can be reduced by means of a draught tube used adjacent to the draught marks. It “stills” the water beside the mark at which the draught is read. Distant reading draught gauges are not accurate enough for this purpose. Another form of assistance can be provided by means of a special clinometer which allows the surveyor to correct for a vessel’s list when the weather permits only an accurate reading of the draught on the lee side.
1-452
These listed items often cover only the first difficulties encountered and once an accurate draught reading has been obtained it may need correcting for the fact that draught marks are often not on the fore or aft perpendiculars. It is then necessary to obtain an accurate density of the water in which the ship is floating. The sea water density can be affected by a number of variables such as:
1-128
(a)
Depth at which they are taken (salinity and temperature variables).
(b)
Location, relative to the fore and aft line of the ship (density can vary between the stem and the stern for the same reasons).
(c)
Local distortions caused by ship’s or shore discharges.
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1-453
Once a representative sample has been achieved the density has to be obtained by means of a hydrometer, and for accuracy a special draught survey instrument should be used. Temperature plays a part as a hydrometer reads correctly at only one specified temperature and the reading obtained will be slightly in error at other temperatures due to expansion and contraction of the material of which it is constructed.
1-454
Having fine tuned the draught readings, the surveyor then has to determine the changes in quantities of ballast and fresh water, fuel and diesel oil, stores, spares and other variables on board. This requires sounding, or at least witnessing, ship’s officers’ taking of soundings, of all the double bottom, deep and wing tanks (even empty tanks too) on the vessel. List and trim can affect the accuracy of tank quantity calculations due to air entrapment when pressed up. Ideally they should be sounded when sufficiently full to give a good sounding, but when no air can be trapped in pockets.
1-455
Reliance has to be placed on the figures given by the builders for tank capacities and all the other hydrostatic information provided. These are usually reasonably accurate but are occasionally unreliable and an error of about one tonne per 1,000 tonnes can be introduced because they sometimes assume fresh water density as being 1.0000 at 15C; a slight inaccuracy.
1-456
Finally, and often with some haste with the master, pilot and terminal operator breathing down the surveyor’s neck as the ship is about to sail, the surveyor is required to complete the calculations and confirm the quantity of cargo loaded or discharged.
1-457
A marine surveyor taking proper care, can expect to obtain reasonably accurate results from a draught survey. It is accepted in most dry bulk trades that an accuracy of about 0.5% is reasonable and feasible provided the quantity is large enough. Much depends upon the co-operation received from the ship’s personnel and whether they want the surveyor to arrive at an accurate figure or not. Sometimes owners and charterers will deliberately hinder accurate readings so as to obtain a figure more favourable to their position, and surveyors need to be fully alive to this possibility.
1-458
Of course draught surveys will not account for cargo lost through spillage when grabs are handling the commodity into and out of the vessel. Another consideration has to be given to water inclusion through rain or condensation, and for this sampling is likely to be required. It does not however normally constitutes part of the actual draught survey. A comparison should be made between the figures obtained from the draught/ ullage surveys and weightometer figures, although the surveyor’s figures are the principal ones used.
SELF-ASSESSMENT QUESTION To what particular considerations would you pay heed when carrying out a draught survey for the loading of a 20,000 ton bulk carrier?
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12.7
SUPERVISORY/OVERSEEING SURVEYS
1-459
Surveyors may sometimes be called in to advise shipowners, charterers and shippers with regard to certain types of cargo and its handling. More often than not, however, they will be instructed to actually oversee or supervise its handling in which case they will be acting clearly as an agent of their principal and need to fully understand their legal position when doing so.
12.7.1
Pre-shipment Surveys
1-460
Shipowners and charterers sometimes call for a survey to be carried out at a shipper’s premises so as to gain a better understanding of some unusual commodity offered for shipment. Occasionally surveyors may be called upon by shippers to advise on packaging and handling where shippers are unfamiliar with a new trade, but the more usual situation is for a surveyor to be retained for this purpose by the shipper’s underwriters. Surveyors will then be expected to advise the shipper, recommend packing and handling, possibly then going on to discuss these matters with the carriers who will be conveying the goods from the shippers’ premises to the port of shipment, and possibly also with the ocean carriers.
1-461
P&I clubs sometimes call for pre-shipment surveys for cargoes that commonly give rise to claims on shipowners. Steel is a commodity which presents problems with regard to rust and care is needed in making sure that bills of lading are appropriately claused, and this may require a surveyor to have particular experience with the commodity or manufactured item involved.
12.7.2
Loading Surveys
1-462
Loading surveys may be required as an extension to the service provided in 4.6.1 above or may stand alone. When they are performed by surveyors acting for the shippers or their underwriters, surveyors need to be particularly conscious of their position.
1-463
Access to a container during stuffing may present little difficulty, particularly where it occurs at a shipper’s premises, but access to a ship (not often refused during loading) is at the courtesy of the shipowner or charterer. However, although possibly permitted to board the ship, the surveyor is generally not in a position to “give any orders” to stevedores or others concerned with the loading unless acting for the shipowner or charterer. The surveyor, if acting for the shipper or their underwriters, will probably not have any authority and can only make recommendations which the ship’s employees may or may not heed. The result of disregarding the advice may be that loss or damage arises in handling or later during the voyage. Where the surveyor’s recommendations are disregarded and damage results as a consequence it would be prudent for the marine surveyor to obtain a witness to the facts regarding the recommendations.
1-464
In any event surveyors should state their recommendations clearly in the survey report and state that these were offered. These facts then also need to be conveyed in writing to the ship’s representatives. Ideally this should be as soon as possible after the cargo handling has taken place and certainly before the ship’s departure. The information may play a significant part when later
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considering the liabilities of the parties, and if conveyed in writing at an early stage its evidential value is considerably enhanced. Of course, where a surveyor’s recommendations during loading are accepted by the ship, possibly against its own representative’s inclinations, and loss or damage is suffered, marine surveyors could find themselves with a responsibility for that situation. 12.7.3
Securing/Lashing Surveys
1-465
Marine surveyors are often called upon to inspect the securing of cargo, both in a ship and in a container. In a conventional ship this is usually the function of the ship’s surveyor who certifies that the shipowner or charterer has taken all reasonable precautions to stow and secure the cargo for the forthcoming voyage. In a container, unless packed by the ship’s representatives, it is more likely for the survey to be carried out by the shipper’s or underwriter’s surveyor. Its purpose is then to endeavour to establish that, if movement damage occurs in transit, it has been caused by the actions of the carrier and not by the shipper’s inadequate securing.
1-466
The surveyor’s certificate testifies to the method and extent of securing and lashing, and where stowage is on deck, also to any additional precautions such as temporarily securing by welding to the deck and ship’s structure.
1-467
Many nations have regulations regarding the carriage of cargo on deck and government surveyors may sometimes be required to attend to approve and issue their certificate.
12.7.4
Discharge/Out-turn Surveys
1-468
Much the same comments apply to the surveys for loading surveys, to the extent that the survey is intended to provide information on the handling, but this time during discharge. The surveyors, if acting for the consignees or their underwriters, may be required to extend their services to the subsequent handling in the port area, with a possible further requirement, particularly in the case of a heavy lift or expensive machinery vulnerable to damage, to cover securing onto the road or rail vehicle for inland transport.
1-469
Checking for damage received up to the time of discharge can also be an important part of the discharge/out-turn survey. This may involve no more than an inspection of a particular commodity, perhaps a consignment of machinery or other goods, which may be susceptible to damage or which has suffered known damage in stow. In the latter case the ship may not permit the receiver’s surveyor to attend on board, but a great deal depends upon the relationship between the particular shipowner/charterer and the receiver.
1-470
If there is known to be a problem of damage from heavy weather on a voyage, or any other cause, surveyors will often be instructed to attend a discharge survey on behalf of the ship and possibly also for the receivers and their respective underwriters. Even if there is no known damage receivers, or more probably their underwriters, knowing that a cargo is susceptible to damage, will often commission a discharge survey as this may later make it easier to pinpoint liability for any damage.
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1-471
When damage is suspected a surveyor may be called in to witness the opening of a hold or a container and then to determine what, if any, damage is present. It will be important to identify the cause or causes and, if there are more than one, to apportion the extent of damage between the causes.
1-472
However when the vessel herself has been involved in a major casualty, an outturn survey may become an essential requirement and part of an extensive operation. Following grounding or a fire there may be very extensive damage to cargo, and the shipowner may have declared a general average. If this is the case then it is likely that a number of surveyors representing different interests will be concerned.
1-473
It will then follow that a general average surveyor and an average adjuster will be appointed by the shipowner. The former will have to record the condition of the cargo discharged from the ship and the latter will have to adjust the average in due course. Where a large ship is carrying a general cargo this can be a huge undertaking for both.
1-474
The General Average surveyor will have the responsibility of sighting every item of cargo as it is discharged, to consider the extent of damage from possibly several causes, arrange for joint surveys to be carried out with receivers’ representatives and finally compile a list of every item against its bill of lading number. All this information must then be included in the report which will cover the circumstances under which the general average was declared together with the disposal of each item of cargo and a record of their losses and causes.
1-475
Where fire is involved the surveyor’s work is complicated by the fact that there will almost certainly be at least three causes of damage to some of the cargo. There will be heat damage, smoke damage and probably water damage, the latter resulting from its extinguishing. The extent of damage has to be considered for each item out-turned.
1-476
Where a grounding is involved with the vessel’s holds flooded, or where a fire may have been extinguished by deliberately flooding a hold, there can be widespread loss of shipping marks in a general cargo. This complicates the surveyors’ task still further in trying to identify ownership. Because of its complications it is usual to appoint a firm of general average surveyors in this situation as the volume of work can be so extensive that no individual could possibly handle it.
1-477
General Average surveys also generate work for other surveyors in the region as underwriters are likely to require their services to attend to their customer’s needs. There is much to be gained from full co-operation between the underwriters’ surveyors and the general average surveyors. Following a major casualty underwriters may group together in appointing one firm of surveyors to look after all cargo interests rather than have a number of different individuals or firms acting for them.
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12.7.5
Types of Survey – Cargo-related Surveys
Steel Cargoes
Figure 11 Coils of Wire Awaiting Shipment 1-478
Where coils of steel or special steels are involved surveyors should check and note the wrapping and banding which is likely to have been applied to them. P&I clubs can be faced with unjustified claims for steel allegedly out-turned in unsatisfactory condition. Some rusting may appear likely to be of considerable concern when in fact it is not really of significance. Any surveyor involved with a steel cargo, when checking shipped condition is a part of the role, should seek comprehensive guidance from the appropriate P&I club.
Figure 12 The Port of New Orleans has Supplied this Photograph Taken in November 2000 of Steel Wires being Inspected During Loading at that Port
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1-479
A correct description of the loaded condition of the steel with regard to rust and other physical damage such as bending requires particular attention. It is essential to establish the degree of rust present at the time of shipment, bearing in mind that all unprotected steel is susceptible to light surface oxidisation, but this tends to be an overall condition following exposure to the atmosphere and is rarely detrimental although it may warrant recording
1-480
Steel is often shipped on bulk carriers. Steel does present one problem on bulkers with regard to stability. Unlike the conventional general cargo ships bulkers have no ’tween decks except where there is provision for suitable ballasting to overcome the low cargo centre of gravity of the mass of steel. Movement of steel within a hold in a seaway can spell major problems, if not disaster.
12.7.6
A Summary of Bulk cargoes in general
1-481
When a surveyor attends any bulk cargo the following list briefly outlines the key tasks: (a)
To measure the quantity of the cargo loaded or discharged
(b)
Confirm the quality of the cargo loaded or discharged
(c)
When instructed, to sample of the cargo generally for moisture content or grade.;
(d)
To check the cleanliness of the cargo spaces and freedom from infestation.
(e)
To check the stability and longitudinal stress calculations of the ship.
(f)
To check the watertight integrity of the ship’s hatch covers.
12.8
TIMBER DECK CARGOES
1-482
As with most deck cargoes, the surveyor should be satisfied that the deck is capable of carrying the complete timber load. Timber deck cargoes, depending upon their quantity, can also present a requirement for compliance with the SOLAS and Load Line conventions.
1-483
Timber deck cargoes obviously have the additional threat of being exposed to sea water and gaining additional moisture. Stability and securing are two of the principal difficulties where the amount of this deck cargo is extensive.
1-484
Compliance with the timber deck regulations is essential. Satisfactory stability and hull stress under the worst conditions are major factors to which attention is required before a loading plan is acceptable.
1-485
Although the recording of quantities of timber cargoes is relatively straightforward, securing is of major concern, and requires specific attention by the surveyor. The cargo must be securely lashed, the lashings fit for purpose and the stow properly secured. Thereafter cleanliness, absence from infestation, and trimming all require careful attention.
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Figure 13 This Photograph Taken in October 2002 is Supplied by the European Commission and Shows Timber Awaiting Shipment to Finland, Sweden and Norway from the Latvian port of Skulte. This is a Typical Cargo of Forest Products Carried on Relatively Small Vessels and its Loading and Stowage Requires Careful Supervision
12.9
BULK, LIQUID CARGO
Figure 14 A Typical 300,000 dwt VLCC, the Tateyama, Owned by NYK, Panama Flag, Built by NKK Japan in 2002
Diploma in Marine Surveying 2011 / 2012 (LP0058)
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12.9.1
Oil and chemicals
1-486
The vast majority of vessels that fall into this category are oil tankers. These vessels carry cargoes of various grades of oil and its derivatives but with an occasional cargo of liquid chemicals. However the last quarter of a century, has seen a dramatic increase in the specialist chemical and liquid gas carriers which today comprise a significant part of the world’s tanker fleets.
1-487
The carriage of bulk chemicals has become a very specialised trade with the chemical tankers being purpose-built and operated by a small number of shipping companies which specialise in their carriage. These surveys vary in complexity and some of the precautions required depend upon the toxicity of the chemicals which are categorised by the US Coast Guard as: (i)
Practically non-toxic.
(ii)
Slightly toxic.
(iii)
Moderately toxic.
(iv)
Highly toxic.
1-488
Surveys associated with the loading and discharging of products of the oil/petroleum industry and with the chemical industry are amongst the most demanding on surveyors. They require careful attention to detail.
1-489
In most cases the requirement is for dual attendance – that is, attendance on both the ship and the shore installation. This may be impractical for one surveyor and two may be required, one in each place. The surveyor(s) may be required to ascertain:
1-490
1-136
(i)
The quantities loaded/discharged.
(ii)
The quality of different samples. (This is largely a laboratory function but will involve the surveyor in sampling.)
(iii)
That there is no avenue for cross contamination.
Attendance on board is usually the more demanding and will involve: (a)
Checking that overside and cargo tank valves are all closed except those actually required for and during the immediate cargo transfer.
(b)
Sounding ballast and fuel tanks (and making allowances for quantities consumed by the ship).
(c)
Pump and pipeline cleanliness and, before loading, tank cleanliness.
(d)
Sampling of ballast water pumped out of cargo tanks.
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1-491
1-492
Types of Survey – Cargo-related Surveys
(e)
Ascertaining the vessel’s experience factor (checking records of past cargo operations to determine the differences between ship and shore figures for quantities handled).
(f)
Sampling the cargo loaded/discharged (and may involve the surveyor in witnessing the testing of the product).
(g)
Measuring the tanks before and after pumping.
(h)
Recording the trim and list.
(i)
Checking and recording temperatures.
Ashore the survey will include where possible: (a)
Checking for water and sampling the content of the pumping lines.
(b)
Checking the state of the valves in the holding and adjacent tanks and witnessing their operation.
(c)
Sampling the holding tanks.
(d)
Measuring the content of the holding tanks before and after pumping.
(e)
Checking and recording temperatures.
Equipment required: (a)
Measuring tape conforming to ASST standards (free of kinks, legible, with a secure bob and checked regularly for accuracy).
(b)
Thermometers (also checked regularly).
(c)
Hydrometer conforming to American national standards or British standards.
(d)
Containers for samples.
(e)
Protective clothing (for chemicals).
1-493
Oil and chemical cargo sampling, unless the surveyor is instructed otherwise or has good reason to depart from standard practice, is best carried out as outlined in the Institute of Petroleum’s manuals on oil and chemical measuring techniques.
1-494
During loading operations, apart from sampling the cargo being shipped, the prudent surveyor will also obtain samples of the cargo, slops and ballast water on board at the commencement of loading.
1-495
Not all of the vast quantity of liquid bulk cargoes are carried in ships specially designed for them and small parcels are carried in general cargo ships and containerships. Deep tanks, often fitted with heating and pumping arrangements, are sometimes located in cargo ship holds and are used to carry small quantities of chemicals, oils and other liquid cargoes. The advent of the small parcel tanker has seen a reduction in the number of cargo ships with deep tanks.
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Figure 15 DNVPS Surveyors Preparing Fuel Samples May 2004
1-496
Latex, coconut, sunflower seed, rape seed, linseed and other vegetable oils are commonly cargoes loaded in small quantities in eastern ports for discharge in Europe and the US and for which cargo ships’ deep tanks are often suitable, depending upon quantity. Tallow is also carried in deep tanks between countries having a significant animal products trade.
1-497
The surveyor’s role in connection with these is usually to take samples and to verify the cleanliness and fitness of tanks, pumps and lines to receive or discharge cargoes. They will often be required to confirm quantities shipped or received.
1-498
A word of warning concerning tank inspections. Toxic residues of cargo, but also little used tanks, can be lethal to unsuspecting surveyors. Each year a number of lives are lost by failure to check the vapour content of a tank before entry, and empty tanks which lack oxygen through the effects of rust generation are as responsible as any. Where there is any doubt surveyors must always check before entry and have a “buddy” to watch over them. The buddy must be fully conversant with the operation and whereabouts of breathing equipment which must be nearby and accessible.
1-499
Recommendations for entering enclosed spaces on board ships as provided under IMO resolution A864/20 warrants attention and includes a pre-entry checklist It is an essential document which should be carried on board all vessels and all seafarers should make themselves familiar with its contents if they are ever likely to have to enter cargo spaces or tanks. Refer to the Appendix 7 to this module for a list of its contents.
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12.9.2
Types of Survey – Cargo-related Surveys
Liquid gas
Figure 16
1-500
Another highly specialised area for which ships have been designed in recent years is that of the carriage of liquid natural and other gases. Standards are, in some cases, still being evolved and outside of the few carriers operating these ships there is very limited knowledge and experience.
1-501
Most of these gases are vapours at ambient temperature and pressure. For carriage by sea they are liquefied by: (i)
refrigerating to drop the temperature but still at atmospheric pressure;
(ii)
a combination of part refrigerating and part pressurising;
(iii)
pressurising without refrigeration (the temperatures and pressures at which gases liquefy varies vary very considerably).
1-502
From the surveyor’s point of view the requirement is principally that of ullage and temperature recording followed by fairly extensive calculations to determine quantity. Both measurements are usually made with ship’s equipment. Accuracy is absolutely critical to correct results.
12.10
QUANTITY SURVEYS
1-503
We have already discussed draught surveys which are often carried out in the case of bulk carriers. The name quantity surveys indicates the purpose for which these surveys are required, ie to determine the quantity of cargo, bunkers or dead freight. There are several methods by which quantity can be determined, but not all are necessarily applicable to every case.
1-504
It is important that surveyors take great care in reading the instruments and equipment available to them. All instruments should be kept clean, tapes free of
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kinks and hydrometers undamaged; the latter ideally made of glass having a small coefficient of expansion. The calibration of instruments requires regular checking and the results recorded so that any significant differences can be applied to readings or the instruments discarded. 1-505
Measurements should be made where appropriate to API/ASTM (American Petroleum Institute/American Standards Testing Methods) standards and, in adverse conditions, several readings taken and averaged.
12.10.1
Weight, Measurement and Ullage
1-506
While draught surveys result in achieving weight measurement there are other more direct forms of cargo measurement. Weighing, ullaging and metering are usually more accurate than draught surveys for small quantities.
1-507
If the cargo has been conveyed to the ship’s side in railway wagons or road trucks it can be physically weighed as it passes over a weighbridge. Deduction of the vehicle’s tare weight results in the weight of the contents being determined. In this case the surveyor will usually be required to obtain the weight dockets from an independent weighbridge (many are sited at the entrance to ports or wharves), check them and issue a weight certificate.
1-508
Many bulk cargoes are loaded by means of elevators and conveyor belts which have weighing devices attached to them. However accurate weighing is dependent upon proper test procedures being followed, when reasonably accurate results can be obtained.
1-509
In the case of general cargo this can be weighed but, since freight is frequently charged on cubic capacity, it may have to be measured to determine the space it occupies. This is done by means of a tape measure and surveyors may be required to check the measurements of a particular item, or possibly the space occupied by a quantity of general cargo in a hold or container.
1-510
With liquid bulk cargoes the more common form of measurement is carried out by taking an ullage of the liquid in the tank. With oil cargoes, for example, the quantity can usually be determined by calculating the volume occupied by the oil. This is normally done by measuring the unoccupied height above the liquid in each tank (or as it is known in the trade as taking an ullage) to ascertain first the unoccupied volume of the tank. From this measurement the quantity is determined by applying the readings to the tank calibration tables.
1-511
A lesser used method is to take a sounding to measure the depth of the liquid in order to obtain the volume occupied by the liquid. In both cases temperature recording, usually at different levels to obtain an average, is necessary to ascertain the density of the liquid. The surveyor must take care to ensure that he has the density of the liquid in air at standard temperature and that he is using the right API/ASTM table for the calculations.
1-512
The marine surveyor should also check whether any water is present at the bottom of the tanks to distort the figures. A special sounding device is used for this purpose.
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Types of Survey – Cargo-related Surveys
1-513
Quantities of ores and similar products are sometimes loaded as slurries and if this occurs in an open roadstead, say at a single point mooring, weather conditions may prevent a draught survey to an acceptable level of accuracy. The alternative may be, after dewatering has taken place, to take a number of ullages uniformly through the holds and calculate the quantity on board by volume using the ore’s specific gravity and a factor to allow for the water content. The result is unlikely to be very accurate but may sometimes be the only one available.
12.10.2
Fuel Oils or Bunkers
1-514
Bunker surveys are most commonly found in on-hire or off-hire surveys. However a bunker survey may be called for as a stand-alone survey This requires the surveyor to sound the fuel and diesel tanks or to witness their soundings by a ship’s engineer and obtain temperatures where possible. Samples are not usually taken unless there is any dispute over quality or if the surveyor is required to witness bunkering. The surveyor’s ability to obtain a representative sample from bunkers already on board is likely to be questionable.
1-515
For the reason mentioned in the last paragraph the surveyor needs to sight the chief engineer’s records of fuel obtained at previous ports and note the specific gravity recorded. This, after possible correction for temperature, is then used for the calculation of quantities on board.
12.10.3
Deadfreight
1-516
Deadfreight is the amount of money payable to a shipowner by the charterer for failing to load the cargo stipulated in the charterparty. Depending upon the terms of the charterparty the payment may be due on the basis of an agreed weight, cubic capacity or even per unit, ie pallet, to be shipped. If the charterer fails to fill the agreed quota then payment is due to the shipowner for the shortfall.
1-517
A marine surveyor will be instructed to measure the quantity of cargo loaded and the shortfall on contracted quantity, or the cargo space not filled as undertaken. Some of the customary methods of measuring the quantity loaded may be available to the surveyor, or alternatively a shortfall in weight may be ascertained from “lift” still available as determined by draught. Where space is the issue then actual measurement of vacant space may be the best method available.
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13.
WARRANTY AND OTHER COMMERCIAL TYPES OF SURVEY
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
understand what is undertaken when carrying out Warranty surveys;
●
be fully conversant with Performance, Commercial, Quality and Quantity surveys;
●
understand how to deal with surveys involving conformity with letters of credit; and
●
know the reasons for P&I club entry surveys.
13.1
WARRANTY SURVEYS
1-518
In some cases an Insurance underwriters will cover a risk subject to the condition that the assured provides a warranty that certain conditions are adhered to. Underwriters often specifically require that the assured does or does not do something which is “warranted” as being complied with. To satisfy themselves that this is being undertaken by the assured they will appoint a surveyor to survey and report relating to these warranties. Some common warranty surveys are: ●
Towage approval surveys
●
Lay up
●
Re activation after lay up
13.1.1
Towage Approval
1-519
This warranty survey requires the assured to arrange, normally at their own expense, for marine surveyors to carry out the necessary approval surveys to satisfy the requirement. Generally the surveyors used will have had considerable experience in pre-towage surveys, however this may not be the case in remote areas and where the tow is not expected to provide major difficulties.
1-520
In towage approval surveys, both the towed vessel and the tug(s) with their towing gear have to be closely examined. Towage approval usually commences with an initial survey of the craft to be towed, with the surveyor then providing written
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Warranty and Other Commercial Types of Survey
recommendations to the assured covering all matters requiring attention. These may involve the craft’s structure and will almost certainly involve its machinery and equipment, particularly if the towed craft is to be unattended during the period of the tow. Protection against sea/weather or other damage is often necessary. This survey usually takes place some days before the tow is due to commence so as to give adequate time for the assured to carry out the work and have the surveyor confirm its standard and acceptability. 1-521
The surveyor will need to be satisfied that the tug is suitable and in fit condition to carry out the task. Sometimes the surveyor may have to await the arrival of the tug as suitable tugs are often not conveniently placed initially in the same port as the tow. Some tentative approval based upon class records may be possible and in many cases the Bollard Pull certificate will give the surveyor a good indication if the tug is powerful enough to undertake the task. However, the surveyor should always check the date of this certificate, as tugs, particularly those that are involved in the oil industry and also carry out supply vessel work, do have a tendency to find their bollard pull capability reducing over time.
1-522
It is important for the surveyor to discuss with the tug master how the towing arrangements are to be arranged and how the voyage is planned. Consider long distance weather forecasting and discuss what plans have been made for the tow to seek shelter during the voyage if required.
1-523
The other essential element to achieve a successful tow is the towing connection. The tug’s towing gear will also have to be checked and the surveyor satisfied that its manning is adequate and its crew adequately qualified. This requires the surveyor to be satisfied that the towing gear is adequate and that the means of making it fast on board the tow are also approved. Frequently a surveyor will need to make recommendations for modifying existing arrangements or specifying new or additional ones which will almost certainly include emergency, or “back up” gear.
1-524
Prior to the tug and tow sailing the surveyor will ensure that all the recommendations have been complied with and that, if the tow is unmanned, the tug crew are conversant with its pumping arrangements and understand the operation of its machinery if required.
1-525
The tug master will have to be given written advice that certain restrictions are placed upon the performance of the towage operation. These may include weather restrictions (relating to departure), routeing, towing speed, checking the performance of the towed vessel and gear and others as appropriate for the nature of the operation.
1-526
It is important that the Marine surveyor understands that towage is a potentially dangerous enterprise and requires skill and good equipment. Provided the surveyor is satisfied that arrangements are warranted under the underwriters instructions the towage approval certificate can be issued.
13.1.2
Lay-up
1-527
Lay-up surveys occur because trade falls off and a ship becomes temporarily surplus to requirements or a ship may be taken out of service awaiting a buyer.
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When laying up a vessel an owner will need to notify the underwriters and P&I club in order to change the conditions of insurance. The owner will have to warranties that vessel has been prepared for the change of conditions. The required warranty surveys to see that this has been done are usually called by of a hull underwriter or of a P&I club, and very possibly of both. The key requirements are: (a)
That the lay-up berth must be safe and secure for the vessel.
(b)
That the ship, machinery and equipment must be secure against intrusion and deterioration.
1-528
The former involves the site itself which has to be both suitable and safe, with the vessel adequately secured in it. A satisfactory berth requires the location to be acceptable from a physical hazards aspect, ie wind and tide, water depth, current, holding ground, shipping movement, emergency and maintenance services, unauthorised persons access and, of course, means of securing the vessel which may be alongside, at buoys or at anchor, ie the moorings in the widest meaning of that term.
1-529
The second requirement is for on-board security for the equipment and preservation of the machinery. It also concerns watertight integrity and reducing to a minimum the possibility of ship side valves permitting unwanted water ingress or leaking hatches allowing rain or spray to enter the vessel. It also concerns emergency pumping, and fire-fighting services, but it is probable that these services will have to be provided by external means.
1-530
Unless proper precautions are taken, extended lay-ups can damage machinery which may be largely or completely idle for lengthy periods. If vessels are not properly secured in their berths or properly shut down they also pose liabilities to others. Consequently it is not surprising that both types of insurers, hull and P&I, are likely to require certain standards to be met if they are to be expected to continue the insurance cover.
1-531
It is important that regular inspections are carried out by competent persons during the period of the lay-up and will normally be one of the warranty surveyor’s recommendations for lay-up approval. Even though a watchman may be employed he/she is rarely skilled or competent to care for the ship’s structure or machinery.
1-532
Even though the vessel is not working it is normal to maintain a vessel in class during lay-up and this will also involve the class surveyor’s requirements being adhered to but these are unlikely to be very different from the underwriter’s requirements.
13.1.3
Recommissioning/Reactivation
1-533
Obviously the warranty surveys are the reverse lay-up surveys and serve to satisfy, again usually underwriters and class, that proper steps have been taken to return the vessel to a suitable state in which it can resume trading. Amongst other benefits surveys of this nature will help to ensure that crew negligence, following resumption of service, does not play a major part in any subsequent
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machinery problems. There can be unfortunate consequences if the correct steps are not taken during the re-commissioning of a vessel especially with regards to machinery. 1-534
Attention to electrical equipment, always susceptible to damage by moisture and inactivity, is a major part of this survey with all circuits being tested for insulation resistance.
1-535
At the completion of reactivation a full sea trial will probably be required under the supervision of both the class and independent surveyors involved.
13.2
PERFORMANCE SURVEYS
13.2.1
Machinery Performance and Fuel Consumption
1-536
The owners of new ships and of vessels which have undergone major refits or repairs usually require to be satisfied that their performance on completion complies with specifications.
1-537
Owners of chartered vessels sometimes find themselves in dispute with charterers over their vessel’s stated performance. Fuel consumption in excess of stated figures, or speed not achieved as called for in the charter-party, not uncommonly give rise to disputes.
1-538
In each case the owner or charterer, or the shipbuilder or repairer, may seek independent verification of the performance and fuel consumption figures and these can be provided by an engineer surveyor. This surveyor may be a class surveyor or a private surveyor.
13.3
COMMERCIAL SURVEYS
1-539
Traders and shippers that are involved with goods and commodities in international trade may require the services of a cargo surveyor. A common situation which arises and may call for surveyors requires them to carry out inspections in an entirely independent capacity so as to provide a firm with a certificate covering the surveyor’s findings. This certificate may then be used to provide independent verification of some condition which the principal may wish to establish to other parties to a transaction.
1-540
On occasions the condition, or a shortfall on specification, may be readily apparent and will present a surveyor with little difficulty in reporting. However in many cases, unless marine surveyors have specialised in the particular subject matter of such a survey, they are generally not competent to carry them out. They may lack the personal experience to report authoritatively. If instructed they may need to call in experts well-versed in the specialised trade involved. The expert’s certificate then forms a part of the surveyor’s report. The surveyor will, because of his accepted impartiality and integrity, have provided a useful service in facilitating the provision of the independent report.
1-541
As this can require specialist skills in understanding certain commodities any marine surveyor instructed to carry out a commercial survey should ensure that
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the principal fully understands the competence under which the surveyor will carry out the work. This must be before undertaking any assignment which differs from that which surveyors customarily perform, and which may involve the use of experts for part of a survey. 1-542
There are three principal occasions when such a certificate may be required: Quality surveys Conformity with Letter of Credit (Before Shipment) Conformity with Specification of Sample (After Shipment)
13.4
QUALITY SURVEYS
1-543
Often referred to as “look, sniff and feel” surveys, this type of survey is almost inevitably carried out by an expert with extensive experience in the particular types of commodities. It is frequently carried out with grains and cereals, so as to certify that the commodity conforms to a certain understanding within the trade.
1-544
This type of survey is rarely undertaken by a marine surveyor, due to the need for the specialised depth of knowledge required, although the sample may be taken by one. This requirement by a principal for a survey may be yet another opportunity for the surveyor to act as an independent coordinator by engaging the services of a suitable expert.
13.5
CONFORMITY WITH LETTER OF CREDIT (BEFORE SHIPMENT)
1-545
The financing of international trade is carried out largely through the banks, and buyers commonly ask their banks to establish letters of credit in favour of an overseas seller. Before parting with their client’s money the banks are required to be satisfied that the goods being shipped conform to the general description, or sometimes comprehensive specification, against which their clients are purchasing.
1-546
It is quite common for the services of a Lloyd’s Agency to be used in this process with the Lloyd’s Agent appointing an independent party of known competence and integrity to carry out the necessary inspection and verification. This party will often be a marine surveyor, either one on the agency staff or one well-known to it.
1-547
The marine surveyor’s role will then be to carry out an independent verification by checking that the goods conform in number and description to those covered in the shipping documents. While this is the usual situation under a letter of credit, as explained above, a marine surveyor may have difficulty when conformity with a complex specification is a requirement and other expertise may then be required.
1-548
A difficult situation can arise when time deadlines are close to the actual completion of loading. The shipper may have stipulated that the cargo must be loaded entirely by 23.59 hours on a certain date. However the surveyor may find he will be asked to sign off the cargo that was only 98% loaded by that time. Knowing that the cargo will be completed within an hour, the surveyor’s integrity will be tested. Understanding your principal’s needs here is essential.
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13.6
CONFORMITY WITH SPECIFICATION OR SAMPLE (AFTER SHIPMENT)
1-549
In the previous paragraphs reference is made to the situation which arises before shipment. However goods and commodities are often shipped against specification or sample and with no letter of credit having being set up. It is sometimes then found that when the goods are received at destination there may be a significant difference in quality, unrelated to any fortuity during the voyage, and which may provide grounds for a claim against a supplier for breach of contract. This breach may have arisen from misunderstandings or possibly due to fraud.
1-550
The situation is one of many in which surveyors are likely to be retained because of their independence and in which they are required to compare specifications or samples with the goods received, and to report accordingly. Where chemicals, for example, are tested by a laboratory the surveyor may only be able to witness that the analysis is conducted in accordance with an appropriate standard. For the surveyor’s protection the report must be qualified accordingly.
13.7
P&I CLUB ENTRY SURVEYS
1-551
The Role of Protection and Indemnity (P&I) Clubs commenced during the nineteenth century when shipowners found themselves with liabilities which their traditional hull underwriters (Lloyd’s) were unable or unwilling to cover. In order to solve the problem groups of shipowners formed themselves into mutual associations and agreed to share each other’s claims. These early organisations have now developed into 13 Mutual Insurance Associations, and today. P&I Clubs, which between them insure the liabilities of some 95% of the world’s ocean going tonnage.
1-552
The P&I clubs provide cover for a shipowner’s liabilities, not the fabric of the ship itself. The risks covered will usually include:Death and personal injury of Seamen Passengers Third parties Liabilities in respect of stowaways or persons saved at sea. Liabilities arising from collisions. Liabilities arising from groundings. Liabilities arising from damage to fixed and floating objects. Liabilities arising from pollution. Liabilities arising from wreck removal. Liabilities arising from towage operations. Liability to cargo. Together with other legal and other costs associated with dealing with these claims.
1-553
P&I clubs operate as a mixture of an insurance company, a law firm and a loss adjuster. This means that a club should be able to assist a shipowner in dealing
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with every aspect of a casualty from finding experts and contractors to deal with the immediate casualty through to legal advice and paying claims. The P&I club exists in order to help the shipowner and pay his liability claims. Almost always the shipowner and his Club will work together in order to solve the problems and it is very rare that a Club will be in dispute with a shipowner over cover. 1-554
However P&I clubs are principally liability underwriters and they work on a mutual basis. That is to say that they do not make a profit and only charge their members for the costs of insuring their liabilities The principal exception is that they may also insure the fourth of any hull damage not covered under the hull policy.
1-555
As they work on a mutuality basis it is important that when they consider accepting a new member they owe it to the other club members to be satisfied that they are entering a shipowner who can be expected to maintain or raise the standard that is expected of the other members.
1-556
A P&I club is therefore particularly interested to learn how the prospective new member runs his ship. The hull condition is clearly important, but the condition and safe operation of the equipment, and the owner’s housekeeping standards, are the main concern. The standard of training of the crew is also an important consideration.
1-557
Those who have studied the Prestige incident will know the potential for causing environmental pollution is receiving increasingly close scrutiny and such precautions such as the phasing out of single-hulled tankers are one example of the direction which this is taking. It was the P&I club that raised the enormous bail required to release the master of the Prestige from prison whilst awaiting trial. Because of the enormous costs associated with oil and chemical spills P&I club surveys are concerning themselves more than ever with this aspect.
1-558
The survey required has an emphasis on the vessel’s potential to create liabilities, and is in general more extensive than that which will satisfy the “on-hire/off-hire” requirement of owners and charterers.
SELF-ASSESSMENT QUESTIONS List the types of commercial surveys that an independent surveyor may be required to undertake and in each case suggest who are likely to the principals.
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14.
TYPES OF SURVEY – WHEN THINGS GO WRONG
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
be fully conversant with Insurance Cargo Loss Surveys;
●
understand the requirements of Damage and Repair Surveys; and
●
have a clear understanding of Accident Investigation Surveys.
14.1
GENERAL INTRODUCTION
1-559
In the previous chapters we have discussed surveys that are carried out hopefully to ensure that the voyage is safe and the authorities, the shippers and the shipowners are all satisfied. Unfortunately it does not always work out that way and Marine surveyors will find themselves involved in trying to sort out the situation. In Figure 17 you will see a not too rare situation of a container ship arriving in port after bad weather. Here we have damaged containers and possibly some containers lost overboard. The marine surveyors will be seeking to advise the underwriters on what went wrong.
14.2
INSURANCE CARGO LOSS SURVEYS
1-560
Surveys on ships and cargo which have suffered damage or loss constitute a prolific source of work for surveyors. When claims are made on underwriters the principal facts about which they need to be satisfied are that the subject matter of the insurance has been damaged in the manner and to the extent claimed, that it has been caused by an insured peril and that, where the claim is for the costs of repair, that repair costs are reasonable.
1-561
Underwriters need to be satisfied of these facts so that, in the first instance, they can meet the claims of their assured where appropriate and, in the second that they are justified in pursuing recoveries under subrogation against some other party who may have a liability for the loss or damage.
1-562
Marine surveyors of almost all specialisations become involved in these claims and are almost always required to provide a report. In presenting their report, which
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Figure 17
is partly a certificate of fact but which often also contains carefully considered opinion, they may have to be prepared to stand by it under cross examination later in court. 1-563
In addition to reporting on the usual three requirements of “nature, cause and extent” surveyors will generally be required also to advise the assured on mitigation of the loss and will be expected to indicate in the report the extent to which the claimant has carried this out.
1-564
On occasions marine surveyors with extensive marine insurance knowledge are asked by underwriters to comment on the underwriters’ liability and adjust the claim under a policy, also possibly advising on third party liabilities and initiating recoveries. However this is outside the normal extent of a surveyor’s role and these additional matters should only receive attention if specific instructions are received to do so.
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14.2.1
Verification of Damage/Loss
1-565
Loss can be total or partial and the nature of it can vary considerably. It may result from non-delivery (theft, pilferage etc), involve damage arising by mechanical means (impact for example) or chemical deterioration due to wetting or contamination by some substance.
1-566
The nature of the loss or damage needs to be investigated and confirmed. The report, supported where possible by photographs, needs to “paint a picture” for the underwriter who must be assisted to understand as much as possible about the circumstances giving rise to the claim.
14.2.2
Investigation of Cause
1-567
Although in most cases the causes of damage may be perfectly obvious and present the surveyor with little or no difficulty in explaining them, there will be occasions when a surveyor is faced with a really difficult case for investigation. Quite often this will require support from other experts, and will require some real detective work to find the cause of loss or damage. The cause may be obscure and there may be more than one cause, in which case each has to be investigated and given its appropriate weight. Inherent vice, when applicable, will be an important cause to ascertain and if damage has occurred prior to the probable attachment of the transit policy, or subsequent to it, this fact will also be important to determine.
1-568
It is therefore essential that the surveyor is very clear about the client’s specific requirements before carrying out the survey or time may be wasted and a client left less than satisfied with the service provided – even if this was because the client’s specification was loose or misleading. The difference between fact and opinion can be fine and often depend upon the source of the information; the surveyor may well need to decide whether a crew member’s opinion about the vessel’s condition or an event qualifies as fact or speculation.
1-569
Having stated that the surveyor’s report should be factual, the surveyor should also be assiduous in collecting all the information and evidence that there is available and from as many sources as reasonably practicable. Thus the surveyor needs to list carefully all the potential sources of information which may be available and to prioritise them in terms of relevance, availability and accessibility. This applies to both hard evidence, such as technical facts, documentation, measurements etc, and soft evidence from interviews and observation.
1-570
Since all information has a value, in certain circumstances the surveyor may find it advantageous to make a shadow report to the formal, factual report which contains additional information of a less factual nature which is for his personal use and which can be particularly useful if the investigation has to be resumed at a later date.
1-571
Since the basis of a survey is fact, it is worth noting again that, even in a contentious situation, such as after an accident or when in dispute, the basic facts can be recorded jointly by both surveyors without prejudice to either party, saving considerable time and effort on behalf of all concerned.
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1-572
Sometimes the marine surveyor will be unable to do more than give a carefully considered opinion as to the cause based upon all the evidence available. It may be necessary to state that there is no conclusive evidence as to cause and that, in the surveyor’s opinion, the loss or damage has resulted, on the balance of probabilities, from some particular event or other.
1-573
Once in a while the surveyor may have to admit that it has not been possible to offer any reasonable explanation of cause and, in this case, the underwriter will have to decide how to respond to a claim, possibly giving the benefit of the doubt to the assured or alternatively taking the view that the assured has failed to discharge its onus of proof, for this onus generally rests with the claimant to establish. The importance of the surveyor carrying out a careful investigation as to the cause of loss is obvious.
14.2.3
Consideration of Repairs and Costs
1-574
When there is a genuine claim under the policy then the underwriters may require a surveyor to see that the quantum of the claim is justified. Where repairs are required the question can then arise as to the most appropriate method of repair as well as the basic consideration that the costs must be reasonable.
1-575
Marine surveyors that deal with Hull and machinery are usually well-versed in the discipline relating to ship repairs and may experience little difficulty in providing recommendations for repair and probably for reasonable repair costs if the repairs are to be carried out in the ports in which they normally operate. However, cargoes are of such a diverse range that cargo surveyors can only expect to bring expertise to bear on certain types of cargoes in which they may have specialist knowledge.
1-576
Sometimes this can present surveyors with a problem and they become dependent upon obtaining the services of independent experts if the likely quantum of claim is sufficient to warrant it; otherwise they have to rely upon their own judgment and enquiries. Experienced surveyors usually find, by carrying out some diligent research, that they are able to satisfy themselves whether a repair cost or allegation as to depreciation is realistic or not.
1-577
To summarise the following list is an outline of the matters to which in general surveyors should direct their observations and enquiries, including their findings in their reports. Some details will obviously apply to hull or cargo claims but perhaps not to both.
1-152
(a)
Name of instructing party, dates of instructions, places and dates of surveys.
(b)
Names of those attending surveys and whom they represent.
(c)
Description of the interest surveyed.
(d)
The nature, extent and cause of loss or damage. (In the case of hull claims “the extent” may need to be very fully detailed to enable others to consider likely repair costs).
(e)
Steps taken to mitigate the loss or damage.
(f)
Cargo Only Diploma in Marine Surveying 2011 / 2012 (LP0058)
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Types of Survey – When Things Go Wrong
(i)
Shipping marks and numbers.
(ii)
Transit history – places and dates of loading, stuffing, devanning, delivery etc.
(iii)
Carriers’ names and conveyances.
(iv)
Damage noted when goods changed hands.
(v)
Details of packaging and whether customary.
(vi)
Whether pro forma claims have been made on carriers.
(vii) Documents, ie shippers’ invoices, bills of lading etc. (viii) Sound market value of damaged goods. (ix)
(g)
Proposed method of determining the loss. ie agreed depreciation, sale in damaged condition, sale at auction. (If sold prior to completion of the report, details of the proceeds and costs to be shown).
Hull Only (i)
Whether repairs are to be proceeded with or deferred.
(ii)
Detailing of repairs associated with alleged cause and those which are not owner’s repairs.
(iii)
Recording dates/times of commencement and completion of repairs.
(iv)
Recording dates of previous drydocking and of any drydocking associated with these repairs.
(v)
Extent to which overtime worked reduced the time taken for casualty repairs.
1-578
Preliminary reports, which may be required by underwriters but which are not normally public documents, should show estimates of costs for loss or damage.
14.3
DAMAGE AND REPAIR SURVEYS
1-579
Damaged ships have to be repaired in a manner that satisfies the classification society so as to ensure the continuity of class and also the statutory requirements. Class and administration surveyors attend as soon as possible after a casualty to determine the nature and extent of the repairs. A surveyor usually then attends from time to time during the course of repairs to ensure satisfactory workmanship and materials are employed and that the repair satisfactorily restores the vessel to the standards required of her. Quite distinct from these routine surveys are those which become necessary following a casualty.
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Figure 18 In May 2003 the Polish Container Ship Gdynia was in Collision with Cosco Bulk Carrier Fu Shan Hai Which Later Sank Offshore Denmark, in the Baltic Sea 1-580
The underwriters will also have particular interest in ascertaining the cause, nature and extent of damage or loss for which they are being called upon to indemnify their assured following a casualty. They will normally instruct an independent surveyor but it is not uncommon for them to request that the class surveyors, who have attended the vessel on behalf of their society, provide them also with a report. In these circumstances the surveyor’s fee is divided on an agreed basis between the shipowner and the underwriter.
1-581
The Marine Surveyor will draw up a full schedule of all the damage sighted, detailing its nature, its extent and the recommended method of repair or replacement. They usually then report this in two columns as “found” and “recommended”. In practice the recommended repair is the result of consultation, and usually agreement, with the ship’s representative and/or underwriter’s surveyor.
1-582
Where it is unlikely that the case will require a legal investigation or settlement of damages, the Marine surveyor should bear in mind that the survey report will ultimately be used by an average adjuster. This adjuster will rarely have seen the damage and will be totally reliant upon the surveyor’s eyes and observations. The report must therefore be constructed after survey with this clearly in mind, giving all the information required to enable an adjustment of any claim, general average (GA) or particular average (PA), to be drawn up, often several years later.
1-583
A marine surveyor who is called upon to carry out this type of survey for the first time may be well-advised to study a major hull damage Particular Average adjustment to see how adjusters handle the various expenses. This will assist surveyors in learning exactly the sort of information required in the survey report. The Rules of Practice of the Association of Average Adjusters, although
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principally concerned with General Average also give some guidance on how the adjuster considers repair costs in Particular Average claims. 14.4
ACCIDENT INVESTIGATION SURVEYS
1-584
Later in this diploma course you will find some interesting concepts as to how to go about investigative surveys. For the moment we need to be aware that these surveys involve careful questioning of parties involved and often a very full and thoughtful investigation to uncover the fundamental causes of a casualty.
Figure 19 In 1995 the Bulk Carrier Alexia and the General Cargo Vessel Enif Collided off the Mississippi 1-585
The obvious cause of damage may, for example, be collision itself but what needs to be investigated is the reason the collision occurred. It may be readily apparent that one or both vessels turned the wrong way or did something else which ultimately brought it about, but these reasons would be only be the obvious and immediate ones. There will almost certainly be very much more deep seated explanations than simply that one or both masters misjudged or misinterpreted the situation immediately prior to the collision.
1-586
One practitioner in health and safety management believes the deeper you investigate an accident the higher up the management chain the responsibility lies. This may be so but a full investigation may unearth much more fundamental reasons relating to the running of one or both of the ships, such as chronic fatigue on the part of a pilot or master, or failure of the bridge team as a whole to work together cohesively. This may mean that criticism should rightly be directed further a field at the owners as well as the master or crew. There may be a need for changes to the manning or the officers’ work pattern, or a need for bridge resource management (BRM) training. These are the sort of answers to which good accident investigators aspire.
1-587
To achieve them it will almost certainly be necessary to inspect records of events, both those leading directly up to the casualty and those some time before them.
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The principal records to which the surveyor may need access are: (a)
Bridge and engine room log books.
(b)
Bridge and engine bell (or telegraph) book.
(c)
Course recorder chart (if fitted).
(d)
Chart in use at the time with record of ship’s track and positions.
(e)
Radar plots.
(f)
VHF logs of shore stations if in the vicinity.
(g)
Compass observations record.
(h)
Ship manoeuvring diagrams and data.
(i)
Medical records (and a reconstruction of the work pattern of crew involved).
(j)
Chain register.
(k)
Stability data.
1-589
In the collision example pictured above in Figure 19, a survey of the ship would almost certainly involve an inspection of the bridge, a check upon the view from it (obstructed visual and radar arcs), operating condition of relevant equipment, a check on whether any deck lighting (if at night) might have obscured the other vessel’s vision, and an inspection of all the above records. A formal questioning of crew involved, culminating in written statements from them, would follow and then a careful consideration of all the facts, without jumping to unsupported conclusions, would lead to the surveyor’s report being prepared.The report would include the facts, breaches of any regulations involved, the surveyor’s conclusions as to cause, and finally recommendations.
1-590
These investigations are primarily carried out to satisfy statutory requirements or for insurance related purposes. In either case they tend to be, but are by no means always, carried out by nautical surveyors. If they only involve machinery the probability is that the investigating surveyor will be an engineer surveyor.
1-591
In November 1997, IMO approved a Code for the Investigation of Marine Casualties and Incidents under Resolution A849(20). It is primarily intended for use by flag states conducting these investigations so as to introduce a standard approach. Subsequently, in 1999, Resolution A884(21) amended it by adding useful guidelines concerning human factors which have a significant influence in marine casualties. A knowledge of their contents could prove useful to all who conduct inquiries of this nature, and it appears in APPENDIX 4 of this Module.
14.5
THIRD PARTY LIABILITIES
1-592
The underwriters will call on accident investigations in anticipation of a civil case for damages being brought by one or more parties. These investigations are usually required to determine which parties may have a liability to others and will arise
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regardless of whether there has been any breach of statutory duty. They are also separate from damage surveys required to determine the costs involved, although they may be carried out by the same surveyors if they possess the dual skills. 1-593
Investigations into third party liabilities, beyond the customary basic requirement that particularly accompanies a cargo survey, will often be conducted by marine surveyors, especially those with sound legal knowledge. This can frequently enable an underwriter, having met a claim under subrogation, to recover from the party who was responsible for the damage. Many such surveys are carried out in association with marine lawyers appointed by principals to work with their surveyors.
14.6
INVESTIGATION BY ADMINISTRATIONS
1-594
A serious casualty will usually require a formal investigation which by international convention is usually the responsibility of the flag state of the ships involved. However it is not unusual for a coastal state to hold an investigation, particularly when it has suffered from the incident such as in the pollution of its coastline. Casualties normally requiring an investigation are stranding, collision, foundering, fire, accidents with dangerous goods in transit and so on. Another prolific source of investigations associated with ships and ports today involves personal accident, safety and health. These may involve P&I club surveyors. Government labour inspectors and medical officers are often involved too, but these persons are not normally seen as being marine surveyors.
1-595
Accident investigation surveys are frequently a statutory requirement for two key reasons which are to consider firstly the cause of the accident and secondly the steps that can be taken to avoid a similar mishap in future. A further reason may be to determine whether a breach of regulations may have occurred and, if so, what penalties should be imposed (including possible prosecution).
1-596
There may be more than one government department or agency involved in these investigations. In some countries only one may be involved in carrying out the investigation for both considerations, thereby acting as both the investigatory and the regulatory body. In the UK there are two separate agencies, the UK Marine Accidents Investigation Branch (MAIB) has almost unique legal status in that any information it receives cannot be used in a court of law. The idea is to seek ways of learning from incidents rather than pointing a finger of blame. On the other hand the Marine and Coastguard Agency has the legal obligation to act as the prosecutors where the law has been broken.
SELF-ASSESSMENT QUESTIONS Is there a difference between a surveyor carrying out an accident investigation and being an expert witness?
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15.
GOING ABOUT A SURVEY
LEARNING OUTCOMES After successful completion of this chapter, you will: ●
fully understand the importance of abiding by the health and safety laws and regulations;
●
know the safety equipment and protective clothing you will require;
●
know the tools of the trade;
●
describe the importance of planning the business of marine surveying;
●
outline the importance of following up a survey;
●
consider the wider range of consultancy;
●
recognise what is meant by given evidence; and
●
state the difference between investigation and consultancy.
Figure 20 Monitoring and Repairing Corrosion and Grab Damage in a Single Sided Bulk Carrier. One of the Main Concerns when Surveying Bulk Cargo Carrier Holds is Access to All Parts of the Hold. Permanent Access Ladders may be Installed, but these are also Susceptible to Damage. Always Check that the Access to the Area to be Surveyed is Secure and Safe
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15.1
PREPARATION AND RESEARCH
1-597
It does not matter how many surveys you carry out, each one will be unique and requires individual attention and preparation. Especially for surveyors working on an international basis, each and every survey requirement may be in a new place, on board a different vessel and require the ability to relate effectively to a range of total strangers. Thus, time in preparation and research, even if time is limited, must be considered essential. The first question to be addressed is – ●
who is the principal?
●
what is his role?
●
what is his purpose in commissioning the survey?
1-598
To take the last point first, there are several different types of survey as have been described in this module. The purpose may be statutory or purely precautionary, it may be to establish a benchmark or it may be in order to prosecute a claim or prepare a defence.
1-599
In all cases the surveyor needs to know whose interests he or she is representing. This is important because, while facts may be facts, their interpretation is another matter, and while much information will be of a public nature, some will be confidential.
1-600
Thus, the surveyor should endeavour to ascertain who owns and who manages the vessel, who charters or sub-charters her, who owns the cargo, who insures it and to whom it is consigned. Many of these interests will have local agent’s representatives or surveyors and the owner or manager will doubtless have a P&I club representative or local correspondent.
1-601
It is useful to have a prepared questionnaire which can be used to collate the necessary information, even while the surveyor is en route to the vessel.
1-602
Good team support from the home base can help here and the organisation’s database should be a good starting place. In order to ensure that it does remain current, accurate and factual, all surveyors should be aware of their responsibility to ensure that any new information gleaned from the current survey is authenticated and entered.
1-603
In many cases, and especially in cargo disputes, it may be found helpful to visualise the complex web of inter-relationships and conflicting interests by constructing a network diagram. From this, the surveyor may need to identify the varying parties as friendly, hostile or neutral, and adjust his or her relationship with them accordingly.
15.2
PLANNING AND ORGANISING
1-604
Almost always, marine surveyors will need to slot their survey requirements into the busy schedule of an operational vessel. This requires a high degree of planning and organising, which the surveyor will frequently have to base on limited information. Key to the planning process are the location and movements
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of the vessel in question – or possibly the cargo. Also essential in these days of the ISPS Code (see Section 3.5) is the need to ensure that accreditation is available to allow the surveyor access to the port and to the ship. The surveyor must ensure that the shipowner or manager, or other competent authority, has authorised the visit and arranged with the port the necessary security pass or entry permission. 1-605
The surveyor’s initial research should have identified the vessel’s agents. The surveyor will need to apply his knowledge of the workings of the shipping industry to decide whether it is the charterer’s or the ship’s (husbanding) agents who can best assist him. An early indication of the various activities which the vessel will be undertaking in port will help the surveyor plan his task in a way which is most compatible with the vessel’s priorities and the requirements of the survey. While at times it will be necessary to insist on the master’s time and resources, this should not be the first approach of a professional surveyor.
1-606
Forethought and planning, together with a flexibility of approach, can often integrate the surveyor’s requirements into the vessel’s routine with the maximum of co-operation. If, for example, the surveyor is undertaking a systems audit and the vessel is bunkering, can the bunker process be part of the systems audit – or perhaps the navigating officer’s passage planning and chart correction procedures or a shift of berth? If the survey requires the inspection of cargo holds or tanks or the inspection of water ballast spaces, the surveyor should find out how the survey requirements can be integrated into the loading or discharging programme and approach the vessel with a compatible plan. If some of the machinery is to be surveyed, what are the chief engineer’s maintenance priorities for that port and how can the survey requirements best be co-ordinated?
1-607
One of the more challenging times for a surveyor is conducting a survey when a crew change is taking place. Not only will the masters and crew have other priorities, the departing master and crew may well be taking valuable information with them, especially if the survey is of an investigative nature. Careful planning can frequently help the surveyor succeed in his survey requirements, even to the extent, if time permits, of organising to drive the departing master (or chief engineer or relevant crew member) to the airport in a relaxed – and information exchanging – atmosphere.
1-608
At times, the surveyor will find that he or she is competing for attention with other surveyors and, on the occasion of a dispute or claim, surveyors representing principals in potential conflict with his own. This is obviously a time when much of the information required will be of a confidential nature but this does not mean that co-operation is not possible. A joint survey of factual information is efficient and effective and can save considerable time at a later stage, and it should always be remembered that the prime task of a surveyor is to collect and report factual information in a complete, clear and concise way, it is not to formulate theories nor to give opinions.
15.3
THE SURVEYOR AND THE HEALTH & SAFETY LEGISLATION
1-609
In the United Kingdom any surveyor attending on board ship will be subject to the Health and Safety at Work Act 1974. There are also further requirements under the EU regulations and in both cases new legislation is continuously being
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introduced. Other Countries will follow the same type of systems and it is the surveyor’s responsibility to be fully cognisant of the health and safety requirements that cover their activity. It would be prudent for the marine surveyor to ascertain the local statutory requirements. 1-610
The marine surveyor in the course of his or her duty, is generally working alone in a potentially hazardous area and although prescribed safety regulations can be annoying at times they are there to reduce the risk of an occupational accident. In the UK the Health & Safety Executive’s mission statement is: “To ensure that risks to people’s health and safety from work activities are properly controlled”. It is essential that the surveyor needs to have a reasonable working knowledge and understanding of health and safety in the workplace.
1-611
It is strongly recommended that all surveyors who carry out surveys on ships should get a copy of the IMO booklet “Recommendations for Entering Enclosed Spaces On Board Ship”.
1-612
The health and safety legislation is of relevance to marine surveyors because they have the responsibility for the health and safety of: ●
those whom they employ (if they are employers);
●
those who are directly affected by their work; and
●
themselves.
15.4
PERSONAL SAFETY GEAR
1-613
The Marine surveyor must be properly attired to carry out the task they have been instructed to do. The normal kit expected is: an approved hard hat, protective coveralls, safety goggles or spectacles, industrial gloves, armoured footwear, fluorescent safety waistcoat and a personal gas monitor. Also an approved buoyancy vest or lifejacket when at risk afloat, gloves, and a face mask in certain circumstances.
1-614
Personal protective equipment is important not only for your own protection but entry into many establishments may be refused without it. Proper working clothes and protective items will also show that you have a responsible attitude to your work ethic.
1-615
With regard to your personal safety common sense dictates the normal precautions to be taken when attending on board ships or in the shipyard, engine shop or dry dock on any occasion Prudent behaviour must be adopted in the course of carrying out work, such as not entering tanks or other confined spaces without first ensuring the atmosphere in the tank has been tested and proved safe. You must always notify your intention to a ship’s officer and also be accompanied by a watcher stationed at the tank door. Similar precautions must be taken in the case of operations on and from staging.
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Figure 21 An ABS Surveyor at Work, May 2000
15.5
THE MARINE SURVEYOR’S TOOLS OF THE TRADE
1-616
It is possible to write a long list of tools for the marine surveyor, however one has to bear in mind the restrictions that may apply, particularly if the surveyor has to travel by air to visit a vessel. Having said that, there are some tools and equipment that are necessary to meet the rules and regulations that affect all surveyors in the course of earning their daily bread.
1-617
We should start with basic requirements, before discussing the specific equipment that may be required for any particular survey.
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(a)
Notebooks, ballpoint pens, and pencils – this may seem obvious but never leave yourself short of these essential items.
(b)
Cameras. The most convenient camera today is a digital camera as you may take hundreds of photographs at a fraction of the cost of film. There has been much debate on the possibility of tampering with digital photographs, but if you taking the pictures for your own reference, and to support your findings in your report to the principal, this question need never arise. Should there be a possibility of photographic evidence being called in a court of law, then the surveyor should check the acceptance of digital photographs and, if necessary, take some essential pictures with a SLR camera. In both cases make sure you have back-up film or chips and, of course, spare batteries.
(c)
Marker pens are essential for supporting your photographic records. Chalk is a common form of marker that is useful on most surfaces and easily removed.
(d)
Means of illumination. An intrinsically safe torch complete with spare batteries and bulbs. Helmet fitted lamps that can be fitted to a safety helmet can be
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excellent for many situations and give you the added advantage of having your hands free. (e)
Tape measures. Be prepared to have a number of different types and sizes to meet your needs. From a 15cm rule, a short steel tape, to a 20–50m fibre tape. Also you may need sounding tapes with different bobs.
(f)
Digital Dictaphone. These lightweight, easily handled devices are most useful as you can rapidly describe any situation using them at a faster rate than writing what you see. The digital Dictaphone can be used with software such as ViaVoice and your spoken word can produce a draft of what you have recorded on the survey. However be aware of the limitations of a Dictaphone. They need batteries, tapes and, most important of all, they need the surveyor’s ability to dictate useful, and only useful, information. There is an art to the diligent use of the Dictaphone: remember, if you become totally dependent on this tool, and it if goes wrong, there is no second chance.
(g)
Tools to poke and prod. The commonly used tools are chipping hammer or similar tools, spike, scraper, and a good knife. It is surprising how frequently these tools are needed during surveys.
(h)
A calculator, and preferably one with a conversion facility.
(i)
Sample containers such as bags, bottles or whatever you prefer to use. Careful labelling is necessary. There is a frequent requirement to obtain samples of something during surveys. (They must always be clean and uncontaminated.)
(j)
A reference notebook. It may be a good idea to compile your own quick reference notes for formulae and general useful information. Nobody can retain in their head all the information that may be required.
(k)
In the 21st century there seems to be a need for the mobile phone. Whilst it is useful for keeping in contact with your customers, switch it off when you are surveying. It can prove to be very distracting and may cause you to miss important aspects of the survey.
1-618
At this point, without going into equipment operational details, it is important that surveyors are fully aware of the myriad of equipment available which is now essential and expected to be used to conduct a complete and competent survey.
1-619
Surveyors must be very aware of the capability of any of the equipment they use. Not only to use it to the manufacturer’s instructions but to be fully confident and competent in its use both in practice and theory. The ability to interpret the results and to report these results in a coherent manner is also paramount to the effective use of any equipment. If wrongly used or interpreted, this equipment can have the completely opposite effect from that originally desired.
1-620
Let us briefly overview some of the tests and equipment that are in regular use by surveyors: On occasions they may have need of additional specialised equipment, such as digital counters, vibration meters, electrical millimeters, and many other specialised instruments but listed below are the more common ones.
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(a)
The silver nitrate test kit. This is used for testing for chloride, but it does not necessarily determine the presence of sea water only (two parts silver nitrate, two parts nitric acid (chlorine free) and 96 parts distilled water).
(b)
A calibrated glass hydrometer. A simple device, but unless used correctly will result in large discrepancies.
(c)
Multi level liquid samplers.
(d)
Lap-top computers are becoming more widely used particularly among draught surveyors, and for ship vetting and safety auditing.
(e)
Liquid level indicators are used in fixed bottle bank extinguisher systems.
(f)
Ultra sonic thickness gauging. These instruments come in all shapes and sizes, eg high capability, variable velocity, intrinsically safe, and underwater types. Also they have the possibility of attaching data logging facilities which are essential for successfully recording the large amount of information required to complete a structural survey. It is important that you make sure you have the right one for the task.
(g)
Paint thickness gauges for both conductive and non-conductive coatings.
(h)
Ultrasonic hatchcover testing. The use of the correct generator and the interpretation or presentation of the results is imperative.
(i)
Fuel and lube oil samplers. Variable method bunker sampling.
(j)
Marine oil test kit.
(k)
Water moisture content test kit.
(l)
Contact thermometers. These are hand-held with ranges from 200C to 1700C. They are available with many probes to suit the job in hand.
(m)
Non-contact thermometers. These are available in infra red or laser with ranges from 18C to 400C.
(n)
Fixed temperature and humidity gauges.
(o)
Hardness testers to measure the ultimate tensile strength.
(p)
Roughness testers.
(q)
Vibration testers to measure acceleration and velocity of parameters of moving machinery.
(r)
Crankshaft deflection indicators.
(s)
Moisture meters (GRP) detect moisture levels trapped within the layers of glass-reinforced plastic.
(t)
Moisture meters (wood) measure the moisture content within wood from 8% to 80% saturation.
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(u)
Moisture meters (condensation) indicate the potential for and the extent of condensation on a surface.
(v)
Moisture meters (grain) measure the percentage of moisture in grain crops.
(w)
Portable gas monitors to deal with single and multi-gases. Normally monitor oxygen, flammable gas, toxic gas, H2S, CO.
(x)
Electronic rigging testers.
The above list can only be considered a general view of what is available on the open market. Some specialist companies have developed their own exclusive items of equipment that may not be available for the independent surveyor.
SELF-ASSESSMENT QUESTIONS You have been instructed to carry out a condition survey of a handysize bulk carrier at a port that is close enough for you to drive to. List the tools and equipment you would take with you to safely carry out this survey.
15.6
THE FOLLOW-UP
1-622
The follow-up has two aspects, internal and external. The external follow-up is, to a large extent, both after-sales service and marketing. When the report is submitted, it is all too easy to be off and away on the next commission without time to check on the outcome of whatever event instigated the requirement for a survey. At the very least it is professional courtesy to enquire whether the service provided was satisfactory – at a more practical level, it is the opportunity to solicit for more business. An on-hire survey will, at some stage, require an offhire survey or a purchase inspection. If followed through, this may mean drydock and subsequent operational surveys are required and at the very least it is an excuse for that marketing essential, customer contact.
1-623
On the internal side, loose ends will inevitably need tidying up, expenses need to be prepared promptly and invoices submitted. Information may also need entering into the organisation’s database, whether it is company or ship-related, or it may be that new legal or technical facts need disseminating around the organisation. Planning must contain an allowance for follow-up.
1-624
Having prepared for the survey and being properly equipped the marine surveyor should now be ready to carry out the Principal’s instructions. This can normally be done in a systematic way, ensuring that all requirements of the survey are met.
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1-625
Once the survey has been completed, the most important part of the service to the Principal is to submit a comprehensive, clearly written, factual report. The skill of report writing will be dealt with in the next module.
15.7
GIVING EVIDENCE
1-626
The marine surveyor may, in the course of his professional duties, be called upon to give evidence either in court or before arbitrators. Surveyors of sufficient experience may also offer their services as expert witnesses. In both circumstances, the underlying requirements are the same; be factual and be well prepared. The model expert witness report, recommended by the London-based Academy of Experts, underlines this in requiring that, in the report, the following should be separately identified and distinguished: ●
facts which the writer has been asked to assume;
●
facts which the writer has observed for himself, ie the results of surveys, experiments, investigations, etc carried out by the expert witness;
●
facts which others, acting on behalf of the writer, have observed, naming and identifying the person(s) concerned;
●
opinions of others or other authorities upon which the writer relies in forming his opinions.
1-627
This also gives good guidance for the surveyor whose role is only to give evidence. So far as possible his role is to give factual evidence and not to give his opinion unless specifically asked by the court – which is different from being encouraged to do so by counsel in cross-examination. Under the English legal system, the witness will be briefed by the solicitor who is preparing the case on behalf of the plaintiff or the defence. Once in court, it is counsel who decides how to manage the case. However, before this stage, the witness should have had the opportunity to state clearly where his area of expertise ends and the witness must take care not to be drawn beyond this point into the area of conjecture – or worse, into advocacy on behalf of one of the parties. Not only does this do little good for the client, it also harms the professional standing of the marine surveyor.
1-628
Equally important, and sometimes quite difficult, is the need for the witness never to lose his temper – this is a well-tried ploy by counsels, sometimes indicating a particularly weak case. Although much of the court proceeding will be conducted in legal jargon, it is also important that the witness does not use technical maritime jargon unless the terms being used are genuinely in the public domain.
1-629
A surveyor involved in an investigation which has the potential for becoming a legal dispute should bear in mind that the dispute is unlikely to come to court for a number of years and what is clear and straightforward at the time is in danger of being lost in the mists of time, especially under hostile cross-examination. This emphasises the importance of the points made earlier about follow-up, the databases and archives. Finally on the point of giving evidence, it is an area
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where thorough preparation is essential and this ranges from eliciting from the solicitor all the information possible that will help the surveyor feel confident and at ease in court to preparing factual responses to likely areas of questioning.
15.8
CONSULTANCY
1-630
Whereas the constant stricture to the marine surveyor is to deal in facts, consultancy is an area where a surveyor may get the opportunity to draw conclusions and offer opinions and recommendations. However, the essence of consultancy remains factual but the scope of the commission is frequently wider, requiring a more extensive database, a research capability and, especially for the smaller surveying organisation, the ability to network information.
1-631
While in its wider sense, consultancy has not been a regulated profession, the European Union for one has now taken steps to define a consultant more clearly. The underlying basis for this definition is that the consultant can demonstrate at least 14 years of experience in the area of expertise being offered. While consultancy may seem a useful adjunct to the marine surveyor’s main profession, its disciplines make different demands, one of which is that the surveyor must be totally flexible to undertake survey work at short notice whilst the consultant needs to be able to commit definite periods of time to an assignment.
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16.
SETTING UP IN BUSINESS AS A MARINE SURVEYOR
LEARNING OUTCOMES After successful completion of this chapter, you will be able to: ●
state the various legal structures of marine surveying organisations;
●
describe how companies are organised; and
●
plan the management of human resources.
16.1
FIRST WE DEFINE WHAT TYPE OF MARINE SURVEYOR THIS APPLIES TO
1-632
Whether you intend to be a ‘one man’ band, a partnership or group of fellow surveyors or part of a large survey company the basic requirements to set up a business remain the same. In this chapter we will consider how survey companies that we may refer to as independent companies would wish to set up in the business of surveying. Government and classification societies have long and well-established management and organisation structures and we will not be referring to this type of organisation.
16.2
THE ESSENTIAL ELEMENTS OF A MARINE SURVEY COMPANY
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More than most organisations which form part of the maritime services industry, surveying companies probably show the greatest diversity Whatever the size and type of organisation, it is essential that they clearly define the market in which they intend to offer their services and then ensure that they have the necessary resources. They must, too, maintain the ability to react promptly in a market which is frequently unable to give much prior notice of when their services will be required and when ship availability can change by the day and sometimes by the hour.
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Set out below are the essential elements of a small to medium-sized marine survey company.
16.2.1
Legal Structure
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Careful consideration should be given to the way in which the surveying organisation is structured as this has implications which cover the liability at a
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personal and organisational level, recruitment, employment status, social benefits, legal liability at a personal and a company level and, it should be added, the way in which the organisation markets itself. 1-636
The main choices are fourfold: sole trader, partnership, a limited liability company (In the UK the name is suffixed by ‘Ltd’), A public liability company (In the UK the name is suffixed by ‘plc’).
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The main features of the three organisational models are as follows:
16.2.2
Sole Trader
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Sole trading is the simplest way for an independent surveyor or consultant to set up; it costs the proprietor little in the way of start-up as well as giving complete control of the business. It is possible to invest or remove as much money as is desired but with this absolute freedom goes absolute responsibility for the business and its debts – if the business fails owing money, the proprietor’s personal possessions, house and investments, are at risk.
16.2.3
Partnership
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Partnerships also offer a large degree of freedom and can be useful if two or more like-minded people want to invest their own resources into a common venture. The ability to invest more funds into the business, or to take more profit, remains wide and the responsibilities of running the business are shared. However, an agreement made by one business partner binds all partners, so that one partner can become responsible for the debts of another, even if the partner was not aware of the debt or business activity – good friends do not necessarily make good partners.
16.2.4
Companies
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Companies can be run by individuals as well as by boards of directors and thus can be fairly simple, straightforward organisations. They are particularly useful if there is access to external funding, either through an equity investment and profit share or through bank (debt) lending. The limited company does protect the equity investor from much of the possible debt and liability downside of investing (which would not be the case for a “sleeping partner”) but the extent of protection for owners who are also directors (as is common in private limited companies – ltd) is not as clear-cut. There are situations where company directors can be held personally liable. Many major creditors, such as banks, will insist on a personal guarantee for loans and there are other tax and legal consequences of operating through a company which can make it substantially more expensive and complicated than operating as a sole proprietor or partnership.
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However, as organisations grow, the reasons for registration as a limited company become more compelling and, at some stage, many organisations find it advantageous to lose a degree of overall control to shareholders in exchange for equity investment to finance expansion and become public limited companies (plc).
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Whichever approach is chosen, it is essential that professional advice, legal, tax and accountancy, is taken. Even at the level of sole trader, the proprietor will need to establish bank accounts which can receive and disburse funds in different currencies and be operated when he or she is effectively uncontactable on site or en route.
16.2.5
Market
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An early decision needs to be made on the particular area of the marine surveying industry, on which the organisation will focus its resources. This is especially so if the resources, especially in a start-up situation, are limited.
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A number of considerations will affect the “market area” decision and the particular skills area of the surveying staff is probably the most important. This has to be combined with a decision on the geographical area on which the organisation will concentrate its marketing efforts. This may be a local port or worldwide and the surveyor’s existing network of potential customer contacts will feature in this decision, as well as the availability of resources to fund the marketing effort.
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A fourth element of this decision is basic market research – where is demand strongest and what are the future trends and developments in the maritime industry (and beyond) which may change this?
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Finally, the new, or existing, surveying company must always keep a close review of its competitors and be aware of the signs of any changes in their market focus.
16.2.6
Organisational Structure
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It is far too easy for organisational structure to grow, especially as companies expand, in an unstructured way. The ultimate downside of this laisséz faire approach is that the organisation then has to commit precious resources to restructuring and, in some cases, write copious procedures manuals to explain to itself how it operates.
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A surveying company has, inherently, a very flat hierarchy and this can and should be maintained, especially with the sensible use of modern technology. As well as front line surveying, there will be a number of other essential functions to be undertaken such as research, marketing, the maintenance of an up-to-date database and, possibly, consultancy. The organisation needs to maintain a careful balance between the need for specialists in these disciplines and the ability to rotate active surveyors through these functions. In the former case, the appointment of specialist support staff, the organisation acquires a very definite, ongoing overhead. In the latter case, using surveyors in support roles on a temporary,
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rotational basis, it can give its surveying staff the ability to enjoy important “home base” time at critical stages of their professional and private lives. Typical examples of this could be around marriage or the birth of children, convalescence or when undergoing professional training. Against this “employee focused” approach, the company must assess the surveyor’s ability to undertake different, desk-bound, tasks such as marketing, budgeting or the maintenance of a database. 1-649
The two areas which need to be addressed by specialists are finance and corporate affairs (the company secretary role) and personnel. In establishing these specialised departments, which are very definitely overheads, it is useful for them to be aware that their function is to facilitate the surveyors in their prime function of surveying and that the surveyor’s prime function is to provide a service to the organisation’s clients which will, in effect, convert them into regular customers and a regular source of income and employment. It is all too easy to lose sight of this perspective.
16.2.7
Policy and Quality
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It almost goes without saying that a marine surveying organisation needs clear and precise policy statements covering its safety, environmental, quality and employment responsibilities and commercial objectives. Behind these will be, hopefully concise, procedures linked to a quality assurance system such as ISO 9002.
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The key to implementing an effective quality system is to make it match the way in which the organisation works, rather than it being a description of the way in which the organisation should be working in order to comply with its procedures manuals. It is a subtle difference in terminology but a quantum improvement in efficiency and effectiveness.
16.2.8
Budgeting and Cash Flow
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While the mechanics of bookkeeping and statutory accounting might correctly be the preserve of a finance department, budgeting and cash flow are very much a mainline management responsibility. Budgeting, in some aspects, is very like passage planning – it establishes a datum line. It is important too, not to view budgets as a purely financial tool, they are a key element of the organisation’s business plan for at least one year ahead in detail and, generally, three to five years ahead in general terms. There are important disciplines in preparing business plans and budgets and wider reading on this subject is recommended. The essential elements, in the context of a shipping company, are set out in Chapter 3 of Commercial Management for Shipmasters.
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Preparation for the budget process needs to start as early as possible, always bearing in mind that the earlier one starts, the older the base data becomes as the budget year in question progresses. This can be an important factor in large organisations where a long period of budget consolidation is required. And, to an extent, this is inevitable because a good budget is one that is prepared, and
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believed in, by the team which is responsible for delivering a compatible performance during the period in question. 1-654
Budgets and the business plan start by drawing together a wide spectrum of relevant information. This ranges from the latest estimate of how the organisation is performing against the current year’s business plan to input from the organisation’s research and marketing functions. From this amalgam of information, the management team prepares the business plan and budget assumptions. The plan sets the goals, the budget assumptions establish such diverse items as the allocation of overheads, the proposed increase in salary costs and the various currency exchange rates to be used.
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So far as possible, the business plan and the budget assumptions should be discussed and agreed with the various operating teams within the organisation before they commence the preparation of their budget input.
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An important element of the year’s operational plan is the management of the organisation’s liquid financial assets, its cash flow. This should be planned as far as possible in advance, and monitored throughout the year in conjunction with the organisation’s commercial performance against the budgeted predictions. A critical aspect of cash flow planning is not just ensuring that there are adequate resources to match the budgeted expenditure, allowing for the inevitable delay between expenditure and income, but it is the ability to finance growth and to take advantage of unforeseen opportunities. Here, the benefits of maintaining an ongoing dialogue, on a business level, with the organisation’s bank or bankers, may prove invaluable.
16.2.9
Technology
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Technology is both a challenge and an asset – incorrectly planned and managed, it can be a liability. Like the finance and personnel function, an organisation’s technology strategy should be designed to assist surveyors in their prime task of investigation and reporting. It is important, therefore, that the technology strategy has the general acceptance of those who must use it. A balance must be achieved between the disciplines necessary in order to ensure systems compatibility and the flexibility that enables the systems to be user-friendly at an individual level.
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The objective is to support the surveyor in working at maximum efficiency in a way which is compatible with the overall objectives of the organisation and which conforms to its quality controls. A key element in achieving this is the provision of proper training, with ongoing refresher and update training. Some people are naturally IT compatible and some are not – it is important that the company provides support for those who are not or the overall efficiency will drop.
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A second dimension of the technology challenge is to ensure that the organisation can interface in a user friendly way with its customers. A moment’s reflection may well place the organisation’s telephone and voice mail system high on the priority list for user-friendly design, especially bearing in mind the inevitability of the prime staff, the surveyors, being away from their desks more than they are at them.
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16.2.10
Databases and Records
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In designing database and record systems, four guiding principles are recommended: ●
identify the sources of information – the inputs;
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identify the uses of the information eg technical data, marketing, research, evidence in arbitration and disputes, invoicing, budgeting – the outputs;
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start yesterday, do not let the input grow in an unstructured way until it becomes a problem;
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build in flexibility, do not over-design.
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Information technology can greatly assist the scope and flexibility of databases and speed up the sorting and retrieval of information. Nevertheless, a physical system will always be required alongside the electronic database since plans, samples, photographs and many other types of evidence will need to be kept (and cross-referenced to the electronic system) until it is clear that they are no longer required. If the surveyor is involved in a potential legal dispute between two parties, this may mean keeping the evidence for several years and the archive should be designed with this in mind. The surveyor will also have his own, personal diary or day-book, and this too is an essential part of the organisation’s records and an area which may need attention if the surveyor leaves the organisation.
16.2.11
Marketing
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Marketing starts with knowing what you are selling and who your customers are. It then progresses to identifying and providing the precise service your customers need and identifying which is the most effective way of making them aware of your product and its benefits. Finally, it is necessary to progress to identifying a) the service which will be needed in the future and b) who the future customers will be.
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This will take a degree of research and analysis and this should be a responsibility for every surveyor in the organisation. In the same way, every surveyor should be marketing the organisation and its service every time they meet a customer or anyone in the industry who is a potential customer or who is in a position to recommend the organisation’s services.
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All this needs co-ordinating and this must be the active responsibility of the management team. Included in their remit will be decisions on the organisation’s style (covering such matters as logo and letterhead), advertising medium (from advertisements in trade journals, through mail shots to websites and to participation in conferences and other methods of gaining exposure).
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One area which must be considered within marketing is the organisation’s telephone system – probably the first and most frequent point of contact for customers. Especially in an organisation where the majority of its staff should be out
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of the office most of the time, it is important to offer the customer more than a voicemail box. 16.2.12
Banking and Finance
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There are two distinct aspects to banking. The first is the normal bookkeeping and accounting function which can be adequately handled by the organisation’s finance team. It will be necessary to set up systems to deal with foreign exchange requirements and the inevitable need to be able to produce cash in strange parts of the world at short notice, but beyond that the requirement is fairly standard.
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The second aspect is the responsibility of the management team and involves ensuring that the bank’s management understands and is sympathetic to the organisation’s business and business aspirations. This means appraising them of the current business plan, at least in general terms, and of any need for supplementary finance, such as for an investment in technology upgrades or an expansion in the organisation’s activities (bearing in mind the strain which this can put on cash flow).
16.3
MANAGEMENT AND HUMAN RESOURCES
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As stated earlier, a surveying organisation is likely to have a very flat managerial hierarchy, since it will be largely made up of surveyors whose tasks are basically the same. This indicates a natural team-based approach to management except that the surveyor’s task is essentially an individual one. It will be rare for surveyors to be deployed as a team or to work as a team except when undertaking the essential administration functions such as budget preparation or research. Indeed, some surveyors may not meet from one month to the next.
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Thus, the management team faces a challenge which requires it to ensure that there is an effective exchange of information within the organisation, together with a commitment to common standards and mutual support. Effective communication, which includes receiving as well as transmitting information, is critically important and deserves and demands proper management. Through effective communication, a diverse and frequently individualistic mixture of marine surveyors can be crafted together as a team and as the core of an efficiently functioning organisation.
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In managing teams it is essential for the manager to know and understand the strength and weaknesses of his team members on an individual basis. Far too frequently, promotion, possibly on grounds of technical capability, is supposed to imbue the new manager with the abilities of “man management”. This is not necessarily true and there are skills which need to be developed. The difference between good and adequate managers is often the support and assistance which they receive at this stage of their career.
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There are many techniques for assessing, analysing and understanding individuals. Psychometric testing is increasingly used as part of the interviewing, selection and ongoing appraisal process and requires a degree of specialist knowledge and training before the results can be relied on as reasonably accurate.
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The end results are frequently quite straightforward and consist of identifying which are an individual’s most dominant traits. Much simpler forms of analysis, based on observation can, with practice, also give a good indication of an individual’s strengths and weaknesses. If a manager can learn to spot the strong and the weaker functions in their various team members – and indeed in themselves – and has the ability to capitalise on the strengths and provide support in countering the weaknesses, it will help in developing the organisation’s overall human resource as well as the individual’s career. 1-672
The first step in this process is developing the ability to know and understand the inherent capabilities of individual members of the organisation. Like navigating, the science of human resource management is to a great extent an art and, although human beings are far too complex to be completely categorised, some simple theories can help the manager. Carl Jung pioneered the modern approach to the study of personality types nearly a century ago when he developed the theory that most people have one predominant function, one or two that are semi-developed and one that is underdeveloped. The four functions which he identified are Thinker, Sensor, Intuitor, Feeler. Thinkers and sensors are basically extroverts while the intuitors and feelers are more introverted. Thinkers are methodical and enjoy tackling problems with logic while intuitors are good at lateral thinking and strategy, less focused on detail. Sensors get things done but do this best in a routine environment – not necessarily the best managers of change, or of people. The feeler, not surprisingly, is a people person and can establish relationships but not necessarily get things done. Starting with this basic matrix, a manager should be able to develop a better insight into how his colleagues approach their professional task of marine surveying and who would be better suited to ancillary tasks such as research or marketing.
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The surveyor who moves into a more managerial role will also need to deploy different skills and the core skills of a manager are often summarised within three groups. Basic knowledge and Information
Command of basic facts Relevant professional understanding
Skills and Attributes
Continuing sensitivity to events Analytical, problem-solving, decision/judgment-making skills Social skills and attributes Emotional resilience Pro-activity; the inclination to respond purposefully to events
Meta-qualities
Creativity Mental agility Balanced learning habits and skills Self-knowledge
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The first group forms the foundation level of basic knowledge and information required for decision-making and taking action. The central group directly affects behaviour and performance with the third being the quality which allows managers to acquire the basic knowledge and information required in one and two; this area also has a direct bearing on a manager’s ability to manage change. A manager needs to be sensitive to events both in his internal working environment (the organisation and his team) as well as the external environment (company, industry, the demand for shipping services). Especially in his internal environment, the manager needs to be sensitive to “soft” information, such as the feelings and capabilities of other people, as well as “hard” information, such as facts and figures.
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In a similar way, a manager needs to be able to identify in his decision-making role between the need for logical, optimising techniques and situations which call for the ability to weigh pros and cons to resolve uncertain or ambiguous situations. At times, a high level of judgment or even intuition may be needed, especially when dealing with people. Here too, social skills and abilities are required to “get things done through other people”. Communicating, delegating, negotiating, resolving conflict, persuading and selling and using and responding to authority and power are all skills that need to be developed. In an organisation where the majority of staff may be individualistic surveyors, used to and happy to work on their own, good interpersonal skills are important.
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Most managers will recognise the need for emotional resilience when the stress levels rise. Effective resilience does not mean an unbending “You’ve got to be thick skinned” approach; self-control with a little, measured flexibility provides a longer term, less wearing solution.
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The Meta-qualities of the third group relate to the manager’s ability to develop the situation-specific skills needed to address the many challenges facing all managers in the conduct of their professional life. Creativity and mental agility, the ability to “think on one’s feet”, are skills that can be exercised and improved by a manager who takes responsibility for his own development and learning.
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In successful human resource management, as in all processes, it is essential to ensure that there is an effective review and feed-back loop – in other words, an appraisal system.
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Too many appraisals are periodic events which are approached with a degree of dread and embarrassment on both sides. And so they should be if treated in this way. The appraisal process should be ongoing, so that the formal appraisal interview and reporting is no more than a confirmation of what is known and understood by both parties, the focus of an ongoing internal audit. As with all audits, it is essential that there is a clear specification against which the audit is made, and in human resource terms this is the job description with its associated responsibilities and authorities, and particularly the job description within the context of the organisation’s policies and procedures.
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Although the “audit” and feedback should be an ongoing process, the appraisal, like the closing meeting of any audit, should be prepared for carefully, not least so that the manager can be relaxed and confident. This means allocating sufficient time for this task – whether the allocation of sufficient time is seen by the
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Each member of staff should be given good notice of the date and time of the appraisal meeting – a week is reasonable – not an easy task in a busy surveying company. All employees should think about what they want to discuss as this leads to a more productive interview and reduces unnecessary apprehension. In planning, the manager should take into account the individual’s cultural background and dominant personality characteristics and think how best to structure an approach which will best develop a two-way communication. It is, as indicated above, sometimes helpful to think of the appraisal as an audit rather than an interview and it is always important to start and finish on a high note. It was mentioned earlier that surveying organisations can be structured in many ways and incorporate self-employed surveyors and consultants as well as employed staff – although some of the content will be different, the manager should also address the appraisal of the organisation’s non-permanent staff if a consistently high quality of service is to be achieved.
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Closely aligned with the appraisal interview is the recruitment interview and it is important that the manager has, at least in general terms, a policy and plan for the ongoing renewal of the organisation’s core resource – people. Especially in the current climate, with a decreasing availability of trained mariners for all the marine service industries, the manager will increasingly need to look towards new sources of manpower and, probably, to training surveyors with a limited or non-maritime background. In approaching this task, the manager will need to develop a number of specifications for suitable recruits, incorporating both the inherent personal qualities which he needs with the essential knowledge and aptitudes. From this base can be structured a development programme which first provides the embryo surveyor with the necessary knowledge (the educational process) after which it is possible to start to teach them how to apply that knowledge (the training process).
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The marine surveyor operates in a changing world with changes in technology, legislation, survey requirements, markets and customers as a continuing backdrop to his or her work. This means that CPD (continuing professional development), is an important area which the survey organisation and its surveyors need to address in a coherent and pro-active way.
SELF-ASSESSMENT QUESTION Draw up an organisation plan of the marine survey company you would wish to be associated with. Note brief job descriptions of each member of the organisation.
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RECOMMENDED READING
It is always helpful to improve your depth of learning by reading other publications. There is a good number of books on surveying practice and the following are some of the books which will provide a useful background, and in some cases specific guidance, in the practice of marine surveying as discussed in this module. There are many more which may be useful to the practising surveyor, particularly those that focus on a surveyor’s specialist interests such as cargo surveys, small craft, environment, engineering and so on. Most of the surveys discussed require a primary knowledge of the appropriate discipline, and the standard texts of those disciplines are also of considerable value. Supplementary reading is necessary to gain the depth of learning required in this module. The following list of publications has been referred to in the preparation of this module and is recommended for supporting your study. However, the list is not exhaustive.
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Captain CF Durham: Marine Surveys (Fairplay, London, 1998). This A4 format publication is an expansion on some of the work in the earlier book by the same author but its real value lies in the very practical guidance given on carrying out some of the more common surveys and the provision of many useful work sheets which the surveyor can photocopy for use on the job.
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Lloyd’s Survey Handbook Seventh Edition (LLP, London, 1998). This book gives some useful information on the general approach to cargo surveys and provides information on a number of different commodities commonly the subject of survey.
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The Nautical Institute on the work of a Nautical Surveyor (The Nautical Institute, London). Divided into four sections, this book covers the nautical surveyor’s role in government, commerce, safety and inspection, measurement and control.
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The Society of Consulting Marine Engineers and Ship Surveyors: Marine Technical Consultancy (Witherby & Co Ltd, London, 1992). This book is currently out of print but is being revised. It covers much of the work of engineers and ship surveyors.
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Guidelines on the Application of the ISM (Code) (International Shipping Federation)
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STCW ’95 Company Checklist (International Shipping Federation)
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Scrutton on Charterparties and Bills of Lading, first edition published in 1886.
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Robert L Tallack, Commercial Management for Shipmasters (The Nautical Institute) ISBN 1 870077 33 4
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UCP 500 Uniform Customs and Practice for Documentary Credits (International Chamber of Commerce, January 1994)
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Recommended Reading
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Analysis of Major Claims (UK P&I Club)
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Achieving Quality Standards (The Institute of Management/Pitman) ISBN 0 293 60411–2
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A M Chauvel, Managing Safety and Quality in Shipping (The Nautical Institute) ISBN 1 870077 407
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Managing Risk in Shipping, A Practical Guide (The Nautical Institute) ISBN 1 870077 48 2
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Procedures for Port State Control 1997 (IMO) ISBN 91-801-1431-X
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Port State Control at Work 1996 (Secretariat of the Paris MoU)
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Annual Report and Hull Casualty Statistics (Institute of London Underwriters)
USEFUL WEBSITES ●
International Maritime Organisation
www.imo.org
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Maritime and Coastguard Agency
www.mcagency.org.uk
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International Association of Classification Societies
www.iacs.org.uk
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The Nautical Institute
www.nautinst.org
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Port State Control
www.parismou.org
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Institute of London Underwriters
www.iua.co.uk
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UK P&I Club
www.ukpandi.com
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International Standards Organisation
www.iso.ch
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TUTOR-MARKED ASSIGNMENT
A brewer in Europe needs to import 25,000 tonnes of malting barley to cover a prospective shortfall in supply. ●
Describe the chain of events and the different documentation and organisations that might be involved in establishing this transaction and in the transport of the grain.
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Indicate where you consider a surveyor (marine or cargo) might be involved.
The aim of this assignment is to widen your perspective of the logistics chain so that detailed descriptions of elements with which you are familiar are less important than demonstrating your overall understanding of the transaction. Please try to restrict your assignment to 1,200 words.
For candidates taking the Diploma option, a Tutor-marked Assignment must be completed for each core module. There is a minimum pass mark for each assignment and candidates will be expected to reach this minimum standard. Collectively, the assignments represent a possible 40% of the candidate’s final mark.
On the cover page of your assignment, could you please include the following information:
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Your name
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Course Name – Marine Surveying
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Course Code – LP0058
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Tutor-Marked Assignment
To speed the processing of assignments, please return your typed assignment by post, fax or email directly to the TMA Administrator: Post:
Mrs Parmjit Gill TMA Administrator The School of Maritime Operations and Logistics North West Kent College Lower Higham Road Gravesend Kent DA12 2JJ United Kingdom
Tel:
+44 (0)1322 629684
Fax:
+44 (0)1322 629667
Email:
[email protected]
Remember to keep a copy of your completed assignment in case of loss in the post. Please also state if you would like confirmation of receipt of your assignment. If so, you must include your email address, as confirmation by post or fax is not possible. Emailing Assignments will only be accepted if they are sent as attachments to the email message. There are no penalty points for late submission of assignments. You should attempt to complete each assignment within four weeks of receipt of the module. However, you can submit assignments at any time during the course, but they must be received before the exam.
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