General Average declared for Ever Given; report

Japan-based Shoei Kisen, the owner of Suez Canal accident mega-container ship Ever Given (IMO 9811000), was reported to have declared General Average. A customer circular from Evergreen reportedly has stated that Shoei Kisen KK has appointed Richards Hogg Lindley, part of insurance services company Charles Taylor, as average adjuster.

However the Shoei Kisen web site’s latest statement refers only to the hull inspection of the Ever Given and stated that “we will continue to fully cooperate with the Suez Canal Authority, which is conducting the accident investigation. We will submit the data of the navigation information recording device called VDR to the investigators of the Suez Canal Authority, cooperate with the inspection necessary for their accident investigation, and provide other necessary data. The health of the remaining seafarers on the ship is also good, and we are cooperating with the accident investigation currently being conducted.”

A departure date for the Ever Given, currently subject to an investigation into the accident, which blocked the Canal from March 23rd to March 29th, has not yet been set.

There is no reported damage to the cargo and little apparent damage to the ULCV’s hull. However, the cost of the salvage operation added to potential compensation claims from Egypt, other shipowners, charterers and other interested parties, could be significant.

Currently it is unclear whether there will be a separate salvage claim from the vessel’s salvors.

With GA being declared, cargo owners will be required to contribute to a GA fund before cargo can be released.

There are ongoing arguments whether GA is a suitable system for modern vessels, particularly large container ships, where the number of parties involved heads well into the thousands.

Shippers and freight forwarders with cargo on the Ever Given look set to have a long and expensive wait before their cargo is released.

The cost of the casualty to the owners will take some time to determine. That means the average adjusters will be unable to fix the level of the GA.

If there is a repeat of the GA levels imposed after the Maersk Honam fire in 2018, where salvage security was set at 42.5% of cargo value and 11.5% was the GA deposit, shippers with uninsured cargo will be vulnerable to losing it, since the owner can hold the goods under lien until the deposit is paid.

Shippers with insured goods will have those deposits covered by their insurers.

2018-built, Panama-flagged, 219,079 gt Ever Given is owned by Luster Maritime/Higaki Sangyo care of Shoei Kisen KK of Imabari-shi, Ehime-ken, Japan. It is entered with UK Club on behalf of Luster Maritime SA.