Insisted on the principle of “bringing about reconciliation if possible and rendering judgments when necessary”, Haikou Maritime Court has efficiently concluded a case concerning a dispute under a salvage contract, and passed a judgment during a court hearing to order a shipping company in Guangdong to pay an ocean engineering company the salvage costs of CNY 2.6 million odd. This has duly protected the litigation rights of both parties, and provided strong judicial protection for the salvage services provider.
The vessel “Yue XX69” owned by the defendant, a shipping company in Guangdong, went aground at an anchorage in Sanya under the attack of Doksuri, the 19th typhoon in 2019. On 29 September, upon request of the defendant, the plaintiff, an ocean engineering company, promptly dispatched people and salvage equipment to refloat the vessel. During the salvage operation, the plaintiff found damage to the hull and reported it to the defendant, who then directed the plaintiff to carry out underwater operations to fix the damage to the hull. Operations were carried out respectively on 3 and 4 October to refloat and repair the vessel. The defendant did not take over the vessel immediately after the operations. The plaintiff had been waiting in the grounding waters for five days before it received the defendant’s instruction to tow the vessel to a vessels and ocean engineering company 300 nautical miles away to deliver it to the defendant. Upon the defendant’s receipt of the vessel and acknowledgment of the costs, the parties calculated the agreed costs and drew up the refloating costs statements on 7 November. Considering that the defendant had suffered from Typhoon Doksuri and it had requested delayed payment on account of financial difficulties and promised to give priority to the plaintiff’s salvage costs out of the ongoing insurance claims, the plaintiff decided to give the defendant a grace period. However, after the grace period, the defendant still defaulted on the payment by making different excuses. This had caused great difficulties to the plaintiff’s subsequent business operations as it had put in significant manpower, equipment and resources to salve the vessel, and the huge amount owed by the defendant would not be recovered in the foreseeable future. Running out of other resorts, the plaintiff brought an action before Haikou Maritime Court on 8 August 2018 on the grounds that the defendant had refused to pay the salvage costs. It requested the defendant to pay a sum of CNY 2.6 million odd for the costs of underwater investigation, refloating, engine room clean-up, towage, and the agreed costs of delay due to wait time.
After entertaining the case, Sanya Division of Haikou Maritime Court promptly carried out pre-trial works including service of documents, investigation and evidence gathering, and arrangements for reconciliation. As the defendant had relocated from its registered address, the service of documents was not smooth. After lots of efforts to get in contact with the defendant and complete the service, the judges actively arranged for a face-to-face reconciliation meeting. Under the judges’ patient explanation of law and persuasion, the defendant verbally agreed to reconcile with the plaintiff before litigation. However, on the date of the court hearing, the defendant did not show up to reconcile with the plaintiff before litigation and did not show up for the hearing. The collegial bench carefully read through the files to learn more about the facts of case and drew up an overarching outline for the trial. In order to protect the litigants’ lawful rights and interests, the handling judge decided to open the court session as planned and made preparations in case the defendant rejected to attend the hearing.
Being duly served a summons, the defendant refused to attend the hearing without just cause. At the hearing, the collegial bench examined the refloating agreement, underwater repairs contract, and costs statements between the parties in relation to the vessel “Yue XX69” and other original evidence. They inquired about the circumstances and learnt that the facts were consistent with the plaintiff’s statement. They duly rendered a judgment by default to protect the salvage services provider’s lawful rights and interests without delay.
As it was difficult to calculate salvage costs in disputes in relation to salvage contracts and the trial of such disputes through general proceedings took a long time, rending judgments at court hearings was quite rare. Within the two months from entertaining the case to making the judgment, Sanya Division of Haikou Maritime Court quickly ascertained the facts and rendered a judgment at the hearing. This protected the lawful rights and interests of the salvage services provider to the upmost extent. The collegial bench of Sanya Division administered justice in a fair and dedicated manner, not keeping the litigant waiting unnecessarily for even one day. Its efficiency in trial was highly applauded by the plaintiff.