Notes to the Rules
These Notes, including those appended
to Rule 2 Sections 10C and 11, do not form part of the Rules or any
Regulations made thereunder and are intended as guidance only to Members
in relation to the practice of the Association. They do not constitute
any waiver or variation of the requirements of the Rules or any such
Regulations. 1 Bail, Rule 14 Paragraph 1 Subject
to agreement in writing in individual circumstances the undertaking
which the Managers will normally require will be in the following
form: TO THE SHIPOWNERS' MUTUAL PROTECTION AND INDEMNITY
ASSOCIATION (LUXEMBOURG) Dear Sirs, Vessel Voyage
(or port, etc) Date Incident We
hereby request you (either personally or through your agents)
to provide bail or other security in the sum of which bail
or security is now being requested and/or is now required in
order to avoid the arrest or detention of SS/MV
or in order to secure her release from arrest. In
consideration of your providing such bail or security (hereinafter
called "the bail or security") we hereby agree as follows: 1 To
pay immediately upon any liability being incurred by
you or your agents under or in connection with the bail
or security a sufficient sum to discharge such liability
in full and generally to take all such measures as may
be necessary to ensure that such liability is discharged
in full without delay as soon as it may be incurred and
that neither you nor your agents shall be required to
make any payment whatsoever to discharge such liability
save out of the funds (hereinafter called "the funds")
which we shall have provided. 2 To
indemnify you and hold you harmless in respect of any
loss or damage whatsoever which may result from your
giving the bail or security and to reimburse to you
at any time upon your demand any sum or sums of money
you may be called upon to pay under or in connection
with the bail or security. 3 To
pay all your costs, expenses, charges and commission
(as specified in your Rules) in connection with the
provision of the bail or security. 4 Without
prejudice to the foregoing in the event that, in
breach of our obligation under Clause 1 above,
we fail to provide the funds and you are obliged
nevertheless to incur or, notwithstanding that
you have no such obligation, you elect to incur
any such liability, loss, damage, costs, expenses,
charges or commission, then A you
shall be entitled to demand immediate repayment
of the amount of any such liability, loss, damage,
costs, expenses, charges or commission; B in
the event that, in breach of our obligations
hereunder, such repayment is not immediately
made, we will pay to you interest thereon or
on any part thereof for the time being outstanding
at the rate of 2% per annum above the offered
rate between prime banks in the London Inter
Bank Euro-dollar Market for three-month deposits
(the rate being determined monthly on the first
day of the appropriate month) until such repayment
is made. 5 That this agreement
shall be governed by English law and that,
without prejudice to your right to institute
proceedings in any other jurisdiction, the
High Court of Justice in London shall have
jurisdiction to hear and determine any action
brought by you in connection herewith. We
further agree that, by providing any of
the bail or security, the Association shall
incur no obligation whatsoever to provide
any further bail or security in connection
with the above incident and that the Association
may at any time in its absolute discretion
cause the above bail or security to be
cancelled or released. If
we are insured by the Association in
respect of the above incident, we reserve
our right to claim repayment of any sums
we may pay hereunder which are properly
recoverable in accordance with your Rules. Yours
faithfully, 2
Delivery of Cargo without Production
of Bills of Lading/Change of Destination A
Member has no right of recovery
from the Association of any claims
that result from delivery of
cargo without production of the
bill of lading or discharge of
cargo at a port or place other
than in accordance with the contract
of carriage. If
Members nevertheless wish to
adopt either of these practices
at their own risk they are
advised to obtain an appropriate
indemnity from charterers or
cargo interests. In doing so
they should understand that
cover by the Association is
not restored when an indemnity
is obtained; the indemnity
must fill the gap created in
the cover by the Association
and it is for Members to decide
what constitutes sufficient
security for these purposes. Forms
of recommended indemnity
wordings follow. Standard
Form Letter of Indemnity
to be given in return
for delivering cargo
without production of
the original bill of
lading
To: [insert name of Owners] The owners
of the [insert name of ship] Dear Sirs, Ship:
[insert name of ship]. Voyage: [insert load/discharge
port, as stated in the Bill of Lading Cargo: [insert
description of cargo] Bill(s) of Lading: [insert
identification number, date, place of issue] The
above cargo was shipped on the above vessel by [insert name
of shipper] and consigned to [insert name of consignee or
to whose order the Bill of Lading is made out, as appropriate]
for delivery at the port of [insert name of discharge port
stated in the Bill of Lading] but the Bills of Lading have
not arrived and we, [insert name of party requesting delivery],
hereby request you to give delivery of the said cargo to
[insert name of party to whom delivery is to be made] without
production of the original Bill(s) of Lading. In
consideration of your complying with our above request,
we hereby agree as follows: 1 To indemnify
you, your servants and agents and to hold all of you
harmless in respect of any liability, loss, damage or
expenses of whatsoever nature which you may sustain by
reason of delivering the cargo in accordance with our
request. 2 In the event of any proceedings
being commenced against you or any of your servants
or agents in connection with the delivery of the cargo
as aforesaid to provide you or them on demand with
sufficient funds to defend the same. 3 If,
in connection with the delivery of the cargo as aforesaid,
the ship or any other ship or property belonging
to you should be arrested or detained or if the arrest
or detention thereof should be threatened to provide
on demand such bail or other security as may be required
to prevent such arrest or detention or to secure
the release of such ship or property and to indemnify
you in respect of any liability, loss, damage or
expenses caused by such arrest or detention or threatened
arrest or detention whether or not such arrest or
detention or threatened arrest or detention may be
justified. 4 As soon as all
original Bills of Lading for the above cargo shall
have come into our possession to deliver the same
to you, whereupon our liability hereunder shall
cease. 5 The liability of
each and every person under this indemnity shall
be joint and several and shall not be conditional
upon your proceeding first against any person,
whether or not such person is party to or liable
under this indemnity. 6 The
liability of each and every person under this
indemnity shall in no circumstances exceed
200% of the CIF value of the above cargo. 7 This
indemnity shall be governed by and construed
in accordance with English law and each and
every person liable under this indemnity
shall at your request submit to the jurisdiction
of the High Court of Justice of England. Yours
faithfully, For and on behalf
of [insert name of Requestor] Signature For
and on behalf of [insert name of Bank] Signature Standard
Form Letter of Indemnity to be
given in return for delivering
cargo at a port other than that
stated in the bill of lading
To: [insert name of Owners] The owners
of the [insert name of ship] Dear Sirs, Ship:
[insert name of ship]. Voyage: [insert load/discharge
port, as stated in the Bill of Lading] Cargo: [insert
description of cargo] Bill(s) of Lading: [insert
identification number, date, place of issue] The
above cargo was shipped on the above vessel by [insert name
of shipper] and consigned to [insert name of consignee or
to whose order the Bill of Lading is made out, as appropriate]
for delivery at the port of [insert name of discharge port
stated in the Bill of Lading] but we, [insert name of party
requesting substituted delivery], hereby request you to order
the vessel to proceed to and give delivery of the said cargo
at the port of [insert name of substitute port] against production
of at least one original Bill of Lading. In
consideration of your complying with our above request,
we hereby agree as follows: 1 To
indemnify you, your servants and agents and to hold all
of you harmless in respect of any liability, loss, damage
or expenses of whatsoever nature which you may sustain
by reason of the vessel proceeding and giving delivery
of the cargo in accordance with our request. 2 In
the event of any proceedings being commenced against
you or any of your servants or agents in connection
with the vessel proceeding and giving delivery of the
cargo as aforesaid to provide you or them on demand
with sufficient funds to defend the same. 3 If, in
connection with the vessel proceeding and giving delivery
of the cargo as aforesaid, the ship or any other ship
or property belonging to you should be arrested or
detained or if the arrest or detention thereof should
be threatened to provide on demand such bail or other
security as may be required to prevent such arrest
or detention or to secure the release of such ship
or property and to indemnify you in respect of any
liability, loss, damage or expenses caused by such
arrest or detention or threatened arrest or detention
whether or not such arrest or detention or threatened
arrest or detention may be justified. 4 The
liability of each and every person under this indemnity
shall be joint and several and shall not be conditional
upon your proceeding first against any person, whether
or not such person is party to or liable under this
indemnity. 5 The liability
of each and every person under this indemnity shall
in no circumstances exceed 200% of the CIF value
of the above cargo. 6 This
indemnity shall be governed by and construed
in accordance with English law and each and every
person liable under this indemnity shall at your
request submit to the jurisdiction of the High
Court of Justice of England. Yours
faithfully, For and on behalf
of [insert name of Requestor] Signature For
and on behalf of [insert name of Bank] Signature Standard
Form Letter of Indemnity to be given
in return for delivering cargo at a
port other than that stated in the
bill of lading and without production
of the original bill of lading To:
[insert name of Owners] The
owners of the [insert name of ship] Dear
Sirs, Ship: [insert
name of ship]. Voyage:
[insert load/discharge port,
as stated in the Bill of
Lading] Cargo:
[insert description of
cargo] Bill(s)
of Lading: [insert identification
number, date, place of
issue] The
above cargo was shipped
on the above vessel
by [insert name of
shipper] and consigned
to [insert name of
consignee or to whose
order the Bill of Lading
is made out, as appropriate]
for delivery at the
port of [insert name
of discharge port stated
in the Bill of Lading]
but we, [insert name
of party requesting
substituted delivery],
hereby request you
to order the vessel
to proceed to and give
delivery of the said
cargo at the port of
[insert name of substitute
port] to [insert name
of party to whom delivery
is to be made] without
production of the original
Bill(s) of Lading. In
consideration of
your complying with
our above request,
we hereby agree as
follows: 1 To
indemnify you,
your servants and
agents and to hold
all of you harmless
in respect of any
liability, loss,
damage or expenses
of whatsoever nature
which you may sustain
by reason of the
vessel proceeding
and giving delivery
of the cargo in
accordance with
our request. 2 In
the event of
any proceedings
being commenced
against you or
any of your servants
or agents in
connection with
the vessel proceeding
and giving delivery
of the cargo
as aforesaid
to provide you
or them on demand
with sufficient
funds to defend
the same. 3 If,
in connection
with the vessel
proceeding
and giving
delivery of
the cargo as
aforesaid,
the ship or
any other ship
or property
belonging to
you should
be arrested
or detained
or if the arrest
or detention
thereof should
be threatened
to provide
on demand such
bail or other
security as
may be required
to prevent
such arrest
or detention
or to secure
the release
of such ship
or property
and to indemnify
you in respect
of any liability,
loss, damage
or expenses
caused by such
arrest or detention
or threatened
arrest or detention
whether or
not such arrest
or detention
or threatened
arrest or detention may
be justified. 4 As
soon as all
Bills of
Lading for
the above
cargo shall
have come
into our
possession
to deliver
the same
to you. 5 The
liability
of each
and every
person
under this
indemnity
shall be
joint and
several
and shall
not be
conditional
upon your
proceeding
first against
any person,
whether
or not
such person
is party
to or liable
under this
indemnity. 6 The
liability
of each
and every
person
under
this
indemnity
shall
in no
circumstances
exceed
200%
of the
CIF value
of the
above
cargo. 7 This
indemnity
shall
be
governed
by
and
construed
in
accordance
with
English
law
and
each
and
every
person
liable
under
this
indemnity
shall
at
your request
submit
to
the
jurisdiction
of
the
High
Court
of
Justice
of
England. Yours
faithfully, For
and on behalf of [insert name
of Requestor] Signature For
and on behalf of [insert name
of Bank] Signature
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