Removal to the place of repair, Cl. 16-10

As mentioned under 7.2.3 above, the cost of removing the ship to the repair yard constitute part of the casualty repairs and are therefore covered by the hull insurer.  This makes it natural that the time involved in removing the ship will be included in the calculation of the total indemnity under the loss of hire insurance, as will the time required for surveys, taking tenders, tank cleaning and/or gas-freeing, ordering replacement parts and similar measures necessary in order to carry out the repairs.

Cl. 16-10 deals with time lost during removal to a repair yard. The clause was edited in 2013 by amending the words “class of repairs” and “class of work” to “category of repairs” and “category of work”. Cl. 16-10 sub-clauses 1 and 2 read:

Loss of time during removal to the repair yard shall be attributed to the category of repairs that necessitated the removal.[20]

If removal to the repair yard was necessary for the repair of more than one category of work, the removal time shall be apportioned in accordance with the time that each category of work would have required if carried out separately.  Removal time that falls within the deductible period shall not be apportioned.


The solution under the previous conditions (Cl. 8, No. 4 of the 1972 and 1993 conditions) was that the removal time was apportioned over all categories of work, provided that the work in fact benefited from the use of the repair yard, see the "Ranhav" award, ND 1967 page 269, see also 6.3 above on this award. The 1996 Plan has departed from this solution.

Cl. 16-10 takes into account that removal to a repair yard can be necessitated by the following categories of repairs:

  • owner's work,
  • damage repairs relevant to the particular loss of hire insurance, and
  • damage repairs relevant to other loss of hire insurance.

Whether the time lost during removal to the repair yard will be covered under the loss of hire insurance now depends on which category of repairs necessitated the removal. Cl. 16-10, sub-clause 1 provides that removal time is to be allocated to the category of repairs that "necessitated the removal". Sub-clause 1 is based on the assumption that only one class of repairs necessitated the removal to the repair yard. Otherwise the provisions of sub-clause 2 will apply. It is therefore necessary to clarify which category of work was necessary to enable the vessel to continue trading. This evaluation must be made on the basis of the situation at the time the removal commenced.

If the casualty damage is so serious that the vessel must be repaired at once, the casualty repairs have "necessitated the removal" and the removal time is therefore to be allocated to those repairs.  If so, the assured has the opportunity to have owner's work performed without having to bear any of the removal time.

On the other hand, if the ship has to be docked at once in order to carry out class surveys or other owner's work while repair of casualty damage could be postponed, the removal time will be for the assured's account even though casualty repairs are actually carried out simultaneously.

This means that if one particular category of repairs necessitated the removal, the removal time will be allocated to that category of repairs, regardless of the actual extent of the repairs or the time needed to complete them once the vessel arrives at the repair yard.

It has been discussed whether the vessel has arrived at the yard already upon dropping anchor at the yard’s or port’s anchorage, or only when she is securely moored alongside the yard’s repair berth or has been dry-docked.  When does Cl. 16-10 seize to apply and Cl. 16-12 on equal apportionment in case of simultaneous repairs take over? This borderline may have economic implications for the parties to the insurance contract. The writer believe the answer must be found Cl. 16-10, sub-clause 3 which expressly states that Cl. 16-10 sub-clauses 1 and 2 shall apply to loss of time during surveys, while obtaining tenders, during tank cleaning, while waiting to commence repairs or due to other similar measures that were necessary in order to carry out the repairs. Regardless of whether these measures are carried out before or after the vessel has “arrived” at the yard, time lost thereby shall be allocated or apportioned according to Cl. 16-10. Cl. 16-12 will then only come into play from the time when repairs are actually commenced. Cl. 16-12, sub-clause 4 first sentence also refers to “the time the work started”. The next sentence may seem confusing reading: “Unless the circumstances clearly indicate another point in time, all categories of work shall be deemed to have started on the ship’s arrival at the yard.” However, even if the vessel have “arrived” at the yard, any waiting time to begin repairs must be allocated or apportioned according Cl. 16-10 and shall not be shared equally according Cl. 16-12.

Casualties occurring while the vessel is en route to the repair yard or unknown damage discovered while the vessel is at the repair yard will not affect the allocation of the removal time to any particular category of work.  The situation existing at the time the removal commenced will be decisive.

Where the ship goes to a repair yard without it being possible to conclude that one particular category of work has necessitated the removal, the most natural solution is to apply the apportionment rule in sub-clause 2 of Cl. 16-10.

Where removal to the repair yard is made necessary by more than one category of work, sub-clause 2 of Cl. 16-10 provides that the apportionment shall be made on a pro rata basis according to the time that each class of work would have taken if carried out separately. This method of apportionment is different from what applies in the case of simultaneous repairs, see 7.4.1 below.  That rule provides for equal apportionment, whilst in sub-clause 2 of Cl. 16-10 the apportionment is pro rata to the time needed for each separate repair. The pro rata method was also applied under Cl. 8, No. 4 of the previous conditions. The pro rata method of apportionment provides a reasonable and balanced solution where removal to a repair yard is made necessary by more than one category of work. The apportionment rule in Cl. 16-10, sub-clause 2 has been applied in cases of deferred repairs of casualty damage where the class has approved that these repairs may be carried out simultaneously with the next ordinary docking. Then the removal to the docking yard is necessitated both by the deferred casualty repairs and the ordinary docking and other work necessary to satisfy the requirements of the class.

It has been discussed whether apportionment according to Cl. 16-10, sub-clause 2 will apply if the class has not imposed a Condition of Class that casualty repairs must be carried out not later than at the next docking. If not, the assured has an option to defer repairs to a later stage. All the same, if the assured avail himself of the opportunity to carry out casualty repairs at the first docking after the casualty occurred, in the writer’s opinion apportionment according to Cl. 16-10, sub-clause 2 should apply.  The same goes for non-classed items such as cranes. If the crane is out of operation due to damage or wear and the assured postpone repairs to a convenient time when the vessel for other reasons is taken out of service, apportionment according to Cl. 16-10, sub-clause 2 is in the writer’s opinion appropriate.

An example will illustrate the difference between the two apportionment methods:

A ship uses 10 days to move to a repair yard where casualty repairs and owner's work are carried out for 80 and 20 days respectively. If the equal apportionment method in Cl. 16-12 had been applied, half of the removal time, i.e. 5 days, would have been allocated to each of the two categories of work.  Under the pro rata apportionment rule of Cl. 16-10 sub-clause 2 ,  80/100 of the removal time, i.e. 8 days, is allocated to the casualty work and 20/100, i.e. 2 days, to the owner's work.

The second sentence of sub-clause 2 states that removal time occurring during the deductible period shall not be apportioned. Where the deductible period has not been exhausted, it is considered to be unreasonable to make the assured bear a portion of the removal time. This means that the deductible period runs in the ordinary way, each day counting in full during the removal time even in cases where the time is in principle to be apportioned.  The common removal time during the deductible period has to be disregarded.  Apportionment is not to be applied until the deductible period is over. If the agreed deductible period in the above example had been 14 days, no removal time would have been apportioned. If the agreed deductible period had been 7 days, only 3 days would have been apportioned, on a pro rata basis.

Sub-clause 3 of Cl. 16-10 extends the rules in the first and second sub-clauses to time lost during surveys, see 7.1.3 above, obtaining tenders, see 7.2.5 above, tank cleaning, waiting to commence repairs and to "other similar measures which were necessary in order to carry out the repairs."  Even if the removal to the repair yard is to be attributed to damage repairs covered by the insurer, it may be that it is the owner's work that necessitates, for instance, tank cleaning (classification works in dirty tanks not affected by the damage).  Time lost for tank cleaning will then be for the assured's account.



[20] The 2003 Commentary to Cl. 16-10 expressly states that Cl. 16-10 is unamended, which is not formally correct because the previous second sentence of sub-clause 1 reading “The same applies to time lost after completion of repairs to the extent that such time is covered under Cl. 16-13.” was in 2003 moved to Cl. 16-13 for editorial reasons.