IS AMICABLE NEGOTIATION OR ARBITRAL RECOVERY ACTION A WISE DECISION FOR THE SUBROGATED INSURER?

The amicable recovery and the arbitral recovery are extrajudicial remedies. In either case, everything begins with the delivery of reserves but also the claim notification. The latter is motivated by the survey report and to make the debate more coherent, subrogated insurer is required to bring back all the documents provided by his insured that will ease the negotiations so that he returns in his right; which is the reimbursement of the amount he has paid as payment of the indemnity to his insured.

The amicable recovery is characterized by the negotiation between the litigants.

1. In case of uninsured cargo, the parties here are: the shipper or consignee and the carrier or the liable third party, or;
2. In case the cargo was been insured and the marine cargo underwriter indemnified his insured being the consignee or shipper, this underwriter will subrogate the rights to claim of the latter and go against the carrier and / or third parties responsible for the damage.

The situation in this type of claim is that the parties involved generally decide to conduct negotiations. The representatives of the parties may be either their law firms or recovery companies (for insurers) and global claims hub (for sea companies).

The advantage of recovery by amicable means is that they do not engender loss of huge sums of money as in endless and costly lawsuits and considerably reduces the length of debates. As far as debates are concerned, the party responsible for the damage and who does not want to compensate, nor pay for the loss generally pushes the debates and prolongs the discussions in order to save time and reach the prescription date of the action. This trick is observed both in the amicable appeal and in the arbitration appeal.

The settlement of disputes arising from transport relations through arbitration is old. The Great Ordinance of Marine of August 1681 (also called the Marine code) established arbitration as a natural way of resolving maritime disputes. Since then, this mode has continued to grow. Thus, all arbitration chambers dealing with international trading may examine questions of carriage of goods by sea law. Maritime arbitration is very common in the field of transport. The use of compromise clauses is quite common in the field. In the international transport of goods, there is an applicable convention to each mode of transport; and the conventions on the maritime transport of goods expressly provide for arbitration. And for others, in the absence of rules, arbitration is based on common law: in particular, the convention of 25 August 1924 on the Unification of Certain Rules of Law relating on the Bills of Lading.

Nevertheless, article 22 of the Hamburg Rules governs and regulates the arbitration in the context of a maritime merchandise dispute. And this, by providing that the parties may provide by a written agreement that any dispute related to the contract of carriage of goods by sea under the said contract will be settled by an arbitration. It is a means of claim which is at the choice of the plaintiff to be done in the jurisdiction of the state where the debtor’s principal place of business or habitual residence is found, the place of conclusion of the contract, provided that the defendant has a representation or intermediary agency found there at the conclusion of a contract of carriage; the port of loading or unloading or any other place designated for that purpose in the compromise clause.

The Rotterdam Convention, which has not yet entered into force, stands out from that of Brussels, of which it looks like a copy paste in the jurisdiction rules. Indeed, the latest law of maritime law also militates in favor of an arbitral appeal as a mode of settlement of a dispute born at the end of a transport operation. And thus, according to article 66 and 67 of the Rotterdam text, the party who suffered the damage is entitled to take legal action against the shipping carrier in a judicial competent court of place where the sea carrier is domiciled or the port where the carrier receives the goods, the port where they are delivered or the port where the carrier carries out his operations concerning the goods. It is worth noting that the parties may by mutual agreement decide on the jurisdiction before which the case will be submitted in the event of a dispute.

It has thus been found that the Rotterdam rules reserve a whole chapter (i.e. articles 15 to 75) for arbitration. The parties may agree to settle their disputes by arbitration. All the actions resulting from the contract of maritime transport, are brought before the competent jurisdictions according to the rules of the common law. This suggests that just as in the 1924 rules each party may by mutual agreement decide the arbitral or jurisdictional recovery to be adopted. In short, even under the banner of CEMAC maritime law, the parties can choose to settle the dispute arising from the transport operation by litigation. Territorial jurisdiction here being the same in all conventions.

Insofar as the arbitral and or amicable recovery does not prosper, the subrogated insurer is obliged to appeal to the judicial judge so as to protect the prescription period of the action until the amount of the indemnity he has paid to his insured is reimbursed.