The Suez Canal Authority yesterday formally arrested the Ever Given.
An Egyptian judge granted permission for the SCA to seize the vessel after it lodged a $916m compensation claim against its Japanese vessel owner, Shoe Kisen.
The SCA says it intends to maintain the vessel’s arrest until the ...
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Comment on this article
Alex Lennane
April 14, 2021 at 2:47 pmFrom:
Jose Guerrero
Virtual Claims Services, Inc.
Arresting the “Ever Given” and not releasing the vessel until the money is paid sounds like a hostage situation.
The maritime industry has a long tradition that when a vessel is arrested, the vessel’s insurer will issue a letter of undertaking, which promises to pay up to its policy limit the court’s judgment or the agreed settlement. I understand that there is USD 2.2 billion in total P&I insurance. After the acceptance of the LOU, the vessel is released to continue its voyage. Skuld’s webpage talked about LOU:
LOUs are, in effect, a form of guarantee issued by the Club – an undertaking to pay to the claimant the sum adjudged by a court to be due to them, or the sum agreed under settlement terms. This is a private security contract between the parties, and the court is not involved in the process of setting the terms of the undertaking, which are negotiated between the Club on the one hand and the other party (whether that be a contractual party, a third party or another club or insurer) on the other. This is an important point, as only the Club, and not the assured, agents, representatives or the Club’s local correspondents, have the authority to issue an LOU.