Text of Maritime Risk article - 23rd March 2005

Resolving deadlocks in difficult jurisdictions:

Ship operators sometimes face operational and other deadlocks in jurisdictions where effective law and legal process are uncertain. In this article Peter Astbury at Astbury Marine Services discusses the problem and offers some ideas.

 

Deadlocks in this type of jurisdiction typically have one or more of the following features: 

• The parties are unable to produce new initiatives. The ship remains detained, financial losses escalate and the position of the ship’s crew deteriorates.
• Bank and P&I Club guarantees and escrow accounts are unenforceable and hence unacceptable to claimants.
• The parties have little knowledge of each other and trust is in short supply.
• Suspicion, even paranoia escalates. The triggers can be various:

-         lack of information translating into inadequate understanding of the other
      side’s intentions and constraints  

-         cultural barriers.

-         innocent misunderstandings, mistranslations etc. 

-        perceived sharp practice.  

-         insistence on measures that claimants do not properly understand or  which have no local resonance.  

Often the ‘killer trigger’ for any breakdown in communication and trust is hard or even impossible for the ship operator to fathom from a distance. .

A new dynamic is required to break the deadlock

The ship operator or his attorney or P&I Club may decide to attend on site and meet the claimant in person. Sometimes, this will make all the difference, but not always.  

• The ship operator loses distance between himself and the claimant. Potentially critical decisions may be forced on the spot. Every word, look or gesture will have a bearing on the claimant’s perception of his goodwill and intention.
• The ship operator’s attorney may provoke further suspicion simply by virtue of the fact that he is an attorney.
• In extreme cases there is a risk that the ship operator or his attorney or P&I Club representative may also be detained and become part of the problem. 
• If the ship operator’s attendance is unsuccessful then his position and his further options are diminished.

 Another alternative in extreme cases is to attempt to bring pressure to bear through diplomatic channels. However diplomatic intervention is a double edged sword. If it works it works, but if it does not then it is likely to antagonise the claimant and raise the temperature still further. Moreover, it can only work if the government on which the pressure is applied is willing and able to respond to it.  Often it will not, especially if the claimant is a powerful local figure in his own right. 

If the claimant is such a person then, in order to re-assert his position in the eyes of his peers, he may be tempted to respond in an even more robust, aggressive and intransigent fashion.

An alternative approach for the ship operator in extremis is to use the services of a third party facilitator or ‘mediator’ to engage face-to-face with local parties on the ground

This is not mediation in the formal sense. The facilitator will be appointed by the ship owner and will report to him. The ship operator  will always retain control over his negotiation.

However, in an informal sense, the process at this stage becomes something similar to formal mediation since a deadlock will remain a deadlock unless a way can be found to address the legitimate concerns of both sides.

Why should this approach break the ice?

• The facilitator doesn’t carry any baggage from earlier exchanges. His brief allows him to act in a more inclusive manner and to promote the positives.
• He may have more freedom of expression and action than the local agent or P&I correspondent since the latter have to live in the location and be more sensitive to local political and social considerations.
• Claimants do not make demands for the thrill of the process. They have specific objectives in mind and clear incentives to give ear to persons tasked with a process that might bring this closer. Sometimes even their expectations soften when the prospect of progress is around the corner.
• The process or ‘mediation’ at this late stage requires the facilitator to get inside and understand the concerns and situation of both parties. Hence if issues of ‘face’ have become part of the deadlock, then these issues are addressed as a matter of course.

Even if the facilitator is unsuccessful, the ship operator has lost nothing and his powder remains dry. The exercise will have delivered new insights and his other options - including the option to travel himself - remain open.  

In order to succeed, the successful facilitator must be able to command the trust of the ship operator and win the trust of the claimant.  He must be at home in his environment. 

Astbury Marine Services has its roots in the ship broking and P&I industries. It was established in London in 2004 and has acted successfully in some of the worlds least accessible locations including Iraq and Somalia. It can be contacted at http://www.astburymarine.com or by email at peter@astburymarine.com

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