The word average, as a technical term used in the shipping trade, was formerly employed in many different senses.
In present practice, average means damage arising from the perils of the sea, including all losses, deterioration, or extraordinary outlay incurred during a voyage, either by a vessel or her cargo, provided such losses, deterioration or outlay be caused by the dangers and accidents of navigation.
Proof of Average.-
The average suffered at sea, either by a ship or by her cargo, is proved by the account of the accident duly recorded in the ship’s log book, and principally by the captain’s protest, which he is bound to make before the appointed authority, within twenty-four hours after his arrival at any port after the accident.
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The protest is a detailed statement of the facts that led to the loss or damage during the passage. The captain has to declare that such loss or damage was not imputable to any fault of the vessel or of her master and crew, but to the bad weather, winds, waves, currents, etc., against which the document usually ends by protesting. Hence the name of protest.
Owing to the short time allowed by law, it is customary for captains to note always on arrival, and afterwards, if required, to extend their protest.
Noting a protest means to present a declaration of protesty whose intended purpose is to cover the ship owner’s responsibility against any possible claim for damages suffered by the cargo during the voyage.
Should any such claim be presented by the receivers, the protest is extended, viz., a new document with full particulars of the case is added to the protest\ formerly drawn up in general terms.
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Distinction in Average.-
Average may be either general or particular.
General average is the loss, damage, or expenses suffered by any of the interested parties for the sake of common safety.
Particular average is the loss, damage, deterioration or expenses incurred by any of the interested parties in consequence of sea perils, but independently of the common safety.
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General Average.-
The principal cases of general average are-
(a) Goods or ship’s tackle and furniture intentionally jettisoned or in any other way sacrificed to lighten the vessel in case of impending danger, or to get her afloat if stranded or grounded.
(b) Money paid to any person or persons for assistance given to the ship in distress.
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(c) Expenses incurred for ship’s urgent and temporary repairs necessary to enable her to proceed on her voyage, such as stopping a leak, replacing a broken mast, etc.
(d) The premium and other charges to be defrayed for the loan of money necessary for such repairs.
In fact, any loss or damage suffered by the ship or cargo for the common safety of the ship, the freight, and the cargo.
Particular Average.-
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As to particular average, no special case need be stated, since any loss, damage, or depreciation not arising from general average .will fall under that head, provided it is caused by acts incidental to navigation, and not by simple wear and tear, or by such deterioration as some commodities are liable to, independently of sea risk, as for instance, the heating of grain, the rotting of fruit or fish, and the like.
Sufferers by Average.-
The leading feature of general average being that the loss, damage or outlay must have been suffered by one or more of the parties concerned, for the sake of the common safety; it is but right that each and all of the said parties should contribute towards covering the loss.
Thus the amount of damage arising from general average is to be divided among the owner of the ship, the contractor of the freight (who may be either the ship-owner himself or another person), and the merchant owning the cargo, in due proportion to the value of their respective property as found at the time and place where the adjustment takes place.
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Particular average, on the contrary, is to be borne wholly by the party on whose property the loss 01 damage has fallen.
Statement of Average.-
The valuation of damage incurred by a ship or cargo, and the consequent assessment of the respective proportional share on each of the parties concerned in a general average, are made at the port where ship and cargo part company, or at the first port the vessel puts into in distress, even if short of her destination.
The charge of such valuation and assessment devolves on the legally-appointed representatives of the parties concerned, and, in default, either on the Consul of the nation to which the vessel belongs, or on the local authorities.
The persons usually employed for the purpose are two surveyors and an average stater or adjuster. The former are to estimate the amount of damage and to appraise the ship and cargo; the latter is to decide whether the average is general or particular, fixing, in the former case, the proportional share of damage to be borne by each of the parties concerned.
To this end he draws up a document called an average statement, showing the amount of losses, the value of the articles to contribute, and the share of contribution due by each of the parties concerned. In the case of a particular average, the statement shows only the particulars and the amount of the damage suffered.
Such operations are usually carried out according to the laws of the country wherein the port is situated. There are, however, certain ways of ascertaining both the amount of damage and the value of the ship, freight and cargo, as contributors to a general average, which, being widely adopted, deserve particular remark.