Too late to dive

A marine surveyor was engaged to inspect the loading and securing of a yacht being transported as cargo aboard a heavy-lift ship on an international voyage. Following the survey, the surveyor issued a certificate confirming that the lashings and fastenings were satisfactory, while also noting a number of ongoing requirements, including regular inspections and tightening of the lashings during the voyage and the avoidance of severe weather where possible.

During the passage, the ship encountered heavy weather and the yacht being carried on deck was lost overboard. Cargo insurers subsequently pursued a claim against the surveyor, alleging that the securing arrangements had been inadequate. The potential exposure exceeded US$5m.

The claim was first presented nearly six years after the incident. ITIC assisted the surveyor in denying liability and defending the claim. Although the cargo insurers were granted an initial extension of time, they failed to commence proceedings before the applicable limitation period expired. They later attempted to pursue the matter in another jurisdiction with a longer limitation period, but proceedings were commenced after that time limit had also passed. The courts ultimately upheld the surveyor’s time-bar defence, bringing the matter to an end.

ITIC funded defence costs of approximately US$200,000, helping the surveyor avoid a substantial liability claim.

Even where a claim appears significant, limitation periods can provide an important defence. Surveyors should retain records, certificates, and correspondence for extended periods, as claims may emerge many years after the original survey.