General Average

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Definition of general average and it's attributes.

The law of general average is a legal principle of maritime law according to which all parties in a sea venture proportionally share any losses resulting from a voluntary sacrifice of part of the ship or cargo to save the whole in an emergency.

General average is the partial expense that is incurred as a result of the actions taking for saving the whole maritime venture. It is therefore the damage resulting from the voluntary surrender of part of vessel or cargo and security expenses.

In case all taken measures are successful, all expenses are covered proportionally by all parties of maritime venture including parties whose interests were affected the most. The general average is distributed between the vessel, freight and cargo based on the cost thereof.

General average may only be declared if all the below attributes are present:

• A common danger: a danger in which vessel, cargo and crew all participate; a danger imminent and apparently 'inevitable', except by voluntarily incurring the loss of a portion of the whole to save the remainder;
• seriousness and actuality;
• voluntarily character of the expenses and sacrifices;
• the expense should be incurred as a result of voluntary actions and not due to random reasons;
• rational character of the expenses and sacrifices, the expenses should be justified by the developed situation. The minor expenses should prevent greater losses;
• emergency character of the expenses and sacrifices.

The common cases of general average:

• jettison of cargo or vessel's equipment;
• firefighting on board of the vessel;
• voluntary grounding of the vessel;
• salvage expenses;
• call at the port of refuge;
• damage to engines and boilers.

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