F1060-R

FOURTH ANNUAL

2009

LAWASIA MOOT COMPETITION

IN THE INTERNATIONAL ARBITRATION CENTER AT HO CHI MINH CITY

GOVERNMENT OF ROLGA

RESPONDENT

In response to:

BENEVOLENT HERITAGE INCORPORATED

CLAIMANT

MEMORIAL FOR RESPONDENT

2

TABLE OF CONTENTS

INDEX OF AUTHORITIES ...................................................................................................... 5

STATEMENT OF JURISDICTION .......................................................................................... 9

QUESTIONS PRESENTED .................................................................................................... 10

STATEMENT OF FACTS ....................................................................................................... 11

SUMMARY OF PLEADINGS ................................................................................................. 14

PLEADINGS ............................................................................................................................ 17

I. HERITAGE INC. WAS ENTITLED TO CONTRACT SALVAGE RIGHTS

RATHER THAN PURE SALVAGE RIGHTS................................................................... 17

A. The element of voluntariness is not established, and as a result, the Heritage Inc. was

not entitled to pure salvage. ............................................................................................ 17

B. Heritage Inc. is entitled to contract salvage rights. .................................................. 19

II. RATIFYING THE 2001 UNESCO CONVENTION BY ROLGA DOES NOT

INTERFERE WITH SALVAGE RIGHTS AND PERFORMANCE OF HERITAGE

INC. 22

B. 2001 UNESCO Convention does not violate the salvage rights of Heritage Inc.

under the 1995 Partnering Agreement. ........................................................................... 22

3

a. The salvage operation under 1995 Partnering Agreement is authorized by a

competent authority: .............................................................................................. 22

b. There is no contradiction between the salvage operation under the 1995

Partnering Agreement and 2001 UNESCO Convention, especially in the relation

with the issue of commercial exploitation. .............................................................. 23

c. Maximum protection of underwater cultural heritage is guaranteed.............. 24

d. In any event, the 2001 UNESCO Convention does not affect the Rolga’s prior

agreements. ............................................................................................................ 25

III. AGREEMENT ON “PROTECTION OF WRECK” BETWEEN THE

GOVERNMENT OF ROLGA AND THE GOVERNMENT OF ASTORIA DOES NOT

VIOLATE RIGHTS OF HERITAGE INC. ....................................................................... 26

A. The recognition of continuing cultural and historical rights of Astoria over the Coeur

de l‟Ocean does not violate the salvage rights and performance of Heritage Inc: ............ 26

B. The disposition of collections by Astoria and Rolga does not affect the rights of

Heritage Inc. to a fixed compensation. ............................................................................ 27

IV. ROLGA HAS THE RIGHT TO ALLOW AQUATIC VIEW TO OPERATE

TOUR AND TO PHOTOGRAPH COEUR DE L’ OCEAN SHIPWRECK. .................... 29

V. HERITAGE INC. IS NOT ENTITLED TO THE EXCLUSIVE RIGHT OF

PHOTOGRAPHING AND DOCUMENTING................................................................... 30

A. Salvage law does not accord Heritage Inc. the exclusive right of photographing and

documenting Coeur de l‟ Ocean. .................................................................................... 30

4

B. Heritage Inc. has not been granted to exclusive rights of photographing and

documenting the Coeur de l‟ Ocean. ............................................................................... 30

C. In any event, the Heritage Inc. is not entitled to exclusive rights of photographing

and documenting the Coeur de l‟ Ocean. ........................................................................ 31

a. Government of Rolga will suffer greater harm if Heritage Inc. is entitled to

exclusive rights. ..................................................................................................... 32

b. Public interest does not support the claim of Heritage Inc............................. 33

D. Even if Heritage Inc. was granted the injunctive relief was entitled, it does not

establish an exclusive right since it does not have the right to exclusive possession. ....... 33

VI. THE DISTRIBUTION OF ARTIFACTS SOLELY ON THE BASIS OF

SALVAGE LEGAL PRINCIPLES WAS NOT ENVISAGED BY THE 1995

PARTNERING AGREEMENT MEMORANDUM. .......................................................... 36

A. The basis of salvage legal principles will not be applied on the distribution of

artifacts. ......................................................................................................................... 36

B. The full effect of the salvage contract between the Government of Rolga and

Heritage Inc. .................................................................................................................. 38

a. The salvage contract is still effective since it is not affected by other factors. 38

b. The contract should be applied as the matter of the first priority. .................. 41

VII. PRAYER FOR RELIEF. ..................................................................................... 43

5

INDEX OF AUTHORITIES

UNITED NATIONS RESOLUTIONS AND DOCUMENTS

1969 Vienna Convention on the Law of Treaties .................................................................. 22

1989 International Convention on Salvage .......................................................... 30, 34, 38, 39

Strati, Draft Convention on the Protection of Underwater Cultural Heritage: Commentary,

UNESCO Doc CLT-99/WS/8 (drafted April 1999) 97 („Commentary‟)............................. 27

The 2001 UNESCO Convention on the Protection of Cultural Heritage ......................... passim

CASES AND LAWS

Aircraft Recovery, L.L.C., v. Abandoned Aircraft, 54 F.Supp.2d 1172, 1179 (1999) .............. 17

Atlantis Marine Towing, Inc. v. M/V "Elizabeth," 346 F.Supp.2d 1266 (S.D.Fla.2004) ......... 37

B.V. Bureau Wijsmuller v. United States, 702 F.2d 333 (2d Cir. 1983) .................................. 18

Biscayne Towing & Salvage, Inc. v. Kilo Alfa ....................................................................... 42

Biscayne Towing & Salvage, Inc. v. Kilo Alfa, Ltd., No. 02-22644, 2004 WL 3310573

(S.D.Fla. September 30, 2004) .......................................................................................... 18

BLACKWALL, 77 U.S. (10 Wall.) 1, 13-14, 19 L.Ed. 870 (1869) .......................................... 37

Blackwelder Furniture Co. v. Seilig Mfg. Co., 550 F.2d 189 (4th Cir. 1977) ......................... 31

Direx Israel Ltd v. Breakthrough Medical Corporation, 952 F.2d 802, 812 .......................... 31

Emblem, 8 F.Cas. 611, 614 (D.Me.1840) .............................................................................. 34

Fine v. Rockwood, 895 F.Supp. 306 (S.D.Fla.1995) .............................................................. 36

Florida Department of State v. Treasure Salvors, Inc., 458 U.S. 670 (1982) ......................... 28

Hener v United States, 525 F Supp 350, 364-365 (S.D.N.Y. 1981) ....................................... 26

6

In re Complaint of The City of New York, as Owner and Operator of M/V ANDREW J.

BARBERI, 534 F. Supp. 2d 370 (E.D.N.Y. 2008) .............................................................. 18

Jones v. Sea Tow Services Freeport NY Inc., 30 F.3d 360 (2d Cir. 1994) ........................ 17, 18

L.J. By and Through Darr v. Massinga, 838 F.2d 118 (4th Cir.1988) .................................... 32

MDM Salvage, Inc., v. Unidentified, Wrecked and Abandoned Sailing Vessel, 1987 AMC 537,

631 F.Supp 308 (S.D. Fla. 1986) ....................................................................................... 31

New Bedford Rescue Marine Inc. v. Cape Jewelers Inc., 240 F.Supp.2d 101 (D.Mass.2003). 42

Noah's Ark v. Bentley & Felton Corp., 292 F.2d 437 (5th Cir. 1961) ..................................... 40

Osal Marine Services, Inc. v. M/V PANASEA, 1993, AMC 1930, 1932 (W.D. Wash. 1992) .. 37

R.M.S Titanic, Inc., v. The Wrecked and Abandoned Vessel, 9 F.Supp.2d 624 (1998) 29, 31, 32

R.M.S. Titanic, Inc., v. Christopher Haver, Deep Ocean Expeditions, 171 F.3d 943, 1999

A.M.C. 1330 (4th Circuit 1999) ................................................................................... 30, 34

R.M.S. Titanic, Inc., v. Wrecked and Abandoned Vessel, 286 F.3d 194 C.A.4.Va. (2002) ...... 34

Sobonis v. Steam Tanker NATIONAL DEFENDER, 298 F. Supp. 631 (S.D.N.Y. 1969) ........ 37

Southern Most Marine Services, Inc. v. One (1) 2000 Fifty Four Foot (54') Sea Ray named

M/V "Potential," 250 F.Supp.2d 1367 (S.D.Fla.2003) ....................................................... 37

The CAMANCHE, 75 US (8 Wall) 448 (1869) ................................................................ 20, 26

The Elfrida, 172 US 186 ....................................................................................................... 20

The Neshaminy, 228 F. 285, 288-89 (3d Cir.1915) ................................................................ 36

The SABINE, 101 U.S. 384 (1879) ........................................................................................ 18

Treasure Salvors, Inc., v. Unidentified Wrecked & Abandoned Sailing Vessel, 640 F.2d 560,

1981 A.M.C 1857 (5th Cir. 1981) ................................................................................ 28, 29

7

Treasure Salvors. Inc. v. The Unidentified, Wrecked & Abandoned Sailing Vessel, 556

F.Supp. 1319, 1340 (S.D.Fla.1983) ................................................................................... 37

Triplecheck, Inc. v. Creole Yacht Charters Limited, No. 05-21182 CIV, 2007 WL 917276

(S.D. Fla. Mar 25, 2007) ................................................................................................... 18

Weeks Marine, Inc., v. Cargo of Scrap Metal Ladened Aboard Sunken Barge Cape Race, 571

F.Supp.2d 334, 2008 A.M.C. 2602 .................................................................................... 31

Yukon Recovery, L.L.C., v. Certain Abandoned Property, 205 F.3d 1189, 1190 (1999) ... 26, 27

TREATISES AND OTHER BOOKS

MJ Norris, 3A Benedict on Admiralty, (7th ed. 1983 & Supp. 1986) ..................................... 20

Roberta Garabello and Tulio Scovazzi, The Protection of the Underwater Cultural Heritage:

Before and After the 2001 UNESCO Convention (Kluwer, 2004) 10 ................................. 22

JOURNAL ARTICLES AND ESSAYS

Andrew Anderson, Salvage and Recreational Vessels: Modern Concepts and Misconceptions,

1993, USF Maritime Law Journal, Vol 6 No 1, page 219 ............................................ 19, 20

Jeffrey W. Yeats, Clearing Up the Confusion: A Strict Standard of Abandonment For Sunken

Public Vessels, University of San Francisco Maritime Law Journal, 1999- 2000 ............... 17

MISCELLANIOUS MATERIALS

1988 Copyright, Designs and Patent Act by United Kingdom ............................................... 34

Andrew Anderson, Salvage and Recreational vessels: Modern concepts and misconceptions,

USF Maritime Law Journal, Vol 6 No 1, page 221 (1993) ................................................. 40

8

David E. Irwin, Salvage, contract or common law, Dec 5th

2008,

http://southfloridaadmiraltylaw.com/salvage-contract-or-common-law. (last visited Aug.

20, 2009) ........................................................................................................................... 37

Newell D. Smith, The Law of Salvage (February 5th 1994),

http://www.mikkelborg.com/files/salvage.pdf (last visited Aug. 20, 2009); ......................... 17

9

STATEMENT OF JURISDICTION

Both the Benevolent Heritage Inc. and the Government of Rolga have agreed to

submit the disputes concerning rights and obligations arising from the contract of the parties to

the International Arbitration Center for resolution. The acceptance of Arbitration authority is in

accordance with the Rules of Arbitration of the Kuala Lumpur Regional Center for Arbitration in

Part I, Rule 1(1), and pursuant to Clause 10 in the 1995 Partnering Agreement Memorandum

between the Government of Rolga and the Heritage Inc. (September 27th 1995).

The Arbitral Tribunal is requested to give solutions on the basis of the rules and

principles of conventions to which the Government of Rolga is a State Party, as well as

applicable rules of national law.

The Arbitral Tribunal is also requested to clarify the rights and obligations of

parties, which are relevant to disputes, arisen from the award on the questions presented.

The parties agree, pursuant to the Rules of Arbitration of the Kuala Lumpur

Regional Center for Arbitration in Part I, Rule 6(1) and Clause 10 in the 1995 Partnering

Agreement Memorandum that the award of the Arbitral Tribunal shall be final and binding on

the parties involved.

10

QUESTIONS PRESENTED

1. Whether the Heritage Inc. was entitled to contract salvage rights under the 1995

Partnering Agreement Memorandum.

2. Whether the 2003 Agreement signed between Rolga and Astoria has interfered with the

salvage rights and performance of Benevolent Heritage Inc.

3. Whether the ratification of the 2001 UNESCO Convention of Rolga has interfered with

the salvage rights and performance of Benevolent Heritage Inc.

4. Whether the allowing of tour operators to organize wreck diving and photographing to

the site has interfered with the salvage rights and performance of Benevolent Heritage

Inc.

5. Whether Benevolent Heritage Inc. has exclusive rights of taking photograph and

document of Coeur de l‟ Ocean.

6. Whether the distribution of artifacts between the Parties to be made solely on the basis of

salvage legal principles was envisaged by the 1995 Partnering Agreement Memorandum.

11

STATEMENT OF FACTS

Astoria, traditionally, was considered to be a colonial empire of the West during the

Seventeenth Century. One of the most notable expeditions was the journey of the Coeur de

l‟Ocean led by Captain Van Cleef in 1800 to conquer the ancient trading city of Zamzala (now

part of the State of Rolga), laden with many invaded riches taken from this city stacked on the

ship. Unfortunately, Coeur de l‟Ocean sank and carried valuable commercial goods and war

booty, went down underwater.

In the 1980s, along with the advanced development of underwater scientific

technology, the illustrious trading history of Zamzala and its sunken warships in Rolga territory

have lured treasure hunters into the area. Wrecks become the targets of rampant illegal treasure

hunting activities.

In 1990, an Astorian, Mr. Bernard Bodd, a major shareholder of Benevolent

Heritage Inc. [hereinafter „the Heritage Inc.‟] proposed the Rolga Cultural Heritage Committee

for recovering significant historical wrecks belonging to the era of expansion of Astorian

presence in the region. The proposal received the attention of the Rolgan Government as it

involved the Coeur de l‟Ocean.

After extensive research, Heritage Inc. discovered the actual claimed-to-be Coeur

de l‟Ocean wreck‟s location. In order to convince the relevant authority, some “rare items” were

recovered from the wreck. Heritage Inc.‟s efforts were paid back, since the Rolgan Government

eventually approved the project and signed “Partnering Agreement Memorandum” on 27th

September 1995. [hereinafter „the 1995 Agreement‟]

12

Today, many of the artifacts have been recovered from the wreck Coeur de l‟Ocean

but the whole collection has not yet been fully revealed. Some parts of the artifacts‟ collection

have been auctioned off to partly finance the cost of the project. The rest of the collection was

showcased through a maritime exhibition within the National Museum by Rolga government in

2000.

In the wave of international legal development on protecting underwater cultural

heritage, in the same year, Rolgan government strengthened its cultural heritage appreciation as

“symbol of nationhood” and introduced the new economic plan with promises of more

governmental efforts in their duty of protecting and preserving the heritage. In late 2000, a new

law in protecting wrecks of historical and cultural significance in Rolga was passed.

In 2001, Rolga adopted the Convention on the protection of the Underwater

Cultural Heritage [hereinafter the „2001 UNESCO Convention‟]. Rolga also entered into an

Agreement with Astoria [hereinafter the „Protections of Wrecks Agreement‟] to encourage the

better protection between the two countries. However, Rolga did not inform Astoria about the

existing commercial Agreement with Heritage Inc. when it entered into the Agreement with

Astoria. The agreement stated that Astoria transfers all its right, title and interest in and to

wrecked ancient vessels of the Astoria lying on or off the coast of Rolga and in and to any

articles thereof to Rolga.

On the other hand, Astoria has a continuing interest, particularly for historical and

other cultural purposes, in articles recovered from any of the vessels referred to in the Agreement

(together with the “Guiding Principles” for the determination of the disposition of materials from

shipwrecks of Astoria off the coast of Rolga). Nevertheless, Astoria has not made any claims to

cargo or in advanced any claim to rights in the cargo of the Coeur de l‟Ocean.

13

Public concerns on protecting heritage arose because the government was believed

to get involved in the “commercial exploitation” of some parts of the artifacts recovered from the

Coeur de l‟ Ocean and some parts of the artifacts were destroyed due to poor-handling.

Furthermore, the Rolgan government permitted a specialized tour operator Aquatic

View to organize exclusive underwater trips to the Coeur de l‟ Ocean wreck. According to

Heritage Inc., the Rolga‟s activities, including selling tickets, CDs, making video clips, taking

photographs, jeopardized their ongoing television documentary deal with an International

Broadcasting Company.

Those developments and public concerns prompted Heritage Inc. to worry that their

performance was jeopardized. Heritage Inc. took steps at finalizing the distribution of recovered

artifacts, but Heritage Inc. accused Rolga of unfair distribution.

Based on article 10 of 1995 Agreement, the dispute is brought before the

International Arbitration Center.

14

SUMMARY OF PLEADINGS

HERITAGE INC. WAS ENTITLED TO CONTRACT SALVAGE RIGHTS UNDER 1995

PARTNERING AGREEMENT.

Heritage Inc. failed to demonstrate the “voluntariness”, one of three elements

making up the pure salvage, since they had conducted the salvage operation under an obligation

arisen from the contract with Rolga. The contract, therefore, binds the salvor to receive

compensation as contractually agreed and entitles Heritage Inc. to contract salvage.

RATIFICATION OF 2001 UNESCO CONVENTION DOES NOT INTERFERE WITH

SALVAGE RIGHTS OF HERITAGE INC.

Rolga has the right to ratify any treaties with other countries as an exercise of its

sovereignty. The salvage operation of Heritage Inc. is in conformity with 2001 UNESCO

Convention since it is authorized by the competent Government of Rolga, is free of commercial

exploitation purpose and helps to protect the Coeur de l'Ocean in the best way. Moreover, the

non-retroactive principle of the 2001 UNESCO Convention precludes the possibility of Rolga

interfering with Heritage Inc. salvage rights under the 1995 Partnering Agreement.

THE “PROTECTION OF THE WRECKS” AGREEMENT DOES NOT VIOLATE THE

RIGHTS OF HERITAGE INC.

The categorical differences of Heritage Inc. salvage rights and Astorian interests

preclude the violation of the salvor‟s rights under the 1995 Partnering Agreement.

15

The fixed salvage compensation based on “no cure, no pay” contract can only be

happened after the successful excavation and does not invade the rights of agreed compensation

of Heritage Inc. as envisaged in 1995 Partnering Agreement.

ROLGA HAS THE RIGHT TO ALLOW AQUATIC VIEW TO OPERATE TOURS AND

PHOTOGRAPH THE COEUR DE L’OCEAN.

The Heritage Inc. failed to demonstrate any record of an injunctive relief issued by

an authorized Court which aims to establish rights to exclude others from operating tour,

documenting and photographing the shipwreck, and by nowhere near of obtaining it.

Accordingly, Rolga does not violate the Heritage Inc. non-exclusive rights.

HERITAGE INC. WAS NOT ENTITLED TO EXCLUSIVE RIGHTS OF

PHOTOGRAPHING AND DOCUMENTING.

Firstly, the law of salvage does not automatically accord Heritage Inc. the exclusive

rights of photographing and documenting.

Secondly, Heritage Inc. was not granted any injunctive relief to establish exclusive

rights of documenting and photographing.

Thirdly, the injunctive relief shall not be issued for the Heritage Inc. since the

Claimant failed to demonstrate the irreparable harm in case of absence of the injunctive relief

and, moreover, the public interest does not support the granting.

This injunctive relief, moreover, in case of being granted or not, will not establish

the exclusive rights for Heritage Inc. since Heritage Inc. does not have the right to exclusive

possession.

16

THE DISTRIBUTION OF ARTIFACTS SOLELY ON SALVAGE LEGAL PRINCIPLES

WAS NOT ENVISAGED BY 1995 PARTNERING AGREEMENT.

Firstly, the basic legal salvage principles will not be applied to a case of contract

salvage rights as such case.

Secondly, the contract between Rolga and Heritage Inc. was in full effect, not

influenced by any others conventions or agreements or common law principles of contract.

Therefore, both parties were bound to follow it and apply it as a matter of first priority.

17

PLEADINGS

I. HERITAGE INC. WAS ENTITLED TO CONTRACT SALVAGE RIGHTS

RATHER THAN PURE SALVAGE RIGHTS.

Considered as a common law right, salvage rights exist in two forms: contract

marine salvage and pure marine salvage.1 As a rule, the nature of the right affects what actually

can be done and cannot done. Historically, there are many cases discussing these two forms of

marine salvage. In general, a salvor will only succeed at claiming salvage award if he can

establish that he conducted pure marine salvage.

A. The element of voluntariness is not established, and as a result, the Heritage

Inc. was not entitled to pure salvage.

Salvage, as understood by common law, is the amount of compensation that

voluntary salvors are entitled to if they were successful, in whole or in part, in saving an

imperiled vessel.2 In order to be pure salvage, and therefore able to bring a claim for

compensation before the court, the salvor must establish three elements.3 First, there must be

marine peril. Second, the salvage service was conducted voluntarily, and not under any pre-

existing obligation. And third, the salvage service must succeed in part or in whole, as a result of

the efforts that the salvor expended to salvage the vessel. Only when all three elements are

1 See infra note 65, 1989 International Convention on Salvage regulates two forms of salvage. 2 Aircraft Recovery, L.L.C., v. Abandoned Aircraft, 54 F.Supp.2d 1172, 1179 (1999). 3 See Newell D. Smith, The Law of Salvage (February 5th 1994), http://www.mikkelborg.com/files/salvage.pdf (last

visited Aug. 20, 2009); Jones v. Sea Tow Services Freeport NY Inc., 30 F.3d 360 (2d Cir. 1994); Jeffrey W. Yeats,

Clearing Up the Confusion: A Strict Standard of Abandonment For Sunken Public Vessels, University of San

Francisco Maritime Law Journal, 1999- 2000, page 365.

18

established, is the claim considered successful.4 As a result, if any single element is not

established, a valid pure salvage claim does not exist.

Conducting the salvage service voluntarily is a key requirement that distinguishes

between pure salvage and contract salvage. The salvor in a voluntary salvage operation may not

be under any obligations to salvage provided by any pre-existing contracts or legal provisions.5

He must act spontaneously, or unbound to any other duties. If there is an prior existing contract

or agreement or anything similar, the element of voluntariness is absent.6 “If there is a contract,

then the services were rendered pursuant to the contract, not voluntarily.”7 In Cargill, 876

F.Supp. 508, at 511-12, the Supreme Court also came to a same decision where a salvage

contract existed, which results that the salvor‟s claim of a salvage award failed.

In the instant case, the claimant conducted the salvage service under the 1995

partnering agreement memorandum with the owner of the vessel, Government of Rolga. The

1995 Agreement regulates the duty of the claimant to recover the Coeur de l‟Ocean. As a rule,

the existence of the Agreement precludes the element of voluntariness. The salvor, conducted the

salvage according to a pre-existing contractual duty. In other words, the claimant had conducted

the operation involuntary. This element is not established.

Since the one of the three elements required to establish pure salvage does not

constitute, the claimant is not entitled to salvage award as pure salvage.

4 The SABINE, 101 U.S. 384 (1879), page 2. 5 B.V. Bureau Wijsmuller v. United States, 702 F.2d 333 (2d Cir. 1983); Supra note 3, SS John, 30 F.3d 360. 6 In re Complaint of The City of New York, as Owner and Operator of M/V ANDREW J. BARBERI, 534 F. Supp. 2d

370 (E.D.N.Y. 2008). 7 Triplecheck, Inc. v. Creole Yacht Charters Limited, No. 05-21182 CIV, 2007 WL 917276 (S.D. Fla. Mar 25,

2007), page 4; Biscayne Towing & Salvage, Inc. v. Kilo Alfa, Ltd., No. 02-22644, 2004 WL 3310573 (S.D.Fla.

September 30, 2004), page 6.

19

B. Heritage Inc. is entitled to contract salvage rights.

The issue of contract salvage balances the rights between the salvor and the owner

of the vessel. The contract clarifies the salvage schedule, the fees and payment which the salvor

will receive. It addresses the issues such as security, arbitration, interest, attorney‟s fee,…8

According to Benedict, §159 at 12-2: “[c]ontract salvage is that type of salvage service entered

into between the salvor and the owners of an imperiled property, or by their respective

representative, pursuant to an agreement, written or oral, fixing the amount of compensation to

be paid whether successful or unsuccessful in the enterprise.” The existence of the contract

precludes the element of voluntariness, and without voluntariness, the salvor is not a pure salvor.

However, the existence of a contract does not always create contract salvage, and pure marine

salvage is still determined.9 If the contract is executed contemporaneously with or after the

services, the salvage services will still be considered as voluntary salvage, and consequently, the

act of the salvor is still be considered pure salvage. Only in case the contract pre-dates the

services, in other words the services were rendered as a consequence of a pre-existing duty, does

the contract result in contract salvage.10

In The Camanche, 75 U.S. 448 (1869) or Nunley v. M/V Dauntless Colocotronis,

863 F.2d 1190, 1201-02 (5th Cir. 1989), the Court held that a contract only precludes pure

marine salvage if (1) the contract clearly covered salvage at a given sum for services; or (2) the

agreement constituted a binding engagement to pay in all events, whether the operation was

successful or not.

8 Andrew Anderson, Salvage and Recreational Vessels: Modern Concepts and Misconceptions, 1993, USF Maritime

Law Journal, Vol 6 No 1, page 219 9 Ibid. 10 Ibid.

20

Generally, salvage services are either11

(1) voluntary, wherein the compensation is dependent upon success;

(2) rendered under a contract for a per diem or per horam wage, payable at all events; or

(3) under a contract for compensation payable only in case of success.

This instant case‟s facts precluded the element of voluntariness; therefore, the first

type does not exist. The other types were clarified by Andrew Anderson in his article “Salvage

and Recreational vessels: Modern concepts and misconceptions.”12

According to Andrew

Anderson, if the contract does not provide any terms regulating the fixed compensation or the

compensation is provided regardless of success, the salvor retains his status of pure salvage.13

On

the other hand, if the contract fixes the compensation only in case of success, that is a “no cure,

no pay” contract and consequently the salvor loses his right to claim for a salvage award, but

only receives the agreed amount of compensation.14

If the salvor fails to recover the vessel, he

will receive nothing at all.

The 1995 Partnering Agreement Memorandum in this case was established

according to the will of the Government of Rolga and Heritage Inc. After extensive research and

sufficient evidence to show that the Heritage Inc. is able to recover a vessel claimed to be Coeur

de l‟ Ocean, in 27th

September 1995, the Government of Rolga signed the 1995 Partnering

11 The Elfrida, 172 US 186, 1898, page 192.

12 Supra note 8. 13 Ibid, page 220; The CAMANCHE, 75 US (8 Wall) 448 (1869). 14 Ibid, Andrew Anderson; Norris, MJ Norris, 3A Benedict on Admiralty § 178 (7th ed. 1983 & Supp. 1986)..

21

agreement memorandum with Heritage Inc.15

There is no term in the 1995 Agreement directly

provides that the price of salvage service will be based on a “no cure, no pay” basis.

Nonetheless, throughout the memorandum, the element of a successful salvage was

repeated. In clause 5 Sharing Arrangements, the monetary gain to which Heritage Inc. agreed is

not absolutely specific. But the gain will be calculated on the appraised value of the recovered

artifacts. In clause 8 Term and Termination, the agreement may be terminated in case they found

vessel is not the Coeur de l‟Ocean; or in other words, the effort to actually salvage the Coeur de

l‟Ocean is failed.

On the whole, 1995 Agreement requires successful salvage operation. It also

regulates the amount of money that the salvor‟s going to receive after successfully recovering the

Coeur de l‟Ocean in part or in whole will be calculated on the basis of the appraised value of the

artifacts that are actually recovered, through the Distribution Arrangement (clause 5 appendix 1).

In fact, some parts of the recovered artifacts have been auctioned off at overseas auction houses

in order to finance the cost of the project.16

As a consequence, Heritage Inc., in the case at hand, loses its discretionary salvage

award, but does receive the payment due to the agreed method of calculation. The claimant is

entitled to contract marine salvage, rather than pure marine salvage.

15 Moot Problem, Appendix 1, page 8. 16 Moot Problem,¶ 6, page 2.

22

II. RATIFYING THE 2001 UNESCO CONVENTION BY ROLGA DOES NOT

INTERFERE WITH SALVAGE RIGHTS AND PERFORMANCE OF HERITAGE

INC.

A. Rolga has the power to ratifying the 2001 UNESCO Convention as sovereignty.

Modern international law recognizes the rights of nations to enter into treaties with

other countries as an unchallenged matter of sovereignty.17

Because Rolga has long been a

member State of 1969 Vienna Convention on the Law of Treaties, the ratification of 2001

UNESCO Convention is encouraged by international norms and is considered as a mere practice

of sovereignty. No restraint shall be made on this ratification.

B. 2001 UNESCO Convention does not violate the salvage rights of Heritage Inc.

under the 1995 Partnering Agreement.

Salvage operation is not fully prohibited in 2001 UNESCO Convention.18

Law of

salvage can be applied in very strict criteria. The salvage operation must be (1) authorized by a

competent authority (2) in full conformity with the Convention and (3) ensure the maximum

protection of any recovery.19

On the other hands, 2001 UNESCO Convention prohibits any

activity that aims to exploit the underwater cultural heritage commercially.20

a. The salvage operation under 1995 Partnering Agreement is authorized by a

competent authority:

17 1969 Vienna Convention on the Law of Treaties. 18 Roberta Garabello and Tulio Scovazzi, The Protection of the Underwater Cultural Heritage: Before and After the

2001 UNESCO Convention (Kluwer, 2004) 10. 19 The 2001 UNESCO Convention on the Protection of Cultural Heritage, Art. 4. 20 Ibid, Annex, Rule 2.

23

There were provided proofs that the salvage operation by Heritage Inc. is authorized

by a competent authority of Rolga. At the beginning of the 1990s, Rolga, pursuant to the existing

law, must have approved Heritage Inc.‟s projects to survey, recover and excavate historical

objects or sites.21

But it was not until 1993, when Heritage Inc. finally recovered some artifacts

which were confirmed by government archaeologists to be “rare items” that Rolga decided to

approve a full and extensive project on “recovery” of the Coeur de l‟Ocean by Heritage Inc. and

eventually signed the 1995 Partnering Agreement Memorandum with the company in September

1995.22

It is obvious that the salvage operation arising from 1995 Partnering Agreement

conducted by Heritage Inc. is fully authorized by a competent authority of Rolga.

Furthermore, in order to ensure the maximum protection of Coeur de l‟ Ocean and

exercise the rights to better supervise the salvage operation, the 1995 Partnering Agreement

establishes the duty of Rolga to “monitor and record the exploration” by an assembly of two

government representatives.”23

The Government of Rolga, in any event, is in full control and

supervision over the salvage operation of Heritage Inc.

b. There is no contradiction between the salvage operation under the 1995 Partnering

Agreement and 2001 UNESCO Convention, especially in the relation with the issue

of commercial exploitation.

The 2001 UNESCO Convention strongly opposes commercial exploitation of

cultural heritage. In order to provide full protection on underwater cultural heritage, contribute

21 Moot Problem, ¶ 4, page 2. 22 Moot Problem, ¶ 5, page 2. 23 Moot Problem, Appendix 1, Clause 4, page 9.

24

for the benefit of mankind, the 2001 UNESCO Convention forbids any activity of trading,

selling, buying, bartering and speculation or dispersal of underwater cultural heritage.24

There is no evidence of such activities envisaged under the 1995 Partnering

Agreement. The 1995 Partnering Agreement Memorandum clearly states that the sales and

marketing of artifacts are excluded25

while the agreed compensation of the Heritage Inc. can be

adjusted “with the respect to the aggregate amount of the appraised values and/or selling prices

of the artifacts, net of agreed selling expenses.”26

The artifacts at any time are kept in a whole

collection without being sold to meet the sharing arrangements of this Agreement.

The fact that some parts of collection have been auctioned off at overseas auction

houses does not constitute the commercial exploitation intended by both parties since the main

purpose of this activity is to finance the costs of the project.27

Historically, auctioning has been a

common way to finance the ongoing salvage operation by relevant parties.28

This auctioning off

of the artifacts does not constitute the commercial exploitation conducted by Rolga and Heritage

Inc.

c. Maximum protection of underwater cultural heritage is guaranteed.

A very strict process to ensure the maximum protection of recovery was agreed by

Rolga and Heritage Inc. and envisaged in the 1995 Partnering Agreement29

. The project was well

24 Supra note 19. 25 Moot Problem, Appendix 1, Clause 6, page 9. 26 Ibid, Clause 5, page 9. 27 Moot Problem, ¶ 6, page 2. 28 Supra note 18, pages 23-28. 29 Moot problem, appendix 2.

25

financed30

and deliberately surveyed31

before operations commenced while the ongoing

operation has been under the supervision of a competent authority.32

In fact, there was no evidence or record of any failure of the salvage operation.

d. In any event, the 2001 UNESCO Convention does not affect the Rolga’s prior

agreements.

Non-retroactivity is one of the highlights of the 2001 UNESCO Convention.

Accordingly, only when a nation becomes a State party, does the Convention take effect on this

nation.. This regulation means that no prior rights and obligations of the State Party shall be

altered by the ratification of this Convention.

According to this principle, salvage operations by Heritage Inc. under the 1995

Partnering Agreement shall not be modified by the 2001 UNESCO Convention regulations. The

2001 UNESCO Convention does not alter the rights and obligations of Rolga regarding the

protection of Coeur de l‟ Ocean arising from the 1995 Partnering Agreement,33

which had been

signed six years prior to the ratification to the 2001 Convention. Therefore, the salvage rights

and performance of Heritage Inc., in this case, is fully guaranteed.

30 Moot Problem, Appendix 1, Clause 3, pages 8-9. 31 Moot Problem, ¶ 4 and 5, page 2. 32 Moot Problem, Appendix 1, Clause 4, page 9. 33 2001 UNESCO Convention, Art. 6(3).

26

III. AGREEMENT ON “PROTECTION OF WRECK” BETWEEN THE

GOVERNMENT OF ROLGA AND THE GOVERNMENT OF ASTORIA DOES

NOT VIOLATE RIGHTS OF HERITAGE INC.

A. The recognition of continuing cultural and historical rights of Astoria over the

Coeur de l’Ocean does not violate the salvage rights and performance of

Heritage Inc:

As a first salvor, Heritage Inc. is entitled to rights of unchallenged salvage,34

which

exclude other salvors over whom the court has in personam jurisdiction.35

Meanwhile, as

provided in the Agreement, Rolga recognized that Astoria has a continuing interest, particularly

in historical and other cultural purposes in articles recovered from any of the vessels referred to

in the Agreement.36

Firstly, Astorian rights differ from the nature of salvage rights of Heritage Inc.

since the salvage rights from a salvage contract are merely considered as rights to

compensation37

while Astoria was entitled to cultural and historical interests.38

While the

Heritage Inc. exercises its rights to seek for compensation on the excavation and recovery of the

Coeur de l‟Ocean, Astoria aims at the educational promotion and archaeology purposes. By

granting Astoria these interests, which are in a different category from Heritage Inc.‟s, Rolga

does not violate any salvage rights and performance of the salvor.

34 Yukon Recovery, L.L.C., v. Certain Abandoned Property, 205 F.3d 1189, 1190 (1999). 35 Hener v United States, 525 F Supp 350, 364-365 (S.D.N.Y. 1981). 36 Moot Problem, ¶ 9, page 4. 37 Supra note 14, Benedict on Admiralty § 159 at 12-2; Supra not 13, Camanche. 38 Moot Problem, ¶ 9, page 4.

27

Secondly, the exclusiveness in salvage of Heritage Inc. in which may be granted to

a contract salvor should be understood as the rights to performance without any interference

from competing salvors.39

In fact, the continuing historical and cultural interests of Astoria are,

traditionally, the rights to disposition of artifacts for the purposes of culture and history40

in order

to prevent the over-fragmentation of collections.41

The “Protection of Wrecks” Agreement has

nothing to deal with salvage matters and, in any event, does not harm the rights to free and full

salvage performance of Heritage Inc.

Lastly, despite the fact that 1995 Partnering Agreement has granted Heritage Inc.

the rights of using the “Coeur de l‟Ocean” brand name in sales and marketing merchandizes

related to the shipwreck,42

which is not exclusive, it does not distinguish Astorian cultural and

historical interests. Had Astoria exercised their rights for cultural and historical purposes,

Heritage Inc. could still operate the salvage operation fully and freely. In fact, there was no

evidence of any reported obstruction of the Heritage Inc.‟s salvage operation.

B. The disposition of collections by Astoria and Rolga does not affect the rights of

Heritage Inc. to a fixed compensation.

Pursuant to the 1995 Partnering Agreement, the compensation of Heritage Inc. is

based merely on the appraised value of successfully recovered artifacts.43

The principle, in this

39 Supra note 33, Yukon Recovery, 205 F.3d 1189, 1196-1197 (1999). 40 This practice was long adopted by Government of Netherlands and Australia concerning the Old Dutch shipwrecks off the coast of Western Australia, Britain with the shipwreck off the coast of South Africa. 41 Anastasia Strati, Draft Convention on the Protection of Underwater Cultural Heritage: Commentary, UNESCO

Doc CLT-99/WS/8 (drafted April 1999) 97 („Commentary‟). 42 Moot Problem, Appendix 1, Clause 6, page 9. 43 Moot Problem, Appendix 1, Clause 5, page 9.

28

case, is “no cure no pay”, which is traditionally accepted by the courts.44

The salvor may exclude

competing salvors from operating salvage services on the shipwreck or any relevant activities in

order to protect the rights of full compensation.45

Whether the disposition of collections by Astoria and Rolga will affect the rights of

Heritage Inc. to compensation is a question that needs a careful examination in the context and

order of the facts of this case.

In fact, a division of materials can only be made after the successful excavation and

is based not merely solely on the consideration of cash value, but also the historic and

educational considerations, which can only be concluded after a long study and research

process46

. In contrast, the compensation for salvage service rendered by Heritage Inc. is

enforceable by the 1995 Partnering Agreement and pursuant to “no cure no pay” basis.

Moreover, pursuant to the salvage tradition, Heritage Inc., as a salvor, can obtain a maritime lien

over the recovered artifacts to ensure compensation from Rolga.47

The customs of salvage and

the terms of the 1995 Partnering Agreement provide more than enough protection of the rights to

compensation of Heritage Inc. so that the claim of interference by Claimant does not constitute.

44 Florida Department of State v. Treasure Salvors, Inc., 458 U.S. 670 (1982). 45 Supra note 33, Yukon Recovery, 205 F.3d 1189, 1196-1197. 46 Moot Problem, Appendix 2, A(1), page 11. 47 See Treasure Salvors, Inc., v. Unidentified Wrecked & Abandoned Sailing Vessel, 640 F.2d 560, 1981 A.M.C

1857 (5th Cir. 1981), on remand to, 546 F.Supp. 919, 1983 A.M.C. 2040 (S.D. Fla. 1981).

29

IV. ROLGA HAS THE RIGHT TO ALLOW AQUATIC VIEW TO OPERATE TOUR

AND TO PHOTOGRAPH COEUR DE L’ OCEAN SHIPWRECK.

The tradition of salvage operations clarifies this issue. The ongoing salvage

operation is guaranteed from the interference of potential salvors, which is accepted as

undisputed.48

On the other hand, anyone other than competing salvors can only be excluded from

entering and operating non-salvage activities in the shipwreck in rare and special cases, where an

injunctive relief was issued by an authorized court.49

The court will apply strict test before

granting any injunctive relief.

In the case in question, there was no evidence or record of any injunctive relief that

was granted to Heritage Inc. to exclude wrecks diving and photographing activities related to

Coeur de l‟ Ocean. Since the exclusive rights in this case are not natural and in need of a very

strict examination by an authorized court,50

it is therefore clear that there is no exclusive right to

dive or photograph the wreck.

Whether the Heritage Inc. meets the necessary criteria to receive the injunctive

relief and therefore to be entitled to the rights to exclusively photograph and document the Coeur

de l‟ Ocean is not an issue in this submission and will be dealt later on.

48 Ibid. 49 See R.M.S Titanic, Inc., v. The Wrecked and Abandoned Vessel, 9 F.Supp.2d 624, 635-37 (1998). 50 Ibid., 637 – 39.

30

V. HERITAGE INC. IS NOT ENTITLED TO THE EXCLUSIVE RIGHT OF

PHOTOGRAPHING AND DOCUMENTING.

A. Salvage law does not accord Heritage Inc. the exclusive right of photographing

and documenting Coeur de l’ Ocean.

Under the 1989 International Convention on Salvage, of which Rolga is a member

State, a salvage operation is defined as an “act or activity undertaken to assist a vessel or any

other property in danger in navigable waters or in any other waters whatsoever.”51

The definition

clearly states that the purpose and policy of salvage law, which are widely accepted by courts, is

the encouragement “of the voluntary assistance to ships and cargoes in distress,”52

which does

not include “the notion that the salvor can use the property being salvaged for a commercial use

to compensate the salvor when the property saved might have inadequate value.”53

Given the policy of salvage law, the salvage rights granted to Heritage Inc.,

regardless of the forms of those rights, do not automatically include the exclusive rights of

photographing and documenting the Coeur de l‟ Ocean, since such award may result into the

counterparts to policy of salvage law and encourages the commercial exploitation on the

recovered materials by the salvor, which is strongly counter to salvage law in general.

B. Heritage Inc. has not been granted to exclusive rights of photographing and

documenting the Coeur de l’ Ocean.

51 United Nations Educational, Scientific and Cultural Organization, Convention on the Protection of Underwater

Cultural Heritage, 41 I.L.M. 40 (2002), Art. 1(a). 52 See R.M.S. Titanic, Inc., v. Christopher Haver, Deep Ocean Expeditions, 171 F.3d 943, 1999 A.M.C. 1330 (4th

Circuit 1999). 53 Ibid.

31

Pursuant to the salvage law tradition in common law countries, unlike the case of

exclusive salvage rights, the exclusive right of photographing and documenting is not naturally

included in general salvage rights, but must be granted by order for an injunctive relief by an

authorized maritime court.54

We assert that this issue is a matter of fact and the provided record is really clear.

There is no record or evidence which proves that the Heritage Inc. has obtained an injunctive

relief, by which it can exclude others from photographing and documenting the shipwreck. It is

inappropriate to claim the “exclusive rights of photographing and documenting” the Coeur de l‟

Ocean without the formal grant from the court.

C. In any event, the Heritage Inc. is not entitled to exclusive rights of

photographing and documenting the Coeur de l’ Ocean.

The question is now whether Heritage Inc. would be entitled to the injunctive relief

that would provides the exclusive rights of photographing and documenting the Coeur de l‟

Ocean.

Customarily, an injunctive relief can only be issued after satisfying “a hardship

balancing test applies to determine the granting or denial of a preliminary injunction”55

. The test

is designed to balance the harms and effects on relevant parties and the public interest. In the

test, there are several elements need to proved including: (1) the likelihood of irreparable harm to

the plaintiff if the preliminary injunction is denied, (2) the likelihood of harm to the defendant if

54 See e.g. MDM Salvage, Inc., v. Unidentified, Wrecked and Abandoned Sailing Vessel, 1987 AMC 537, 631 F.Supp 308 (S.D. Fla. 1986); Weeks Marine, Inc., v. Cargo of Scrap Metal Ladened Aboard Sunken Barge Cape

Race, 571 F.Supp.2d 334, 2008 A.M.C. 2602; Supra note 48, R.M.S Titanic, 9 F.Supp.2d 624; Supra note 46, 546

F.Supp. 919, 929 (S.D.Fla.1981). 55 See Direx Israel Ltd v. Breakthrough Medical Corporation, 952 F.2d 802, 812, citing from Blackwelder Furniture

Co. v. Seilig Mfg. Co., 550 F.2d 189 (4th Cir. 1977).

32

the requested relief is granted, (3) the likelihood that the plaintiff will succeed on the merits, and

(4) The public interest.”56

a. Government of Rolga will suffer greater harm if Heritage Inc. is entitled to

exclusive rights.

The issue is again a question of fact and requires close examination on the record.

In fact, the most significant harm caused to Heritage Inc. is the effect on an ongoing

television documentary deal with the International Broadcasting Company.57

Without the

injunctive relief, other tour operators and photographers (e.g. Aquatic View) can freely access

the shipwreck with the consent of Rolga. The harm to Heritage Inc. in this case is not sufficient.

Moreover, it is purely a matter of economic harm and cannot be considered as “irreparable”.

In contrast, Rolga, being the owner of Coeur de l‟ Ocean, would suffer a greater

harm if the Heritage Inc., was entitled to the exclusive rights. Rolga will be both politically and

economically affected.

Firstly, the 2000 Rolgan economic plan promised more efforts to be undertaken by

the authority in protecting and ensuring sustaining use of its cultural heritage58

. If the exclusive

right of photographing and documenting is granted to Heritage Inc., public awareness, which is

one of the most important approaches to preserve and promote the value of heritages for the

future generation and public interest, will be immediately . In the long run, these effects can

cause a failure in the Rolgan economic plan that will affect the stability of Rolgan society.

Secondly, the international obligation of Rolga will be altered if the exclusive right

is granted. Under the Protection of Wrecks Agreement with Astoria, Rolga has officially

56 See L.J. By and Through Darr v. Massinga, 838 F.2d 118, 120 (4th Cir.1988), cert. denied, 488 U.S. 1018, 109

S.Ct. 816, 102 L.Ed.2d 805 (1989); Supra note 48, R.M.S Titanic, Inc.,9 F.Supp.2d 624 . 57 Moot Problem, ¶ 11, page 4. 58 Moot Problem, ¶ 7, page 3.

33

recognized the “continuing historic and cultural interests” of Rolga, from which the two

governments can help promote the educational and archaeological value of Coeur de l‟ Ocean.

Had the Heritage Inc. been granted the exclusive right, the purpose of the Protection of Wrecks

Agreement would not be able to be fulfilled. This will be an actual irreparable harm if the

exclusive right is approved.

b. Public interest does not support the claim of Heritage Inc.

As an underwater cultural heritage, any activity concerning the exclusive access to

Coeur de l‟ Ocean needs to be balanced with the public interest.59

Under the 2001 UNESCO Convention on Protection of Underwater Cultural

Heritage, an underwater cultural heritage will be best preserved “for the public interest” if it is in

situ preservation,60

with the concern of protection by international cooperation,61

and with the

consideration of the public awareness.62

By granting Heritage Inc. exclusive rights, none of these principles can be enforced

and this will be a loss to humanity.

D. Even if Heritage Inc. was granted the injunctive relief was entitled, it does not

establish an exclusive right since it does not have the right to exclusive

possession.

59 Supra note 19, 2001 UNESCO Convention on Protection of Underwater Cultural Heritage, art. 2 (3). 60 Ibid., Art. 2 (5) 61 Ibid., Art. 2 (1), Art. 2 (4) 62 Ibid., Art. 2 (10)

34

International copyright law clarifies this issue. Under the 1866 Berne Convention

and the 1996 WIPO Copyright Treaty, only “protected” works can be copyrighted,63

not the

property itself. Traditionally, the member States of the 1866 Berne Convention and the 1996

WIPO Copyright Treaty do not expand copyright protection to the right to exclude others from

access to the property.64

On the other hand, member States of the 1866 Berne Convention and the 1996

WIPO Copyright Treaty do, in rare circumstances, entitle the exclusive right to viewing and

photographing of property when the possessor can exercise an “exclusive possession and remove

the property in a private and controllable location”65

where it cannot be viewed or photographed

normally.

Firstly, Heritage Inc. has a salvage lien to claim compensation from the

Government but this lien does not expand temporary possession to the scope of exclusive

possession.66

Although a claim for salvage compensation is secured by a maritime lien on the

vessel or other property salvaged and a salvor may normally retain possession of the salvaged

property for a reasonable time,67

while efforts to claim compensation are pursued, eventually, the

salvor must either pursue a lien claim or release the property to its owner. Besides, the law of

salvage also imposes “duties of good faith, honesty and diligence” in protecting the salvaged

property.68

63 Ibid., Art. 2 (1). 64 See 1988 Copyright, Designs and Patent Act by United Kingdom, section 6 (1). 65 Supra note 51, R.M.S. Titanic Inc. 171 F.3d 943, FN5. 66 The 1989 International Convention on Salvage, Art. 20 (2); Emblem, 8 F.Cas. 611, 614 (D.Me.1840); Supra note

14, 3A Benedict on Admiralty, § 143, at 10-8 (quoting The Emblem ). 67 R.M.S. Titanic, Inc., v. Wrecked and Abandoned Vessel, 286 F.3d 194 C.A.4.Va. (2002). 68 Supra note 51, R.M.S. Titanic Inc. 171 F.3d 943, FN5.

35

Moreover, it is inappropriate to say that the Coeur de l‟ Ocean is in a private and

controllable location where the Heritage Inc. has right to exclude others from access. Under the

2000 Rolgan law, the authority to designate area within Rolgan waters as a restricted site belongs

only to the Minister of Government of Rolga.69

In fact, Rolga had declined the Rolgan Cultural

Society‟s proposal to designate the Coeur de l‟ Ocean and its site as “restricted area”.70

Given the

fact that Coeur de l‟ Ocean was never a “restricted area” or a “private location,” it is

inappropriate to restrict people from photographing and documenting a property in a public place

such as in the case of Coeur de l‟ Ocean shipwreck.

69 See Moot Problem, ¶ 8, page 3. 70 See Moot Problem, ¶ 10, page 4.

36

VI. THE DISTRIBUTION OF ARTIFACTS SOLELY ON THE BASIS OF SALVAGE

LEGAL PRINCIPLES WAS NOT ENVISAGED BY THE 1995 PARTNERING

AGREEMENT MEMORANDUM.

The claimant was bound by its contract with the government of Rolga, and the basis

of salvage legal principles will not be applied to the distribution of artifacts.

A. The basis of salvage legal principles will not be applied on the distribution of

artifacts.

The main aim of a salvor when he conducts a salvage operation is finance. In other

words, the person who salvages a vessel is entitled to an amount of payment as a compensation

for all his work to recover the vessel. This compensation encourages the salvors to contribute to

the safety of marine route. "The salvage award, which is unique to maritime and admiralty law,

is not one of quantum meruit as compensation for work performed, [but] is a bounty given on

grounds of public policy to encourage the rescue of life and property imperiled at sea and to

foster maritime commerce."71

As discussed above, the key difference between pure salvage and contract salvage

is the element of voluntariness. Each of the two forms of salvage has its own characteristics. The

way to calculate the compensation in these two types is one of those characteristics. Actually,

there is no precise formula72

to calculate compensation. However, throughout the development of

71 The Neshaminy, 228 F. 285, 288-89 (3d Cir.1915); Fine v. Rockwood, 895 F.Supp. 306, 308 (S.D.Fla.1995). 72 Supra note 7, Triplecheck, Inc, F.Supp.2d, 2007 WL 917276.

37

international jurisdiction, there have been six necessary, well-accepted elements, first established

by Justice Clifford, which shall be taken into consideration when determining the payment:73

(1) The time and labor expended by the salvors in rendering the salvage service;

(2) The promptitude, skill, and energy displayed in rendering the service in saving

the property;

(3) The value of the property at risk or employed the salvor;

(4) The degree of danger to which this property was exposed;

(5) The value of the property saved; and

(6) The degree of danger from which lives and property are rescued.

Those six factors are basic salvage legal principles. They have been widely used by

the Court in many cases.74

However, as stated in these cases, these six factors are only used in case of pure

salvage. “Of course these factors come into play when there was no prior agreement for salvage

and the property was saved voluntarily,”75

according to Irwin in his article “Salvage, Contract or

Common Law”. Eventually, if there is a prior agreement for salvage, in other words, if the vessel

is not salvaged by a voluntary salvor, these six factors would not be applied.

73 Supra note 3, The Law of Salvage; Blackwall, 77 U.S. (10 Wall.) 1, 13-14, 19 L.Ed. 870 (1869); Atlantis Marine

Towing, Inc. v. M/V "Elizabeth," 346 F.Supp.2d 1266, 1272 (S.D.Fla.2004). Citing Southern Most Marine Services,

Inc. v. One (1) 2000 Fifty Four Foot (54') Sea Ray named M/V "Potential," 250 F.Supp.2d 1367, 1377- 78

(S.D.Fla.2003); Treasure Salvors. Inc. v. The Unidentified, Wrecked & Abandoned Sailing Vessel, 556 F.Supp. 1319, 1340 (S.D.Fla.1983). 74 See Osal Marine Services, Inc. v. M/V PANASEA, 1993, AMC 1930, 1932 (W.D. Wash. 1992); Sobonis v. Steam

Tanker NATIONAL DEFENDER, 298 F. Supp. 631 (S.D.N.Y. 1969). 75 David E. Irwin, Salvage, contract or common law, Dec 5th 2008, http://southfloridaadmiraltylaw.com/salvage-

contract-or-common-law. (last visited Aug. 20, 2009)

38

In this present case, as discussed above, Heritage Inc. and the government of Rolga

have signed the 1995 Partnering Agreement Memorandum before Heritage commenced the

project.76

This Agreement is the foundation for all later explorations carried out by Heritage Inc.

to find the vessel Coeur de l‟ Ocean. As proved before, the salvage service of Heritage in this

case is not voluntary. Heritage Inc. was not entitled to pure salvage; thus, this company cannot

claim for a salvage award which is always determined upon the basic salvage legal principles, as

they have to base their claim on the existing contract, with agreed terms to calculate the payment.

B. The full effect of the salvage contract between the Government of Rolga and

Heritage Inc.

a. The salvage contract is still effective since it is not affected by other factors.

As discussed above, this salvage contract is safe and sound even when the

Government of Rolga ratified the 2001 UNESCO Convention and joined in the Agreement with

Astoria. Moreover, it is absolutely effective. There is no evidence showing that it may be null or

void.

(i) There is not enough evidence to show that the amount of

compensation calculated upon contract is not equitable to the

degree of rendered services.

For protecting the salvage right of salvors, article 7 of the International Convention

on Salvage (1989) states that:

76 Moot Problem, Appendix 1, ¶ 5, page 2.

39

“A contract or any terms thereof may be annulled or modified if:

(a) the contract has been entered into under undue influence or the

influence of danger and its terms are inequitable; or

(b) the payment under the contract is in an excessive degree too large

or too small for the services actually rendered.”77

Therefore, in order to decide that a salvage contract is annulled or must be

modified, the relevant parties must have sufficient evidence showing one of the two above

conditions.

In this instant case, however, there is no specific evidence showing that the

agreement between Heritage Inc. and the Government of Rolga satisfies either of the conditions

in article 7. Heritage Inc. does not give any proofs of how they conducted the project, what

machines are used, as well as the amount of money they had to pay for recovering such artifacts.

They do not show how the sum of money and efforts they paid for covering the shipwreck are

larger or smaller in comparison with the agreed payment.

Moreover, the negligence of the Heritage Inc. also reduces the amount of

compensation. As a rule, the salvors carrying out the salvage operations have a duty of care to

the vessel and its cargos. The International Convention on Salvage (1989) provides that the

salvor shall owe a duty to the owner of the vessel or other property in danger to carry out the

salvage operations with due care.78

Therefore, he is liable for any negligence when conducting

77 Supra note 65, Art. 7. 78 Ibid. 1989, chapter II, Article 8, Clause 1(a).

40

the services.79

As a result, if there is any damage caused by the negligence of the salvor, the

amount of payment will be reduced.80

However, as a matter of fact, many of the recovered

artifacts (e.g. Chinese porcelains) had been destroyed due to the poor handling of objects caused

by the claimant‟s personnel.81

82

As a result, the claimant is in breach of the duty of care and is

responsible for those damages. Hence, the amount of profits acquired from the distribution of

artifacts recovered based on the contract could possibly be sufficient. There is not enough

evidence to show that the expenses the Heritage Inc. paid for the project are larger or smaller

than the fees agreed upon in the contract.

Moreover, there is no danger approaching or undue influence or equitable terms

within the contract. The 1995 Partnering Agreement Memorandum is out of the adjustment of

article 7. Eventually, the Salvage Convention does not annul the contract between Government

of Rolga and Heritage Inc.

(ii) There are no factors that affecting the validity of the contract

under common law.

Common law and the history of salvage law jurisdiction celebrated many cases

wherein salvage contract were void due to factors, such as fraud, collusion, mutual mistake,

misrepresentation or suppression of material facts or compulsion.83

In this instant case, none of those factors exist. The 1995 Partnering Agreement

Memorandum was signed in full conformity with the law of Rolga at that time, by the

79 Supra note 3, The Law of Salvage. 80 Noah's Ark v. Bentley & Felton Corp., 292 F.2d 437, 443 (5th Cir. 1961). 81 Moot Problem, ¶ 10, page 4. 82 Further Clarification, Clause 34, page 3. 83 Andrew Anderson, Salvage and Recreational vessels: Modern concepts and misconceptions, USF Maritime Law

Journal, Vol. 6 No 1, page 221 (1993).

41

Government of Rolga and the Heritage Inc. These two entities are legally established under the

Rolgan law.84

This contract was the result of legal progress, since the Heritage Inc. started

looking for an official government approval for conducting salvage project on Coeur de l‟ Ocean

until Heritage Inc. and the government of Rolga singed the 1995 Agreement in 27th

September

199585

. There is no fraud on the part of either Heritage Inc. or Government of Rolga. These two

parties did not cooperate with any other parties in order to cheat each other… As a consequence,

the contract is not null or void under common law.

Since the contract is still effective, the parties must rely on the contract‟s terms to

solve any conflicts between them, including the distribution of artifacts.

b. The contract should be applied as the matter of the first priority.

Contract is an agreement between parties and binding on the partied involved. Any

dispute between the parties arising out of the contract should be solved based on the terms and

conditions agreed upon by the parties in the contract. In case the contract lacks of provisions

dealing with a particular dispute, Courts will apply relevant (applicable) law to resolve the

conflict. In other words, even though contract does not have the statute of legislation, it is

binding on contracting parties and should be treated as first priority when resolving disputes

between them. In salvage cases, the same rule applies. In The Triplecheck, Inc. v. Creole Yacht

Charters Lmt, S.D.Fla, WL 917276, 2007, , the Court made a similar decision. Because of the

existence of a contract between these two parties, the Court first took a look at the contract, then

after concluding that “[a]s the parties' agreement does not provide otherwise,” the court applied

84 Further Clarification, Clause 21, page 3. (Heritage Inc. was incorporated under Rolgan law; the government of

Rolga was set up after the Rolga‟s independence on 7th November 1959, see ¶ 2, page 1, Moot Problem) 85 Moot Problem, ¶ 5, page 3. (The day the agreement memorandum was signed)

42

other widely-accepted ways to determine the amount of compensation, including the six above

factors.86

In this instant case, there is also an existence of a valid contract, ruling the

distribution of artifacts between parties. In clause 5 Sharing Arrangements, both parties had

agreed upon the sharing arrangements with respect to the appraised values, the selling prices of

the artifacts, and the net of selling expenses.87

As discussed above, this contract is still in full

effect. As a rule, the parties should follow the distribution method agreed in the contract to

distribute the recovered artifacts, not the legal salvage principles.

86 Supra note 7, Triplecheck, F.Supp.2d, 2007 WL 917276; See also Biscayne Towing & Salvage, Inc. v. Kilo Alfa,

citing New Bedford Rescue Marine Inc. v. Cape Jewelers Inc., 240 F.Supp.2d 101, 115 (D.Mass.2003). 87 Clause 5, Sharing Arrangements, Appendix 1, Moot Problem.

43

VII. PRAYER FOR RELIEF.

On the basis of foregoing facts and points of law, the Government of Rolga

respectfully requests this Arbitral Tribunal to adjudge and declare that:

Heritage Inc. was entitled to contract salvage rights rather than pure salvage rights;

Rolga does not invade the rights of Heritage Inc. by ratifying the 2001 UNESCO

Convention on Protection of Underwater Cultural Heritage, by entering into the

“Protecting of Wreck” Agreement with Astoria and by allowing tour operator to organize

wreck diving and photographing of the Coeur de l‟Ocean;

Heritage Inc., in any event, is not entitled to exclusive rights of photographing and

documenting of the Coeur de l‟Ocean; and

Every distribution and compensation must be based solely on the basis of Sharing

Arrangement Clause envisaged by 1995 Partnering Agreement Memorandum.