Your assignment is to prepare and submit a paper on the principle of general average. To put the definition of general average into simpler terms, if it is determined that the only way to avoid a total loss of the ship, cargo, and crew was to voluntarily sacrifice part of the cargo, the general average could then be declared. The object of general average is to place all owners of the cargoes being carried by ship, as well as the owner itself, on equal footing (Roanoke Trade Services, Inc.). General average is usually established via contract of affreightment and usually states that the adjustment will be made in accordance with the rules of a certain port. in the event that the port does not have jurisdiction, then the general average adjustment will be made according to York-Antwerp Rules (Roanoke Trade Services, Inc.). Thus, there is always a consistent way to determine the general average for any ship, and whether or not it applies to a given situation and can be declared.

Under the principle of general average, the word “average” is read to mean “loss”, and thus a general loss must occur for general average to be declared (Ship Inspection Maritime Guide). Also, as stated above, the loss must be unavoidable and the ship would incur a total loss if such sacrifice was not undertaken, e.g. a sinking ship tossing cargo overboard to lighten the load and enable the ship to float again, at least long enough to get into port (Roanoke Trade Services, Inc.). When the general average is declared, it is required by all parties who did not suffer any loss to compensate, equally and fairly, the party that did incur the loss (Ship Inspection Maritime Guide). The owner or owners of the cargo themselves are not&nbsp.are not liable but will receive a proportionate share of costs from the owner of the vessel as well as the owners of the other cargoes (Roanoke Trade Services, Inc.). In other words, all groups that did not lose any cargo must give an equal proportion to the one that did, in order that they may not incur total loss themselves. Each shipper having cargo aboard the ship that was not damaged, therefore, must either make payment in the form of a security or post a bond showing that they can cover their portion of the loss to the owner whose cargo was damaged (Freight Transport Association).&nbsp.

 
"Looking for a Similar Assignment? Get Expert Help at an Amazing Discount!"