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Why
you need insurance! A True Story.
You never expect
the worst case scenario or the unexpected to happen to you,
but when(and if) it does, then you're going to wish that you
were prepared for it. All companies look good when the sailing
is smooth. You really see how a company operates when you
have to deal with problems. I've had 3 companies that I've
stopped working with because they showed their true colors
when the chips were down!
This is a true
story and we are in the midst of it, so I'm leaving the name
of the yacht company out, for now, but you can contact me
privately if you want more information.
July 2010- Mykonos
Greece
Brian and his new
wife were going to spend their honeymoon sailing for two weeks
in The Cycades Islands in Greece. The paid in advance, hired
BJ as their skipper and chartered a 38 foot Lagoon Catamaran
for the two of them.
The first few days
were uneventful(although wonderful!) but that changed very
quickly! They were docked at the government dock in Mykonos
when the High Speed Ferry came in and docked at a different
location. Normally it was further down the down, but for some
reason the Port Police had them dock closer to where the yachts
were docked.
The High Speed
sent a huge wave down the dock towards the yachts and force
of the enormous wave ripped off the cleat and separated the
superstructure from the hull.
BJ followed all
the procedures- contacted the Port Authority and filed a report.
Next he contacted the charter company who is managing the
yacht for it's owner. Everything seemed ok for a day or two
with BJ and Brian thinking that the charter would go on as
planned.
The next day the
owner of the yacht(not the company that was managing the yacht)
contacted BJ and told him that the charter was over and that
the yacht would have to be returned to Athens for repairs.
As for Brian, the owner told them that if they wanted to continue
then they would have to pay for another yacht.
When I heard about
the accident I called the charter company and they confirmed
what I had heard. That the charter was over, Brian would have
no money refunded and if he wanted to continue the charter
he would have to pay for a new yacht.
He had left a damage
deposit through the company which at the very least should
have covered 2500 euro worth of damage, but the company was
going to keep the damage deposit as well as the total rental
fees for the two week charter and half the skipper's fees(they
paid BJ only half of his fees and kept the other 980 euro
for the second week).
Brian went through
the contract and found the following clause… paragraph
11 states "should the yacht become an actual or constructive
loss before or DURING the charter period, this agreement shall
be deemed to be at an end and the charterer shall RECOVER
from the owner ALL charter monies paid in advance to the owner
only in the case the loss has occurred before the charter
period, or during the charter period, provided that the charterer
or his crew were not responsible for the loss".
I spoke with the
base manager of the charter company and he agreed that the
ferry was at fault and Brian should not be responsible. He
said they had an attorney on the job who had successfully
sued the ferry company in the past so he was optimistic that
Brian would have his money recovered. We talked about the
procedure and he told me that the Ferry Company and the Port
Police work very closely together and that they would even
"find" a witness to say what they need to have said
to protect them.
I reiterated our
point that clause 11 absolves Brian of all responsibility,
he agreed but then he said that the money would have to come
from the ferry company through the court.
A week or so later
I sent another letter saying that Brian was very upset because
they had not followed the agreement and I received the following
reply…
Dear Mr.
Econopouly,
Thank you for both your last e-mails, and apologize for this
unpleasant situation.
Mr. Bibis is away from the office since last Thursday, for
summer vacation, and for that reason I am taking the initiative
to conclude this case, as due to legal implications repayment
for Mr. Sarath's charter fee has taken a rather longer period
than usual.
Indeed your client was entitled to this refund, as he was
not responsible for the incident that has rendered his yacht
out of operation, but before the final clearance from our
legal advisors, charter fees had to be kept "suspended".
Please advise in which way we will settle this transaction.
By wiring money to your account, or directly to your client's
account ??
Please also note that we will handle you a document, by which,
with this charter fee repayment everything is cleared from
our side, and your client has no further claim,
which has to be signed by your client and kept by you, till
the day we will wire the money back, after which it has to
be send to our office.
Looking forward hearing from you regarding the all the above,
please express to your client our deepest sympathy for his
unfortunate situation.
Yours sincerely,
I sent the email to Brian and it looked like we were on the
way to solving the problem, but the very next day I received
the following email…
Dear David,
Further to our e-mail of yesterday, please be informed that
we called today to our office the owner for the catamaran
in order to claim the money paid for the charter of Mr. Sarath.
He came with his lawyer, refusing any such refund towards
Mr. Sarath, both for the amounts of the charter fee, or the
refundable deposit, claiming that indeed this term exists
in the signed contract (repayment of charter fee), but this
is referred solely to systems on board leading to the yacht
being rendered unusable.
According to their lawyer's argument, this is not our case,
as the yacht has not malfunctioned in any aspect, and the
problem/damages occurred by an outer source.
Given the fact that on a bareboat charter, the skipper/charterer
are considered the "physical owners" of the yacht
for the duration of their charter, they should bear the blame
for the final outcome, as they are responsible not only for
navigational duties, but also for the general well-being of
the yacht, even when birthed.
In view of the above, owner will keep money paid both for
charter period and damages sustained on the yacht, and the
charterer (Mr. Sarath) should address a legal inquiry
towards the ownership company of big catamaran that created
this havoc, for their refund.
They have signed a document acknowledging possession of said
amounts, and taking full responsibility against any legal
action on behalf of Mr. Sarath, and left our office.
In view of the above developments, we are unable to proceed
with any money transfer, as simply we have no money in our
possession, regarding charter fees of client Mr. Sarath.
Looking forward hearing from you, regarding the above
Yours sincerely,
The charter company
basically broke the contract with Brian and sided with the
owner of the catamaran by agreeing to the owner's rewriting
the contract and interpreting it to suit their needs(claiming
that "indeed this term exists in the signed contract
(repayment of charter fee), but this is referred solely to
systems on board leading to the yacht being rendered unusable."-
There is NO distinction in the contract about systems on board,
the owner just added that in his meeting with the owner to
try to bilk Brian out of his money- it WAS NOT in the contract).
Through subsequent
conversations the base manager said that they had spoken to
their attorneys and they claimed that the Port Police claimed
that they had warned all the yachts about the new docking
area of the High Speed Ferry and told them to tie off loosely
from the pier and be on board when the ferry arrived. There
are 3 things to remember about this statement. 1. BJ says
the Port Police never came to warn him 2. This "warning'
was never mentioned in the original report 3. Mention of the
"warning" didn't appear until a month after the
accident 4. The base manager said the Port Police and High
Speed would do anything they could not to be found at fault)…..
despite all those obvious facts, the charter company still
would not support Brian, nor the legal contract they had between
them.
We also talked
about the amount of money that was going to be lost(8000 euro
was what Brian stands to lose on this charter). I told them
that it was minimal for a company like theirs with 60+ yachts
and that they should pay Brian the money that he is due. The
Manager then brought up a new arguement which was the lost
income aspect because the yacht might lose the next 2-4 weeks
or possibly more as she was undergoing repair.
I told him that
was what insurance was for and he responded that loss of revenue
insurance was expensive so most owner's didn't carry it. I
told him that was between the owner and the insurance company
and lost of future income was not Brian's responsibility.
If the owner wants to cut operating costs, he can, but for
him to hold Brian responsible for his lack of foresight is
irresponsible. The issue here was Brian's deposit and payment
of a charter that was prevented from continuing due to no
fault of the skipper and crew.
Brian has disputed
the charges with his insurance company and we're waiting on
the reply from them but in the meantime to recap.
1. The Charter
Company told Brian that he would lose his total payment plus
would have to pay for a new yacht if he wanted to continue
his charter despite the fact that signed contract said the
opposite.
2. The Charter Company took a month to admit their mistake
and offer a full refund, but one day later they turned around
when the owner verbally "added" a clause to the
contract that didn't exist in the one that Brian signed.
3. The charter company disregarded the contract and sided
with the owner(and ultimately the Port Police and the High
Speed Company) taking the approach to save themselves money
rather than recognize that Brian was protected against the
loss in the contract.
4. The Charter company only paid BJ 980 euro but kept the
other 980 Euro that Brian had paid them in cash to pay BJ
for the second week…. And they wouldn't return the 980
Euro to Brian.
These are the stories
you read about in magazines or hear about on the news, but
not what you expect would happen to you…. So you need
to be prepared…. I can only suggest you look into insurance
to protect yourself in the event that the unexpected happens….
The cost looks like a lot a first, but having to cancel your
charter for any reason will end up costing you a lot of money!
I would thnk very
seriously about purchasing Travel Insurance...
Click here to purchase or get more info....
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