Further to our notification on 13 October 2011, we have an additional update for you regarding cargo onboard the stranded “Rena”.

However it’s worth noting the handling of cargo on board is now the responsibility of the salvors and MSC (the charterers of the ship) as all of the containers involved are currently in the care, custody and control of MSC. The owners of the ship have appointed Svitzers as their salvors, and they have a similar duty to MSC to look after the cargo.
 
As has been reported in the media, containers have fallen off the ship; some are missing and some have been washed ashore. Those remaining on the ship at the moment are in a precarious situation, and it looks unlikely that many will be saved completely intact due to flooding, loss of power to refrigeration units, or the ongoing possibility of them falling off or sinking with the ship.
 
It is the salvors who have complete control of searching for and retrieving any containers/cargo which have fallen off. These operations must be coordinated and cannot be undertaken by any cargo insurer.
 
Cargo notified by MSC as 'lost' or obviously a total loss
We understand that owners of cargoes which are obviously a total loss or are known to be missing are now being notified by MSC.

Those cargoes which are obviously a total loss will be disposed of/ dumped by salvors at their expense (i.e. not at the expense of the cargo owners).

Once the cargo owners have been notified, we will be able to fully consider settlement under their policy terms and conditions.
 
Cargo retrieval
Salvors will be recovering where possible any or all containers (including washed-up cargo) and these will be taken to a site in Tauranga. At that site, salvors and MSC will record the details and
it will be MSC's duty to notify the cargo owners (also see Partial Loss notes below).

To date we have not been advised of the site's location nor the surveying/inspection process.
 
We are trying to gain greater involvement in this process, but it will depend on the salvors’ and shipping company’s response.
 
Partial loss cargo
Cargo which is not a total loss and which might have some remaining value (for example a container of logs) will be formally handed back to the cargo owner for loss mitigation once salvaged.
 
It is cases involving partial loss which will require additional involvement for cargo owners (and their cargo insurers). Expected work would include the removal of the cargo to another location, devanning, inspection/surveying and mitigation/calculation of the claim.

The salvors and MSC will record the details and notify the owners as appropriate in partial loss claims.
 
Negative brand exposure
There is unfortunately little that can be done to prevent exposure of branded goods to the general public if they wash ashore. The cause of such exposure is not, and could never be, within the brand owner's (nor cargo insurer's) control.
 
As mentioned above, it is the responsibility of salvors to manage the collection of cargo and consequently insurers are unfortunately unable to offer any other alternatives.

Summary
For all cargo owners and their insurers, it is a case of having to patiently wait confirmation of cargoes being declared lost or properly identified as being a total or partial loss. In the case of goods sold on FOB or CFR terms, the overseas buyers and their insurers will need to be informed of the disposition of their cargo.
 
We realise that it is a frustrating situation for cargo owners. The salvors have a difficult and lengthy task ahead, and unfortunately we are unable to have any input into their activities.

However, we will endeavour to keep you updated if any significant developments occur.

If you have any queries relating to your client’s cargo on the “Rena”, please contact the Lumley Marine team on (09) 308 1100.