In a series of decisions in the 1990s, John Franklin Willmer QC as LOF Appeal Arbitrator stated that a salvage award in such a case “should not be wholly out of line with commercial rates”,1 so that owners and underwriters should not be discouraged from contracting on LOF in such a case. His successor, Nigel Teare QC (now Teare J), agreed.2 The guidance has become known as “the disparity principle” and is discussed in some detail in Brice on Maritime Law of Salvage .3 The present Appeal Arbitrator, John Reeder QC, has not only strongly disagreed with his predecessors but has gone further and held that repeated application of this misconceived “disparity principle” had led to a “stagnation” in the level of salvage awards in simple towage cases and that this had had a knock-on effect so as to restrain the level of awards in cases where there was physical risk but the essential service was that of towage.4

The Voutakos 5 was not about a rescue tow. A very large bulk carrier laden with some 175,000 tonnes of coal broke down in the Western Approaches to the English Channel. She required professional salvage assistance and a powerful salvage tug. Weather conditions were difficult and the tow of some 560 miles through one of the world’s busiest shipping lanes was especially difficult.

It was surprising in these circumstances that the second of the four questions on which the shipowners were given leave from the award of the Appeal Arbitrator to appeal to the court was whether, if there was a “disparity principle”, it applied to the facts of this case. Plainly it did not. That easily disposed of that question.