On 21 September 2014 the Italian-flagged passenger ferry EU, owned by the defendant, a foreign company based in Palermo, Italy, was on its way from Igoumenitsa, Greece, to Ancona, Italy. The EU was on autopilot and while it was turning to port, the vessel struck a rocky shoal south of Peristeres, located 0.6 nm off the north-east coast of Corfu.

After the allision, the master managed to get the ship off the reef to avoid damage to the rudders and propellers. The ship suffered severe damage resulting in an ingress of sea water. While the vessel continued its way to Ancona, it heeled slightly on its bow. The master was informed that the bilge pumps had stopped working and the flooding could not be contained. The master and chief engineer jointly decided to return to the port of Igoumenitsa. The crew prepared the passengers and ship for emergency evacuation.

The master then decided to go to the port of Corfu, which was closer than Igoumenitsa. The vessel requested the assistance of a pilot and two tugs to dock the vessel. The Coast Guard contacted the masters of the DI and the DO, which were the only professional salvage/towing tugs in Corfu, and informed them that the master of the EU requested their assistance.

En route to the mooring position all engines and generators failed, leading to a blackout and a complete loss of steering and bow thrust power. As a consequence, the ship could not carry out berthing manoeuvres.

The DI and the DO sailed up to the EU, and, on the orders of its master, pushed the EU's port side to starboard. This allowed the EU to approach the pier and align with it. The two tugs remained at their positions pushing it throughout the mooring procedure and until its completion. During the disembarkation of the 693 passengers on the EU, the DI and the DO assisted by keeping the ship steady in the mooring position. The master and crew abandoned the EU. Following that, the EU was moored with the assistance of the DI and the DO in order to unload the vehicles it was carrying. During the unloading the vessel's listing increased and the process was stopped, and resumed once the stability of the vessel was settled. The master also requested the assistance of the tugboat Th, which had arrived from Igoumenitsa and was standing by to help. The claimants' vessels stopped pushing the EU after the completion of the unloading but remained in port in readiness until 4 October in the case of the DO and the Th, and until 6 October in the case of the DI.

On 28 October 2014 the tug MA arrived at Corfu. On 31 October 2014 the EU was towed by the MA to a shipyard in Yalova, Türkiye, for repairs, and remained there until 22 September 2015.

The claimants brought a claim against the owner of the EU before the Court of First Instance of Piraeus for remuneration under the Salvage Convention 1989. The Court partially upheld the claimants' claim and ordered the defendant to pay each of the first and second claimants EUR 483,960, and the third claimant EUR 232,080.

Both parts appealed to the Court of Appeal of Piraeus.

Held: Decision 3044/2017 of the Multimember Court of First Instance of Piraeus is annulled. The Court of Appeal heard the case and decided on its merits. The claimants' claims are partially accepted.

The Court of Appeal reviewed the decision in the light of arts 1, 1.a, 1.b, 2, 6, 8, 12, 13, 13.1, 13.3, 14, 15.1, 17, 24, and 30 of the Salvage Convention 1989 and concluded the following.

The Salvage Convention 1989 was ratified by Law 2391/1996 and entered into force in Greece on 3 June 1997. It repealed the Salvage Convention 1910, and the provisions of the CPML regulating the same issues, and replaced them with the Salvage Convention 1989.

Article 2 of the Convention provides that it governs judicial or arbitral proceedings concerning matters covered by it, whenever such proceedings are initiated in a Member State: ie, it governs matters related to maritime salvage cases brought before national courts, irrespective of the nationality of the salvor or the salvaged ship, and without requiring any other foreign element in the dispute. Moreover, since Greece has not expressed any reservation to the Convention, these provisions also govern inland maritime salvage, ie that provided in inland waters and even by inland waterway vessels.

Under art 1.a, a maritime salvage operation means any act or activity aimed at assisting a ship or any other property in danger in any waters, navigable or otherwise. Furthermore, it is divided into: a) salvage governed by law; b) salvage governed by a contract concluded under the influence of the peril; and c) salvage governed by a contract prior to the peril.

Salvage, when governed by the Convention, gives rise to a claim for remuneration in favour of the salvor. The statutory right to remuneration under arts 12 and 13.3 presupposes a useful result and limits the claim for remuneration to the value of the salved property.

Salvage contracts may be freely concluded. As referred to in arts 6, 14, and 17 of the Convention, salvage contracts exclude the creation between the parties of legal obligations or claims for remuneration and expenses, unless the contract provides otherwise.

The amount of remuneration is determined by the Court on the criteria set out in art 13.1, irrespective of the order in which they are listed. In particular, as is clear from the combined provisions of arts 1, 12, and 13 of the Convention, the conditions required for the right to remuneration to arise from acts of maritime salvage are: a) an act or activity of assistance to a ship or any property in waters fit for navigation or in any other waters; b) a risk of loss or damage; and c) a useful result.

As regards the risk of loss or damage to the assisted ship, this must be real, even if not immediate, but expected with probability, existing before the salvage services and not caused by them, without requiring the ship in distress to be incapable of traction or self-propulsion. It is also sufficient that, at the time the assistance was given, the object of the assistance was subject to any mishap or probability of mishap which might have exposed it to loss or damage if the assistance services had not been provided.

Risk is an essential building block of salvage, because it defines and differentiates it from towage. The risk also must be serious, not imaginary, not presumed, not vague, and present, and its existence and degree must be assessed by an overall examination of the circumstances of the particular case. Such circumstances which may indicate a risk are: a) abandonment of the voyage; b) the use of distress signals, where these are used to call for assistance, due to, eg, damage to the ship; c) total or substantial loss of means of propulsion, resulting in reduction in the ship's ability to cope with difficulties; d) loss of anchors and chains; e) abandonment or preparation for abandonment of the ship; f) immediate requirement for assistance; g) ingress of water into the ship due to damage, etc.

The condition for the existence of the risk is not only the situation that causes the loss of the ship, actual or presumed, but it is sufficient that there is a risk of damage and even a calculable risk to justify the cost of the intervention, but not, however, a minor damage to the ship or the cargo (Court of Appeal of Piraeus Decision 913/2009). Salvage at sea is also considered to include merely standing by the ship in distress or escorting the ship to provide the necessary security (Court of Appeal of Piraeus Decision 831/2009). In summary, it could be said that this element exists when there is a reasonable fear of danger, so that in order to avoid it, no prudent and skilful maritime operator at the time of danger would refuse the offered assistance of the salvor, provided that a reward for the rescue is paid (Court of Appeal of Piraeus Decision 831/2009 END 2010.71).

The act of salvage must have had a useful result, alone or in combination with assistance provided by other salvors. It is not necessary that the object of the assistance be subject to the risk of total loss. The risk of serious damage is sufficient. Salvage operations may exist, even though the risk can easily be remedied. A useful result means the preservation of the property by counteracting the risk of loss or damage with which it is threatened, either in whole or in part (Court of Appeal of Piraeus Decision 6/2009, Court of Appeal of Piraeus Decision 1172/2005).

At the same time, it is also possible to make a partial contribution to the preservation of the property, where rescue services were provided by more than one salvors and contributed to the useful result, even if each of them alone could not have achieved a useful result. The existence of an alternative means of providing salvage assistance is a factor which will affect the degree of risk, and entail a reduction of the remuneration when it is determined by the court. Often, in cases where a ship in distress is rescued by another ship, it is demonstrated that if a ship in distress had not been rescued by the salvor's ship, it would not have been lost, but would have been rescued by other salvors. In such cases it should not be assumed that because there is an alternative means of assistance, there is no danger.

Salvage remuneration is the consideration due by law and determined by the court, payable to the person or persons assisting by the owners of the salvaged property under arts 13, and 15.1. The amount of the remuneration is determined by the court on the basis of the criteria set out in art 13.1, irrespective of the order in which they are listed. These criteria are either: (i) assessed by the parties to a contract entered into after the salvage and not subject to judicial annulment or modification because it was not entered into under the influence of the risk; or (ii) assessed by the parties to an agreement prior to the salvage, in which case, if the risk existed, the agreement is subject to judicial annulment or modification; or (iii) assessed by the court. The criteria are stated by law to be exhaustive (restrictive) rather than indicative and are subject to the rule that they are aimed at encouraging the willingness, ability, equipment of the salvor (Court of Appeal of Piraeus Decision 207/2008; Court of Appeal of Piraeus Decision 893/2013; Court of Appeal of Piraeus Decision 1013/2006).

According to art 15.1, if the assistance was provided by several salvors, the distribution of the remuneration between the salvors is based on the art 13 criteria, and distributed among them according to the contribution of each of them to the rescue of the ship in distress, but any salvage agreement prevails over these criteria (Court of Appeal of Piraeus Decision 893/2013).

Further, towage is the service paid to a ship, equipped with propulsion power, that transports from place to place, either a ship which is generally or partly without propulsion power of its own, or generally any floating structure, by means of a tow which connects the tug to the towed vessel. Towage has the character of a contract of hire for work when the towed vessel has a sufficient crew of its own and is controlling its own movements in the context of its limited activity, and does not follow the tug as an inert body. In other cases, where the towed vessel has no crew of its own and is not in control of its own movements, but is in the care of the tug, under the authority of the master of the towing ship, and follows the tug as an inert body, the towage is characterised as a charterparty. Moreover, the difference between salvage and simple towage lies precisely in the fact that the former presupposes the existence of a serious risk of loss or damage to the ship, whereas in the latter the ship is simply unable for some other reason (deprived of all or part of its own propulsion power) to continue its voyage and requests the assistance of another ship to continue.

The Court examined the facts and concluded that this was a maritime salvage operation and not a simple towage service because the defendant's ship was facing a real risk of capsizing and sinking in the port of Corfu. The risk was imminent and immediate, highly probable and likely, due to the continuing infgress of water into its interior, the specific areas of the ship which were flooded by water, together with the loss of its own means of propulsion. The damage caused by its impact on the shoals of the rocky islet Peristeres was considerable.

The risk, for the most part, passed with the unloading of the vehicles, but was not completely eliminated. Thus, the services rendered by the claimants' ships throughout the whole period constitute essential maritime salvage services.

The Court of First Instance, which similarly accepted that the defendant's vessel was in danger of capsizing and sinking in the port of Corfu, with the result that the services provided to it by the claimants' vessels constituted maritime salvage services, for which they were entitled to reasonable remuneration, and not mere towage, correctly assessed the evidence. However, when it held that the above services were provided to the defendant's vessel until 25 September 2014, it incorrectly assessed the evidence. It should have accepted that those services were provided by the DO and the Th until 4 October 2014, and by the DI until 6 October 2014.

It was also proven before the Court of Appeal that the defendant purchased the EU for the amount of EUR 86,000,000 in September 2013 and that the value of the ship could not have dropped to EUR 70,000,000 by August 2014 due to normal daily use and operation of the vessel. As a consequence, when the claimants' vessels provided the EU with maritime salvage services, its market value was equivalent to its purchase price a year ago. The total cost of repairs amounted to EUR 31,135,647.80. Thus, the value of the salvaged ship amounted to EUR 54,864,352.20, as was accepted by the Court of First Instance, which correctly assessed the evidence.

On an application of the criteria of art 13 of the Salvage Convention 1989, the Court of Appeal found that total reasonable remuneration should be set at EUR 1,600,000, since it has not been proved that there was an agreement between the parties to that effect. This amount was to be distributed as follows: a) for the first and second claimants EUR 645,280 each; and b) for the third claimant EUR 309,440. The Court of First Instance, which found that a reasonable remuneration of the claimants for their maritime salvage services amounted to EUR 1,200,000, calculated on, among other criteria, the time spent by the claimants' vessels, incorrectly held that the salvage services ended on 25 September 2014.

The claimants are entitled to the above amount of remuneration in its entirety, since they are professional salvage vessels, that is to say, vessels of special design and equipment, which provide maritime salvage services, not on an occasional and casual basis, but on a professional and profit-making basis and in a customary manner, equipped with the appropriate life-saving appliances and equipment, having provided such services on a large scale in the past in various incidents, and remunerated on the basis of the Lloyd's standard form, either mostly by way of compromise or by referral to arbitration, while also performing towage services, which of course lack an element of risk.