This was an appeal in cassation against decree no 185/2014 of the Court of Rome, in respect of a salvage claim brought by Purple Water Ltd (Purple) as assignee of the rights of Rimorchiatori Siciliani Srl and PurpleWater Towing Ltd, the owners of the tugs Alce Nero and Garibaldo, which, together with other units of the Fire Brigade and the Port Authority of Palermo, came to the rescue of the motor ship Vincenzo Florio (belonging to Tirrenia di Navigazione SpA (Tirrenia) and used on the Naples-Palermo ferry line), following a fire on board around 3h40 on 29 May 2009. After the incident, Tirrenia was placed under extraordinary administration [an insolvency regime broadly similar to US Ch 11 bankruptcy]. The Court of Rome partially upheld Purple's claim for compensation for the salvage operation pursuant to art 1.a of the Salvage Convention 1989 and awarded EUR 979,200 (as opposed to the EUR 2,750,000 claimed).

Tirrena appealed in cassation on five grounds. Purple counter-appealed, proposing in turn a conditional cross appeal.

Held: The first and third grounds of the appeal are accepted; the second and fourth are declared; the fifth plea is rejected. The contested judgment is struck down in relation to the grounds accepted and referred back to the Court of Rome, differently composed.

The matter in question is governed by the Salvage Convention 1989, ratified in Italy by Law no 129 of 12 April 1995, in force since 14 July 1996, which, unlike the previous Brussels Salvage Convention of 1910, applies in principle (with the exceptions provided in art 3 for 'platforms and drilling units', in art 4 for warships and state-owned vessels entitled to sovereign immunity, and in art 6 for salvage contracts that opt out of the Convention, subject to the annulment and modification of salvage contracts pursuant to art 7 and the obligations 'to prevent or minimize damage to the environment') whenever in a State Contracting Party 'judicial or arbitral proceedings relating to matters dealt with in this Convention are brought' (art 2), which Convention therefore has the nature of a substantive lex fori - regardless of the (non-)involvement of international parties and which therefore also applies to national salvage operations - with respect to which the Code of Navigation assumes the role of supplementary applicable national regulation only to the extent that it is compatible with uniform international law.

This is the case, of course, unless 'reservations' are formulated pursuant to art 30 of the Convention, which allows the Contracting States to 'reserve the right not to apply the provisions of this Convention: (a) when the salvage operation takes place in inland waters and all vessels involved are of inland navigation; (b) when the salvage operations take place in inland waters and no vessel is involved; (c) when all interested parties are nationals of that State; (d) when the property involved is maritime cultural property of prehistoric, archaeological or historic interest and is situated on the sea-bed'. It does not appear that such reservations have been made by Italy.

In particular, art 1.a of the Convention defines 'salvage operations' as meaning 'any act or activity undertaken to assist a vessel or any other property in danger in navigable waters or in any other waters whatsoever' ('property' meaning, pursuant to art 1.c, 'any property not permanently and intentionally attached to the shoreline and includes freight at risk') and art 5.1 provides that the Convention does 'not affect any provisions of national law or any international convention relating to salvage operations by or under the control of public authorities', specifying in art 5.2 that, nevertheless, 'salvors carrying out such salvage operations shall be entitled to avail themselves of the rights and remedies provided for in this Convention in respect of salvage operations' (as well as, pursuant to art 5.3, providing that the 'extent to which a public authority under a duty to perform salvage operations may avail itself of the rights and remedies provided for in this Convention shall be determined by the law of the State where such authority is situated'.)

Having said this, on the first ground of appeal, Tirrenia complains of the violation or false application of arts 1224 and 1277 of the Civil Code, in that the Court below 'erroneously quantified the salvage fee as a debt of value, having a compensatory nature', without taking into account the value of the property saved, since this value is taken as a criterion of quantum, even if it is not exhaustive. This complaint is well founded. Undoubtedly salvage operations at sea constitute a source of obligations even when not of a contractual nature, being classifiable in the genus of 'any other act or fact capable of producing obligations in accordance with the law', pursuant to art 1173 of the Civil Code. Indeed, art 8 of the Salvage Convention 1989 governs the 'duties of the salvor and the owner and the master' (the latter being personally bound, pursuant to art 10, 'so far as he can do so without serious danger to his vessel and persons thereon, to render assistance to any person in danger of being lost at sea') while arts 12 and following govern the 'rights of salvors', first of all the 'right to a reward'. In particular, art 12.1 of the Convention states that 'salvage operations which have had a useful result give right to a reward' (specifying in art 12.2 that, '[e]xcept as otherwise provided, no payment is due under this Convention if the salvage operations have had no useful result'); art 13 dictates a series of 'criteria for fixing the reward', all of equivalent scope, 'with a view to encouraging salvage operations': (a) the salved value of the vessel and other property; (b) the skill and efforts of the salvors in preventing or minimizing damage to the environment; (c) the measure of success obtained by the salvor; (d) the nature and degree of the danger; (e) the skill and efforts of the salvors in salving the vessel, other property and life; (f) the time used and expenses and losses incurred by the salvors; (g) the risk of liability and other risks run by the salvors or their equipment; (h) the promptness of the services rendered; (i) the availability and use of vessels or other equipment intended for salvage operations; (j) the state of readiness and efficiency of the salvor's equipment and the value thereof - specifying that '[t]he rewards, exclusive of any interest and recoverable legal costs that may be payable thereon, shall not exceed the salved value of the vessel and other property' (art 13.3); finally, art 14 provides for a specific 'special compensation' for those who have 'prevented or limited damage to the environment', calculated on the basis of 'expenses ... incurred'.

The right to 'compensation' under the Convention - understood as the payment of a sum of money in favor of the salvors, with the character of remuneration or reward, responds not only to obvious equitable reasons, but also to the declared policy intention of 'encouraging salvage operations' (art 13.1), to achieve the priority objectives of safeguarding human lives (art 16 provides that '[n]o remuneration is due from persons whose lives are saved, but nothing in this article shall affect the provisions of national law on this subject' and that a 'salvor of human life, who has taken part in the services rendered on the occasion of the accident giving rise to salvage, is entitled to a fair share of the payment awarded to the salvor for salving the vessel or other property or preventing or minimizing damage to the environment'), and safeguarding public interests in the national economy and the environment. Nor must one be misled by the references contained in art 13.f and 13.g, as these are simply some of the many concurrent criteria for quantifying a fee that retains its character of monetary remuneration. Moreover, the Convention establishes that '[e]xcept as otherwise provided, no payment is due under this Convention if the salvage operations have had no useful result' (art 12.2) - in line with the Anglo-Saxon principle of 'no cure, no pay'.

The assertion of the Court below about the compensatory nature of the fee in question was therefore erroneous.

The second submission complains about the violation or false application of art 13.2 of the Convention and art 497 of the Navigation Code. Article 13.2 provides that '[p]ayment of a reward fixed according to paragraph 1 shall be made by all of the vessel and other property interests in proportion to their respective salved values. However, a State Party may in its national law provide that the payment of a reward has to be made by one of these interests, subject to a right of recourse of this interest against the other interests for their respective shares. Nothing in this article shall prevent any right of defence.' Article 497 of the Navigation Code provides that 'the expense for indemnities and compensation due to the salvor ship in case of assistance or salvage of ship or aircraft shall be shared by the interested parties in the salved venture in accordance with the provisions on general average contributions, even when assistance has not been requested by the master of the ship or aircraft in distress or has been provided against his refusal'. The complaint is inadmissible. It should be remembered that the Salvage Convention 1989, although applicable in the Italian legal system as substantive lex fori, does not exclude the applicability of national law as a supplementary means, with regard to non-regulated aspects - within the limits of compatibility - or where the Convention is subject to a different discipline of national law. The latter is the case in art 13.2 of the Convention, which allows the acceding States to contemplate an obligated principal with the right of recourse against the other co-obligors, or different forms of joint or apportioned liability (and in fact similar solutions have been adopted in various ways, in the German, Danish, Dutch, French, German, Greek, Spanish and US legal systems). Such a reference in the Convention to domestic law includes - of course - already existing provisions in domestic law.

The Court then surveyed previous Italian decisions which indicated that, under Italian law, the shipowner has always been regarded as the leader of the maritime expedition and therefore as the 'principal debtor' to the salvor. The shipowner can thereafter file a recourse action against the cargo interests whose property has been saved, by analogy to the York-Antwerp Rules regime.