Lloyd's Maritime Law Newsletter
Margate Shipping Co v M/V ‘J A Orgeron’ - US Court of Appeals (5th Circuit) (Garwood, Jolly and Higginbotham Ct JJ) - 29 June 1998
Salvage award - Largest maritime salvage award in history - Whether district court erred in its valuation of salved property
During a severe tropical storm off the Florida coast in November 1994 the vessel
Cherry Valley
, an oil tanker belonging to Margate Shipping Co, rescued a barge containing a valuable external fuel tank for NASA’s space
shuttle. The district court held that Margate was entitled to a salvage award equal to 12.5% of the value of the salved property.
It found that the value of the barge was $2 million and that the value of the fuel tank was some $51 million, on the basis
that that was the production cost. The district court accordingly awarded Margate approximately $6.4 million in salvage -
apparently the largest maritime salvage award in recorded history. The district court noted, in the alternative, that even
if the value of the fuel tank was only $19 million as the United States had claimed, it would adjust the percentage accordingly
so as to result in the same figure for the salvage award.