NATIONAL OPEN UNIVERSITY OF NIGERIA
14/16 AHMADU BELLO WAY, VICTORIA ISLAND, LAGOS
SCHOOL OF LAW
MARCH/APRIL 2014 EXAMINATION
COURSE CODE: LAW532
COURSE TITLE: MARITIME LAW II
TIME ALLOWED: 3 HOURS
INSTRUCTION: QUESTION ONE IS COMPULSORY AND YOU ARE TO ANSWER ANY OTHER THREE (3) QUESTIONS. All questions carry 17.5 marks
1. Equatorial Shipping Line Plc is a shipping company and has a fleet of ships in its inventory. It secured a major contract from Republic of Ciga for the purpose of shipping the goods of that country. In order to effectively fulfill its obligations under the contract with Republic of Ciga, Equatorial Shipping Line decided to procure more ships from ship building companies. Equatorial Shipping Line, however, does not have all the financial resources to pay for the new ships it intends to acquire. It approached Fine Bank Plc to finance the procurement of the ships. Fine bank Plc has agreed to finance the acquisition of the ships on the condition that the interests or property in the ships should be conveyed to it by Equatorial Shipping Line. Equatorial Shipping Line has agreed to convey its interests in the new ships to Fine Bank Plc. Equatorial Shipping Line and Fine Bank Plc has executed a formal agreement by which all Equatorial Shipping Line’s interests in one of the ships were transferred to Fine Bank Plc as a security for the facility granted to Equatorial Shipping Line by Fine Bank Plc. With respect to the second ship which is still under construction, Equatorial Shipping Line deposited the Builder’s Certificate with Fine Bank Plc as security for the second ship which is under construction. Equatorial Shipping Line has taking possession of the two ships and is using them for the contract it secured. Equatorial Shipping Line has failed to make good its obligation to Fine Bank Plc by repaying the facilities it took from Fine Bank Plc. Equatorial Shipping Line is contending that the first agreement with Fine Bank Plc is not legal and therefore not enforceable against it because it was not registered. It also contends that the second agreement is not enforceable because there was no formal agreement signed between the parties. It further contends that the Builder’s Certificate which it gave to Fine Bank Plc as security does not constitute a contract between the parties. Advice Equatorial Shipping Line on the merits of the claim by Equatorial Shipping Line. 17.5 Marks
2. Maritime Worldwide Plc has vast investments in shipping and related businesses. The company has decided to expand its business pursuant to a strategic business development programme designed by consultants to the company. Accordingly, the companyhas ordered three ships from its ship buildersand the ship builders have concluded construction of the ships. However, Maritime Worldwide Plc has been experiencing cash flow problems in recent times asa result of recession in the world economy. To overcome this problem the company has approached Clean Bank Plc to finance the acquisition of the ships. The bank has agreed on the condition that the ships should be used as security for the funds it will lend to the company. Both parties have entered into an agreement which by its nature transferred Maritime Worldwide Plc’s interests in the ships to Clean Bank Plc. By the terms of that agreement the shipping company will continue to use the ships for its business, insure the ships and maintain the ships. The shipping company has failed to insure the ships and the bank being apprehensive that it may be exposed to unnecessary risk has gone ahead to insure the ships and added the cost of the insurance to the funds that the shipping company is meant to repay to the bank. Maritime Worldwide has refused to pay the part of the money representing the cost of insurance because it was the bank that ought to insure the ships in the first place. Clean bank has threatened to sell the ships. Advice the parties. 17.5 Marka
3. Metal Petroleum is an oil company operating in the offshore of the Kongo Republic. By this very fact the compay has considerable experience in off shore technologies. Since it has several oil wells offshore it decided to procure aFloating Production Storage and Offloading (FPSO) platform from Hampa Heavy Industries inorder to enable it to produce, store and transmit oil from its production platform to ships that carry the oil to the international market. The Maritime Commission of Kongo Republic has demanded that the Minister in Charge of transport in that country must make rules relating to the construction of the Floating Production Storage and Offloading (FPSO) platform; that the Floating Production Storage and Offloading (FPSO) platform should be registered in Konga Republic. Metal Petroleum has refused these conditions on the ground that the Floating Production Storage and Offloading (FPSO) platform as well as Floating Storage and Offloading (FSO) platform.is not a ship and that when it eventually sales the platform latter it will not comply with the requirements of the sale of ship in Konga Republic. Advice the parties. 17.5 Marks
4. The law relating to the survey of ships and rules relating to collision of ships are critical in order to ensure safety of maritime transportation. Discuss. 17.5 Marks
5. Discuss the following:
a. Limitation of Liability
b. Salvage
c. Towage
d. Pilotage
17.5 Marks
6. Discuss the following issues:
a. Utmost Good Faith
b. Indemnity
c. Insurable Interests
d. Rights of Insurers
17.5 Marks
You can get the soft copy for this course or the exam summary answers for this course from 08039407882
Exam summary sample below
