Article 266 of the Saudi Commercial Maritime Law
المادة 266 من النظام البحري التجاري · الفصل الثاني: الإنقاذ البحري
The Article allows the court, at a party's request, to annul or amend a salvage agreement if its terms are unfair and made at the time of danger, if consent was tainted by fraud, or if the reward is disproportionate.
Official text (Arabic)
This article has not been amended since the law was issued.
للمحكمة -بناء على طلب أحد الطرفين- إبطال أو تعديل أي اتفاق على الإنقاذ البحري إذا تبين لها أن شروطه غير عادلة, وتمت وقت الخطر وتحت تأثيره، أو إذا كان رضا أحد الطرفين قد شابَهُ تدليس أو غش، أو إذا كانت قيمة المكافأة مبالغاً فيها زيادة أو نقصاً بحيث لا تتناسب مع الخدمة التي قدمت.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 266 explained in plain English
A salvage agreement is often concluded at a moment of danger, when the threatened ship has no real opportunity to negotiate. For this reason the Article gives the court, at the request of one party, the power to annul or amend any maritime salvage agreement in three cases:
- if its terms are shown to be unfair and were made at the time of danger and under its influence. Both must be present together.
- if the consent of one of the parties was tainted by fraud or deceit.
- if the amount of the reward is excessive or too low so that it is not proportionate to the service rendered.
Note that the third case protects both parties: the salvaged ship benefits if the reward is excessively high, and the salvor benefits if it is paltry and not proportionate to his effort.
The court does not intervene on its own under the text, but at the request of one of the parties. In setting the reward the court considers the bases in Article 267, including the value of what was saved, the danger threatening the ship, the duration of the salvage, and the expenses. Anyone who believes a salvage agreement he concluded was unfair may consult a lawyer specializing in maritime matters.
Practical example
The engine of a small ship failed in the middle of a storm, and a rescue boat demanded an amount far exceeding the value of the service, which its master accepted under the pressure of danger. The ship's owner may afterwards ask the court to amend or annul the agreement, because its terms are unfair and were made at the time of danger and under its influence.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 266 of the Saudi Commercial Maritime Law
Can a salvage agreement signed by a ship in danger be canceled?
The court may annul or amend it at the request of one party if its terms are unfair and were made at the time of danger and under its influence.
What if the salvage reward is very low?
The court may annul or amend if the reward is excessive or too low so that it is not proportionate to the service provided.
Does fraud affect a salvage agreement?
Yes. If the consent of one party was tainted by fraud or deceit, the court may, at the request of one of them, annul or amend the agreement.
More articles on Collision and Maritime Salvage
- Article 111
The master submits a report on unusual incidents to the Authority within 24 hours of arrival; the Authority verifies it and draws up a record, and the master may not unload the affected cargo before the report except in extreme necessity.
1- إذا طرأت أثناء الرحلة حوادث غير عادية تتعلق بالسفينة أو بالركاب أو بالشحنة وجب على الربان أن يعد تقريراً بذلك يقدمه إلى الهيئة خلال أربع وعشرين ساعة من وصول
- Article 254
The article specifies who bears compensation for a maritime collision according to its cause: fault of one ship, force majeure or an unknown cause, or common fault, and sets out the cases of joint liability toward third parties.
1- إذا حدث تصادم بسبب خطأ إحدى السفن التزمت السفينة المحدثة للضرر بالتعويض الذي يترتب على هذا التصادم. 2- إذا وقع التصادم بسبب قوة قاهرة، أو كان هناك شك في أسبا
- Article 255
The Article provides that the liability set out in the collision chapter also arises if the collision occurs through the pilot's fault, even if pilotage is compulsory, without prejudice to the general rules of liability.
تترتب المسؤولية المنصوص عليها في هذا الفصل, إذا وقع التصادم بخطأ المرشد، ولو كان الإرشاد إجباريًّا، وذلك مع عدم الإخلال بالقواعد العامة في المسؤولية.
- Article 256
The Article requires the master of each ship involved in a collision to help the other ships and those aboard without endangering his own ship, and to give them his ship's particulars; the shipowner is liable only on his express instructions.
1- على ربان كل سفينة من السفن التي حدث تصادم بينها أن يبادر إلى مساعدة السفن الأخرى وبحارتها وغيرهم من الأشخاص الموجودين عليها، وذلك بالقدر الذي لا يعرض سفينته
- Article 257
The Article lists the courts before which a claimant may bring a maritime collision action, and allows arbitration agreements provided it takes place within the area of one of these courts, as the claimant chooses.
1- للمدعي إقامة الدعوى الناشئة عن التصادم البحري أمام إحدى المحاكم الآتية: أ- المحكمة التي يقع في نطاق اختصاصها موطن المدعى عليه، أو مقر عمله الرئيس. ب- المحكمة
- Article 258
The Article bars hearing a collision compensation action after two years from the incident and a recourse action after one year from the death, and suspends the periods if the ship cannot be arrested and the claimant is Saudi or domiciled in the Kingdom.
1- لا تسمع الدعوى بالتعويض الناشئة عن التصادم بعد مضي سنتين من تاريخ وقوع الحادث. 2- لا تسمع دعوى الرجوع المنصوص عليها في الفقرة (5) من المادة (الرابعة والخمسين
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.