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Ilyashev & Partners Persuades Ukraine's State Ecological Inspection to Accept British P&I Club’s Letter of Undertaking as Security for Claim

Ilyashev & Partners Persuades Ukraine's State Ecological Inspection to Accept British P&I Club’s Letter of Undertaking as Security for Claim

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Acting on behalf of Challenge Shipping Ltd., the Odesa office of Ilyashev & Partners has secured the acceptance by Ukraine's State Ecological Inspection of a British protection and indemnity club's letter of undertaking as a sufficient security for a maritime claim.

Challenge Shipping Ltd. is the owner of the bulk carrier New Challenge, which was detained at the Port of Mykolaiv on July 17, 2020 in connection with an incident taking place involving cargo offloading.

According to Ilyashev & Partners, on July 12, 2020, "when unloading a 12-ton forklift from New Challenge, due to a breakage of the rope on a ship’s crane hook, the forklift fell on the berth from a height of four meters, which resulted in significant damage to the berth and a pipeline of the neighboring oil terminal. As a result, about ten tons of sunflower oil spilled on the berth, some of which got into the port water area, which led to the New Challenge captain being held administratively liable for the environmental pollution, as well as to a claim exceeding UAH 5 million. The total amount of claims against the vessel amounted to about UAH 13.5 million."

Ilyashev & Partners Attorney at Law Sergey Nedelko reported that the firm was able to "persuade the State Ecological Inspection of Ukraine to accept the P&I club’s letter of undertaking as a security in respect of a maritime claim that fully meets the world’s best maritime practice. This allowed the vessel to leave the port safely and the shipowner to avoid huge losses."

According to Ilyashev & Partners, "despite the fact that starting in the 19th century letters of undertaking of P&I clubs are widely used to secure maritime claims in many jurisdictions, their status is not yet regulated by the Ukrainian law."

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