Legal Definitions - extraordinary average

The term "extraordinary average" is a concept primarily found in maritime law. It refers to a specific type of loss or expense incurred during a sea voyage that is *not* part of the ship's normal operating costs. Instead, these are voluntary and reasonable sacrifices or expenditures made by the ship's master or crew to save the entire vessel, its cargo, and the lives on board from an imminent and shared danger.

When such an extraordinary sacrifice or expense is made, all parties whose property was saved (the ship owner and the owners of the cargo) are legally obligated to contribute proportionally to cover that loss or expense. This principle, known as "general average," ensures that no single party bears the full cost of an action taken for the common good.

Here are some examples illustrating "extraordinary average":

• Jettisoning Cargo to Prevent Sinking:

  Scenario: A large container ship encounters an unexpected, violent storm in the open ocean. The vessel begins to list dangerously, taking on water, and the captain determines that the ship is at imminent risk of capsizing. To lighten the ship and prevent it from sinking, the captain orders a portion of the non-essential deck cargo to be thrown overboard.

  Explanation: The value of the cargo deliberately thrown overboard (jettisoned) represents an extraordinary sacrifice. This action was not a normal part of the voyage but a voluntary and reasonable measure taken to save the entire ship and the remaining cargo from a shared peril (sinking). The financial loss from the jettisoned cargo would be considered an "extraordinary average" expense, to be shared proportionally by the ship owner and the owners of the cargo that was successfully saved.

• Diverting to a Port of Refuge for Emergency Repairs:

  Scenario: A bulk carrier suffers a severe engine malfunction mid-voyage, rendering it unable to maintain safe propulsion. Continuing the journey would risk further damage, potential breakdown, and loss of the vessel and its valuable cargo. The captain decides to divert hundreds of miles off the planned route to the nearest suitable port equipped for major engine repairs.

  Explanation: The additional costs incurred due to this diversion—such as extra fuel, port charges, pilotage fees, and the expenses for temporary repairs at the port of refuge—are extraordinary expenses. These costs were not anticipated in the original voyage plan but were voluntarily and reasonably incurred to secure the safety of the ship and its cargo from a common danger (being stranded or breaking down at sea). These expenses would qualify as "extraordinary average" and would be shared among all parties who benefited from the ship's safe arrival and subsequent repairs.

• Hiring Salvors to Refloat a Grounded Vessel:

  Scenario: A tanker carrying crude oil accidentally runs aground on a sandbar in a busy shipping lane. The ship is stuck fast and cannot free itself using its own power. To prevent potential environmental disaster, further damage to the hull, or the complete loss of the vessel and its cargo, the ship owner contracts a specialized salvage company to pull the ship off the sandbar.

  Explanation: The substantial fees paid to the professional salvage company are extraordinary expenses. While the grounding itself might have been an error, the decision to hire salvors was a deliberate and reasonable action taken to save the entire venture (the ship and its valuable cargo) from the peril of being stranded, breaking up, or causing pollution. These salvage costs would be considered "extraordinary average" and would be shared proportionally among the ship owner and the owners of the crude oil cargo.