The Baltic Exchange’s dispute resolution service has a new manager, experienced shipbroker Anthony Zavos. The free for members service, which in 2020 handled 60 cases and recovered $6.5m of claims, is designed to negate the need for further legal costs. It can help recover unpaid commissions, freight, demurrage and arbitration awards. The majority of cases have involved issues in the physical dry bulk and tanker markets, but FFA related disputes are also investigated. Whilst some of the claims have involved seven figure sums, many can be for as little as $10,000 and deemed not financially worthwhile to appoint lawyers to collect.

According to Anthony Zavos, whose 35-year career in shipping has included stints with Jebsen, Furness Withy and China Navigation, the Baltic understands the sensitivities involved with chasing claims and the importance of maintaining commercial relationships. All cases reported to the Baltic are handled in close cooperation with the company reporting the issue.

He notes: “We cannot intervene with cases still in dispute or arbitration, but we are there to mediate. It’s not our job to adjudicate.”

Thanks to the recent introduction of a new software system, activating the service is easier than ever before. The claimant is asked for a summary of the dispute, a copy of the charterparty (if relevant), details of the defendant, including domicile and full address. All parties involved are then contacted for clarification. Indeed, many cases are resolved at this stage without the need for further action. In 2020, 65% of cases brought to the Baltic were resolved this way.

Where facts need further investigation, the team digs deeper with guidance on procedure from the Membership Council, acting in line with the governance of the Baltic Code.

If the defaulting counterpart fails to provide satisfactory resolution, the Council will issue a warning that they risk being suspended or expelled from membership or “Posted.” Currently chaired by Colm Nolan, the Council is made up of six members and meets every six weeks. It has disciplinary powers of censure, suspension and expulsion over members and is responsible for maintaining proper, ethical standards in trading.

If no acceptable resolution can be achieved, the Baltic’s ‘Posting’ sanction will be enforced. This warning is recognised across the global membership, which encompasses a majority of shipping interests worldwide as well as those in financial and commodity markets, due diligence agencies including Infospectrum and Orbis. All members have access to the posting list which can be found in the intelligence section of the password protected “MyBaltic” area of www.balticexchange.com.

Anthony Zavos says that with shipping more regulated than ever before, the levels of due diligence required before fixing or doing business with a new counterparty are high. However, all too often he notes that brokers will quote new business or vessels of which they know little or nothing about.

“The Baltic Exchange can play a part in this due diligence process,” he says. “Not only do we have a database of postings, but we are often able to provide informal guidance about a company and its track record with other members. A quick call to the Baltic can potentially save big future headaches.”

Whilst the service is available directly for all Baltic members, it is important to note that the service can also act on behalf of a member’s client. In these cases, the Baltic will take a success fee which is 15% of the value of the claim, capped at $15,000. One major P&I Club already uses the service to support its claims handling on a regular basis.  

For further details please contact Anthony Zavos.

Tel: +44 (0)20 7369 1628
Email: disputeclaims@balticexchange.com