De Beers Marine (Pty) Ltd v Harry Dilley (Pty) Ltd

De Beers Marine (Pty) Ltd (De Beers) owned an autonomous underwater vehicle (AUV), a robotic submarine used for seabed mapping. In September 2017, De Beers contracted with Harry Dilley (Pty) Ltd (HD) to charter a work boat, MV Nkwaza, for sea trials in False Bay, Western Cape, to commission new equipment on the AUV. The contract (2017 contract) tacitly incorporated terms from a 2015 charter agreement. During sea trials on 27 October 2017, the AUV suffered a communication breakdown and was washed ashore on rocks near Simon's Town. HD's work boat, skippered by Mr Harry Dilley, with the assistance of two commercial divers (Mr Garthoff and Mr Day), re-floated the AUV and towed it to Simon's Town harbour. The entire recovery operation lasted about an hour. HD subsequently sued De Beers claiming R10 million (later reduced to R7,647,231.54, alternatively R5,525,288.23) as a salvage reward. The High Court (Western Cape Division, Le Grange J) awarded HD R5,525,288.23, being 10% of the AUV's replacement cost of R55,252,882.20. De Beers appealed.

• Whether HD's services in recovering the AUV were rendered voluntarily (entitling HD to a salvage reward) or were performed pursuant to the 2017 charter contract (entitling HD only to contractual fees)
• Whether alleged tacit terms requiring HD to tow the AUV 'should the need arise' could be incorporated into the 2017 charter contract
• Whether the salvage reward of R5,525,288.23 fixed by the High Court was appropriate having regard to the criteria in article 13(1) of the International Convention on Salvage, 1989
• What is the correct approach to appellate review of salvage reward determinations

The appeal succeeded in part. The High Court's order was set aside and replaced with: (1) a salvage reward of R80,000 fixed in terms of article 13(1) of the International Convention on Salvage, 1989; (2) interest a tempore morae from date of service of summons to payment in terms of s 5(2)(f) of the Admiralty Jurisdiction Regulation Act 105 of 1983; (3) De Beers to pay HD's costs of the action, including costs of two counsel. Each party was ordered to bear its own costs of appeal, as both were partly successful.

The binding legal principles are: (1) Under article 17 of the International Convention on Salvage, 1989, no payment is due unless services rendered exceed what can reasonably be considered due performance of a contract entered into before the danger arose. Services are 'voluntary' when not rendered pursuant to a pre-existing contractual or legal duty. (2) Tacit terms cannot be incorporated into a contract where they contradict express contractual terms or where the parties objectively would not have intended them. (3) When fixing a salvage reward under article 13(1) of the Salvage Convention, the 'salved value' in article 13(1)(a) means the value of the property after salvage, not its replacement cost or value before the casualty. (4) A salvage reward must not be out of proportion to the services actually rendered, regardless of the high value of the property salved (applying The 'Amerique' principle). (5) The article 13(1) criteria must be analyzed in light of the facts to determine an appropriate award that: reflects the benefit received by the salvee; rewards the salvor for services provided; and implements public policy of encouraging salvage through generous but proportionate awards. (6) An appellate court may set aside a salvage reward that is manifestly excessive and disproportionate to services rendered, even if views may reasonably differ on quantum.

The Court made observations on the nature of the discretion in fixing salvage rewards under article 13(1), noting it does not fit neatly into the binary distinction between 'true' and 'loose' discretion established in Trencon Construction. Rather, it is a structured power to fix a reward serving a particular purpose (encouraging salvage) determined by reference to stated criteria. The Court also noted that while professional salvors might use dedicated salvage vessels kept in readiness (as in The Glengyle), HD was not a professional salvor, used no salvage equipment of its own, and the Nkwaza was not a dedicated salvage vessel. The Court observed that the divers assumed the greatest risks in the operation and were only paid an agreed fee of R10,000, not a salvage reward. The judgment also contains observations on the incorporation of the Salvage Convention into South African law through the Wreck and Salvage Act 94 of 1996, and notes that article 17 restates the general principles of English common law that a salvor must be a volunteer to claim a reward, though the Convention does not expressly state this general rule but implies it through its structure.

This case provides important South African jurisprudence on the law of salvage, particularly: (1) clarification of when services are 'voluntary' under article 17 of the International Convention on Salvage, 1989 - services exceed contractual performance when an AUV runs aground and recovery is required, as opposed to towage on the surface contemplated by contract; (2) authoritative application of article 13(1) criteria for fixing salvage rewards, emphasizing that 'salved value' means the value of property after salvage, not replacement cost; (3) reaffirmation of the principle from English salvage law (The 'Amerique') that salved value must not raise the reward to an amount disproportionate to services rendered; (4) guidance on the nature of the discretion in fixing salvage rewards - it is a structured determination based on prescribed criteria that must serve the policy of encouraging salvage while maintaining proportionality; (5) clarification on appellate review standards for salvage awards - interference is warranted where the award is manifestly excessive and out of proportion to services, not merely because the appellate court would have awarded a different sum. The judgment reinforces that salvage law must balance generous rewards to encourage salvage services with fairness and proportionality based on actual services rendered and value saved.