English
This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.
PRINT
SHARE
P&I (CLASS 3) / PART VII / RULE 39
RESERVES
The Board may establish and maintain such reserve funds or other accounts for such contingencies or purposes as it in its discretion thinks fit. In particular:
39.1 General Reserve
The Board may set aside at any time to General Reserve such sums from the proceeds of the Estimated Total Call or Exceptional Call in respect of any Policy Year as it thinks fit. Such General Reserve may be used by the Board at any time:
39.1.1 so as to provide in whole or in part for any claims, expenses, losses or other outgoings of the Association (whether incurred, accrued or anticipated) and including, but not limited to, any deficiency which has occurred or may occur in respect of any Closed Policy Year or so as to eliminate or reduce any Call in respect of any Policy Year past, present or future; or
39.1.2 to make a distribution to Members of such amount and in such manner as it thinks fit.
39.2 Overspill Reserve
The Board shall create an Overspill Reserve or Reserves from the proceeds of any Overspill Call or Calls.
39.2.1 Any Overspill Reserve so created shall be made up from the proceeds of one Overspill Call only and shall be specified to be in respect of a particular Overspill Claim (whether such claim has occurred or is anticipated).
39.2.2 Any Overspill Reserve shall be invested by the Board as a separate fund and any gains (including dividends, interest, or accruals of interest) or losses, in the funds so invested, shall be credited or debited, as the case may be, to the said Overspill Reserve.
39.2.3 Each Member who has made a contribution to an Overspill Call which has been used to create an Overspill Reserve shall (subject to the powers of the Board under this Rule 39.2) have an interest in such Overspill Reserve proportional to the amount actually contributed by the Member to the Overspill Call which was used to create the said Overspill Reserve.
39.2.4 Any sums standing to the credit of an Overspill Reserve shall be used to eliminate or reduce the burden of the specified Overspill Claim or to pay such claim in whole or in part, or shall be returned to the Members in accordance with Rule 39.2.6 below.
39.2.5 If more than one Overspill Call has been made in respect of one Overspill Claim and more than one Overspill Reserve created in accordance with the provisions of Rule 39.2.1 above in respect of such Overspill Claim then such Overspill Reserves shall be utilised by the Board for the payment of such Overspill Claim in the order in which they were established.
39.2.6 If at any time it shall appear to the Board that the sum standing to the credit of an Overspill Reserve is greater than is required to meet the actual or anticipated Overspill Claim for which it was established the Board may order the whole or part of such surplus to be returned to the Members who contributed by way of Overspill Call to such Overspill Reserve. Any such return shall be made to Members in proportion to their interests in the said Overspill Reserve as set out in Rule 39.2.3 above.
Provided always that:
39.2.6.1 the Association shall be entitled to set off any sums owing to the Association by a Member against any such return; and
39.2.6.2 if in the opinion of the Board it appears impossible or impracticable to make such a return to one or more Members then the amounts which would otherwise have been due to be returned shall be transferred to General Reserve; and
39.2.6.3 no return shall be made in respect of Contributions levied on any Ship which has been released under Rule 14 Release.