## Facts

- Belcher’s tug, the *E.N. Belcher, Jr.*, was pushing two empty barges through Florida waters when it struck a submerged object and began taking on water.
- The captain grounded the barges in the shallows and intentionally ran the tug aground to prevent sinking; the tug was not abandoned.
- The Coast Guard and local fire/police units responded with pumps and other assistance.
- Sea Tow arrived and provided multiple vessels, pumps, and personnel; Sea Tow also helped secure the barges and placed a temporary patch over the hull breach.
- Before Sea Tow began, Belcher’s captain asked about the price; Sea Tow’s captain replied, “We’ll worry about it later,” and Belcher directed Sea Tow to do what was necessary to save the tug.
- Sea Tow and Belcher had prior dealings in which Sea Tow performed similar work and Belcher paid on a flat running-rate basis.
- The district court treated Sea Tow’s efforts as voluntary (“pure”) salvage and awarded $125,000.

## Issues

1. Whether the parties formed a legally enforceable oral agreement for compensation before Sea Tow performed, thereby precluding a pure salvage award.
2. Whether a price left open at the time of agreement defeats formation where prior dealings and customary rates can supply a reasonable compensation term.
3. What remedy applies if a salvage contract exists: salvage reward in equity or contract damages.

## Decision

- The Eleventh Circuit reversed the district court’s $125,000 pure salvage award.
- The court held the parties formed a valid oral salvage contract before performance.
- Because compensation was governed by contract, Sea Tow could not recover a separate voluntary salvage reward.
- The case was remanded for the district court to determine appropriate damages under the parties’ agreement.

## Legal Principles

- When a valid and enforceable agreement governs compensation for salvage services, contract terms (express or reasonably implied) control, and a pure salvage award is unavailable.
- A salvage contract may be oral and may be enforceable even if the exact price is not fixed, where the parties intend to be bound and a reasonable price can be derived from course of dealing and customary rates.
- If a salvage contract is found, the proper remedy is contract damages, not an equitable salvage reward.

## Conclusion

The court held that Sea Tow’s compensation was controlled by an enforceable oral agreement formed before the rescue work began, so the district court erred in granting a pure salvage award; the case was remanded to calculate damages under the contract.


Flagship Marine Servs., Inc. v. Belcher Towing Co., 966 F.2d 602 (11th Cir. 1992)