Salvage Law and Legal Definition

Salvage is a payment to a person or group which saves cargo from a shipwreck. Claims for salvage may be based on services rendered either voluntarily or pursuant to a contract. Salvors who contract to assist a ship in distress must be paid according to their efforts, even though their services may prove useless to the vessel or cargo, unless by the terms and provisions of the contract their right to compensation depends on success. A "no cure-no pay" provision in a contract allows compensation only on successful completion of the salvage operation. Contract disputes are heard in an admiralty court, and contracts will generally be enforced despite the value of the cargo recovered unless fraud, compulsion, or clear mistake of fact exists.