KEANE & MARLOWE, LLP

Attorneys for Defendants

REPINTER INTERNATIONAL SHIPPING

CO. S.A. and MIACHART CORPORATIONLLC

197Route 18 South Suite 3000

East Brunswick, New Jersey 08816

(732) 951-8300

Mary Ann C. Marlowe (MM-0723)

Christopher P. Keane (CPK-4394)

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

x

DEV AL DENIZCILIK VE TICARET A.S.,

Plaintiff, REPLY AFFIDAVIT OF

ANDREW GOODYEAR

-against07 Civi13397 (JGK)

REPINTER INTERNATIONAL SHIPPING

CO. S.A. and MIA CHART CORPORATION

LLC.,

ECF CASE

Defendants.

x

ANDREW GOODYEAR, being duly sworn, deposes and says:

1 I am a senior Claims Executive employed by Michael Else & Company Limited at 65

Leadenhall Street, London EC3A 2AD.

2 Michael Else & Company are the managers of the Charterers' liability cover provided

under the name of the Charterers P&I Club and act as underwriting agents for syndicate

1036. I have been involved in the field of Charterers' liability insurance since joining

Michael Else & Co in April 1991 and have been working in the shipping industry since

1968.

3 I am duly authorised by Michael Else & Company to make this affidavit in support of the

application brought by our assureds, Repinter International Shipping Co S.A. and

Case 1:07-cv-03397-JGK Document 19 Filed 06/21/2007 Page 1 of 5
Miachart Corporation LLC the Defendants/Charterers in the above captioned action to

have the attachment released against a letter of undertaking put up by Syndicate 1036.

4 I make this affidavit based on the facts and matters within my own personal knowledge

and upon information provided to me by the Defendants' English and United. States

counsel, namely Reed Smith Richards Butler LLP and Keane & Marlowe, LLP

respectively, and in reply to some of the statements made in the 18 June 2007 declaration

ofEpaminondas G. Arghyrakis.

5 I believe that it is important to draw the Court's attention to the role which Charterers'

liability cover plays in facilitating internationaltrade.

6 Before entering into a charterparty, a charterer will want to know that the shipowner is

fully covered with appropriate P&I insurance which will respond in the event that there

are claims for cargo damage and/or other losses which arise out of the negligent operation

of the vessel by the owner.

7 Similarly, one of the concerns of any shipowner contemplating entering into a

charterparty is the ability of his intended charterer to respond to liabilities if these are

incurred due to the charterer's breach of contract.

8 In this case, the Owners did make such an enquiry and were told that the Charterers were

entered with the Charterers P&I Club. This was recorded as a formal term of the

Charterparty - in clause 38 [Exhibit 1].1

9 The charterers' liabilities insured include, in broad terms:

(a)

(b)

(c)

Loss of or damage to the vessel;

Loss of or damage to cargo;

oil pollution;

J The referenceto "Charterers'MutualAssuranceAssn"is a brokererror.As explainedin paragraph23 ofMr

Sunley's first affidavit, the Club was demutualised in 1999 and has been run ever since as a fixed premium

insurance.

Case 1:07-cv-03397-JGK Document 19 Filed 06/21/2007 Page 2 of 5
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(d) loss of or damage to third party property;

(e) death and/or personal injury.

We currently have over 130 policy holders, ranging from large state-owned grain trading

companies and publicly listed commodities houses to small-scale operators who may only

charter a few ships in any given year.

11 The advantage that an owner has when he contracts with a member of the Charterers'

Club is that no matter how large or small the entity with whom he is contracting, the

same level of liability cover is available, independently of any resources which may be

available to the charterer concerned.

12 The owner therefore has the assurance that if a liability arises for which the charterers are

responsible to indemnify him, there is insurance cover in place which will respond.

13 One of the key benefits of such cover is also the ability of owners to obtain security for

claims as and when they arise, pending their later determination in arbitration or before

the relevant court.

14 Typically charterers' liability cover comesfrom three sources:

(a) First, there are fixed premium clubs, like ourselves and Raetsclub, in the

Netherlands, which operate in the same fashion and give the same service as

mutual P&I Club Associations, but are backed by commercial underwriters and/or

the Lloyds market

(b) Secondly, some charterers, for example many of the large oil trading companies

and majors, take out insurance cover directly from commercial underwriters

and/or the Lloyds market.

(c) Finally, some of the mutual P&I associations underwrite charterers' as well as

owners' risks - although this sometimes gives rise to conflicts between the cover

provided to Owners and the cover provided to Charterers.

- u ------------

Case 1:07-cv-03397-JGK Document 19 Filed 06/21/2007 Page 3 of 5
15 Naturally, the mutual P&I associations also reinsure on the commercial insurance market

(typically Lloyds), as well. In this regard, I draw the Court's attention to the following

extract from page 5 of Exhibit 4 to Mr Arghyrakis' declaration. There, in the very

materialsrelied upon by Mr Arghyrakis, Syndicate 1036 statesthat:-

"We are the leading underwriter to many International Group P&I Associations,

providing extended coverages over and above those offered by the Club Rules as

well as reinsurance capacity and solutions. "

16 Common to any form of Charterers' liability cover however is the need for a swift

mechanism for providing security as and when claims arise. This too is a service we

offer our client Assureds.

17 As far as I am aware, in 2006 and 2007 Syndicate 1036 issued at least 8 letters of

undertaking in total, 3 of which were put up to secure Rule B attachments. These were

all put up by Michael Else & Company on behalf of Syndicate 1036. No doubt Syndicate

1036, which underwrites many more risks other than charterers' liability cover, will have

secured many more claims.

18 Be that as it may, we have a long track record of securing Charterers' liabilities, as a

mutual association since 1986 and as a fixed premium operator since 1999. There is no

instance of which I am aware in which a letter of undertaking put up by Michael Else &

Company on behalf of Syndicate 1036 in respect of the Charterers P&I Club liability

cover has been dishonoured. Doing so would be fatal to our credibility in the market and

I cannot believe that the Owners can genuinely have any fear that the guarantee tendered

will in fact be dishonoured if presented for payment.

19 However, if this Court finds that an LOU put up by a Lloyds syndicate, with the strength

and backing such as that behind Syndicate 1036, is not acceptable security to lift this

attachment, then our ability, and the ability of any other fixed premium provider of

charterers' liability insurance to offer the cover we currently do, will be severely

Case 1:07-cv-03397-JGK Document 19 Filed 06/21/2007 Page 4 of 5
compromised, which in turn will leave many owners facing claims for damage, death and

pollution without recourse to commercial underwriters if those claims are found to be

their charterers' responsibility.

20 As pointed out by Mr Sunley in his affidavit, the Owners' lawyers initially indicated that

a Charterers' Club letter was in principle acceptable to them, reversing this position once

it became clear that the Charterers would not waive their request for counter-security.

21 I respectfully submit that this Court should not allow a tactical ploy to jeopardise cover

which exists to protect both charterers and, ultimately, their owners and other 3rdparty

claimants.

22 In the circumstances, I respectively ask the Court to lift the attachment based on the letter

of undertaking currently tendered.

fic4 ~

Sworn to before me

this 21st day of June, 2007

BARLO

.

W LYDE & Gll..BERT'LLP'

j

BEAUFORT HOUSE

, <"I 15st. BOTOLPHSTREET

"

LONDON, EC3A 7NJ . ..., mu

Case 1:07-cv-03397-JGK Document 19 Filed 06/21/2007 Page 5 of 5