Brokers face litigation over falling ship prices

The International Transport Intermediaries Club, which provides professional indemnity insurance to shipbrokers, said brokers were under commercial pressure from both banks and owners.
Ship values have plunged since last September, with the price of modern capesize vessels falling 70% while Baltic Exchange values showed very large crude carriers have dropped 45% in price.
Since late 2008, many brokers have declined to publicly provide prices, or suspended all evaluations unless contractually necessary, amid concerns that there were too few sales to properly benchmark values.
The club’s Andrew Jamieson said some owners had demanded to see brokers’ evaluations of their vessels before they were submitted to banks.
Banks may then question whether the broker’s independence was compromised, he said.