Letter of Undertaking
LOU for maritime claims and releases
LETTER OF UNDERTAKING
P&I CLUB NAME / GUARANTOR
Address of the Club/Insurer
Claims Department
To:
Date:
Dear Sirs,
VESSEL:
VOYAGE:
INCIDENT:
In consideration of your releasing and/or refraining from arresting or otherwise detaining the above-named vessel or any other vessel or property in the same ownership, associated ownership or management in connection with the above claim, we hereby undertake:
- To pay to you or your Solicitors on your behalf such sums as may be agreed in writing between the parties or as may be awarded by a final arbitration award or judgment of a competent Court.
- The maximum liability of this Undertaking shall not exceed the sum of inclusive of interest and costs.
- This undertaking shall be governed by and construed in accordance with and we hereby submit to the exclusive jurisdiction of the High Court of Justice in London for the purpose of any process for the enforcement hereof.
This Letter of Undertaking is given without prejudice to any defences or limitations of liability available to the Shipowners.
Yours faithfully,
For and on behalf of:
Letter of Undertaking (LOU)
A **Letter of Undertaking (LOU)**, typically issued by a P&I Club, is a guarantee given to a claimant (port authority, cargo owner, etc.) to prevent the arrest of a vessel or to secure its release.
Key Features:
- Security: Acts as a secure promise of payment if liability is proven.
- Liquidity: Avoids tying up cash in court deposits.