Late in the evening of July 29, 1977, the Oswego Tarmac lay fast alongside the jetty in
Curacao loading asphalt cargo. Moments later, the tanker listed helplessly, having been
struck four times by the motor vessel Elektra with such heavy impact that four of its
tanks ruptured, and heated asphalt spewed across the harbor.
Soon thereafter, the owners of both ships commissioned expert appraisers
to assess the extent of the damage suffered by the tanker.
The appraisers submitted a joint field survey in which they estimated the
cost of repair at not less than $1,500,000. Armed with this information, Enterprise
advised Asphalt that it considered the Oswego Tarmac a complete loss, since its fair
market value prior to collision was approximately $750,000. Disagreeing with the damage
estimates reported in the joint survey, Asphalt requested that Enterprise repair the
Oswego Tarmac; Enterprise refused. At the recommendation of Enterprise's appraiser who
stated that repair would be infeasible, Enterprise sold the ship as scrap for $157,500.
The company then collected insurance proceeds of $1,335,000 on its $2,500,000 marine hull
insurance policy, an amount which exceeded the ship's fair market value.