Pollution at Sea

Law and Liability

Baris Soyer, Andrew Tettenborn, Baris Soyer, Andrew Tettenborn

• Publisher: Informa Law from Routledge
• Year: 2013
• ISBN:
  9781317984412
• Edition: 1
• Topic: Law
• Subtopic: Maritime Law
• Index: Law

A sharp, informed and thoroughly practical guide to contemporary and developing issues relating to sea pollution, prepared by leading academics and practitioners with everyday hands-on experience. Pollution at Sea focuses on a number of the vital private law issues – compensation, insurance, contract and tort – thrown up by contemporary developments in the law of pollution. The book also intends to offer a critical analysis on emerging public law concepts, such as the legal position of seafarers from the perspective of criminal law in cases of pollution and the impact of port state control as a pollution control mechanism.

Pollution at Sea is divided into three parts:

1. Private Law Liability Regimes
2. Rights and Liabilities of Particular Parties
3. The Impact of Public Law on the Actors Concerned

In part 1; various liability regimes are dissected, including those which have been under the spotlight in recent years. This section has particular international appeal, and many of the regimes discussed are based at least in part on international conventions, agreements or practices. In part 2; the impact of pollution at sea on third parties is considered, with respect to the legal position of parties that might be perused either by the victims of pollution incidents or in some cases by the parties liable by way of a recourse action. Finally in part 3; recent relevant developments, particularly in the realm of public law are covered.

PART 1

VARIOUS LIABILITY REGIMES: INTERNATIONAL, REGIONAL AND NATIONAL

CHAPTER 1

“TORREY CANYON”, 45 YEARS ON: HAVE WE SOLVED ALL THE PROBLEMS?

Patrick Griggs CBE^*

INTRODUCTION

There is a widespread belief that the modern oil pollution law was developed as a direct result of the Torrey Canyon incident in March 1967. This is not the case. In the mid-1960s, there was a series of incidents involving tankers making the passage round the Cape of Good Hope. The resulting pollution, much of which produced no compensation, gave rise to a call for legislation which would require all tankers using the Cape route to carry proof of insurance to cover potential claims. The fear in the oil industry was that if the South African government introduced such legislation it would encourage other states with vulnerable coastlines to follow suit.

In May 1968, I travelled to Walvis Bay in what is now Namibia to investigate the sinking of the small Greek tanker Andron, then chartered to BP (British Petroleum). Considerable pollution resulted from this incident. The crew members were repatriated via Cape Town and I travelled with them. It so happened that in Cape Town at the time were the then head of the BP Tankers Legal Department, James Featherstone, and his opposite number from Shell Tankers, Alistair Hetherington. Over breakfast, I listened with fascination as these two senior oil company executives discussed the continuing urgency of creating a voluntary oil pollution compensation scheme to persuade countries with vulnerable coastlines, such as South Africa, not to introduce unilateral legislation. It was clear to me that discussions had been going on for some time and certainly pre-dated the “Torrey Canyon” disaster.

Thus it was on 7 January 1969 that the text of the Tanker Owners' Voluntary Agreement concerning Liability for Oil Pollution (TOVALOP) was published. It came into effect in October 1969 and provided a compensation regime for oil pollution incidents subject to certain financial limits. This scheme strictly involved tanker operators only, but in 1971 it was reinforced by the Contract Regarding an Interim Supplement to Tanker Liability for Oil Pollution (CRISTAL) under which the major oil companies agreed to “top-up” the compensation fund where claims exceeded the TOVALOP limits.

THE TORREY CANYON INCIDENT

It was in the early stages of the development of these two voluntary schemes that the Torrey Canyon incident occurred. On 18 March 1967, Torrey Canyon ran aground on Pollard's Rock, a part of the Seven Stones Reef located midway between Land's End and the Isles of Scilly. She broke her back and of her 120,000 tonne cargo of crude 31,000 tonnes escaped, creating a 270-square-mile slick which contaminated 50 miles of the coast of Normandy and 120 miles of the Cornish coast. Nobody, at that time, had much experience in dealing with oil pollution of this scale. Something like 10,000 tonnes of chemical dispersant was initially used to no great effect except to increase the damage to the environment. Prime Minister Harold Wilson's Emergency Cabinet wanted action; and when the Fleet Air Arm offered to bomb the wreck in order to sink it and (hopefully) burn off the oil, they were given the go-ahead. This attack took place on March 28, and was followed by the Royal Air Force who had the bright idea of dropping cans of aviation fuel to encourage the blaze. Then an Atlantic swell developed and put out the fl ames. As the tide fell the RAF returned, this time with napalm. After that they gave up and left nature to take its course.

Even by recent standards this was a major incident; and not surprisingly most of the maritime law firms in London became involved. My old firm, Ince & Co, was instructed for the London liability underwriters. On 5 April 1967 an opinion letter was sent to the brokers Sedgwick, Collins & Co. Ltd, as from Ince's offices at 10 & 11 Lime Street in the city. In those days letters came from the firm and individual case handlers were expected to hide their identity behind an anonymous reference number. This letter had the reference number 29. Smarter clients worked out that the reference was the number of the room in which the case handler sat. A quick scout down the first fl oor corridor at 10 & 11 Lime Street revealed that room 29 was occupied by my father who was then the firm's senior partner.

This opinion letter identified some of the problems which would be faced by claimants with the law as it then stood. From the identification of these problems in that case, sprang our current law on liability and compensation for oil pollution.

Liability

Claimants would have had to bring a claim in tort for negligence or public nuisance; in either case they would need to prove negligence. This did not appear to be a problem in this case, and it was also pretty clear that pollution would be regarded as a foreseeable consequence of that negligence. What was not clear, however, was whether the crew members were the servants of the registered owners or of the long-term charterers. It was recognised that this might give rise to difficult issues of vicarious liability and jurisdiction.

There was also an issue of possible criminal liability under the Oil in Navigable Waters Act 1955, but we need not concern ourselves with that.

Claimants: Rights of Action

I quote from my father's opinion letter:

“Gruff noises made by the Prime Minister since the occurrence, in so far as they are meaningful, indicate an intention on the part of H.M. Government to seek redress in respect of the expenses which it has incurred in its attempt to defeat the spread of oil from the “Torrey Canyon” to the shores of this country, including the cost of the operation which has resulted in the destruction of the vessel and her cargo”.

My father's advice was that

“… on a limited review of the authorities it is our opinion that in principle H.M. Government have a good claim in respect of the expenses which they have incurred in the action which they have taken to combat the menace presented by the leakage of oil from the “Torrey Canyon”.

He also expressed the view that local authorities in Cornwall would have a good cause of action for the expenses involved in cleaning their beaches.

As to private individuals, he advised that if they could prove property damage they would have a good cause of action. Hoteliers, however, who suffered financial loss only “would appear to have no cause of action”.

Jurisdiction

My father's advice was conventional. The Admiralty Court had jurisdiction to hear “any claim for damage done by a ship”.¹ Damage caused by oil pollution was clearly within this definition. Under the Administration of Justice Act 1956, jurisdiction could be invoked by an action in rem against the ship or a sister ship, or by action in personam against the owner.

In the context of establishing English jurisdiction, the loss of the ship itself was an immediate problem — though it was suggested that the presence of a lifeboat in Penzance, recovered from the ship, might be enough to found it. (This was never tested). The owners were a Bermudian company not directly amenable to English jurisdiction: but they did own two other tankers. However, claimants could reasonably assume that these two sister-ships would be kept well away from the UK, and so there seemed to be an insoluble jurisdictional problem. However, four months after the stranding one of the two sister-ships, the Lake Palourde, arrived in Singapore and was arrested on behalf of the UK Government. Rather than have the claims determined by the Singapore courts, the owners and their liability insurers agreed to submit to the jurisdiction of the English courts. The fact is that most tankers at the time were operated by single-ship companies; and that but for the chance of there being two sister ships, the English and French claimants might well have been unable to establish jurisdiction for their claims.

Limitation of Liability

In 1967 the law of limitation in England was to be found in the Merchant Shipping Act 1958, itself loosely based on the 1957 Limitation Convention which set the limit for damage to property on a per tonne basis. This produced a limitation fund for the Torrey Canyon of a modest £1,500,000 — a figure likely to be dwarfed by the claims. However, the 1957 Convention provided that the owner could only limit if he could establish that the accident giving rise to the claim occurred without his actual fault or privity. There was enough evidence to suggest that the owners might have problems in establishing their right to limit.

In the context of limitation, mention should also be made of the fact that owners and charterers of the Torrey Canyon applied to a Federal District Court in the USA for a decree of limitation. Under US law the limit of liability was (and still is) the value of the vessel at the end of the voyage. The only part of the ship which had survived the grounding was the lifeboat in Penzance valued at $50. Therefore, under US law it was arguable that this would be the extent of liability of the owners and charterers for this disaster. The governments of the UK and France opposed this application for a decree of limitation in the US but for various reasons (including a finding that charterers had no right to limit under the US limitation statute²) the matter was not pursued.

The rest is history. The claims of the British and French Governments were eventually settled for quite modest sums by current standards.

INTERNATIONAL RESPONSE TO THE TORREY CANYON DISASTER

Immediately following the Torrey Canyon incident and before the claims had been settled, the British Government submitted a Note to IMCO³ calling for changes in international law governing oil pollution. IMCO responded by setting up a Legal Committee charged with the task of producing an international convention to tackle the twin issues of liability and compensation for oil pollution. At about the same time the Comité Maritime International or CMI — since 1897 the only international organisation concerned with the harmonisation of international maritime law — set up the International Torrey Canyon Sub-Committee to work with IMO on this project. At its Tokyo Conference in March/April 1969, the CMI adopted the text of a draft convention. This draft was passed to the IMO Legal Committee for consideration at its meeting in May 1969 alongside a draft convention which that committee itself had produced. The IMO International Conference on Marine Pollution Damage was held between 10 and 28 November 1969. This conference had before it for consideration the draft conventions which had been prepared by the Legal Committee and by the CMI, together with the TOVALOP Agreement referred to earlier.

From this conference emerged the 1969 Civil Liability Convention for Oil Pollution (CLC). This was swiftly followed in 1971 by the oil-industry-financed Fund Convention. Since then the oil pollution regime has been improved and updated on several occasions. The current regime is based on the CLC 1992 and the Fund Convention 1992 (with increased limits introduced in 2000), together with the 2003 Supplementary Fund Protocol. All these Conventions are aimed at improving the claimants'...