Liability Regimes in Contemporary Maritime Law

Rhidian Thomas, Rhidian Thomas

• Publisher: Informa Law from Routledge
• Year: 2020
• ISBN:
  9781000341447
• Edition: 1
• Topic: Diritto
• Subtopic: Diritto marittimo

This book addresses the topical and current issues in maritime law and brings them together into a coherent strand by the common perspective of liabilities for the professional reader. Liability Regimes in Contemporary Maritime Law appeals to both the industry and the legal profession and provides a degree of analysis and discussion, while also bringing together in a single volume the essential interest in a range of individual subject areas.

Part 1

Ship Source Pollution – Oil and Hazardous and Noxious Substances

CHAPTER 1

Ship source pollution – Oil and hazardous and noxious substances

MÅNS JACOBSSON^*

Introduction

1.1 The international regime for the compensation of pollution damage caused by oil spills from tankers is based on two treaties adopted under the auspices of the International Maritime Organization (IMO), the 1992 International Convention on Civil Liability for Oil Pollution Damage (1992 Civil Liability Convention) and the 1992 International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage (1992 Fund Convention). These Conventions replace two corresponding Conventions adopted in 1969 and 1971 respectively.

1.2 The 1992 Civil Liability Convention governs the liability of shipowners for oil pollution damage. The Convention lays down the principle of strict liability for shipowners and creates a system of compulsory liability insurance. Shipowners are normally entitled to limit their liability to an amount which is linked to the tonnage of their ship.

1.3 The 1992 Fund Convention, which is supplementary to the 1992 Civil Liability Convention, set up an intergovernmental organisation, the International Oil Pollution Compensation Fund 1992 (1992 Fund), which provides additional compensation to victims when the compensation under the 1992 Civil Liability Convention is inadequate. By becoming party to the 1992 Fund Convention, a State becomes a member of the 1992 Fund. The Organisation has its headquarters in London.

1.4 The 1992 Fund succeeds a previous organisation, the 1971 Fund, which is at present being wound up.

1.5 A third tier of compensation in the form of a Supplementary Fund was established on 3 March 2005 by means of a Protocol adopted in 2003.

1.6 On 31 August 2006, 113 States had ratified the 1992 Civil Liability Convention, and 98 States had ratified the 1992 Fund Convention. The Supplementary Fund Protocol had been ratified by 19 States.

1.7 The States which are parties to the 1992 Conventions and the Supplementary Fund Protocol are listed in the Annex.

Main Features of the 1992 Conventions

1.8 The 1992 Conventions and the Supplementary Fund Protocol apply to pollution damage suffered in the territory (including the territorial sea) and the exclusive economic zone (EEZ) or equivalent area of a State party to the respective Conventions. “Pollution damage” is defined as damage caused by contamination and includes the cost of “preventive measures”, i.e. measures to prevent or minimise pollution damage.

1.9 The treaties apply to ships which actually carry oil in bulk as cargo, i.e. generally laden tankers, as well as to spills of bunker oil from unladen tankers in certain circumstances.

1.10 The liability rests on the registered owner of the ship from which the oil originated. Shipowners have strict liability for pollution damage (with very limited defences) and are obliged to cover their liability by insurance. Shipowners are normally entitled to limit their liability to an amount which is calculated on the basis of the tonnage of the ship, and which – after increases by some 50% with effect from 1 November 2003 – ranges from 4.51 million SDR (US$6.7 million) for small ships to 89.77 million SDR (US$134 million) for large tankers.¹

1.11 Shipowners are deprived of the right to limit their liability if it is proved that the pollution damage resulted from the shipowner’s personal act or omission, committed with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result.

1.12 Claims for pollution damage under the 1992 Civil Liability Convention can be made only against the registered owner of the ship concerned. This does not preclude victims from claiming compensation outside the Convention from persons other than the owner. However, the Convention prohibits claims against the servants or agents of the owner, the crew, the pilot, the charterer (including a bareboat charterer), manager or operator of the ship, or any person carrying out salvage operations or taking preventive measures.

1.13 The compensation payable by the 1992 Fund in respect of an incident is limited to an aggregate amount which, with effect from 1 November 2003, was increased from 135 million SDR (US$201 million) to 203 million SDR (US$302 million), including the sum actually paid by the shipowner (or the shipowner’s insurer) under the 1992 Civil Liability Convention.

1.14 The 1992 Fund is financed by contributions levied on any entity which has received in one calendar year more than 150 000 tonnes of crude or heavy fuel oil (contributing oil) in a State party to the 1992 Fund Convention after sea transport. Member States are obliged to submit annually to the Fund reports on the quantities of contributing oil received.

1.15 The Japanese oil industry is the major contributor to the 1992 Fund, paying 18% of the total contributions. The Italian oil industry is the second largest contributor paying 10%, followed by the oil industries in the Republic of Korea (9%), the Netherlands (8%), France (7%), India (7%), United Kingdom (5%), Singapore (5%) and Spain (5%).

1.16 The Supplementary Fund has available an amount of 547 million SDR (U$814 million), in addition to the amount of 203 million SDR (US$302 million) available under the 1992 Conventions. As a result, the total amount available for compensation for each incident for pollution damage in the States which are Members of the Supplementary Fund will be 750 million SDR (US$1,116 million).

1.17 The 1992 Fund has an Assembly, which is composed of representatives of all 1992 Fund Member States. The Assembly is the supreme organ governing the 1992 Fund, and it holds regular sessions once a year. The 1992 Fund also has an Executive Committee composed of 15 Member States elected by the Assembly. The main task of the Committee is to approve compensation claims to the extent that the Director has not been given the authority to do so. The Supplementary Fund has its own Assembly composed of representatives of its Member States. During the winding up of the 1971 Fund it is governed by an Administrative Council.

1.18 The 1992 Fund, the 1971 Fund and the Supplementary Fund have a joint Secretariat. The Secretariat is headed by a Director and has at present 27 staff members.

1.19 The Director has been granted extensive authority to approve claims for compensation.

1.20 The IOPC Funds have a trilingual website (http://www.iopcfund.org) containing information on the international compensation regime and the activities of the IOPC Funds.

Claims Settlement

Claims experience

1.21 Since their establishment, the 1971 and 1992 Funds have been involved in approximately 135 incidents and have made compensation payments totalling some US$1,040 million. The Supplementary Fund has so far not been involved in any incidents.

1.22 In the great majority of these incidents, all claims have been settled out of court. To date, court actions against the Funds have been taken in respect of only a handful of incidents.

1.23 The cases involving the largest total payments are as follows:

Incident	Payments to claimants
Antonio Gramsci (Sweden, 1979)	US$18million
Tanio (France, 1986)	US$36million
Haven (Italy, 1991)	US$58million
Aegean Sea (Spain, 1992)	US$65million
Braer (United Kingdom, 1993)	US$87million
Keumdong No. 5 (Republic of Korea, 1993)	US$21million
Sea Prince (Republic of Korea, 1995)	US$40million
Yuil No. 1 (Republic of Korea, 1995)	US$30million
Sea Empress (United Kingdom, 1996)	US$60million
Nakhodka (Japan, 1997)	US$211million
Nissos Amorgos (Venezuela, 1997)	US$21million
Erika (France, 1999) (payments up to 01.09.06)	US$131million
Prestige (Spain, France, Portugal, 2002) (payments up to 01.09.06)	US$153million

1.24 A major oil spill can give rise to a large number of claims. The Erika incident resulted in over 6,900 compensation claims, of which over 50% were presented by businesses in the tourism sector and 27% originated from the fishery and mari-culture sectors.

Admissibility of claims for compensation

1.25 The 1992 Fund and the Supplementary Fund can pay compensation to a claimant only to the extent that the claim meets the criteria laid down in the 1992 Fund Convention and the 2003 Protocol.

1.26 The Funds have acquired considerable experience with regard to the admis-sibility of claims. In connection with the settlement of claims they have developed certain principles as regards the meaning of the definition of “pollution damage”, which is specified as “damage caused by contamination”.

1.27 The 1992 Fund has published a Claims Manual which contains general information on how claims should be presented and sets out the general criteria for the admissibility of various types of claims. A revised version of the Claims Manual has been adopted by the Assembly and was published in May 2005.

1.28 Decisions on the admissibility of claims which are of general interest are reported in the Funds’ Annual Report. Some of the main types of claim are dealt with below.

Property damage

1.29 Pollution incidents often result in damage to property: the oil may contaminate fishing boats, fishing gear, yachts, beaches, piers and embankments. The Funds accept costs for cleaning polluted property. If the polluted property (e.g. fishing gear) cannot be cleaned, the Funds compensate the cost of replacement, subject to deduction for wear and tear. Measures taken to combat an oil spill may cause damage to roads, piers and embankments and thus necessitate repair work, and reasonable costs for such repairs are accepted by the Funds.

Clean-up operations on shore and at sea, and preventive measures

1.30 The Funds pay compensation for expenses incurred for clean-up operations at sea or on the shore. Operations at sea may relate to the deployment of vessels, the salaries of crew, the use of booms and the spraying of dispersants. In respect of onshore clean-up, the operations may result in major costs for personnel, equipment, absorbents, etc.

1.31 Measures taken to prevent or minimise pollution damage (“preventive measures”) are compensated under the 1992 Conventions and the Supplementary Fund Protocol. Measures may be taken to prevent oil which has escaped from a ship from reaching the coast, e.g. by placing booms along the coast which is threatened. Dispersants may be used at sea to combat the oil. Oil may be removed from a sunken vessel. Costs for such operations are in principle considered as costs of preventive measures. It must be emphasised, however, that the definition only covers costs of reasonable measures.

1.32 The admissibility of claims for preventive measures is decided on the basis of objective criteria. The fact that a government or other public body decides to take certain measures does not in itself mean that the measures are reasonable for the purpose of the Conventions. The technical rea...