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OWNER’S LIABILITY

OWNER’S LIABILITY. SECOND LECTURE LIABILITY FOR COLLISIONS. Chapter 11 ’Liability for Collisions’. Outline: 1. ’Rules of the Road’ / COLREG 1972 2. Assessment of fault 3. Compensation and liability a) apportionment of liability, and b) liability for i. cargo damage, and

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OWNER’S LIABILITY

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  1. OWNER’S LIABILITY SECOND LECTURE LIABILITY FOR COLLISIONS

  2. Chapter 11 ’Liability for Collisions’ • Outline: • 1. ’Rules of the Road’ / COLREG 1972 • 2. Assessment of fault • 3. Compensation and liability • a) apportionment of liability, and • b) liability for • i. cargo damage, and • ii. personal injury

  3. 1. COLREG 1972 • Regulates traffic at sea. • Included in Norwegian law by regulation ito MC section 506 • Rules on • a) steering and sailing, • b) conduct of vessels in sight of one another, and • c) conduct of vessels in restricted visibility.

  4. 2. Assessment of fault • Little guidance in chapter 8 • Objective assessment, taking into account • COLREG, and • the Ship Safety Act.

  5. 3. Compensation and liabilitya) apportionment of liability • Collision: • One ship at fault: section 161, first paragraph • Both-to-blame: section 161, second paragraph • a) Proportion, unless • b) cannot determine (accidental collisions) • Example ‘equally to blame’: Action Alpha Damage: 200 Wan Hai Damage: 400 Carries own loss and 100 of Wan Hai’s loss (200 + 400) : 2 = 300 Carries 300 of own loss

  6. 3. Compensation and liabilitya) apportionment of liability (cont.) • Single or cross liability: • a) Global limitation = single liability principle • b) NMIP = cross liability principle Single liability principle: Cross liability principle: Proportion loss before set off. This is the basis for the settlement of the Claim (and NOT apportionment of liability) Add amounts and divide. Excess is subject to Limitation. Action Alpha (200+400) : 2 = 300 Set off: 300 - 200 = 100 Subject to limitation: 100 Action Alpha: 200 : 2 = 100 Wan Hai: 400 : 2 = 200 Settlement AA: 100 WH: 200

  7. 3. Compensation and liabilityb) liability fori. cargo damage and ii. Personal injury • Is the Action Alpha liable for damage/loss of the Wan Hai’s containers? • - section 161, third paragraph: pro rata liability • - American position: joint and several liability • Is the Action Alpha liable for injury to/loss of life of the Wan Hai’s passengers? • - section 161, third paragraph: joint and several liability • - compensation from the Wan Hai if (section 161, fourth paragraph): • a) paid more than its share • b) subject to • i. limitation of liability, • ii. valid contractual reservation, however subject to mandatory liability rules.

  8. Example: Cargo damage • Action Alpha’s blame 1/3 • Wan Hai’s blame 2/3 (eg in breach of traffic separation scheme): Cargo damage 300 • Liability of the Action Alpha ito MC chapter 8 = pro rata liability • Cargo owner can claim 1/3 of 300 = 100 from the Action Alpha • Cargo owner cannot claim from the Wan Hai due to contract or MC s 276. • American rules = joint and several liability • Cargo owner cannot due to contract or MC s 276 claim from the Wan Hai. • Cargo owner can claim 300 from the Action Alpha. • The Action Alpha can claim 2/3 of 300 = 200 from the Wan Hai (which cannot avail itself of the exemption rules). • Wan Hai must pay 200 regardless of contract.

  9. Research aid • The International Maritime Organisation (IMO) website (good for most information relating to conventions except for conventions texts themselves): • www.imo.org • See also the International Maritime Committee: Comité Maritime International (CMI): • www.comitemaritime.org • For convention texts (not always updated), try: • www.admiraltylawguide.com • For general maritime law information, look at: • Prof William Tetley: www.mcgill.ca/maritimelaw (most of his articles and books can be downloaded) • Prof John Hare: www.uctshiplaw.com

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