THE TRAVAUX PRÉPARATOIRES - Comite Maritime · Appendix V Report on linkage 547 Appendix VI Draft protocol by the Secretariat (Doc. LEG.71/5) 572 Appendix VII Draft protocol submitted

T H E T R AVA U X P R É PA R AT O I R E S

O F T H E

LLMC CONVENTION, 1976A N D O F T H E

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COMITE MARITIME INTERNATIONAL

THE TRAVAUX PRÉPARATOIRES

OF

THE LLMC CONVENTION, 1976 AND OF

THE PROTOCOL OF 1996

CONTENTS

Foreword IX

Preface and Acknowledgment XI

Glossary XII

PART ITHE TRAVAUX PRÉPARATOIRES OF THE LLMC CONVENTION, 1976

History of the Convention 2

General comments 4

CHAPTER I - THE RIGHT OF LIMITATION 33Article 1- Persons entitled to limit liability 33

General comments 33Paragraph 1 34Paragraph 2 37Paragraph 3 47Paragraph 4 50Paragraph 5 54Paragraph 6 56Paragraph 7 58

Article 2- Claims subject to limitation 60General comments 60Paragraph 1-Chapeau 61

Sub-paragraph (a) 62Sub-paragraph (b) 64Sub-paragraph (c) 69Sub-paragraphs (d)-(e) 74Sub-paragraph (f) 78

Paragraph 2 84Additional paragraph (not adopted) 89

Article 3- Claims excepted from limitation 91General comments 91

Sub-paragraph (a) 92Sub-paragraph (b) 93Sub-paragraphs (c)-(d) 108Sub-paragraph (e) 115Sub-paragraph not adopted 119

Article 4- Conduct barring limitation 121

Article 5- Counterclaims 136

CHAPTER II - LIMITS OF LIABILITY 138Article 6- The general limits 138

General comments 138Paragraphs 1 and 2 151Paragraph 3 203Paragraph 4 214Paragraph 5 227

Appendix I/A Note submitted by the delegations of Norwayand Sweden 238

Appendix I/B Comparative table 239Appendix I/C Extract from the Report of the Working Group 240Appendix I/D Further extract from the Report of the Working Group 242Appendix I/E Note by the Secretariat 245Appendix I/F Proposal by the delegations of the Fed. Republic of

Germany, the Netherlands, the United Kingdom andthe United States 247

Article 7 - The limit for passenger claims 248

Article 8 - Unit of account 260

Article 9 - Aggregation of claims 273

Article 10 - Limitation of liability without constitution of a fund 280

CHAPTER III - THE LIMITATION FUND 287Articles 11-13 - General comments 287

Article 11 - Constitution of the fund 290

Article 12 - Distribution of the fund 301

Article 13 - Bar to other actions 319

Article 14 - Governing law 337

CHAPTER IV - SCOPE OF APPLICATION 340Article 15- General comments 340

Paragraph 1 342

VI COMITE MARITIME INTERNATIONAL

The travaux préparatoires of the LLMC 1976 and of the Protocol 1996

Paragraph 2 343Paragraph 3 359Paragraph 4 362Paragraph 5 374Provisions not adopted 376

CHAPTER V - FINAL CLAUSES 378Article 16 - Signature, Ratification and Accession 378

Article 17 - Entry into force 380

Article 18 - Reservations 386

Article 19 - Denunciation 389

Article 20 - Revision and Amendment 390

Article 21 - Revision of the limitation and of Unit of Account or monetary unit 391

Article 22 - Depositary 421

Appendix I Draft of the CMI I-SC 423

Appendix II CMI Hamburg Draft 427

Appendix III IMCO Draft Articles - XXIII Session 432

Appendix IV IMCO Draft Articles - XXV Session 437

Appendix V IMCO Draft Articles - XXVII Session 444

Appendix VI IMCO Draft Articles - XXVIII Session 449

Appendix VII Draft International Convention 456

Appendix VIII Convention on Limitation of Liability forMaritime Claims, 1976 467

PART IITHE TRAVAUX PRÉPARATOIRES OF THE PROTOCOL OF 1996

REVISION OF THE LIMITS 480

The purpose of the Protocol - General statements 480

Article 1 Definitions 483

Article 2 New text of article 3 (a) 483

Article 3 New text of article 6 (1) 486

Article 4 New text of article 7 (1) 491

Article 5 New text of Article 8, paragraph 2 496

Article 6 Addition of paragraph 3 bis in article 15 497

Article 7 New text of article 18, paragraph 1 501

Article 8 Amendment of the limits 507

COMITE MARITIME INTERNATIONAL VII

Table of contents

VIII COMITE MARITIME INTERNATIONAL


Article 9 Scope of application 515

Article 10 Signature, ratification, acceptance, approval and accession 519

Article 11 Entry into force 520

Article 12 Denunciation 523

Article 13 Revision and amendment 525

Article 14 Depositary 526

Appendix I Draft submitted by the United Kingdom 527Appendix II IAPH paper on monetary erosion 532Appendix III Draft protocol by the Secretariat (Doc. LEG.71/4) 535Appendix IV Memorandum by Germany (Doc. LEG.71/4/1) 541Appendix V Report on linkage 547Appendix VI Draft protocol by the Secretariat (Doc. LEG.71/5) 572Appendix VII Draft protocol submitted by France, Netherlands and UK

(Doc. 72/5/1) 579Appendix VIII Final Draft Protocol (Doc. LEG/CONF.10/6(b)) 587

PART IIITEXTS

Final act of the International Conference on Limitation of Liability forMaritime Claims, 1976 596

Convention on Limitation of Liability for Maritime Claims, 1976 599

Protocol of 1996 to amend the Convention on Limitation of Liabilityfor Maritime Claims, 1976 611

Acte Final de la Conférence Internationale de 1976 sur la Limitation de laResponsabilité en matière de créances maritimes 618

Convention de 1976 sur la Limitation de la Responsabilité en matièrede créances maritimes 621

Protocole de 1996 modifiant la Convention de 1976 sur la Limitation de laResponsabilité en matière de créances maritimes 633

Guidelines on Shipowners’ Responsibilities in respect of Maritime Claims 640

International Convention on Liability and Compensation for Damage in connection with the Carriage of Hazardous and Noxious Substances by Sea, 1996 643

Index– LLMC Convention, 1976 675– Protocol, 1996 684

Foreword

Limitation of liability has a long history in maritime law, stemming from arecognition of the importance of maritime trade and reflecting a desire to shieldshipowners and others involved in the operation of the ship from the potentiallycrippling financial effects of legal claims.

The existence of different national laws gave rise to moves for the internationalunification of maritime law on the subject, and this led to the adoption of theInternational Convention for the Unification of Certain Rules Relating to theLimitation of Liability, 1924 and, later on, the International Convention Relating tothe Limitation of the Liability of Owners of Seagoing Ships, 1957. Rapiddevelopments in the 1960’s, particularly depreciation of monetary values, increasesin the size of ships and the need to protect other categories of operators, led theComité Maritime International (CMI) to embark on a further review of the regime,in conjunction with the Legal Committee of the International MaritimeOrganization (IMO).

The result was the convening of an International Conference by the IMO inNovember 1976, which adopted the text of the Convention on Limitation of Liabilityfor Maritime Claims (LLMC Convention). The Convention entered into force on 1December 1986. It was later amended by the 1996 Protocol which increased thecompensation limits and also introduced the “tacit acceptance” procedure forupdating those limits. As at September 2000, the Protocol was still awaiting entryinto force.

The objectives of the LLMC Convention, carried through to the 1996 Protocol,were to enable shipowners and others, including insurers, to limit their liability in away which would allow legitimate claims to be satisfied, having regard to theavailability of effective insurance cover or other financial guarantees. Liability limitswere also set at appropriate levels, based on tonnage rather than value of the ship,as in former times.

The LLMC Convention dealt with liability for maritime claims generally,although the subject of liability has also been a prominent feature of a number ofother conventions over the past 30 years, largely developed under the aegis of theIMO. The Convention can now therefore be seen as the global instrument forlimitation of the shipowner’s liability, while other treaties deal with specific risks.Together, they comprise a comprehensive legal regime dealing with liability in anumber of maritime fields, as witness the conventions and protocols on liability and

compensation in respect of oil pollution damage, the carriage of nuclear materials,passengers and their luggage and hazardous and noxious substances, and the draftconventions on civil liability for bunker oil pollution damage and wreck removal.

The topical nature of the subject was also reflected in the adoption inNovember 1999 by the IMO Assembly of Resolution A.898(21) “Guidelines onShipowners’ Responsibilities in Respect of Maritime Claims”, which recognises theright of shipowners to limit their liability but which, at the same time, urgesshipowners to ensure that their liability under the LLMC Convention is covered byadequate insurance.

Liability is certain to remain a live issue in the maritime community in the yearsto come. It is an issue that is frequently brought before national courts and onewhich, no doubt, will continue to be the subject of legal debate and analysis in theseand other forums. The interpretation and implementation of the LLMC Conventionand its 1996 Protocol, as well as the other legal instruments mentioned, will begreatly enhanced by the availability of ready access to the travaux préparatoires,including the debates, of the Convention and Protocol.

To compile and edit such a formidable range of documents was an immensetask and an invaluable service. In this instance, the international maritimecommunity is fortunate indeed that an acknowledged expert in the field, ProfessorFrancesco Berlingieri has undertaken it. The text that has been produced as a resultof his labours bears all the hallmarks of his meticulous research and skilledinterpretation of events. CMI and Francesco Berlingieri are to be warmly thankedand congratulated for their efforts.

W. A. O’NEILSecretary-General

International Maritime Organization

X COMITE MARITIME INTERNATIONAL


Preface and Acknowledgment

In view of the decision of the Executive Council of the CMI to carry out astudy of the implementation and interpretation of the Convention on Limitation ofLiability for Maritime Claims, 1976 and of its Protocol of 1996 I have deemed ituseful to collect all the travaux préparatoires and publish them arranged under eachindividual article of the Convention and of the Protocol.

The travaux préparatoires consist of the following:

For the 1976 Convention

– Reports of the Chairman of the CMI International Sub-Committee– CMI Hamburg Conference– CMI Introductory Report to IMCO– Records of the sessions of the Legal Committee of IMCO– Official Records of the Diplomatic Conference of 1976

For the 1996 Protocol

– Records of the sessions of the Legal Committee of IMO– Records of the Diplomatic Conference of 1996.

The page numbers of the original documents are indicated in square brackets.In view of the fact that the official records of the Diplomatic Conference of

1996 do not include the records of the debate that took place before the Committeeof the Whole, I have obtained from the Secretariat of IMO the tapes on which thisdebate was recorded and have transcribed the interventions of the delegates. Suchinterventions are therefore published in full or in a summary form in order toprovide as complete a legislative history of the Protocol as possible.

I wish to express my personal profound gratitude and that of the CMI to theSecretariat of IMO for its kindness in providing me with copies of all relevantdocuments as well as with the tapes previously referred to. Without suchcooperation this work would have not been possible.

The cost of publication of this book has been defrayed by the CMI CharitableTrust and the proceeds of its sale will be used by the Charitable Trust for theadvancement and promotion of its charitable objects.

FRANCESCO BERLINGIERI

Glossary

Consideration of Draft International Convention: Consideration of Draft InternationalConvention on Limitation of Liability for Maritime Claims, DocumentLEG/CONF.5/4 of 27 September 1976

Diplomatic Conference, 1976: Official Records of the International Conference on theLimitation of Liability for Maritime Claims, 1976-IMO, London, 1976

Draft Articles: Draft Articles for an International Convention on Limitation ofLiability for Maritime Claims, Document LEG/CONF.5/WP.1 of 22September 1976

Draft International Convention: Draft International Convention on Limitation ofLiability for Maritime Claims, approved by the Drafting Committee (Annex tothe Report of the Drafting Committee, Official Records of the InternationalConference on the Limitation of Liability for Maritime Claim, 1976, DocumentLEG/CONF.5/C.3/1 of 16 November 1976, p. 449 and DocumentLEG/CONF.5/C.3/1/Add. 1 of 17 November 1976)

Hamburg Conference, 1974: XXXth International Conference of the Comité MaritimeInternational, Hamburg 1-5 April 1974

Hamburg Draft Convention: Draft International Convention on the Limitation ofLiability for Maritime Claims, Appendix 1 to the Introductory Report

Introductory Report: Introductory Report to the Intergovernmental MaritimeConsultative Organization (IMCO) on the Revision to the Limitation of theLiability of Owners of Sea-going Ships and Protocol of Signature (Brussels,October 10th, 1957), Submitted May, 1974

Legal Committee - 23rd Session: Report of the Legal Committee on the work of itstwenty-third session, 3-7 June 1974 - Document LEG XXIII/4 of 18 June 1974

Legal Committee - 25th Session: Report of the Legal Committee on the work of itstwenty-fifth session, 20-24 January 1975 - Document LEG XXV/4 of 31January 1975

Legal Committee - 27th Session: Report of the Legal Committee on the work of itstwenty-seventh session, 16-20 June 1975 - Document LEG XXVII/4 of 30 June1975

XII COMITE MARITIME INTERNATIONAL


Legal Committee - 28th Session: Report of the Legal Committee on the work of itstwenty-eighth session, 24 November-5 December 1975 - Document LEGXXVIII/7 of 12 December 1975

Legal Committee - 29th Session: Report of the Legal Committee on the work of itstwenty-ninth session, 28 June-2 July 1976 - Document LEG XXIX/5 of 12 July1976

Legal Committee - 69th Session: Report of the Legal Committee on the work of itssixty-ninth session, 27 September-1 October 1993 - Document LEG 69/11 of12 October 1993

Legal Committee - 70th Session: Report of the Legal Committee on the work of itsseventieth session, 21-25 March 1994 - Document LEG 70/10 of 29 March1994

Legal Committee - 71st Session: Report of the Legal Committee on the work of itsseventy-first session, 10-14 October 1994 - Document LEG 71/13 of 17October 1994

Legal Committee - 72nd Session: Report of the Legal Committee on the work of itsseventy-second session, 3-7 April 1995 - Document LEG 72/9 of 10 April 1995

Legal Committee - 73rd Session: Report of the Legal Committee on the work of itsseventy-third session, 11-13 October 1995 - Document LEG 73/14 of 16October 1995

Second Report of the Chairman: Revision of the International Convention relating tothe Limitation of the Liability of Sea-going Ships (Brussels, October 10th,1957), Second Report by the Chairman of the International Sub-Committee,Document LIMIT-19/II-74

COMITE MARITIME INTERNATIONAL XIII

Glossary

PART I

THE TRAVAUX PRÉPARATOIRESOF

THE LLMC CONVENTION, 1976

History of the Convention

After IMCO had placed on its agenda the revision of the 1957 InternationalConvention relating to the Limitation of Liability of Owners of Sea-going Ships theBureau Permanent of the Comité Maritime International decided, at its meeting of 15February 1972, to establish an International Sub-Committee under the chairmanshipof Mr. Alex Rein for the purpose of studying the 1957 Convention with a view toenabling the CMI to advise IMCO, to the extent which might be required.

A questionnaire prepared by the Chairman of the International Sub-Committeewas distributed to all CMI National Associations and on the basis of the replies thathad been received the Working Group appointed by the International Sub-Committee prepared two alternative drafts: the draft of a Protocol to amend the 1957Convention and the draft of a new Convention intended to replace the 1957Convention.

Prior to the preparation of such drafts the Chairman of the International Sub-Committee had attended on 21 June 1973 the nineteenth session of IMCO’s LegalCommittee, offering assistance from the CMI in the revision of the 1957 Conventionand such offer was accepted by the Legal Committee.

The two drafts, as subsequently amended, were submitted to the CMIConference held in Hamburg in April 1974 and the Conference, after reviewing thedrafts, resolved to submit them both for the consideration of IMCO.

An Introducing Report was then prepared by the Chairman of the InternationalSub-Committee and was submitted to the Legal Committee of IMCO in May 1974.The Report was accompanied by the draft convention and the draft protocol as wellas by a set of explanatory notes.

The two drafts were considered by the Legal Committee at its twenty-thirdsession held in June 1974, with the assistance of the CMI, and the decision wasadopted to use the draft convention as the basic working document. The LegalCommittee decided to give a second reading to the draft articles, and this was doneduring the twenty-fifth and twenty-seventh sessions. At its twenty-eighth session theLegal Committee adopted a set of recommended draft articles for an InternationalConvention on Limitation of Liability for Maritime Claims for consideration at theConference to be convened by IMCO from 1 to 19 November 1976, when the LLMCConvention was adopted.

During the work on the HNS Convention the United Kingdom delegation drewthe attention of the IMO Legal Committee on the need for a revision of the limits ofliability adopted by the LLMC Convention in 1976 and submitted a draft protocol withprovisions on such revision. At its sixty-eighth session, held in July 1993, the LegalCommittee decided to commence its consideration of a revision of the LLMCConvention at its next session. The work on the draft Protocol to the LLMCConvention commenced at the subsequent session of the Legal Committee – the 69thsession, held from 27 September to 1 October 1993. The work on the draft HNSConvention and the draft Protocol to the LLMC Convention then continued during the70th session held from 21 to 25 March 1994, the 71st session held from 10 to 14October 1994 and was completed during the 72nd session, held from 3 to 7 April 1995when the Legal Committee requested the Secretariat to prepare new drafts on the basis

2 COMITE MARITIME INTERNATIONAL


of the decisions taken at that session and recommended that a diplomatic conference toconsider them be convened during the spring of 1996. At its 74th session, in June 1995the Council considered and approved the proposal and arrangements were then madefor the Conference to be held from 15 April to 3 May 1996.

During the sessions the need for a linkage between the LLMC Convention andthe future HNS Convention was considered and an Informal Working Group wasestablished with the task to study this problem. A report of the Chairman of thatGroup was submitted to the Legal Committee at its 73rd session, held from 11 to 13October 1995.1

In the report four options were identified to solve the question of linkage. As itwill appear from the travaux préparatoires2 the Diplomatic Conference decided thatthere should be no linkage between the two Conventions, but that Article 18paragraph 1 of the LLMC Convention be amended so to enable State Parties toreserve the right to exclude claims for damage within the meaning of the HNSConvention.

As it is known, compulsory liability insurance is provided by the HNSConvention (Article 12) and in the CLC Convention (Article 7), while no provision iscontained in this respect in the LLMC Convention and in its Protocol. However aResolution was adopted on 25 November 1999 by the Assembly of IMO3 by which“Guidelines on Shipowners’ Responsibilities in Respect of Maritime Claims” wereapproved. By these Guidelines shipowners are urged to arrange for the liabilityinsurance in respect of their ships.

PART I – THE TRAVAUX PRÉPARATOIRES OF THE LLMC 1976 3

History of the Convention

(1) Infra, Part II, Appendix V, p. 547.(2) Infra, p. 501-505.(3) Infra, p. 643.

General comments

Comité Maritime InternationalIntroductory Report and Questionnaire 4by Mr. Alex Rein, President of the International Subcommittee

[14] At its last session, in Brussels on February 15, 1972, the Bureau Permanent of theCMI decided to initiate the preparations for a revision of the 1957 Limitation ofLiability Convention.

A revision of this Convention is on the agenda of IMCO, and it may be expectedthat IMCO, in the course of the Summer of 1972, will make arrangements for a studyof the subject and that the CMI, among others, will be invited to present the views ofthe commercial interests involved.

The Constitution of the CMI is presently under revision, but it will take sometime until a new procedure for CMI’s activities has been agreed and put into operation.In the meanwhile the work must continue within the framework of the presentConstitution and traditional CMI practice.

The Bureau Permanent, therefore, decided to establish an International Sub-Committee under the chairmanship of the undersigned for the purpose of studying the1957 Convention with a view to enabling the CMI to advise IMCO to the extent whichmay be required.

[16] In accordance with traditional CMI practice I have prepared the followingQuestionnaire which will be submitted to the National Associations as an initial steptowards the formation of an International Subcommittee.

Member Associations are requested to kindly submit their replies to theSecretary-General not later than May 15, 1972, and to appoint their representative tothe International Sub-Committee which is expected to convene in the course of theSummer or Autumn of this year.

QUESTIONNAIRE

I.

1. The need for revision

Has the 1957 Limitation Convention been ratified by your country?If so, please state whether a revision is called for and, should such be the case, for

what main reasons.If the Convention has not been ratified, please state the main reasons therefor and

on what points the Convention should be modified in order to be acceptable.



(4) CMI Document LIM-1/3-72.

2. The basic principles to be applied for a revision

It is suggested that limitation of liability should be permitted only in respect ofsuch excess of liability for which the person liable cannot reasonably be required tocarry adequate insurance. It is not in the public interest, and in most cases of littlebenefit to the creditor, to endeavour to enforce liabilities which are uninsurable froma practical point of view. On the other hand, the fact that there is a ceiling encouragespotential debtors to insure up to the ceiling which may be a higher amount than theone they would have chosen had there been no ceiling. This suggestion will entail asubstantial increase of the limitation funds as compared with the 1957 LimitationConvention. It is suggested that the right of limitation if based on the principle ofinsurability should generally be accorded to all persons who become liable for certainclaims for damage arising in connection with the operation of sea-going ships.

Finally, it is suggested that limitation should not be denied in cases where theperson liable is guilty of fault or privity amounting to simple negligence only.

[18] 3. Global limitation

The 1957 Limitation Convention does not deal with the basis on which liabilitymay be established. No revision is suggested on that point.

The Convention confers the right of limitation of liability on certain persons inrespect of certain maritime claims. This is a global limitation in the sense that theperson liable may limit his liability for all such claims arising on one distinct occasionby establishing one single limitation fund.

Certain claims which would have been subject to limitation under the terms ofthe 1957 Limitation Convention have been made the subject of separate internationallimitation conventions with the intention of excluding them from the system of globallimitation. This applies to claims in respect of nuclear damage caused by nuclear ships(the 1962 Nuclear Ships Convention) and oil pollution damage caused by tankers (the1969 Oil Pollution Convention). These conventions deal not only with the limitationof liability for such claims, but also with the conditions of liability.

It is reasonable to assume that separate limitation funds for various types ofclaims or the exclusion of certain claims from the global limitation system will increasethe total cost of insurance and thus reduce the amount of insurance which canreasonably be required for the global limitation. If separate funds are established inrespect of certain claims, for example claims for damage caused by hazardous cargo,such claims will receive preferential treatment at the expense of other claims.

It is suggested, therefore, that this Convention should establish a system of globallimitation applicable to all limitable liability under other international conventionsdealing with the basis of liability.

Question 3.1.Should this Convention deal with the global limitation only, leaving it to other

international conventions to deal with the basis for establishing liability for the varioustypes of damage ?

Question 3.2.Should the system of global limitation be maintained in respect of all limitable

claims which, up to now, have not been made the subject of separate regulation byinternational convention?


General comments

[20] Question 3.3.Should certain claims be excluded from the system of global limitation and be

made subject to separate limitation funds, either by new separate internationalconventions or by inclusion under the regime of existing separate internationalconventions such as the 1962 Nuclear Ships Convention or the 1969 Oil PollutionConvention?

4. The system of global limitation

The main features of the system of global limitation contained in the 1957Limitation Convention appear in the provisions which determine (a) the liabilitiessubject to global limitation and (b) the principles for construction of the limitationfund. The main issues arising in these two contexts will be dealt with in Parts III andIV of this Questionnaire. The Convention also contains provisions dealing withprocedure and other incidental matters. At the present stage, however, these matterscan be left aside.

III

5. Liabilities subject to global limitation

In the 1957 Limitation Convention the question of what liabilities are subject toglobal limitation is determined by three different – but interrelated – criteria. First,the liability must have arisen from loss of life or personal injury (personal claims), orfrom loss of or damage to property, infringement of any rights, or removal of wreck(property claims). Second, the liability must have arisen, generally speaking, inconnection with the operation of the ship. Third, the liability must have been incurredby the shipowner or certain other persons.

6. Personal claims

The 1957 Limitation Convention provides that personal claims are subject toglobal limitation, but reserves a particular portion of the fund for such claims. Someof the personal claims may also be subject to a separate per capita limitation, cf. e.g.the 1961 Passenger Convention. This latter type of limitation is also well known innational law on civil liability.

[22] It may be argued that liabilities for personal claims should always be limited on a“per capita” basis only. Assuming “per capita” limitation of personal claims, asupplementary global limitation may, however, be considered desirable as regardsclaims in respect of persons other than passengers or members of the crew; the totalamount of such claims arising in any particular case cannot be reasonably predicted,and this may make it difficult to obtain satisfactory insurance.

Question 6.1.Should a revised Convention contain provisions limiting liabilities in respect of

personal claims ?

Question 6.2.Assuming an affirmative answer to Question 6.1., should personal claims be

limited on a “per capita” basis ?



Question 6.3.If personal claims are made subject to “per capita” limitation, should all, or

certain types of, personal claims also be subject to global limitation?

7. Property claims

Under the 1957 Limitation Convention, global limitation in respect of propertyclaims includes liabilities for the physical loss or damage itself as well as forconsequential losses incurred by the owner or other person having interests attachedto the property involved. Apparently, liabilities for certain economic losses notnecessarily connected with physical damage are also included; the expression“infringement of any rights” seems to cover any contractual (e.g. charterparty) or otherright recognized by law, e.g. infringement of the right to free and safe use of ports,canals or navigable waters. Although not expressly stated, liabilities for costs ofpreventive measures taken after an accident by the person whose property or right (orperson) is thereby imperilled are apparently also subject to global limitation.

One group of property claims, claims for loss of or damage to cargo, may also besubject to a separate unit limitation (the 1924 Bills of Lading Convention and the 1968Protocol). These conventions presuppose global limitation as well (Art. VIII of the1924 Convention) but it may be argued, as in respect of personal claims subject to percapita limitation, that this is inappropriate. The deletion of [24] this important groupof cargo claims from the system of global limitation would undoubtedly have the sameeffect on the cost of insurance as suggested above under 3.

Question 7.1.A person otherwise entitled to global limitation may incur liability for damage to

the ship itself, e.g. where a charterer has loaded or discharged the goods or shippeddangerous goods. Should liabilities in respect of damage to the ship be subject toglobal limitation?

Question 7.2.Should liabilities in respect of losses consequential to the physical loss of or

damage to property be subject to global limitation?

Question 7.3.Should “infringement of any rights” be deleted, or should it be restricted so as not

to include contractual rights, or possibly be replaced by an enumeration of particularcases (e.g. blocking of ports, canals or navigable waters and other particular cases)?

Question 7.4.Should liabilities for the cost of preventive measures taken after an accident by a

party likely to suffer loss or damage therefrom be subject to global limitation? (Withregard to the liable person’s own costs of such nature, see below under 9.)

Question 7.5.Should cargo claims subject to unit limitation be subject to global limitation?

8. The connection between the claims and the ship

The 1957 Limitation Convention, Art. 1 (1), sets out in great detail the particular


General comments

connection between the ship and the claims which is required for global limitation.Subject to limitation are claims in respect of persons or goods on board the ship as wellas claims arising from the act, neglect or default of any person on board the ship orother persons taking part in certain enumerated operations relating to the [26] ship,for whom the owner (or other person entitled to global limitation) has vicariousliability. It is probable, however, that the group of claims subject to global limitation issomewhat enlarged by Art. 1(3), dealing with liability without fault by reason ofownership, possession, custody or control of the ship. Apparently, this provisioncovers, for instance, all liabilities imposed by national law or international conventionsrelating to the carriage in ships of hazardous cargo – some of which could perhaps falloutside the enumeration in Art. 1(1).

These detailed provisions can be seen to have caused difficulties in practice (cf.e.g. The “Tojo Maru” [1971] 1 Lloyd’s Rep. 341), and for this and other reasons it issuggested that they should be simplified. One possible solution would be to use thegeneral language contained in the 1967 Maritime Liens and Mortgage Convention Art.4(1): claims in respect of damage “occurring, whether on land or water, in directconnection with the operation of the vessel”.

Question 8.1.Should the provisions describing the required connection between the ship and

the claims subject to global limitation be amended or simplified? If the answer is in theaffirmative, please suggest how this should be done.

Question 8.2.Should liabilities imposed by law relating to loss or damage occurring in

connection with the carriage in ships of hazardous cargo (other than nuclear damageand oil pollution damage) be subject to global limitation?

9. Cost of preventive measures

Under the 1957 Limitation Convention the cost of preventive measures takenafter an accident by the person liable for the accident, or his insurer, cannot be claimedagainst the limitation fund. However, it is not in the interest of prevention of damageif no relief is given for such costs. The 1969 Oil Pollution Liability Convention allowsthe cost of preventive measures to be claimed against the fund, pari passu with claimsin respect of oil pollution damage.

Question 9Should cost of preventive measures incurred by the liable person be allowed as a

claim against the limitation fund ?

[28] 10. Persons entitled to global limitation of liability

The 1957 Limitation Convention reserves the right of limitation for personsengaged in the operation of the ship, viz. the owner, manager, operator or charterer ofthe ship (including their servants). It is suggested that under a system of globallimitation based on the principle of insurability (see above under 2) the right oflimitation should depend on the fact that liabilities of a limitable nature have beenincurred. Consequently, it does not appear appropriate to reserve the right oflimitation only for certain of the persons running the risk of incurring such liabilities.



Question 10.1.Should the right to global limitation be reserved for persons engaged in the

operation of the ship ?

Question 10.2.Limitable liabilities in respect of personal or property claims may be incurred by

persons performing various types of work or services connected with the ship, e.g. bya shipyard repairing the ship, by an independent contractor or dock or port authorityloading or discharging cargo, by a person undertaking salvage operations, etc. Shouldall or some of such persons be entitled to global limitation?

Question 10.3.Limitable liabilities in respect of personal or property claims may also be incurred

by the shipper, consignee or owner of the cargo, e.g. liabilities for loss or damageoccurring during loading or discharge of the goods or in connection with the carriage ofhazardous cargo, or liabilities for damage to the ship. Under the 1957 LimitationConvention a charterer is entitled to global limitation of such liabilities. Should also theshipper, consignee and owner of the cargo be entitled to global limitation?

IV

11. Principles for construction of the global limitation fund

Under the 1957 Limitation Convention the maximum limitation fund is 3,100Francs Poincaré for each ton of the ships tonnage. Out of this, [30] 2,100 Francs perton are reserved for personal claims. The remaining 1,000 Francs per ton are sharedbetween property claims and excess personal claims.

If limitation of liability is permitted only in respect of such excess of liability forwhich the person liable cannot reasonably be required to carry adequate insurance, thelimitation fund should, logically, be in proportion to the ship’s capacity of carryinginsurance. It is suggested that the value of the ship is the best indication of suchcapacity. The value, however, is not a practical standard of measurement and the bestapproximation both to the value and to the damage risk represented by the ship isprobably the size of the ship. And if size shall be the decisive factor the tonnage of theship is as good as any other measurement.

The “limitation ton”, as used by the 1957 Limitation Convention, should besubstituted by the gross ton unit in the new International Convention (1969) on TonnageMeasurement of Ships. Under the said convention the data necessary for the calculationof the “limitation ton” will not be available. The previous “limitation ton” will constitutebetween 90 and 60 per cent of the new gross ton unit, depending on the type of ship.

Question 11.1Should the global limitation fund be computed on the basis of the ship’s tonnage

or on the basis of other criteria?

Question 11.2.If the ship’s tonnage shall be maintained as the relevant criterion, should the

“limitation ton” be substituted by the new gross ton ?


General comments

Question 11.3.Should there be additional amounts for certain types of claims, such as personal

claims, and if so, for what claims?

12. Minimum and maximum limitation fund

The 1957 Limitation Convention provides for a minimum limitation fund basedon 300 tons, but for no maximum. Both the 1962 Nuclear Ships Convention and the1969 Oil Pollution Convention have introduced ceilings to the fund, maximumamounts above which there shall be no liability.

[32] It is assumed that a minimum should be retained if the fund is to be calculated onthe tonnage. The amount per ton which is reasonable in the higher tonnage bracketsis clearly inadequate in respect of ships with small tonnage and large engine power.

If there is to be a maximum it must be based on insurability. In this context it issuggested that insurability must mean technical facilities for insurance.

Question 12.1.Should there be a minimum limitation fund regardless of the ship’s tonnage or

equivalent criterion?

Question 12.2.Should the amount per ton for the first X tons of any ship be higher than the

amount per ton for the balance of the tonnage?

Question 12.3.Should there be a maximum limitation fund for large ships?

13. Fault or privity of the person liable

Under the 1957 Limitation Convention the right of limitation is forfeited if thereis “actual fault or privity” on the part of the person liable. Thus, with certainexceptions for servants, limitation of liability can only be invoked in respect ofvicarious or strict liability and only where the person liable is not privy to thecircumstances.

It is suggested that this rule be changed for several reasons.If the limitation fund is to be equivalent to the amount which is reasonably

insurable the liability in excess of such amount is of small benefit to the creditors.From the point of view of general prevention the privity rule is not entirely beneficial.The fact that even the smallest degree of negligence on the part of the person whocarries liability results in loss of the right of limitation does not induce such a personto take an active part in operations which may entail liability. It is safer to be ignorantof what is going on. Finally, actions for the purpose of “breaking the limitation” arefrequent, but relatively seldom successful. The cost of defending such actions is partof the cost of the insurance which could be more profitably applied.

It is suggested that a person should not forfeit his right of limitation unless he hasbeen guilty of a qualified degree of negligence – gross negligence or wilfulmisconduct.[34] Question 13.1.



Should limitation of liability be forfeited if there is actual fault or privity on thepart of the person liable?

Question 13.2.What degree of negligence should be required in order to deny right of

limitation?

14. Miscellaneous

Should other matters be discussed at this stage?

Oslo, 15th March 1972Alex Rein.

Second report by the Chairman of the International Subcommittee 5

Introduction

The International Subcommittee (herein called the Committee) charged with thetask of studying the Limitation of Liability Convention of 1957 (herein called theConvention) and reporting to CMI on the question of a possible revision wasestablished under the chairmanship of Mr. Alex Rein (Norway) by CMI’s BureauPermanent in Brussels on February 15, 1972.

An introductory Report and Questionnaire, dated March 15, 1972, (LIM-1, 3-72)was prepared by the Chairman and circulated by CMI to the National Associations.Replies to the Questionnaire have been received from 14 Associations. The followingare included in CMI Documentation 1, 1972: Denmark (LIM-2, 6-72), Italy (LIM-3,6-72), Switzerland (LIM-4, 6-72), Yugoslavia (LIM-5, 5-72), Norway (LIM-6, 6-72).Greece (LIM-7, 8-72) and Great Britain (LIM-8, 8-72). The following replies havebeen circulated to the National Associations: Sweden (LIMIT-9, 10-72), Belgium(LIMIT-10, 10-72), Netherlands (LIMIT-11, 10-72), France (LIMIT-12, 10-72),D.D.R. (LIMIT-13, III-73), Canada (LIM-17, I-74) and the Federal Republic ofGermany (LIMIT-18, I-74).

The Committee had its first meeting in Antwerp on November 8, 1972, where thefollowing National Associations were represented: Belgium, D.D.R., France, FederalRepublic of Germany, Great Britain, Ireland, Japan, Netherlands, Portugal, Sweden,U.S.A., Yugoslavia.

Following a general discussion of the principles for a possible revision of theConvention, in the light of the replies received up to that time, the Committeeappointed a Working Group to prepare a first draft. The Group was composed asfollows [14]:

Dr. Alex Rein (Norway), ChairmanMr. Arthur M. Boal (U.S.A.)Mr. Simon Cotton (Great Britain)


General comments

(5) CMI Document LIMIT-19/II-74

Dr. Bern Kröger (Federal Republic of Germany)Professor Hisashi Tanikawa (Japan)Mr. André Vaes (Belgium)Mr. C. Buisseret (Belgium), Deputy

The Working Group had meetings in Antwerp on November 8, 1972, and inLondon on January 8 and 9, 1973.

On March 23, 1973, in Brussels, the Chairman of the Committee reported to theAssembly of CMI on the progress of the work. The Chairman of the Committee wasappointed to represent CMI at the forthcoming meeting of IMCO’s Legal Committeewhere the revision of the Convention would be put on the agenda.

This meeting took place in London on June 21, 1973, and the Chairman of theCommittee accepted, on behalf of CMI, that CMI should act as a “working party” forIMCO in carrying out the preparatory work for the presentation of a first draft.

The Working Group again met in Oslo on September 29 and 30, 1973, andprepared two alternative drafts: a “Maxi Draft” for a new “International Conventionon Limitation of Liability for Maritime Claims” and a “Mini Draft” for a Protocol toamend the 1957 Convention. These drafts were submitted to the Committee asExhibits 1 and 2 to The Chairman’s First Report to the International Sub-Committee,dated October 8, 1973 (LIMIT-14, X-73) (herein called the First Report). Details ofthe work of the Working Group will be found in this Report.

Comments to the First Report were submitted by France (LIMIT-15, XII-73) andItaly (LIMIT-16, XII-73).

The second meeting of the Committee took place in Brussels on December 17and 18, 1973. The meeting was attended by the Chairman, the Chief Legal Officer,Professor Jan Ramberg, and delegates representing the following NationalAssociations: Canada, Denmark, the Federal Republic of Germany, France, GreatBritain, Ireland, Japan, Netherlands, Norway and Sweden.

The basis for the discussion was the Maxi and Mini Drafts. The outcome was thatthe Committee decided, in accordance with the prevailing view of the delegates, topresent to CMI only a Draft Protocol to amend the existing Convention, although a MaxiDraft would be prepared as a working paper for the Hamburg Conference: see below.

A Drafting Group was appointed and charged with the task of drawing up Draftson the basis of the prevailing views expressed. As no minutes had been kept, and assubstantial drafting difficulties would [16] be encountered, it was understood that theDrafting Group must also be given a relatively free hand in matters of certainsubstance. For reasons of time no new meeting of the Committee would be possibleprior to the Hamburg Conference.

The Drafting Group was composed as follows

Mr. Alex Rein (Norway), ChairmanMr. J. Niall Mcgovern (Ireland)Mr. Jacques Potier (France)Professor H. Schadee (Netherlands)

The Drafting Group met in Oslo on January 19 and 20, 1974. Professor Schadeewas prevented from attending. Professor Emmanuel du Pontavice (France) assistedMr. Potier, and the Chief Legal Officer was also present. Valuable assistance wasrendered to the Group by Professor Sjur Braekhus and Professor Erling C. Selvig



(Chairman of the Norwegian Association), both professors of maritime law at theUniversity of Oslo.

The Draft Protocol prepared by the Drafting Group is attached to this Report asAppendix A. In order to avoid confusion the provisions of the Draft Protocol arecalled Sections.

The Chairman’s Comments on the Draft

The Scope of the Revision

The Committee decided at its second meeting to base its discussions on the MaxiDraft without prejudice to its final decision as to the scope of revision to berecommended. Most delegates preferred the structure and systematic order of the MaxiDraft to that of the Convention, but the prevailing view was that the ultimate choicebetween a maxi or mini draft would depend on the number of amendments which wouldbe deemed necessary or desirable. The majority took the view, already reflected in theopinions expressed by most National Associations, that time is not ripe for a radicalchange of the present system.

Although the discussions revealed that many changes might be called for if theConvention were to be replaced by a new structure, the majority preferred to limit theproposed amendments to such as may reasonably be made by way of a protocol. It wasdecided, therefore, that the only official document which should be presented by theCommittee to the Hamburg Conference should be a Draft Protocol to amend theConvention.

It was realized, however, that the Conference will hardly be inclined to limit itsdeliberations to the scope of revision reflected in the Draft Protocol. Proposals formore extensive changes, including restructuring of the Convention, are likely to betabled by National Associations. The [17] Draft Protocol designed for the purpose ofincorporating a very limited number of changes into the rather special fabric of theConvention would not be a good working paper for a conference at which the field iswide open for new proposals. It was decided, therefore, that the Chairman’s Reportshould include a working paper in the form of a revised Maxi Draft which shouldreflect the solutions favoured by the Committee if, in principle, a new convention shallreplace the present Convention. It was also agreed that in his Report the Chairmanshould deal with the questions under discussion in the systematic order of the revisedworking paper.

This working paper, herein called the Working Paper (WP), prepared by theDrafting Group, is attached as Appendix B.6


General comments

(6) Appendix B, titled “Working Paper in the form of a draft International Convention on theLimitation of the Liability for Maritime Claims” is published in Appendix I at p. 423.

IMCO Legal CommitteeTwenty-third Session3-7 January 1974

[1] Consideration of the review of the 1957 Convention relating to the Limitation ofthe Liability of Owners of Sea-Going Ships (Agenda item 2).

4. At its preceding (twenty-second) session (18 to 22 March 1974) the LegalCommittee decided to devote the twenty-third session to consideration of the reviewof the International Convention relating to the Limitation of the Liability of Ownersof Sea-Going Ships signed at Brussels on 10 October 1957. This treaty revised andreplaced, as between its Parties, an international convention on the same subjectsigned at Brussels on 25 August 1924.

5. In June 1973, at its nineteenth session, the Committee availed itself of an offerof assistance from the Comité Maritime International (CMI) in the revision of theConvention. This assistance took the form of two sets of draft articles with anaccompanying Introductory Report, and these materials were made available by theCMI to the Legal Committee for the latter’s twenty-third session.

6. The first of these two sets of draft articles is entitled Draft InternationalConvention on Limitation of Liability for Maritime Claims. The second set of articlesis in the form of a draft protocol containing drafts of amended or new provisionswhich might be incorporated into the 1957 Convention.

[2] On the understanding that the two sets of draft articles are largely identical insubstance, the Legal Committee decided to use the draft convention (“Maxi-Draft”)rather than the draft protocol (“Mini-Draft”) as the basic working document of thepresent session under the second agenda item.7 This decision was taken withoutprejudging in any manner the future employment of the draft protocol either as to itssubstance or its form.

7. The Introductory Report presented by the CMI contains a detailedexplanation of the individual draft articles of the “Maxi-Draft” and a synopsis of the“Mini-Draft”. The documentation so helpfully provided by the CMI was presentedand further explained by its representatives.

8. The Legal Committee concluded that it should begin its review of the existingrégime of limitation of liability for maritime claims by first discussing the principleswhich had been evolved in the form of these draft articles of a new convention. Eachdraft article was accordingly examined, explained when necessary and debated in itsturn. No restraint was imposed upon the scope of the debate and the major pointswhich were elicited are set out below after an introduction in the order of thenumbered draft articles. The texts of the draft articles themselves are set out in theAnnex to the present Report.

Introduction

9. The concept of limitation and the extent of the need for revision of existingrules tending to unify the law on the subject were discussed in terms of basic policyobjectives, with particular reference to the desirability of keeping insurance premiumsat reasonable levels and other insurance aspects of the problems and to the need to



(7) This draft is published in Appendix I.

find a proper balance between the interests of those entitled to the benefit of limitationand of potential claimants. Reference was made to the function of limitation wherecatastrophic losses might have to be contemplated, but could not be economicallyinsured against, and to the aggregation of claims with consequent heavy liability. Forthese peculiarities of maritime enterprise, in addition to the need for the unhinderedmobility of the ship, a global limitation system may perform the function of providingcertainty, security and uniformity.

[3] 10. The earlier concept of limitation held that a shipowner should be able to freehimself from liabilities which exceeded his total interest in a venture subject to marineperils. The more modern view is that a shipowner should be able to free himself fromliabilities which exceed amounts coverable by insurance at reasonable costs. It wasthought to be in the general interest that shipowners should be able to meet claims upto those amounts and that procedures should be established to facilitate the settlementof claims. Additionally, it was thought that, with respect to the economy of seatransport, it was important to take into account the costs of insurance not forshipowners alone, but the totality of insurance costs for sea carriage, includinginsurance costs for shippers of cargo.

11. Many changes had taken place since the earliest effort (1924) to unify rules ofmaritime law on these matters. Monetary values had altered and the limits set in thepast were widely considered to be too low. Judicial interpretation in some jurisdictionshad disturbed the uniform application of some principles enshrined in the earliertreaties. Newer conventions of maritime law had been concluded with regard toliability for damage caused by nuclear incidents and pollution, and these treaties hadother consequences for the shipowner, in particular the 1969 InternationalConvention on Civil Liability for Oil Pollution Damage. A new system of tonnagemeasurement is in prospect which would have an effect on the system of determininglimitation.

12. Revision, in particular of the 1957 Convention on Limitation of Liability, hasbeen seen as necessary. How this revision is to be accomplished and how extensive itis to be must await further study. In the opinion of some, there was no need for aradical revision of the present system. What was required was merely to make thechanges which experience had shown were necessary. In their view the generalobjective would be to make possible a viable and continuing commercial situation inwhich “limitable claims” may be insured on an economical basis.

Twenty-fifth Session20-24 January 1975

[1] 1. The Legal Committee met from 20 to 24 January 1975 in its twenty-fifthsession. In the unavoidable absence of its Chairman, Mr.G. A. Maslov (USSR), theVice-Chairman of the Committee, Dr. F. L. Wiswall, Jr. (Liberia) presided.

2. A list of participants attending the session appears in document LEGXXV/INF.1.

3. The Committee adopted the Agenda contained in document LEG XXV/1.Consideration of the review of the 1957 Convention relating to the Limitation of theLiability of Owners of Sea-Going Ships (Agenda item 2).

4. At its twenty-third session in June 1974, the Committee, with the assistance ofthe Comité Maritime International, began substantive work on the consideration of


General comments

the review of the International Convention relating to the Limitation of the Liabilityof Owners of Sea-Going Ships signed at Brussels on 10 October 1957.

5. Of two draft sets of articles presented by the Comité Maritime International,the Legal Committee decided at the twenty-third session to use the first (“Maxi-Draft”) as its basic working document without prejudging the eventual form ofinstrument which a revision of the 1957 treaty might take.

6. The Comité Maritime International on the request of the Legal Committee,made information on financial limits of liability available for the twenty-fifth session andthe European Tugowners Association also submitted observations prior to the session.

7. The Committee decided to give a second reading to the draft articles annexedto the Report of its twenty-third session (LEG XXIII/4),8 proceeding article by article.In doing this, it was reiterated that the progressive modification of the texts of thesedraft articles did not reflect the settled opinions of any Member, nor were furtherchanges – and the possible re-introduction of earlier texts – precluded. The text ofthe draft articles set out in Annex I to the present Report9 accordingly reflects a stagein the Committee’s consideration of this review, rather than a consensus ofgovernmental opinion. Comments of delegations on the draft articles are set out intheir order below.

Twenty-seventh Session16-20 June 1975

[1] 1. The twenty-seventh session of the Legal Committee convened from 16-20June 1975 under the chairmanship of Mr. G. A. Maslov (USSR).

2. A list of participants attending the session appears in document LEGXXVII/INF.1.

3. The Committee adopted the Agenda contained in document LEG XXVII/1.Consideration of the review of the 1957 Convention relating to the Limitation of theLiability of Owners of Sea-Going Ships (Agenda item 2).

4. The principal substantive item on the Committee’s agenda was considerationof the review of the International Convention relating to the Limitation of the Liabilityof Owners of Sea-Going Ships, signed at Brussels on 10 October 1957. This item wasthe continuation of a study begun at the twenty-third session of the Committee in June1974 and resumed at the twenty-fifth session in January 1975.

5. At the latter session, it was not possible to examine all the draft Articlesannexed to the Report of the twenty-third session (LEX XXIII/4). Accordingly, theCommittee first considered the texts of draft Articles 8, 9, 10 and 12, after which itagain gave attention to Articles 1, 2 and 3. It also considered a draft Article concerningthe scope of application submitted by the delegation of Belgium.

6. The texts of the draft Articles resulting from the discussions of the Committeeup to the end of the twenty-seventh session are given in Annex I.10 A summary of theprincipal points in the discussions of the session is given in the following paragraphs.



(8) The Draft Articles annexed to Document LEGXXIII/4 are published in Appendix III.(9) The Draft Articles, annexed to the Report of the Twenty-fifth Session of the Legal Committee

(Document LEG XXV/4) are published in Appendix IV.(10) The Draft Articles, annexed to the Report of the Twenty-seventh Session of the Legal

Committee (Document LEG XXVII/4) are published in Appendix V.

Twenty-eighth Session24 November-5 December 1975

[1] 1. The Legal Committee convened in a two-week session from Monday 24November to Friday 5 December 1975. It was the twenty-eighth session.

2. A list of participants attending the session appears in document LEGXXVIII/INF.1.

3. The Committee adopted the Agenda contained in document LEG XXVIII/1.Consideration of the review of the 1957 Convention relating to the Limitation of theLiability of Owners of Sea-Going Ships (Agenda item 2).

4. The twenty-eighth session was the third and concluding session of the LegalCommittee devoted to the consideration of the review of the 1957 Convention relatingto the Limitation of the Liability of Owners of Sea-Going Ships.

5. At its previous (twenty-seventh) session the Committee decided on the orderin which individual articles (including a proposal for an article on financialresponsibility) of the draft new international convention on this subject would beexamined or re-examined at the present session.

6. The principal points arising from the Committee’s discussions are set outbelow, following the order of the draft articles as finally presented with this Report.

7. Annex I11 contains the set of recommended draft articles for an InternationalConvention on Limitation of Liability for Maritime Claims, together with comments andalternative drafts, where these have been considered appropriate. Annex II contains asummary of observations and proposals on the important [2] question of a new unit ofaccount for the calculation of the limitation amounts in the Convention. This Annex is tobe read in conjunction with the text of draft Article 8 as given in Annex I.

8. The Legal Committee recommends that the text of the draft InternationalConvention on Limitation of Liability for Maritime Claims contained in Annex I,together with any comments and observations thereon, be circulated to governmentsand interested organizations for consideration at the conference to be convened by theOrganization from 1-19 November 1976, with a view to the adoption of a newconvention on this subject.

9. The Committee further recommends that the contents of Annex II, togetherwith any comments which may be made on them, be made available to the conference.

10. In order to provide governments and organizations with the fullest possiblebackground information on the draft articles, the Committee also recommends thatthe Secretary-General be authorized, when submitting these draft articles to thegovernments and interested organizations invited to the conference, to accompany thedraft articles with the records of the discussion of the Legal Committee on the draftsas contained in the Reports of the Committee’s twenty-third, twenty-fifth, twenty-seventh and twenty-eight sessions.

Twenty-ninth Session28 June-2 July 1976

[16] Any other business (Agenda item 4)(a) Preparations for the 1976 Conference on Limitation of Liability for Maritime Claims


General comments

(11) The Draft Articles, annexed to the Report of the Twenty-eighth Session of the Legal Committee(Document LEG XXVIII/7) are published in Appendix VI.

65. The Committee took note of the steps undertaken by the Secretary-General inview of the forthcoming Conference on Limitation of Liability for Maritime Claims asreported in the Secretariat document LEG XXIX/4. It noted in particular [17] thatCouncil had approved the convening of three Conferences to revise the unit of accountprovisions in the International Convention on Civil Liability for Oil Pollution Damage,1969, the International Convention on the Establishment of an International Fund forCompensation for Oil Pollution Damage, 1971 and the Athens Convention relating tothe Carriage of Passengers and their Luggage by Sea, 1974, all three Conferences to beheld in conjunction with the Limitation of Liability for Maritime Claims Conference.

66. The Committee furthermore considered the Secretary-General’s initialproposals on the organization of the work of the Conference and, in particular, on theCommittee structure. In this context, a number of delegations expressed theirmisgivings over the fact that, as a result of decisions of the Council and the Assembly,summary records would be provided only in respect of meetings of the Plenary, butnot for meetings of the Committee of the Whole.

67. Some delegations felt that it would be most important for the Conference tohold a first reading of the draft articles of the Convention in a Committee of the Wholerather than in Plenary, even if this meant foregoing the availability of summary recordsof the proceedings in such a Committee. Other delegations on the other hand took theview that for a legal conference full records of the proceedings were of suchfundamental importance that, under the circumstances, it would be preferable to workexclusively in Plenary, even if this implied more formal working and decision-makingprocedures.

68. After giving careful consideration to these alternatives, the Committee agreedto recommend that substantive consideration of the Convention Articles be undertakenin the plenary sessions of the Conference. The Committee however recommended thata first reading of the draft Articles be held under the simpler procedural provisionsnormally applicable to committee proceedings. If necessary, the Conference couldexplicitly provide for this by adapting its Rules of Procedure accordingly.

69. For the future the Committee decided to recommend that Council reconsiderits decision on this matter and to make provision in respect of legal conferences, forsummary records of meetings of any Committee of the Whole, in addition to suchrecords for plenary meetings. In this connection the Committee noted that the presentIMCO practice was not exactly in accordance with the practice adopted by the UnitedNations in respect of diplomatic conferences held under its auspices.

Diplomatic ConferenceSummary Record of the First Plenary Meeting1 November 1976

[467] The Secretary-General welcomed delegates and declared open theConference on Limitation of Liability for Maritime Claims convened under theauspices of the Inter-Governmental Maritime Consultative Organization.

The Conference was meeting to continue, in many respects, the work begun bythe adoption at Athens in December 1974 of the Athens Convention Relating to theCarriage of Passengers and their Luggage by Sea. That Convention had established thebasis and limits of the liability which the shipowner bore towards the passengerscarried in his ship and in respect of the luggage of such passengers. The presentConference was meeting to adopt an instrument which would establish the limits of



the liability of the shipowner to persons who might not be on board the ship or whomight not even be linked to the shipowner by a contractual relationship. Thus, the newConvention would have to set limits to the liability of the shipowner not only towardspersons with whom he had entered into some form of contract but also to third parties,i.e., to persons with whom he might not have had any dealings whatsoever. Moreover,it would also deal with the liability of persons – such as salvors – who, not beingshipowners themselves, had such a direct relationship to the operation of the ship thatit was considered reasonable to treat their liability on the same footing as that of theshipowner.

The basic foundation for both the Athens Conference and the present one hadbeen material generously placed at the disposal of IMCO’s Legal Committee by theComité Maritime International (CMI), and the first draft of both conventions hadbeen prepared by the CMI. Furthermore, experts from the CMI had participatedactively throughout the long and detailed consideration of those drafts by the LegalCommittee of IMCO, providing additional information, explanation and expertadvice. On behalf of the Secretariat, the Legal Committee and the MemberGovernments of IMCO, he expressed his gratitude to the CMI for their co-operationand assistance. The interest which the CMI maintained in IMCO’s work wassymbolized by the presence of the new President of the CMI, Professor F. Berlingieri,to whom he extended a warm welcome and sincere felicitations.

He paid tribute to the late President of the CMI, Baron Albert Lilar, under whosePresidency the close working relationship between IMCO and the CMI had beenforged, and who had contributed greatly to the development of maritime law. Heinvited the Conference to observe a minute’s silence in honour of Baron Lilar.

The Conference observed a minute’s silence in honour of Baron Albert Lilar.

[468] The Secretary-General said that the task before the Conference was to providefor a regime which would balance realistically and equitably the legitimate interests, onthe one hand of the shipowner, and on the other hand, of parties who might suffer lossand damage as a result of the operation of the ship. To establish such a balance would beby no means easy; but he was sure that the readiness of governments, as shown onprevious occasions, to work out acceptable and compromise solutions, and the presenceat the Conference of so many persons of expertise and diplomatic skill would contributeto the success of the difficult assignment before the Conference.

The establishment of international standards and regulations in the maritimefield was, of course, a function which IMCO had been established to perform andwhich he ventured to say IMCO had performed with competence and consideratesuccess. IMCO was now a truly international maritime organization, global both in itscomposition and in the scope of its activities, and widely recognized as such.Moreover, the regulations and standards developed in IMCO were more widely andreadily implemented than was perhaps the case in other areas. For, in spite ofoccasional assertions to the contrary, the conventions and instruments adopted inIMCO did not enter into force less quickly than international conventions generally.IMCO’s record in that regard was, in fact, better than the average. He thereforeexpected that the Convention resulting from the Conference’s deliberations would besuch that it would be speedily accepted by a large number of governments and thusenter into force within a short period of time.

The Secretariat would do all it could to provide participants with the necessaryfacilities, service and assistance. He wished participants every success in theirdeliberations.


General comments

Election of the president

The Secretary-General reported that Heads of Delegations, at a meeting heldearlier that morning, had unanimously agreed to recommend the election as Presidentof the Conference of Mr. Stanley Clinton Davis MP, Parliamentary Under-Secretary ofState for Companies, Aviation and Shipping. Mr. Clinton Davis had had a longexperience in law as a practising solicitor, a Member of Parliament and as Ministerresponsible for shipping in the United Kingdom which, as was well known, possesseda large merchant fleet and was the host State to IMCO.

Mr. Bendjenna (Algeria), Mr. Gowland (Argentina) and Mr. Nair (India)supported the candidature of Mr Clinton Davis for the office of President of theConference.

Mr. Stanley Clinton Davis (United Kingdom) was elected President of theConference by acclamation. Mr. Clinton Davis (United Kingdom) took the Chair.

The President thanked all delegations for the honour which they had conferredupon the United Kingdom and upon himself by his election. As Minister in the UnitedKingdom Government concerned with shipping, he was aware of the importance toshipowners, insurers, cargo owners and many others of the existing Convention on theLimitation of the Liability of Owners of Sea-going Ships of 1957, to which sometwenty-five States were Parties. A replacement of that Convention was overdue bothon economic and legal grounds, and the task of the Conference was to [469] producethat replacement.

The Government of Belgium had for many years played a special role in thedevelopment of maritime conventions of this kind, and he associated himself with thetribute which the Secretary-General had paid to the late Baron Lilar for hisdistinguished work in that field.

Although IMCO had the important task of convening such conferences, manyother facets of its work should not be forgotten. In the field of safety, great progresshad been made; the International Convention for the Safety of Life at Sea and theCollision Regulations were of the utmost importance to seafarers, as were the trafficseparation schemes soon to have mandatory effect. IMCO had also worked toestablish standards to eradicate the evil of sub-standard ships; and the recent adoptionof a Convention on an international maritime satellite system demonstrated its abilityto keep abreast of modern technology.

Following the “Torrey Canyon” disaster, IMCO had done excellent work on theprotection of the environment and on the prevention of pollution. For the UnitedKingdom, a country with a large number of merchant ships and seamen and one whichwas particularly exposed to pollution risks, the work of IMCO was of inestimablevalue, and he was proud that it had its headquarters in London – the only such UnitedNations agency in the United Kingdom. IMCO’s strength lay in its ability to producepractical results without undue controversy, and that was undoubtedly one of thereasons why its work was not as widely known as it should be.

The success of a conference depended in great measure on the effectiveness of thepreparations which had been made for it. The Conference owed much to the ComitéMaritime International which had assisted the Legal Committee of IMCO in its lengthydevelopment of the draft articles, thus enabling work to be begun on a sound basis.

He hoped that, with the spirit of goodwill and compromise which hadcharacterized IMCO since its inception in 1959, delegations would succeed inadopting a convention which would be even more widely acceptable than theConvention of 1957 which it would replace.



[470] Agenda Item 3 – Election of Vice-Presidents and other Officers of theConference

The President said that, in accordance with Rule 6 of the Rules of Procedure justadopted, the Conference was required to elect five Vice-Presidents, the Chairman ofthe Committee of the Whole, and the Chairman of the Drafting Committee.

The Secretary-General said that Heads of Delegations had unanimouslyrecommended that the first three Vice-Presidents should be Mr. R. F. Bondoni(Argentina), Mr. M. A. Bendjenna (Algeria) and Mr. Y. Djavad (USSR) respectively.They had recommended postponing the election of the fourth and fifth Vice-Presidents pending further consultation.

The Conference adopted the recommendations of Heads of Delegations and electedMr. R. F. Bondoni (Argentina), Mr. M. A. Bendjenna (Algeria) and Mr. Y. Djavad (USSR)first, second and third Vice-Presidents respectively, by acclamation.

The Secretary-General said that Heads of Delegations had unanimouslyrecommended that Ms. B. Blom (Sweden) be appointed Chairman of the Committeeof the Whole.

Ms. B. Blom (Sweden) was elected Chairman of the Committee of the Whole byacclamation.

The Secretary-General said that Heads of Delegations had recommended thatthe election of the Chairman of the Drafting Committee should be postponed pendingfurther consultation.

It was so decided.

Committee of the WholeSummary Record of the First Meeting1 November 1976

General debate

[209] The Chairman said that the draft Convention was global in character in tworespects: in the first place, it provided for a global limitation of liability, and secondlyit concerned all States either because they had a shipping industry or because theywere possible claimants. That being so, there were necessarily a number of divergentinterests, and differing views were therefore to be expected. The object of all, however,should be to reach a consensus of opinion and a common position. The resultingConvention must gain wider acceptance than that of 1957, and the Conference wouldhave to work efficiently if it was to complete its task within the time available. Somedelegations had suggested that proposals on which the Legal Committee of IMCO hadnot submitted recommendations – in particular, the figures to be inserted in Articles6 and 7 – should be considered as soon as possible, and she intended to put forwarda provisional timetable for the Committee’s deliberations the following day.

Mr. Cleton (Netherlands) said that the limitation of liability was one of the mostimportant items of private maritime law and a concept that was becoming more widelyaccepted. The present Conference had met to revise the 1957 Convention, which hadserved its purpose well but which, in the opinion of his Government, now neededsome adjustment. In particular, a revision of the limitation amounts fixed by thatConvention was called for, to take account of inflation and technologicaldevelopments. His delegation considered that the new amounts should be calculatedin such a way as to enable shipowners to insure their liabilities at commercially


General comments

acceptable premiums. The proposed new tonnage-measurement system would, in anycase, considerably increase the size of the limitation funds, and the Netherlandsdelegation would be satisfied with an increase of 100 per cent in the funds availableunder the 1957 Convention; its attitude would depend, however, on the decisionstaken in respect of other provisions – such as the system of limitation. It also stronglyfavoured a system providing for unbreakable limits, as that would do away with much[210] litigation regarding the term “actual fault and privity”. So far as the minimumlimit was concerned, his delegation was not in favour of any significant increase in thefigure contained in the 1957 Convention in order to avoid making it unnecessarilydifficult to insure ships of low tonnage.

Of the alternative versions of Article 6, his delegation preferred the one providingfor claims for loss of life or personal injury to be separated from other claims, since itappeared that a single fund for both types of claim might result in a considerableincrease in insurance premiums.

Turning next to the unit of account, he thought it must be accepted that the gold-based Poincaré franc was no longer a reliable unit and must be abandoned. Hisdelegation had prepared a working paper on Article 8, its view being that the SpecialDrawing Rights of the IMF would meet the requirement for a stable unit of accountwhich could be determined without ambiguity. His delegation had also prepared aworking paper on the provisions dealing with preventive measures; it would revert tothat question later.

In conclusion he expressed the hope that the Conference would contribute to theunification of international maritime law.

Mr. Amoroso (Italy) said his Government regarded it as of the utmostimportance that the Conference should succeed in its task. Italy, in common with anumber of other major countries, had not ratified the 1957 Convention and it wasessential that the Conference agree on a text acceptable to most, if not all, participatingGovernments. Thanks to the efforts of the Legal Committee of IMCO, the Conferencewas in a position to give detailed consideration to a highly satisfactory draft text whichhis own Government could accept subject to a certain number of points which hewould be raising during its examination article by article.

Italy was in favour of a significant increase in the liability amounts, a view sharedby the shipowners themselves. Yet, while due account had to be taken of theinflationary trends of the past few years, one should not fix exaggeratedly high limits.That was a fundamental problem to which he thought the Committee of the Wholewould do well to give priority by discussing first Articles 6 and 7 of the draft, since thesolution adopted would affect the decision on many other issues. Before a finalconclusion was reached, however, he recommended that the position of the insurancemarket should be investigated.

Mr. Lyon (Canada) said that although Canada had not ratified the 1957Convention, its provisions had in substance been adopted in Canada’s domestic law.In Canada, a shipowner might limit his liability for damage negligently caused by hisship, provided he had not been privy to such negligence. Nevertheless, innocentvictims of such damage should not, in his Government’s view, be left to bear the costof the damage thus caused; the present draft Convention appeared to offer a means ofprotecting them by striking an equitable balance between their interests and those ofpersons engaged in maritime trade. With that in view, the limit fixed should be as highas possible when remaining compatible with the capacity of the shipowners and theposition of the insurance market. Lastly, the “fault or privity” rule should be



preserved, and limitation of liability should not apply in cases either of damage toharbour works, etc., or of pollution.

Mr. Wiswall (Liberia) said he did not intend to make any general comments butwould raise two important points. In the first place, the Convention currently in [211]force had the major disadvantage of having been ratified by only twenty-five States. Bymeans of a contract, it was possible for a Party to the 1957 Convention to refrain fromapplying its provisions; that was a totally unacceptable situation. In the second place,serious problems could arise in the case of a salvor not operating from a ship, and anequitable scheme needed to be worked out to deal with that question. His Governmentwould in due course be submitting specific proposals on those two points.

The present Convention belonged to that category of innovatory legalinstruments which remained largely a dead letter for lack of wide acceptance. It was tobe hoped that existing differences of opinion would be reconciled and a consensusreached, so that the new Convention did not suffer the same fate.

Mr. Herber (Federal Republic of Germany) said that his Government fearedthat a total revision of the 1957 Convention as envisaged might endanger theharmonization of legislation already achieved in that field. His Government wouldtherefore have preferred to see the adoption of a Protocol containing amendmentsonly to those few Articles really requiring them. There was only need to review thelimits of liability amounts and tonnage measurement, and to harmonize the text of the1957 Convention with those of subsequent Conventions.

If, however, a new Convention was judged necessary, the Federal Republic ofGermany thought that further changes should be restricted to the bare essentials.Certain clarifications would have to be introduced with regard to such questions as,for example, the limitation of the liability of salvors; but the basic principles shouldbe left untouched. For example, a system providing for unbreakable limits would becontrary to the criterion of “actual fault and privity” laid down in the 1957Convention, and it would not be advisable to adopt the principle of a single fund.Both changes would constitute a significant alteration of the actual limitationsystem.

To avoid the problems bound to arise from the simultaneous existence later of thetwo legal instruments, a final clause should be inserted requiring States ratifying thenew Convention to denounce the previous one.

Mr. Jeannel (France) said that his Government believed that the Conferencewould have considerable influence in developing shipping and in protecting partiesinjured in the course of shipping activities. The Conference had become necessarybecause some of the provisions of the 1957 Convention were now out of date.

The aim of the Conference was twofold: first, it had become necessary to revisethe figures set in 1957 so as to take account of the general decline in the purchasingpower of currencies and because the usual clause referring to the “Poincaré Franc”was no longer relevant. Whatever solution was adopted should be acceptable to thelargest possible number of delegations, so as to avoid parallel systems and especiallythe need for further revision at a later stage.

Second, the Conference had to make certain adjustments; and in that connexionhe felt that the text drafted by the Legal Committee of IMCO was an improvement incertain respects.

In Article 6, his delegation would like priority to be given to claims for damage toharbour installations. His delegation approved the idea expressed in Article 7 of aspecific limit on passenger claims. However, in other matters and in particular in


General comments

Article 4, his delegation would prefer to retain the wording used in the French text ofthe 1957 Convention.[212] He stressed that the problem of limits was of great importance, and that theConference would not be able to make progress unless it had an idea of the figuresinvolved fairly soon.

The Conference’s task, therefore, was to bring the 1957 Convention up to date;and it was his delegation’s view that, without being too revolutionary, the Conferencemust not remain too greatly attached to the past. It had to take account of currenteconomic facts, including the capacity of the insurance market, so as to find workableand effective solutions and draft an up-to-date legal text on which general consensuscould be reached.

Mr. Selvig (Norway) agreed with the remarks of the French representative, andsaid that his delegation agreed that the Conference must follow the approachsuggested by the French delegation.

It had become necessary to revise the 1957 Convention, and the LegalCommittee’s draft was of a higher legal and technical standard than the Convention of1957, and was on the whole satisfactory. The new draft solved certain problemscreated by the adoption of new international conventions – such as the 1974 AthensConvention – and Article 7 provided a natural and appropriate solution to theproblems arising from that Convention. Finally, it was necessary to revise the 1957Convention because in practice “uninsurable” cases arose. One of the advantages ofthe IMCO draft was the consensus on the specific point that the limit of liabilityshould be based on the principle of insurability.

That concept had two aspects: a technical aspect involving the capacity of theinsurance market, particularly with respect to very large ships, and a practical aspect,involving the need for commercially acceptable insurance premiums. The limit ofliability must be set so as not to create an unreasonable burden where insurancepremiums were concerned.

Since 1957, there had been a depreciation in the real value of the amounts laiddown in the Convention which now represented only 50 per cent of their originalvalue. His delegation had in fact supplied the IMCO Legal Committee with statisticsshowing the effect on costs of raising the limits of liability, based on its country’sexperience. It would have liked to have similar information, to which it attached greatimportance, from other delegations.

Those considerations led his delegation to conclude that it preferred the basic textof Article 6, starting from the principle that the Conference wished to arrive at a certainaverage limit of liability with respect to the ships covered. That also seemed to be themost economical solution. Some delegations had said that one disadvantage of the basictext of Article 6 was that it left no balance for claims for damage to property; but hisdelegation believed that claimants of that kind should indeed be given lower priority.

With respect to Article 4, concerning conduct barring limitation, the fairest solutionwould be to provide as high a liability limit as possible. Concerning the unit of account inthe Convention, his delegation’s view was that Special Drawing Rights should be used.[213] His delegation thought it would be useful to provide for periodical revision ofthe limits laid down in the present Convention. Finally, it endorsed the view of thosedelegations which thou

Documents

THE TRAVAUX PRÉPARATOIRES - Comite Maritime · Appendix V Report on linkage 547 Appendix VI Draft protocol by the Secretariat (Doc. LEG.71/5) 572 Appendix VII Draft protocol submitted