Civil liability for certain offences

Civil liability for certain offences

PART XA – LIMITATION OF LIABILITY

DEFINITIONS

Salvage operations include  Sec. 352H(h)(i) Raising, removal, destruction or rendering a ship harmless which is sunk, wrecked, stranded or abandoned including anything that is or has been         on  board such ship; (ii) Removal, destruction or rendering the cargo of a ship harmless; and (iii) Measures taken to avert or minimise loss to a ship or its cargo or both;
APPLICATION

• This Part applies to the following persons : Sec. 352A(1) and 352F(1)

• Ship owner, charterer, manager and operator of ship. Sec. 352(i)
• Master and crew members even if it is due to their actual fault or privity. Sec. 352F(2)
• Salvor
• Servants of above persons.
• Insurer of liability.

LIMITS OF LIABILITY

Provided that the total limits of liability of all the above persons for a single incident shall not exceed limit stated in Limitation of Liability for Maritime Claims Convention 1976 (LLMC) as follows :
For India who is a member of International Monetary fund (IMF) 

• For loss of life or personal injury, other than passenger 

• 3.02 million Special Drawing Rights (SDR) for a ship of GT 2000 tons.
• For each additional ton from 2001 to 30000 tons, 1208 SDR.
• For each additional ton from 30001 to 70000 tons, 906 SDR.
• For each additional ton in excess of 70000 tons, 604 SDR.
• For loss of life or personal injury to passengers 

         Limit = 175000 SDR  number of passengers the ship is certified to carry. 

• For any other claims 

• 1.51 million SDR for a ship of GT 2000 tons.
• For each additional ton from 2001 to 30000 tons, 604 SDR
• For each additional ton from 30001 to 70000 tons, 453 SDR.
• For each additional ton in excess of 70000 tons, 302 SDR.

• If the amount calculated for loss of life or personal injury, other than passengers, is insufficient, then the amount calculated for other claims shall be used to pay the balance. 
• State may provide by its laws that the claims for damage to harbours, basins, waterways and aids to navigation shall have priority over other claims. 
• The limits for a salvor shall be calculated according to GT of 1500 tons. 
• The above limits shall apply to the aggregate of all claims, which arise on any distinct occasion. 
• The conversion of SDR into Rupees shall be made in accordance with the method applied by IMF.

SDR is an international reserve asset, created by IMF in 1969 to supplement its member countries’ official reserves. The value of the SDR is currently based on a basket of five major currencies: U.S. dollar, Euro, Japanese yen, Pound sterling and Chinese renminbi (RMB). The value of the SDR in terms of the U.S. dollar is determined daily and posted on the IMF’s website. It is calculated as the sum of specific amounts of each basket currency valued in U.S. dollars, on the basis of exchange rates quoted at noon each day in the London market.

• This Part shall not apply to the following: Sec. 352E

• Any of the above persons who do not habitually live in India or do not have their principal place of business in India.
• Ship belongs to a State who is not a party to the LLMC.
• Ship navigating on coasts of India.
• Ship of GT <300 tons.
• Air-cushion vessels.
• Floating platforms for exploiting natural resources of sea-bed.
• If claims arise due to actual fault or privity of owner, charterer, manager or operator. Sec. 352F(2)
• Above persons may limit their liability in respect of the following claims arising due to ship or salvage operation, in accordance with LLMC or Rules made under this Act: Sec. 352A(1) and 352B

• Loss of life, injury to any person, including passengers, or loss of or damage to property on board.
• Damage to harbour works, basins, waterways and navigation aids.
• Delay in the carriage of cargo and passengers and their luggage.
• Loss from infringement of rights.
• Measures taken to avert or minimise loss, which cause further loss.
• Limitation shall not apply to the following claims : Sec. 352A(3)

• Salvage claims or contribution to general average.
• Oil pollution damage under CLC Convention 1992.
• Claims by servants as stated above, provided that their contract of service does not lay down any limits or lays down higher limit than that prescribed in this Act.
• Nuclear damage, including damage caused by nuclear ship.
• The act of involving limitation of liability shall not constitute an admission of liability. (Explanation 1 under Sec. 352A)

LIMITATION FUND – Sec. 352C

• Person who has incurred liability may approach the High Court for constituting a Limitation Fund for the total amount prescribed in the LLMC or Rules made under this Act, and deposit the full amount or give a bank guarantee as decided by the High Court, who shall distribute the amount rateably amongst the several claimants.
• Once the Fund is constituted, no claimant shall have any right against any other asset of the owner.
• Furthermore, the High court shall order release of the vessel or property of the owner, which was detained for exercising such claim. Sec. 352D
• If the owner has already paid any amount to any of the claimants, then he shall have the same right on the Fund as those claimants.

PART XB – CIVIL LIABILITY FOR OIL POLLUTION DAMAGEAPPLICATION

• This part applies to Sec. 352G

• Every Indian ship.
• Every foreign ship while it is at a port or place in India or within the territorial waters of India or any marine areas adjacent thereto over which India has exclusive jurisdiction in regard to control of marine pollution under the Maritime Zones Act, 1976.
• This part does not apply to Sec. 352Q

• Ships of war.
• Ships used by government of any country for non-commercial purposes.

DEFINITIONS – Sec. 352H

• Oil means any persistent hydrocarbon mineral oil such as crude oil, fuel oil, heavy diesel oil and lubricating oil, whether carried on board a ship as cargo or as bunker.
• Pollution damage means

• Loss or damage caused outside the ship by contamination resulting from escape or discharge of oil from the ship, wherever such escape or discharge occurs, provided that compensation for impairment of the environment other than losses of profit from such impairment, shall be limited to costs of reasonable measures of reinstatement actually undertaken or to be undertaken.
• Costs of preventive measures and further loss or damage caused by such measures.
• Ship means any sea-going vessel constructed for the carriage of oil in bulk as cargo, provided that it is actually carrying oil in bulk as cargo, and during any voyage following such carriage, unless it is proved that it has no residues of such oil on board.

LIABILITY OF OWNER AND OTHERS

• Owner shall be liable for any pollution damage caused by oil, which has escaped or been discharged from the ship as a result of an incident, unless it resulted due to following circumstances : Sec. 352-I (1 to 5)

• Act of war, hostilities, civil war or insurrection.
• Natural phenomenon of an exceptional, inevitable and irresistible character.
• Act or omission done with intent to cause such damage by any other person. Owner shall be exonerated from liability to that person. 
• Negligence or wrongful act of any government or other authority responsible for the maintenance of lights or other navigational aids.
• Following persons shall not be liable : Sec. 352-I(6)

• Servants or agents of the owner.
• Members of the crew.
• Pilot or any other person who, without being a member of the crew, renders services for the ship. 
• Charterer, including a bare-boat charterer, manager or operator of the ship.
• Person performing salvage operations with the consent of the owner or on the instructions of a competent public authority.
• Person taking preventive measures.
• Servants or agents of persons mentioned above.
• Unless the incident occurred as a result of their personal act or omission committed with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result. 

LIMITATION OF LIABILITY

• Owner shall be able to limit his liability as stated below unless the incident occurred as a result of his personal act or omission committed with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result. Sec. 352J

• For ship of GT  5000 tons 4.51 million SDR.
• For ship of GT >5000 tons 4.51 million SDR + 631 SDR for every additional ton of GT above 5000 tons, maximum 89.77 million SDR.

• Owner or his insurer shall constitute a limitation fund by depositing an amount in SDR converted in rupees by Reserve bank of India, or financial bank guarantee, as decided by the High court. Sec. 352K
• If the owner has paid any compensation to any claimant, he shall acquire by subrogation the rights of the claimant. Sec. 352L
• The court shall consolidate all claims, including that of the owner under Sec. 352L and for expenses voluntarily incurred by him to minimize pollution, and distribute the amount in the fund proportionately. Sec. 352M

INSURANCE

• Owner of every ship, which carries 2000 tons of bulk oil as cargo, shall maintain an insurance for an amount of 133 SDR/ton of ship’s tonnage or 14 million SDRs, whichever is lower. Sec. 352N(1)
• D.G. Shipping shall issue a certificate to every Indian ship, which maintains the insurance cover. Sec. 352N(2)
• D.G. Shipping may issue a certificate to any foreign ship, which maintains the insurance in accordance with the CLC convention. Sec. 352N(3)
• No Indian or foreign ship carrying  2000 tons of bulk oil as cargo shall enter or leave any port in India without the insurance certificate. Sec. 352P

PART XBA – CIVIL LIABILITY FOR BUNKER OIL POLLUTION DAMAGE

APPLICATION

• This part applies to the following:

• Pollution damage caused by bunker oil by an Indian vessel wherever it is, and by a foreign vessel in Indian territorial waters or marine areas adjacent thereto over which India has exclusive jurisdiction to control pollution under Maritime Zones Act 1976.
• Preventive measures taken to prevent or minimize pollution.
• This part shall not apply to the following:

• War ships.
• Vessels owned or operated by the Government only on non-commercial service.
• Pollution damage as defined in Sec. 352H relating to CLC Convention.

DEFINITIONS – Sec. 352RB

• Bunker oil means any hydrocarbon mineral oil, including lubricating oil, used for the propulsion of a ship, and any residues of such oil.
• Pollution damage means

• Loss or damage caused outside the ship by contamination resulting from escape or discharge of bunker oil from the ship, wherever such escape or discharge occurs, provided that compensation for impairment of the environment other than losses of profit from such impairment, shall be limited to costs of reasonable measures of reinstatement actually undertaken or to be undertaken.
• Costs of preventive measures and further loss or damage caused by such measures.

LIABILITY

• Owner of a vessel shall be liable for Sec. 352RC

• Pollution damage caused outside the vessel due to bunker oil;
• Cost of measures taken to prevent or minimize damage; and
• Damage caused by such preventive measures.

• With respect to vessels owned or operated by the Government only on non-commercial service, the Government shall be liable for pollution damage.
• Owner of a vessel shall not be liable for pollution damage in the following cases: Sec. 352RD

• Act of war, hostilities, civil war or insurrection.
• Natural phenomenon of an exceptional, inevitable and irresistible character.
• Act or omission done with intent to cause such damage by any other person. Owner shall be exonerated from liability to that person. 
• Negligence or wrongful act of any government or other authority responsible for the maintenance of lights or other navigational aids.

• Owner of a vessel shall be able to limit his liability in accordance with Part XA (under LLMC convention or Rules made under this Act) unless pollution damage occurred due to his personal act or omission made with the intent to cause damage or recklessly and with the knowledge that such a damage would result. Sec. 352RE
• Owner of a vessel, who has incurred liability may approach the High Court for constituting a Limitation Fund for the total amount prescribed in the LLMC or Rules made under this Act, and deposit the full amount with the High Court, who shall distribute the amount rateably amongst the several claimants. Sec. 352RF & RG
• Right to claim compensation shall extinguish if the claim is not made within 3 years of the damage. In no case claim shall be made after 6 years from the date of damage. Sec. 352RH

INSURANCE

• Owner of a vessel of GT >1000 tons shall maintain compulsory insurance cover for an amount of his liability. Sec. 352R-I(1)
• Any claim for compensation may be brought directly against the insurer, who may invoke the limitation of liability as available to the owner, provided where the owner is not entitled to limit his liability under Sec. 352RE, the insurer may limit his liability equal to the amount of insurance. Sec. 352R-I(2)
• D.G. Shipping shall issue a certificate to the vessel, which maintains insurance. Sec. 352RJ
• No ship shall leave or enter any port without the above certificate. Sec. 356RK

PART XC – INTERNATIONAL OIL POLLUTION COMPENSATION FUND

DEFINITIONS – Sec. 352S

• Contributing oil means crude oil and fuel oil.
• Crude oil means any liquid hydrocarbon mixture occurring naturally in the earth whether or not treated to render it suitable for transportation and includes crude oils from which certain distillate fractions have been removed or to which certain distillate fractions have been added.
• Fuel oil means heavy distillates or residues from crude oil or blends of such materials intended for use as a fuel for the production of heat or power of a quality equivalent to the American Society for Testing and Materials specification for Number Four Fuel Oil (Designation D 396 – 69) or heavier.

CONTRIBUTION TO THE FUND

• Contributions to the Fund, in respect of contributing oil carried by sea to ports or terminal installations in India, shall be payable in accordance with the Fund Convention, whether or not the oil is imported. Sec. 352T (1 & 2)
• Contributions shall also be payable to the Fund when oil is first received in any installation in India after having been carried by sea and discharged in a port in a country, which is not a Party to the Fund Convention. Sec. 352T(3)
• The person importing or receiving >150000 tons of oil in India or as specified in the Fund convention, shall pay the contribution. Sec. 352T (4 & 5)
• The amount of contribution to be paid in installments shall be determined by the Assembly of the Fund. If any installment remains unpaid it shall bear interest at a rate as determined by the Assembly. Sec. 352U(1)
• The persons liable for paying contribution shall give financial security to the Central Government or the Fund. Sec. 352U(2)
• The Central Government may by notice require persons liable for making contributions to give their names and addresses and the quantity of oil for which they are liable, for transmitting the same to the Fund. This information shall not be disclosed unless it is made with the consent of the person for legal proceedings. Sec. 352V(1 to 5)
• A person who neglects to provide information or gives false information shall be guilty of an offence. Sec. 352V(6)

LIABILITY OF FUND

• If any person has not obtained full and adequate compensation for damage under the CLC convention on any grounds specified in the Fund convention, the Fund shall be liable for pollution damage in accordance with the Fund convention. Sec. 352W
• Claim against the fund shall be brought in a High court within 3 years of the damage. No claim shall be enforced after 6 years from the date of incident that caused damage. Sec. 352X and Y
• If a public authority in India or the Fund has paid any compensation, then it shall acquire the right by subrogation of the person compensated. Sec. 352Z

COMPENSATION 

• Compensation payable by the Fund for any one incident shall be limited as follows:
• Maximum 203 million SDR including the amount actually paid under the 1992 CLC convention. Article 4(4a)
• Maximum 203 million SDR if the damage was due to natural phenomena of exceptional, inevitable and irresistible character. Article 4(4b)
• In special circumstances both the above limits shall be increased to 300.74 million SDR if in any incident there are 3 Parties to this convention who have received combined quantity of contributing oil ≥ 600 million tons in the preceding calendar year. Article 4(4c) (750 million SDR under 2003 Supplementary Fund Protocol).

Interest accrued on a fund constituted in accordance with Article V(3) of the 1992 CLC convention shall not be taken into account for computing the above limits. Article 4(4d)