Tonnage as per the Tonnage Measurement Convention 1969 (CLC 1992, Art. V.10).
Calculation Results:
Cases:
Summaries of cases. The cases are generally on CLC, Fund Convention and Supplementary Fund Protocol, decided by the UK courts, following the law, limits, the version of respective Convention, and domestic modifications to them, applicable there at that time. They are only for purposes of learning the general principles, and not to determine any specific law or limit.
For a ship up to 5,000 tons, the limit is 4.51 million SDR.
For a ship over 5,000 tons, the limit is 4.51 million SDR plus 631 SDR for each additional ton, up to a maximum of 89.77 million SDR.
Tier 2 - 1992 Fund Convention (Art. 4): This fund provides additional compensation. The total compensation available under both Tier 1 and this fund is aggregated.
The standard aggregate limit is 203 million SDR.
A higher aggregate limit of 300.74 million SDR applies if three State Parties have combined contributing oil receipts of 600 million tons or more in the preceding year.
Tier 3 - 2003 Supplementary Fund (Art. 4): For States party to this Protocol, this fund provides a third tier of compensation. The total sum available across all three tiers shall not exceed 750 million SDR.
The owner loses the right to limit if the damage resulted from their personal act or omission, "committed with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result" (CLC 1992, Art. V.2).
CLC 1992 (as amended in 2000) Notes:
STRICT LIABILITY
The registered "owner" of a "tanker" ship is strictly liable for any "pollution damage" caused by the ship as a result of an incident [Art. I.3 and III.1, CLC 1992].
An "incident" is defined as an occurrence, or a series of occurrences having the same origin, which causes pollution damage or creates a grave and imminent threat of causing such damage [Art. I.8, CLC 1992].
"pollution damage" is defined as loss or damage caused by contamination resulting from the escape or discharge of oil from the ship, wherever such escape or discharge may occur, and includes loss from contamination, the costs of preventive measures, and further damage caused by those measures. Environmental damage compensation (other than loss of profit) is limited to reasonable measures of reinstatement [Art. I.6, CLC 1992].
“Oil” is defined as 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 in the bunkers of such a ship [Art. I.5, CLC 1992].
A "ship" is defined as a seagoing vessel constructed or adapted for carrying oil in bulk as cargo. If it can carry other cargoes, it is considered a "ship" for the purposes of the Convention only when actually carrying oil in bulk as cargo or during a voyage following such carriage, unless it is proved free of oil residues [Art. I.1, CLC 1992].
Liability applies to pollution damage caused in the territory, territorial sea, or Exclusive Economic Zone (EEZ) of a Contracting State, and to the costs of preventive measures wherever taken [Art. II, CLC 1992].
If an incident involves two or more ships, the owners are jointly and severally liable for all damage that is not reasonably separable [Art. IV, CLC 1992].
EXCEPTION TO LIABILITY
An owner is not liable if they prove the damage resulted from: (a) an act of war, hostilities, or an exceptional, inevitable and irresistible natural phenomenon; (b) wholly by the intentional act of a third party; or (c) wholly by the negligence of a Government authority in maintaining navigational aids [Art. III.2, CLC 1992].
An owner may be fully or partly exonerated from liability to a person if the damage resulted from that person's own intentional act or negligence [Art. III.3, CLC 1992].
EXCLUSIVITY OF LIABILITY (CHANNELLING)
No claim for pollution damage may be made against the owner otherwise than in accordance with this Convention [Art. III.4, CLC 1992].
No claim for such damage may be made against the owner's servants, agents, crew, pilot, charterers, managers, operators, salvors, or persons taking preventive measures, unless the damage resulted from their personal act or omission, done with intent to cause damage, or recklessly with knowledge that such damage would probably result [Art. III.5, CLC 1992].
LIMITATION OF LIABILITY
An owner is entitled to limit their liability for any incident [Art. V.1, CLC 1992].
The owner loses the right to limit liability if it is proved that the pollution damage resulted from their "personal act or omission, committed with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result". The burden of proof is on the substantive claimant opposing the right to limit. [Art. V.2, CLC 1992]. Note: This is a formidably high threshold for a person opposing the limitation to meet.
LIMITATION FUND & DISTRIBUTION
To limit liability, the owner must constitute a fund with the Court in a Contracting State where an action is brought [Art. V.3, CLC 1992].
Once the fund is constituted, no claimant may exercise any right against any other assets of the owner, and any ship or property arrested for the claim must be released [Art. VI.1, CLC 1992].
An owner who has voluntarily taken reasonable preventive measures has a claim against the fund for those costs, ranking equally with other claims [Art. V.8, CLC 1992].
TIME LIMIT FOR CLAIMS
Rights to compensation are extinguished unless an action is brought within three years from the date the damage occurred or six years after the date of the incident, whichever is earlier [Art. VIII, CLC 1992].
COMPULSORY INSURANCE & DIRECT ACTION
The owner of a ship carrying more than 2,000 tons of oil in bulk as cargo is required to maintain insurance or other financial security [Art. VII.1, CLC 1992].
A certificate issued by the Contracting State attesting the compliance with the insurance requirement must be carried on board the ship [Art. VII.2 and VII.4 , CLC 1992]. Note: The relevant authority in the State issues the certificate upon sight of the "blue card" issued by the insurer evidencing the cover.
A claim for compensation may be brought directly against the insurer providing the financial security. The insurer may avail themselves of the same liability limits and defences as the owner [Art. VII.8, CLC 1992]. Note: There may be practical limitations to direct-claims in the context of the policy containing a "pay to be paid" clause. A direct-claimant may be bound by an arbitration clause in the policy (the "conditional benefit" principle"). See The Prestige [2024] EWCA Civ 1536 and The Fanti & The Padre Island [1990] 2 Lloyd's Rep. 191.
GOVERNMENT SHIPS & RECOURSE
The Convention does not apply to warships or other ships on government non-commercial service [Art. XI.1, CLC 1992].
The Convention does not prejudice any right of recourse/indemnity claim the owner may have against third parties [Art. III.6, CLC 1992].
Fund Convention 1992 Notes:
WHO CONTRIBUTES?
Contributions are payable by any person who has received, in a calendar year, total quantities exceeding 150,000 tons of "contributing oil" (crude oil and fuel oil), carried by sea, in the ports or terminals of a Contracting State [Art. 10.1, Fund Convention 1992].
This also applies to oil first received in a Contracting State after having been discharged in a non-Contracting State [Art. 10.1(b), Fund Convention 1992].
LIABILITY OF THE FUND
The Fund is liable to pay compensation if a person suffering pollution damage has been unable to obtain full and adequate compensation under the CLC 1992 [Art. 4.1, Fund Convention 1992].
This applies if: (a) no liability arises under the CLC (e.g., due to the exceptions in CLC Art. III.2); (b) the owner is financially incapable of meeting their obligations; or (c) the damage exceeds the owner's liability limit under the CLC [Art. 4.1(a)-(c), Fund Convention 1992].
The owner's own costs for reasonable voluntary preventive measures are treated as pollution damage claimable against the Fund [Art. 4.2, Fund Convention 1992].
EXCEPTIONS TO LIABILITY OF FUND
The Fund is not liable if the damage resulted from an act of war or was caused by oil from a warship or state-owned ship on non-commercial service [Art. 4.3(a), Fund Convention 1992].
The Fund is also not liable if the claimant cannot prove the damage resulted from an incident involving one or more identifiable ships [Art. 4.3(b), Fund Convention 1992].
The Fund may be exonerated from paying compensation to a claimant if that person's own intentional act or negligence caused or contributed to the damage. This exoneration does not apply to claims for preventive measures [Art. 4.4, Fund Convention 1992].
TIME LIMIT FOR CLAIMS AGAINST THE FUND
Rights to compensation against the Fund are extinguished unless an action is brought (or a notification of a claim against an owner is made to the Fund) within three years from the date the damage occurred. In no case shall an action be brought after six years from the date of the incident [Art. 6, Fund Convention 1992].
SUBROGATION & PROCEDURE
The Fund acquires by subrogation any rights the compensated person had against the shipowner or their insurer [Art. 9.1, Fund Convention 1992].
A State Party or its agency which has paid compensation under national law acquires by subrogation the rights the person compensated would have had against the Fund [Art. 9.3, Fund Convention 1992].
If a claimant gives proper notice to the Fund of a court case against an owner, any final and enforceable judgment in that case becomes binding on the Fund, which cannot then dispute the facts and findings [Art. 7.6, Fund Convention 1992].
Supplementary Fund Protocol 2003 Notes:
LIABILITY OF THE SUPPLEMENTARY FUND
The Supplementary Fund pays compensation to any person who has been unable to obtain full and adequate compensation under the 1992 Fund Convention because the total damage exceeds (or is at risk of exceeding) the applicable limit under that convention [Art. 4.1, Supplementary Fund Protocol 2003].
The total aggregate compensation across all three tiers (shipowner, 1992 Fund, and Supplementary Fund) is limited to 750 million SDR [Art. 4.2(a), Supplementary Fund Protocol 2003].
EXCEPTIONS & TIME LIMITS
The Supplementary Fund pays compensation for "established claims", which are claims already accepted as admissible by the 1992 Fund. Therefore, the exceptions to liability (e.g., act of war, claimant's negligence) would have already been applied at the 1992 Fund level [Art. 4.1 & Art. 1.8, Supplementary Fund Protocol 2003].
The time limits for bringing claims are the same as for the 1992 Fund. Rights against the Supplementary Fund are extinguished if they are extinguished against the 1992 Fund under Article 6 of the 1992 Fund Convention [Art. 6.1, Supplementary Fund Protocol 2003].
WHO CONTRIBUTES?
Annual contributions are made by any person who has received, in a calendar year, total quantities exceeding 150,000 tons of contributing oil, carried by sea, in the territory of a State that is party to this Protocol [Art. 10.1, Supplementary Fund Protocol 2003].
PROCEDURE AND SUBROGATION
A claim made against the 1992 Fund is regarded as a claim made by the same claimant against the Supplementary Fund [Art. 6.2, Supplementary Fund Protocol 2003].
The procedural rules for actions and jurisdiction largely mirror those of the 1992 Fund Convention [Art. 7, Supplementary Fund Protocol 2003].
The Supplementary Fund acquires by subrogation the rights of the person it has compensated against both the 1992 Fund and the shipowner/guarantor [Art. 9, Supplementary Fund Protocol 2003].
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