Spain v. ABS

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DMC/SandT/08/03
Reino de Espana v. The American Bureau of Shipping, Inc.
United States of America: United States District Court for the Southern District of New York; Hon. Laura Taylor Swain; 2008 U.S. Dist. LEXIS 3; January 2, 2008
SHIPPING: OIL POLLUTION: CLASSIFICATION SOCIETY: INTERNATIONAL CONVENTION ON CIVIL LIABILITY FOR OIL POLLUTION DAMAGE: "ANY OTHER PERSON WHOÖ PERFORMS SERVICES FOR THE SHIP: WHETHER A CONTRACTING STATE MAY BRING CLAIMS IN JURISDICTIONS OTHER THAN THOSE PROVIDED BY THE CONVENTION
Summary
In granting summary judgment in favor of defendant, The American Bureau of Shipping, Inc. ("ABS"), the United States District Court for the Southern District of New York held that the International Convention on Civil Liability for Oil Pollution Damage ("Convention") governed the claims by the Government of Spain against ABS because ABS is an "other person" within the meaning of the Article III(4)(b) of the Convention. As a result, the Court further held that it lacked subject matter jurisdiction to adjudicate the Government of Spainís claims, since the Convention provided that claims had to be brought in the courts of the Contracting State where the damage occurred

DMC Category Rating: Confirmed

Case note submitted by Brian S. Tretter, an attorney with the firm Blank Rome LLP, in New York. Blank Rome are International Contributors to the website for the United States

Facts
On November 19, 2002, the M/T Prestige sank off the coast of Spain, discharging millions of gallons of oil into Spainís coastal waters. The Prestige was built in compliance with the American Bureau of Shipping, Inc.ís ("ABS") 1973 "Rules for Building and Classing Steel Vessels." Since its construction, the Prestige was periodically surveyed/inspected to ensure it retained its ABS certification. At the time of the casualty, the Prestige was listed in the ABS Record. The Government of Spain ("Spain") brought suit against ABS in the United States District Court for the Southern District of New York alleging that ABS was negligent in classifying the Prestige as fit to carry oil cargoes. ABS asserted several counterclaims against Spain seeking, among other things, to offset any judgment entered against it with any recovery by Spain in several other actions currently being prosecuted by Spain relating to the casualty.

ABS filed a motion for summary judgment arguing: (1) that Spain was unable to prove the requisite degree of culpability under the International Convention on Civil Liability for Oil Pollution (the "Convention") or, alternatively, (2) that the Court was not the appropriate forum for the suit under the terms of the Convention to which Spain and the Bahamas, the flag state of the Prestige, are both signatories.

Judgment
The Court first considered whether Spainís claims against ABS were covered by the Convention. Article III(4)(b) of the Convention provides in relevant part that no claim for compensation for pollution damage may be brought against "the pilot or any other person who, without being a member of the crew, performs services for the ship" unless the damage resulted from such personís personal act or omission with the intent to cause pollution damage or the person acted recklessly and with knowledge that pollution damage would probably result. The Court held that because ABS performed classification services for the Prestige which are essential to the ship being able to operate, ABS was an "other person" performing services for the ship within the meaning of the Convention Ė in particular because Art.I(2) of the Convention defines person" as "any individual or partnership or any public or private body, whether corporate or not, including a State or any of its constituent subdivisions." In so holding, the Court rejected Spainís argument that Article III(4)(b) of the Convention was only meant to cover individuals actually working on the ship at the time of the pollution incident. Because ABS was deemed an "other person," the Court held that the Convention was applicable to Spainís claims against ABS.

The Court next considered the applicability of the Conventionís forum selection provision (contained in Article IX(1)) which requires an injured party seeking recovery for pollution related damage occurring in the territory of a contracting state to bring its claim in the courts of that state. Noting that the Convention creates legal obligations "akin" to contractual obligations to states that are signatories, the Court held that Spain must pursue its claims against ABS in its own courts or in the courts of any other injured signatory state. The Court rejected Spainís argument that United States courts are not obligated to respect the provisions of the Convention since the United States is not a signatory. Accordingly, the Court granted ABSís motion and dismissed Spainís claims against ABS. ABS withdrew its counterclaims against Spain without prejudice in light of the Courtís dismissal.

Although no notice of appeal has been filed to date [1 February 2008], Spain intends to appeal this decision to the United States Court of Appeals for the Second Circuit.

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