This paper originally formed the basis of a presentation to APIL on 3 December 2020. The law is accurate as at 6 November 2020
This paper considers two liability and limitation regimes: the Athens Convention; and, the Convention on Limitation of Liability for Maritime Claims 1976 (“the Limitation Convention”). The text of both Conventions can be found attached to the Merchant Shipping Act 1995 (at Schedules 6 and 7 respectively). The liability regime of the Athens Convention could (and, indeed, has) filled a chapter in several textbooks: definitions of “contract of carriage”, “passenger”, “carrier/performing carrier”, “course of carriage”, “fault or neglect” and “shipping incident”; issues of jurisdiction; exclusive application; time limits etc. This well-trodden ground can be found elsewhere. Instead, this paper concentrates on limitation: not the time limit for launching proceedings, but – instead – the financial limits or caps on the damages that may be awarded where the relevant maritime convention applies. The underlying apparatus of the liability regime will be considered (in brief) only where relevant to the relevant financial limit. Given the complexity of the issues, this paper considers only claims for death/personal injury (rather than damage to luggage etc).
The text of the Athens Convention was agreed in principle in 1974. It came into force (after obtaining the requisite number of accession States) on 28 April 1987 and was given statutory effect in the UK by sections 183 and, for carriage within the British Isles, 184 of the Merchant Shipping Act 1995 (to which the Convention is appended in Schedule 6, Part I). The Convention was amended by the Athens Protocol in 2002 which came into force on 23 April 2014.
The European Union has adopted most, but not all, of the Athens Convention regime: European Regulation No 392/2009 (generally referred to as “the Athens Regulation”) came into force on 31 December 2012.
The Athens Regulation applies to international carriage of passengers by sea where: (i) the flag State of the ship is an EU Member State; (ii) the State where the relevant contract of carriage was made is an EU Member State; (iii) the place of departure/destination (identified in the contract of carriage) is an EU Member State.
In the UK, the Athens Convention (Schedule 6 to the Merchant Shipping Act 1995) will continue to apply where the Athens Regulation does not apply: see, Merchant Shipping (Carriage of Passengers by Sea) Regulations 2012 (SI 2012/3152). The Merchant Shipping (Miscellaneous Provisions) (Amendments etc) (EU Exit) Regulations 2018 provide saving for the Athens Regulation (notwithstanding Brexit) (SI 2018/1221).
As to intra-UK carriage, the Athens Regulation applies to Class A ships (as defined) from 30 December 2016 and to Class B ships from 30 December 2018. The old Athens Convention will continue to apply to ships within Classes C and D: see, Carriage of Passengers and their Luggage by Sea (Domestic Carriage) Order 1987 (SI 1987/670).
The remainder of this paper refers to the Athens Convention (as amended by the 2002 Protocol).
Convention on Limitation of Liability for Maritime Claims 1976 (“the Limitation Convention”)
This has legal effect in the UK by reason of section 185 of the Merchant Shipping Act 1995 and the text of the Convention appears at Part I of Schedule 7 to the 1995 Act. As with Athens, it is also necessary to have regard to an amending Protocol to the Convention: the 1996 Protocol which came into force in the UK on 13 May 2004. There was a further revision in 2012 which entered into force on 8 June 2015 and which revised the financial limitation for claims.
The financial limits prescribed by this “Convention” are referred to as units of account or special drawing rights which represent a notional currency (based on a basket of actual currencies) with a value fixed by the International Monetary Fund. As at 6 November 2020 1 SDR = £1.08678. The method of conversion of any judgment (from Units of Account/SDRs to sterling) is set out in paragraphs 5(1) – (2) of Part II of Schedule 6 to the Merchant Shipping Act 1995: “(1) For the purpose of converting from special drawing rights into sterling the amounts mentioned in articles 7 and 8 of the Convention in respect of which a judgment is given, one special drawing right shall be treated as equal to such a sum in sterling as the International Monetary Fund have fixed as being the equivalent of one special drawing right for— (a) the day on which the judgment is given; or (b) if no sum has been so fixed for that day, the last day before that day for which a sum has been so fixed. (2) A certificate given by or on behalf of the Treasury stating— (a) that a particular sum in sterling has been fixed as mentioned in sub-paragraph (1) above for a particular day; or (b) that no sum has been so fixed for that day and a particular sum in sterling has been so fixed for a day which is the last day for which a sum has been so fixed before the particular day, shall be conclusive evidence of those matters for the purposes of articles 7 to 9 of the Convention; and a document purporting to be such a certificate shall, in any proceedings, be received in evidence and, unless the contrary is proved, be deemed to be such a certificate.”
The financial limits described below do not include interest and costs (Article 10(2) of the Convention).
As to the financial limits themselves, much will depend on whether the passenger suffers death or personal injury in a “shipping incident” which is defined in Article 3(5)(a) of the Convention to mean “shipwreck, capsizing, collision or stranding of the ship, explosion or fire or defect in the ship.” As to “defect in the ship”, Article 3(5)(c) defines the same as, “any malfunction, failure or non-compliance with applicable safety regulations in respect of any part of the ship or its equipment when used for the escape, evacuation, embarkation and disembarkation of passengers; or when used for the propulsion, steering, safe navigation, mooring, anchoring, arriving at or leaving berth or anchorage, or damage control after flooding; or when used for the launching of life saving appliances.”
The limits can be summarised as follows:
Death or personal injury in a shipping incident (as defined) with financial loss up to 250,000 SDRs. The Convention institutes a system of qualified strict liability in which the carrier will be strictly liable to the passenger up to 250,000 SDRs. Such liability is qualified in the sense that the carrier has a complete or partial defence by reason of contributory negligence: Article 6 of the Convention (which also has application to the higher financial limits). Equally, pursuant to Article 3(1), the carrier will avoid strict liability if it proves that loss resulted from an act of war, hostilities, civil war, insurrection or a natural phenomenon of an exceptional, inevitable and irresistible character or was wholly caused by an act/omission done with intent to cause the incident by a third party.
Death or personal injury in a shipping incident with loss between 250,000 SDRs and 400,000 SDRs. Damages are capped at 400,000 SDRs. For claims that lie between 250,000 SDRs and 400,000 SDRs the carrier will be liable unless it (the carrier) discharges the burden of proving that the loss-causing incident occurred without fault/neglect on its part;
Death or personal injury in a non-shipping incident. The carrier is liable up to 400,000 SDRs (Article 7(1)), but only if the passenger proves that the loss was caused by the fault/neglect of the carrier;
Damages above 400,000 SDRs. Only where the passenger establishes that the damage resulted from an act or omission “done with the intent to cause such damage, or recklessly and with knowledge that such damage would probably result”: Article 13(1).
As to the application of this Convention (Schedule 7 to the Merchant Shipping Act 1995, Part I, Article 1):
“1 Shipowners and salvors, as hereinafter defined, may limit their liability in accordance with the rules of this Convention for claims set out in Article 2.
2 The term “shipowner” shall mean the owner, charterer, manager or operator of a seagoing ship.
3 Salvor shall mean any person rendering services in direct connection with salvage operations. Salvage operations shall also include operations referred to in Article 2, paragraph 1(d), (e) and (f).
4 If any claims set out in Article 2 are made against any person for whose act, neglect or default the shipowner or salvor is responsible, such person shall be entitled to avail himself of the limitation of liability provided for in this Convention.
5 In this Convention the liability of a shipowner shall include liability in an action brought against the vessel herself.
6 An insurer of liability for claims subject to limitation in accordance with the rules of this Convention shall be entitled to the benefits of this Convention to the same extent as the assured himself.
7 The act of invoking limitation of liability shall not constitute an admission of liability.”
A shipowner is entitled to limit its liability in this manner in respect of death and personal injury (Article 2(1)(a) of the Limitation Convention).
The UK has extended the right to limit in this manner to any ship (whether or not it is seagoing): paragraph 2, Part II of Schedule 7 to the Merchant Shipping Act 1995. Similarly, the UK has provided that “ship” for limitation purposes extends to “any structure (whether completed or in course of completion) launched and intended for use in navigation as a ship or part of a ship”: paragraph 12, Part II of Schedule 7 to the Merchant Shipping Act 1995.
The right to limit liability is lost if it is proved that the relevant injury, loss and damage was caused by “… personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result.” Article 4 of the Limitation Convention. The high hurdle that this creates means that this Article will rarely be invoked.
In respect of death and personal injury generally and pursuant to Article 6 of the Limitation Convention (as revised for the UK by paragraph 5(1), Part II of Schedule 7 to the Merchant Shipping Act 1995), the limits are as follows (based on the tonnage of the relevant vessel):
“[Article 6 of the Limitation Convention] 1 The limits of liability for claims other than those mentioned in Article 7 [ie. passenger claims as defined], arising on any distinct occasion, shall be calculated as follows:
in respect of claims for loss of life or personal injury,
3.02 million Units of Account for a ship with a tonnage not exceeding 2,000 tons,
for a ship with a tonnage in excess thereof, the following amount in addition to that mentioned in (i):
for each ton from 2,001 to 30,000 tons, 1,208 Units of Account;
for each ton from 30,001 to 70,000 tons, 906 Units of Account; and
for each ton in excess of 70,000 tons, 604 Units of Account.
Where the amount calculated in accordance with paragraph 1(a) is insufficient to pay the claims mentioned therein in full, the amount calculated in accordance with paragraph 1(b) [which identifies financial limitation – again dependent on the tonnage of the ship – for “other” claims which do not involve loss of life or personal injury] shall be available for payment of the unpaid balance of claims under paragraph 1(a) and such unpaid balance shall rank rateably with claims mentioned under paragraph 1(b).”
“[Paragraph 5, Part II of Schedule 7 to the Merchant Shipping Act 1995] In the application of article 6 to a ship with a tonnage less than 300 tons that article shall have effect as if—
paragraph 1(a)(i) referred to 1,000,000 Units of Account; and
paragraph 1(b)(i) referred to 500,000 Units of Account.”
In this regard financial limitation works by applying a general personal injury fund to claims – all claims – arising on any distinct occasion (providing sufficient compensation in all but the most serious personal injury claims where only one person is injured, but potentially resulting in a significant shortfall if many people are injured).
The following limits apply in a fatal accident/personal injury context to passenger claims as defined:
Article 7 of the Limitation Convention provides as follows:
“The limit for passenger claims
1 In respect of claims arising on any distinct occasion for loss of life or personal injury to passengers of ship, the limit of liability of the shipowner thereof shall be an amount of 175,000 Units of Account multiplied by the number of passengers which the ship is authorised to carry according to the ship’s certificate.
2 For the purpose of this Article “claims for loss of life or personal injury to passengers of a ship” shall mean any such claims brought by or on behalf of any person carried in that ship:
under a contract of passenger carriage, or
who, with the consent of the carrier, is accompanying a vehicle or live animals which are covered by a contract for the carriage of goods.”
The UK has revised Article 7 as follows (paragraphs 2 and 6, Part II of Schedule 7 to the Merchant Shipping Act 1995):
Death and personal injury generally: paragraph 2, Part II, “… the right to limit liability under the Convention shall apply in relation to any ship whether seagoing or not, and the definition of “shipowner” in paragraph 2 of article 1 shall be construed accordingly.”
Death and personal injury in passenger claims: paragraph 6, Part II,
“The limit for passenger claims
“Article 7 shall not apply in respect of any seagoing ship”
And as to any ship which is not “seagoing”, Article 7(1) shall read as follows:
“1. In respect of claims arising on any distinct occasion for loss of life or personal injury to passengers of a ship, the limit of liability of the shipowner thereof in respect of each passenger shall be an amount of 175,000 Units of Account.”
The Limitation Convention 1976 (and the legislation to which it is annexed by Schedule) does not provide definitional content to all of the terms that are relevant to its application (and the financial limits with which it deals):
“Ship” is defined – for UK purposes – as follows, “References in the Convention and in the preceding provisions of this Part of this Schedule to a ship include references to any structure (whether completed or in course of completion) launched and intended for use in navigation as a ship or part of a ship. [“Meaning of ‘ship’”, Schedule 7, Part II, paragraph 12].”
There is no definition of “contract of passenger carriage”; and,
There is no definition of “seagoing”, but it should be noted that this is not defined in the Convention by reference to the “seas” (to use a neutral term) in which the relevant vessel sails ie. there is no distinction drawn in the Convention between harbour waters, a bay or sound, territorial or international waters and the like).
These terms derive from and are contained in an International Convention and, consistent with principles of international comity and consistency, the case law of any Convention Party may be of relevance in their construction. However, usages (and interpretation) of these terms in domestic legislation may be apt to mislead and should be treated with a degree of caution (at least).
There is relatively little English case law on the proper approach to the interpretation of the Limitation Convention and/or on the meaning of the terms identified above:
Splitt Chartering APS v SAGA  EWHC 1294 (Adm Ct) (considers the meaning of “operator” of a ship in Article 1(2) of the Limitation Convention and whether this term extends further than the manager of a ship);
The Cape Bari  UKPC 20 (deals with the proper approach to construction of the 1976 Convention and whether a shipowner can waive or contract out of the statutory right to limitation under the Convention. The answer is that this can be done, but must be done expressly);
The Sea Eagle  2 Ll Rep 37 (Adm Ct) (considers the meaning of “seagoing” in the context of the Athens Convention and a personal injury claim arising out of a rigid inflatable boat “RIB” trip around the coast of Anglesey).
The following may assist in drawing together the matters discussed above (and with a concentration on limitation for passenger claims because (i) this is, perhaps, where most claims will be found; and, (ii) this is where either the Athens Convention or the Limitation Convention may be relevant):
|FINANCIAL LIMITATION ON LIABILITY (IN ASCENDING VALUE ORDER)||PERSON(S) ENTITLED TO RELY ON ANY LIMITATION||CONDITIONS FOR LIMITATION||EXCEPTIONS & QUALIFICATIONS|
|LIMITATION CONVENTION 1976: THE LOWER LIMIT
“In respect of claims arising on any distinct occasion for loss of life or personal injury to passengers of a ship”: 175,000 units of Account “in respect of each passenger”:
Article 7(1) of the Limitation Convention, as amended by paragraph 6 of Part II to the Limitation Convention (SI 1998/1258)
|“Shipowners” defined (by Article 1(2) of the Limitation Convention) as “owner, charterer, manager or operator of a seagoing ship.”||See, Article 7(2), as amended (and the need for a passenger claim as defined). There are two positive requirements for this limit to apply:
(1)That the Claimants be “passengers of a ship”;
(2)That the Claimant passengers be carried “under a contract of passenger carriage” [emphasis added].
|First, a negative element is provided by paragraph 6(1) of Part II of the Limitation Convention (SI 1998/1258) viz. “Article 7 shall not apply in respect of any sea going ship …”
Accordingly, to put the matter positively, if the relevant ship is “sea going” then a different financial limitation will apply: see below.
Second, “A person liable shall not be entitled to limit his liability if it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result.” Article 4 of the 1976 Convention.
If death or personal injury is caused to a passenger by a shipping incident, the carrier is strictly liable up to 250,000 special drawing rights (Article 3(1) Athens Convention) and, for damages above this limit, the carrier will be liable up to a cap of 400,000 SDRs per passenger on each distinct occasion (Article 7(1) Athens Convention) unless he can discharge the burden of proving that the incident occurred without any fault or neglect on his part (Article 3(1) Athens Convention).
|Carrier or performing carrier and the servants or agents of the same: Articles 1, 3 and 11 of the Athens Convention.||Among other things, “contract of carriage” and “carriage” as defined (Article 1) and “international carriage”: Article 1(9) of the Athens Convention.||First, “contributory fault” (Article 6 of the Athens Convention) – whatever the financial value of the claim.
Second, for the purposes of the cap above 250,000 (to 400,000 SDRs) that the carrier etc. prove that “the loss occurred without the fault or neglect of the carrier” ie. without any fault or neglect: see, Article 3(1) of the Athens Convention.
Where the Athens Convention applies, it will prevail over the lower Limitation Convention limits because, by definition, the Athens Convention will only apply to seagoing ships.
(Above 400,000 SDRs only where there is intent or recklessness: Article 13(1) Athens Convention).
|LIMITATION CONVENTION 1976: THE HIGHER LIMIT
General limit of 3.02 million – 1 million units of account depending on tonnage “in respect of claims for loss of life or personal injury”: Article 6(1)(a)(i) – (ii) of the Limitation Convention, as amended by paragraph 5(1)(a) of Part II to the Limitation Convention.
(cf. claims for death and personal injury generally and the fund provided in this respect).
|As above, viz. “Shipowners” defined (by Article 1(2) of the Limitation Convention) as “owner, charterer, manager or operator of a seagoing ship.”||Applies to “The limits of liability for claims other than those mentioned in Article 7 …” ie. if Article 7 applies then Article 6, as amended, does not. But Article 7 does not apply to seagoing ships.
Applies to “Claims for loss of life or personal injury” per ship referable to tonnage of the same: 1,000,000 units of account applies “to a ship with a tonnage less than 300 tons”.
|Recklessness etc. per Article 4(1) of the Limitation Convention.|
|LIMITATION CONVENTION 1976: ADDITIONAL SUM FOR INSUFFICIENCY OF COMPENSATION
Additional sum depending on tonnage of the ship (eg. cap of 1,500,000 units of account for seagoing ship with tonnage less than 300 tons) “Where the amount calculated [in limiting claims for loss of life or personal injury] is insufficient to pay the claims … in full, the [additional] … amount shall be available for payment of the unpaid balance of claims … and such unpaid balance shall rank rateably with [any other] claims [ie. claims other than for loss of life or personal injury].”: Article 6(1) of the Limitation Convention, as amended by paragraph 5(1)(b) of Part II of the Limitation Convention.
|As above, viz. “Shipowners” defined (by Article 1(2) of the Limitation Convention) as “owner, charterer, manager or operator of a seagoing ship.”||Applies where there is insufficient compensation in respect of “the claims” for loss of life or personal injury.||Recklessness etc. per Article 4(1) of the Limitation Convention.|
Some particular issues: Limitation Convention
The Limitation Convention (by contrast to Athens) has not been extensively covered in the textbooks. It gives rise to some particular issues which are considered below:
“Ship” is defined in the Limitation Convention (at Article 12 of Part II) to include “any structure (whether completed or in course of completion) launched and intended for use in navigation as a ship or part of a ship. [emphasis added]”: see, among other cases, R v Goodwin  1 Ll Rep 432 (CA) (which concerned a jet ski).
What about tender vessels? Does a vessel capable of independent use as a vessel “intended for navigation” (even if typically stowed on board a larger vessel) constitute a “ship”?
As to “seagoing” there is no definition in the Convention which has to be construed in the manner directed by The Cape Bari  UKPC 20 (PC) viz. by reference to the broad and generally accepted “ordinary meaning” of the words used in the light of the object and purpose of the Convention (as a whole). See, The Sea Eagle  2 Ll Rep 37 (Adm Ct) (as to the meaning of “seagoing” in the context of the Athens Convention and a personal injury claim arising out of a rigid inflatable boat “RIB” trip around the coast of Anglesey) – “[para 31 per Mr Registrar Kay QC] The next question is whether Sea Eagle [ie. the RIB] falls within the definition of being a seagoing ship. In my judgment the word ‘seagoing’ is adjectival and is intended to describe the use to which the particular vessel under consideration is actually being used. Considered in context this must mean that the word ‘seagoing’ is intended to convey something more than the word ship, which means that it must include something more than the words ‘used in navigation’. Thus the fact that a vessel is capable of use in navigation is relevant to the issue of whether she is a ship within the 1995 Act, nonetheless, when considering whether she is a ‘seagoing’ ship, it is necessary to consider the actual use to which the vessel in question is being put in the context of the claim being brought against her. It follows that although a ship may be a ship for the purposes of the Merchant Shipping Legislation she will not be a ‘seagoing ship’ unless it is her actual business to go to sea. In Salt Union Ltd v Wood … Lord Coleridge made it clear that, in the context of deciding whether a ship is a ‘seagoing’ ship, the important issue is not whether a ship can go to sea but whether she does go to sea.”
The Limitation Convention draws no distinction between the stretches of water to which the term “seagoing” might refer. Internal waters and rivers may not count, but what about coastal/territorial waters and/or bays/harbours etc? In R v Goodwin, while declining to answer this question, the Court of Appeal referred to a jet ski as being operative in proximity to land and unlikely to be seaworthy in heavy weather. In The Sea Eagle Mr Registrar Kay QC was satisfied (in part by application of domestic, UK Regulations) that a RIB used in coastal waters around the UK was a seagoing ship.
Insofar as they assist, Concise Oxford Dictionary, “Seagoing: fit for crossing the sea” and Cambridge English Dictionary, “Seagoing: (of ships) built for travelling across the sea, not just near the coast and on rivers.” These, perhaps, bear some resemblance to R v Goodwin viz. “… a ship which remains within the United Kingdom is not a sea-going ship” and “A sea-going vessel is a vessel which sets out to sea on a voyage.”
What is the meaning of “the claims” in Article 6(2) of the Limitation Convention?
Does this term mean that where the Limitation Convention limit is insufficient to pay the aggregate value of, say, a fatal accident and personal injury cause of action pursued by a single Claimant in one set of proceedings then the Claimant is entitled to the additional Units of account identified in Article 6(1)(b) (as amended by paragraph 5(1)(b) of Part II of the 1976 Convention)?
This argument must proceed on the basis that these proceedings are based on different causes of action in which the Claimant sues in his own right and in a representative capacity on behalf of dependents and the estate of his late wife. While there is one Claimant and one set of proceedings there is, therefore, more than one claim “for personal injury or loss of life” and the additional fund should therefore, it might be argued, be available to meet part of the shortfall. There is a further aid to construction: (i) Article 7(2) of the 1976 Convention states, “For the purpose of this Article ‘claims for loss of life or personal injury to passengers of a ship’ shall mean any such claims brought by or on behalf of any person carried in that ship” (ii) paragraph 6(2) of Part II of Schedule 7 of the Merchant Shipping Act 1995 states, “In paragraph 2 of article 7 the reference to claims brought on behalf of a person includes a reference to any claim in respect of the death of a person under the Fatal Accidents Act 1976 … .”
However, the general scheme of the 1976 Convention is as follows: (i) it is based on the tonnage of the ship – the larger the vessel, the larger the potential pot; (ii) it applies so that “the following claims, whatever the basis of liability may be, shall be subject to limitation of liability: (a) claims in respect of loss of life or personal injury” (Article 2(1)(a) of the 1976 Convention). In other words, the word “claims” is not synonymous with “causes of action”; the Convention’s limits will apply whatever the cause of action may be. This would suggest that an individual Claimant claiming in respect of “the same distinct occasion” cannot avoid financial limitation or increase the limits that may otherwise apply, by pleading additional or alternative causes of action
 Athens Regulation, Article 2.
 See, Directive 98/18/EC, Article 4, “‘Class A’ means a passenger ship engaged on domestic voyages other than voyages covered by Classes B, C and D. ‘Class B’ means a passenger ship engaged on domestic voyages in the course of which it is at no time more than 20 miles from the line of coast, where shipwrecked persons can land, corresponding to the medium tide height.”
 See, Directive 98/18/EC, Article 4 for a definition of class C and D ships.
 Article 7(1), “The liability of the carrier for the death of or personal injury to a passenger under Article 3 shall in no case exceed 400,000 units of account per passenger on each distinct occasion. Where, in accordance with the law of the court seised of the case, damages are awarded in the form of periodical income payments, the equivalent capital value of those payments shall not exceed the said limit.”
 There is very little such case law.
 Convention on Limitation of Liability for Maritime Claims 1976.