Lloyd's Maritime and Commercial Law Quarterly

Professor Francis D Rose

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MORE LIMITATIONS UPON THE RIGHT TO LIMIT UNDER THE LIMITATION CONVENTION 1976

The ICL Vikraman

Shortly before coming into force of the Convention on Limitation of Liability for Maritime Claims 1976, a collection of papers given at the Institute of Maritime Law at Southampton University explaining and discussing the Convention was published.1 The papers evidence, to a greater or lesser degree, enthusiasm for the Convention. However, in the foreword to the collection, Lord Brandon of Oakbrook said: ‘‘by no means all maritime countries have yet adhered, or can be expected in the future to adhere, to the 1976 Convention. The most important aspect of this is that, however desirable it may be in theory for the 1976 Convention to be truly and completely international, there is no real prospect of this being achieved in practice, with some countries still applying earlier Conventions or their own special systems in their domestic laws.’’

That observation has proved to be a prophetic warning. The fact that the 1976 Convention has not received universal acceptance amongst the states of the world has meant that those involved in shipping litigation have more reason to ‘‘forum shop’’ than they did before the Convention came into force.

First, the limit of liability under the 1976 Convention is higher than it was under the 1957 Convention. The limit of liability under the 1957 Convention no longer had the purchasing power it had in 1957 and the capacity of the insurance market had increased.2 Secondly, in return for that higher limit, the circumstances in which the right to limit could be broken were circumscribed to such an extent that the limit was ‘‘almost indisputable’’.3 These differences between the 1957 Convention and the 1976 Convention have provided reasons for shipowners and cargo owners to decide which limitation regime is preferable in the circumstances of a particular casualty. Their judgment is not based upon the

1. N. Gaskell (ed), The Limitation of Shipowners’ Liability: The New Law (1986).

2. See R.C. Seward, ‘‘The Insurance Viewpoint’’, ch 9 of N. Gaskell (ed), The Limitation of Shipowners’ Liability: The New Law (1986).

3. See The Bowbelle [1990] 1 Lloyd’s Rep 532, 535 (per Sheen J) and The Leerort [2001] 2 Lloyd’s Rep 291, 294–295 (per Lord Phillips of Worth Matravers MR).

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