Lloyd's Maritime and Commercial Law Quarterly
COMPENSATION FOR CATASTROPHIC OIL SPILLS: A TRANSATLANTIC COMPARISON
Gavin Little * and Jenny Hamilton †
The full implementation of the 1992 Civil Liability and Fund Conventions under the Merchant Shipping Act 1995, which will take place at the end of the current relatively short transitional period, is generally viewed as an important development, particularly by oil industry commentators. Looking beyond the transitional period, the authors compare the key features of the provisions of the Merchant Shipping Act 1995 relating to liability and compensation for oil tanker spills with the corresponding provisions of the United States Oil Pollution Act 1990. They conclude that the comparison highlights defects in the British regime, which, inter alia, will place British claimants at a disadvantage in the context of a “catastrophic” spill.
The recent grounding of the tanker Sea Empress at the entrance to Milford Haven water,1 occurring so soon after the wrecking of the Braer in the Shetland Isles in 1993,2 focuses attention on the adequacy of United Kingdom legislation providing for the evaluation of liability and the provision of compensation for damage caused by oil spills at sea. Approximately one half of the Sea Empress’ cargo of 130,000 tonnes of Fortes light crude oil escaped into the sea, affecting a long stretch of the Welsh coastline. Although the environmental damage is likely to be substantial, it is not unmanageable.3 In comparison with the Exxon Valdez oil spill at Prince William Sound in Alaska in 1989,4 the damage is, fortunately, comparatively minor. In both the Sea Empress and Braer spills, the U.K. has, through a combination of factors, been relatively fortunate in that major disasters have been averted.5 Consequently, the British system of compensation has been able to cope reasonably well to date. It should, nonetheless, be noted that there are still a substantial number of claims arising out of the Braer spill outstanding in the Scottish Court of Session, and it is likely that there will be insufficient funds to compensate all of
* Lecturer in Law, University of Stirling.
† Lecturer in Law, University of Strathclyde.
1. The Sea Emperess ran aground on 15 February 1996. For a discussion of the law applying to the Sea Empress spill, see Hamilton and Little, “Liability for Oil Spills: The Sea Empress and Recent Developments under the Merchant Shipping Act 1995” [1996] IJIL 287.
2. The Braer ran aground on 5 January 1993.
3. The Times, 7 May 1996 and Environmental Data Services Report No. 253, February 1996.
4. The Exxon Valdez ran aground on 24 March 1989.
5. The Braer spill was broken up by heavy seas, and the Sea Empress spill involved light crude oil, which is more easily dispersed than heavy oils.
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