Lloyd's Maritime and Commercial Law Quarterly
SPECIAL CONTRACTS AND THE MALTA AGREEMENT
Neil R. McGilchrist
M.A. (Oxon.); Legal Consultant with International Insurance Services.
It is perhaps axiomatic that by the time an international Convention—particularly one regulating transport law—is put into effect, it is out of date. The period of gestation is so extended that commercial and technical developments, quite apart from inflation, may render obsolete the principles upon which the Convention is founded. This problem is perhaps worsening as the number of independent States wishing to participate in the legislative process grows.
The most ready illustration of this difficulty as it affects the law relating to carriage by air is the manner in which the monetary limit to the international air carrier’s liability towards its passengers has failed to keep pace with evolving judicial and financial realities.
The original Warsaw Convention of 1929 prescribed that this limit (subject of course to proof of damages) should be 125,000 poincaré gold francs. The amendments to the Warsaw Convention adopted as The Hague Protocol in 1955 doubled this figure to 250,000 gold francs.
It was not until 1961 that the United Kingdom Government introduced legislation to enable the U.K. to implement the 1955 amendments. At that time, 250,000 gold francs was worth approximately £6,000. During the course of the committee stage of the Bill in the House of Lords, the Lord Chancellor declared that “the figures I have been given show that a remarkably high percentage of claims over a period of years were for less than £6,000 …” However, even in 1961 the view that a limit of £6,000 reflected a proper balance of interest between air carrier and passenger was not shared by all. Lord Denning in the same debate observed that “three thousand pounds as at present is far too low; and £6,000, as in the Convention, is, I suggest, also too low.”
In making these remarks, Lord Denning also drew attention to a relatively obscure provision in the original 1929 Convention which had survived the 1955 amendments intact. At the foot of art. 22—the provision which specifies the limit to the carrier’s liability—is a sentence which reads: “Nevertheless, by special contract, the carrier and the passenger may agree to a higher limit of liability.” Lord Denning’s plea, which effectively fell on deaf ears, was that: “I should like to see the aircraft companies, by special contract, if need be, showing the way to a higher limit of liability.”
If the U.K. proceeded to adopt The Hague Protocol without further thought to the implications of Lord Denning’s remarks, this was not the case in the United States. Indeed, the U.S., although a party to the original 1929 instrument, declined to ratify the 1955 amendments on the grounds that the limit to the carrier’s liability was absurdly low and contrary to public policy. According to an article in the
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