Prestige case sent back to lower court

The Second Circuit U.S. Court of Appeals in New York has reversed a lower court in a case growing out of the 2002 sinking of the tanker Prestige, which resulted in a 70,000-ton oil spill.

A district court judge granted summary judgment to the classification American Bureau of Shipping back in January 2008.

ABS, which had classed the tanker, was sued by Spain's government. ABS argued U.S. courts did not have jurisdiction because the International Convention on Civil Liability for Oil Pollution Damage (CLC Convention) conferred jurisdiction solely to courts in Spain. Both Spain and Bahamas, where the Prestige was registered, were signatories to the CLC Convention.

But the Second Circuit, in a decision handed down last Friday, said a convention to which the United States is not party cannot control the jurisdiction of a U.S. court.

It said the lower court could review the issue under what it called the doctrine of "forum non conveniens," to determine if district court was an appropriate forum in which to hear the dispute. It added the lower court might still decide not to exercise its jurisdiction.

ABS had appealed the lower court’s ruling that its counterclaims for indemnity and contribution were barred by the Foreign Sovereign Immunity Act. The appellate court held that the counterclaims, if not unduly speculative, were sufficiently related to the claims presented by Spain to allow such claims to be joined in one proceeding.

The court noted that "Spain’s suit against ABS raises questions of its alleged contributory negligence in handling the Prestige disaster -- questions that implicate the extent of Spain’s duties to vessels in distress, and the extent to which its alleged breach of those duties caused or exacerbated its damages. ABS’s counterclaims raise similar, if not identical, issues of duty and causation, and it is therefore sensible, as a matter of fairness and judicial efficiency, to adjudicate them in tandem with Spain’s claims"

The Prestige, which was carrying a load of heavy fuel oil, suffered a breach of one of its cargo tanks during a storm on Nov. 13, 2002 and sought refuge ashore. But the ship was reportedly turned away by authorities, not only in Spain but France and Portugal. On Nov. 19 it broke in half.
 

Source: American Shipper