Liabilities Arising from Maritime Collisions
Following the occurrence of a maritime collision between two vessels, the competent maritime court may be confronted with one of the following situations and issue decisions accordingly:
- One of the two vessels is declared at fault.
- Both vessels are found to be at fault to a certain extent, and as a result, liability is borne by both vessels.
- Both vessels are held responsible, but the degree of each vessel’s responsibility cannot be determined.
- Neither vessel is found at fault, for example, where the collision results from an unavoidable incident.
The burden of proving that the collision was unavoidable lies with the party against whom a claim is brought based on negligence or lack of due care. Establishing that an incident was unavoidable is highly difficult. It is only possible in limited circumstances, such as where a sudden and unforeseeable event occurs, for instance, the unexpected failure of braking systems, which constitutes the sole cause of the collision.
In any event, about the extent of liability arising from a collision, a hypothetical example may be considered. Assume that the vessels Sahand and Alborz collide, both sustain damage, and the cargo on both vessels is also damaged, and that the vessel Sahand is recognized as being responsible for the collision.
Legal Foundations of Liability Arising from Maritime Collisions Under Iranian Law
In this scenario, the owners of the vessel Sahand shall bear responsibility as follows:
- Toward the owners of the vessel Alborz for damage caused to the vessel.
- Toward the cargo owners on board the vessel Sahand.
- Toward the cargo owners on board the vessel Alborz.
From a legal perspective, the situation shall be as follows:
- The owners of the vessel Sahand shall be liable to compensate the owners of the vessel Alborz for the damage suffered by the Alborz and to restore the Alborz to its prior condition.
- The owners of the vessel Sahand shall bear no liability for the damaged cargo on board the vessel Sahand, as the charter agreement includes an exception clause relating to liability for negligence.
- The owners of the vessel Sahand shall be liable to compensate the owners of the damaged cargo on board the vessel Alborz.
- Where the vessel Alborz is subject to a charter agreement, its owners may claim damages for loss of hire. This means that, had the collision not occurred, the vessel Alborz could have completed its existing voyage and, in addition, undertaken another voyage for which freight had already been agreed. This claim applies where the owners of the vessel Alborz were required to charter another vessel to fulfill their contractual obligations.
- The owners of the vessel Alborz are entitled to a vessel with the same efficiency and seaworthiness as it had before the collision. Where the replacement of worn parts and equipment is necessary, increasing the value of the vessel Alborz, the usual deductions for new replacing old shall not be permissible. This is because the matter concerns compensation for loss rather than an insurance-based adjustment. The claim is for amounts the owners of the vessel Alborz have directly and naturally incurred to restore the vessel to its pre-collision condition. Accordingly, they are entitled to recover such expenses from the owners of the vessel Sahand, to place them in the position as if the collision had not occurred.
- The owners of the damaged cargo on board the vessel Sahand may, in accordance with common practice, recover their losses from the insurance institution with which the cargo was insured. In this case, after payment of compensation to the cargo owners, the insurance institution may, under maritime law, not bring a claim against the owners of the vessel Sahand to recover the amounts paid. This is because the cargo owners on board the vessel Sahand themselves did not have such a right, and therefore, the insurer cannot bring a claim by way of subrogation.
- However, the owners of the damaged cargo on board the vessel Alborz may recover their losses from the insurance institution, and in this case, the insurer may, by way of subrogation, recover the compensation paid to the cargo owners from the owners of the vessel Sahand. In other words, the right of subrogation is applicable in this situation.
- The owners of the vessel Sahand may limit their liability if they prove that no personal act of negligence or lack of due care was committed. This is possible provided that the total claims against the vessel Sahand do not exceed the maximum liability limit stipulated in the relevant conventions.
Frequently Asked Questions About Liabilities Arising from Maritime Collisions
Liability arising from a maritime collision refers to the legal obligations of vessel owners to compensate for damage caused to vessels and cargo as a result of a collision between two vessels. Such liability is determined based on the degree of fault and the circumstances of the incident.
Possible situations include: one vessel being found at fault, both vessels being at fault, joint responsibility without determination of the exact degree of fault, or neither vessel being at fault due to an unavoidable incident.
Cargo owners may recover their losses from their insurance institution. Where the vessel at fault is liable, the insurer may, in applicable cases, exercise the right of subrogation and recover the compensation paid from the owners of the vessel at fault.
The burden of proof lies with the party against whom negligence or lack of due care is alleged. Proving that a collision was unavoidable is generally limited to sudden and unforeseeable events, such as the unexpected failure of critical vessel systems.
The owners of the vessel at fault are liable to compensate the owners of the other vessel and the owners of damaged cargo. In certain cases, insurance institutions that have compensated cargo owners may also bring claims against the vessel at fault by way of subrogation.
Yes. If it is proven that no personal negligence or lack of due care occurred and the total claims do not exceed the maximum limits established under the applicable conventions, the owners of the vessel at fault may limit their liability. What is liability arising from a maritime collision?
What situations may arise in a maritime collision?
How are cargo damages compensated?
How is an unavoidable incident proven?
To whom are the owners of the vessel at fault liable?
Can the owners of the vessel at fault limit their liability?
If both captains made mistakes, does one ship still end up paying for everything?
Not necessarily. In many maritime collision cases, liability may be divided based on each party’s degree of fault. Determining responsibility usually requires a detailed review of the evidence, navigation records, and the circumstances leading up to the collision.
What if bad weather was the main reason the ships collided?
Weather conditions are certainly relevant, but they do not automatically eliminate legal responsibility. Investigators will often examine whether the vessels were operated with reasonable care given the conditions and whether applicable navigation rules were followed. Each case depends on its own facts.
Can the cargo owner make a claim even if the ship owner settles with the other vessel?
In some situations, yes. Cargo interests may have legal rights that are separate from those of the vessel owner. Whether a claim is available depends on the applicable contracts, insurance arrangements, and the governing maritime law. A careful review of those documents is essential.
If the collision happened in another country’s waters, which law usually applies?
That can be a complex question. Jurisdiction may depend on where the collision occurred, the nationality of the vessels, contractual provisions, and applicable international conventions. Determining the governing law often requires a detailed legal analysis of the specific circumstances.
Does having marine insurance mean the owner cannot be sued directly?
Not necessarily. Insurance may help cover financial exposure, but it does not automatically prevent legal claims from being brought against the vessel owner or other responsible parties. The insurance policy and applicable law will determine how claims are handled.
How important is the ship’s electronic tracking data after a collision?
It is often very important. Information from navigation systems, voyage data recorders, AIS records, and other electronic evidence can help reconstruct what happened. However, those records are usually considered alongside witness statements and other available evidence.
Can a pilot be held responsible if they were guiding the vessel when the collision happened?
Potentially. Liability involving a marine pilot depends on the applicable law and the pilot’s role in the incident. In some cases, responsibility may involve multiple parties rather than resting on a single individual. The facts of the collision must be examined carefully.
What if one ship was anchored when it got hit?
Being anchored does not automatically determine liability. Investigators will consider whether the vessel was anchored lawfully, whether proper lights and signals were displayed, and whether the moving vessel complied with its navigational obligations. Every collision requires a fact specific assessment.
Is there a time limit for filing a claim after a maritime collision?
Yes, maritime claims are generally subject to limitation periods, but the applicable deadline varies depending on the governing law and the jurisdiction involved. Waiting too long can affect your legal rights, so it is advisable to seek legal guidance as soon as possible after an incident.
Can a ship owner limit their financial liability even if the damage was huge?
In some circumstances, maritime law allows vessel owners to seek limitation of liability, but that protection is not available in every case. Whether it applies depends on the relevant legal framework and the specific facts surrounding the collision. If a collision has resulted in significant losses, the case should be reviewed individually before reaching any conclusions.