Compensation of damages

In 1978, the French State, the Breton communes and the economic operators affected by the Amoco Cadiz pollution had no other alternative than to embark upon legal proceedings in the United States against the shipowner, as the international conventions and national rules in force at the time made it impossible to obtain satisfactory compensation in a straightforward manner from a French court.

Considerable progress has been made since in favour of those affected. Whether he is responsible for the spill or not, the owner of a tanker is liable for the damages caused up to a certain limit. The International Oil Pollution Compensation Funds (IOPC Funds) can be approached for supplementary compensation, in excess of the tanker owner’s limit of liability. The assessment of damages is determined by the law of the affected country, within the limits of the international convention governing the funds.

Compensation is subject to strict rules, in order to avoid abuse. The use of theoretical mathematical models to assess global damages is not accepted and each claimant has to individually demonstrate his loss. This can be disconcerting for claimants, who find themselves having to show their account books to international experts and to prove the relationship between the pollution and their damages, when they might have expected the polluter to come with a cheque in hand. However, representatives from the IOPC Funds are pro-active in assisting local claimants to understand how to make a successful claim. This approach can also provoke criticism from scientists and economists who are used to assessing the evolution of ecosystems and the economy of usable resources using mathematical models.

It is therefore not surprising that compensation is an extremely controversial subject. Once duplications in claims and saved expenses have been deducted, payment offers are often considerably lower than the claimed amounts.

Most claimants recognise the logic of the system and accept amicable settlements. However, some do not and decide to challenge the rules in force in the national courts of the country affected. As a result, most large oil spills of the last few decades have failed to avoid a major lawsuit. Some such lawsuits end up being terminated after some years by an out-of-court settlement, while others have extended for more than a decade.

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The problematic link

A turbot breeder is affected by an oil spill and loses a large part of his stock in the second year. However, he manages to save the majority of his stock from the first year by improvising a semi-closed water circulation system. The rest of his stock from the second year is unfit for consumption and is destroyed a few months later as a result of an administrative decision. The breeder continues to maintain and feed his stock from the first year, which seems to have suffered little.

The following year, these fish are seriously affected by a common illness on fish farms, which can usually be treated without any major damage. Other fish farms in the region which were unaffected by the pollution the previous year suffer only minimal losses. The breeder is convinced that his losses are due to medium term effects of the oil, which made his animals fragile. But how can he prove, a year on, the link between the losses suffered and the past oil spill?

There is no obvious solution to this type of problem and it can often require court arbitration to resolve such cases.