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CLAIMS ARISING FROM ACCIDENTS DURING TRANSITS OF THE PANAMA CANAL

P. A. N. A. M. A. CLAIMS ARISING FROM ACCIDENTS DURING TRANSITS OF THE PANAMA CANAL. APRIL 8, 2008. GABRIEL R. SOSA III

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CLAIMS ARISING FROM ACCIDENTS DURING TRANSITS OF THE PANAMA CANAL

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  1. P A N A M A CLAIMS ARISING FROM ACCIDENTS DURING TRANSITS OF THE PANAMA CANAL APRIL 8, 2008

  2. GABRIEL R. SOSA III DE CASTRO & ROBLESScotia Plaza 51st & Federico Boyd StreetsP. O. Box 0834-02262Panama, Republic of PanamaPhone (+507) 263-6622Fax (+507) 263-6594Mobile (+507) 6670-0711sosa@decastro-robles.comwww.decastro-robles.com

  3. I. CLAIMS AGAINST THE PANAMA CANAL Pilot in Command Board of Inspectors Claims Procedure II. CLAIMS FROM THE PANAMA CANAL  LOU PHYSICAL/ECONOMIC DAMAGES OIL SPILLS III. CONCLUSIONS

  4. Article 90: Pilotage is compulsory in Canal waters. The Authority shall determine the number of pilots assigned to each vessel navigating in Canal waters, including the ports of Cristobal and Balboa, pursuant to the provisions of the annex. • … • Article 92: The pilot assigned to a vessel shall have control of the navigation and movement of such a vessel.

  5. Article 63. TheAuthority, withtheexceptions set forth in thisSection, shallpromptlyadjust and payindemnityfordamagestovesselsortheircargoes, crew, orpassengers, whichmayarisefromtheirtransit of the Canal, … whentheBoard of Inspectors determines, as a result of aninvestigation, thatthedamagewascausedthroughfaultornegligenceonthepart of theAuthorityoritsworkers in the performance and withinthescope of theirduties and theAuthorityacceptsthatdetermination. • … • TheAuthoritymayclaimindemnityfordamagescausedtothe Canal, itsworkers, and properties of theAuthorityafteraninvestigationconductedbytheBoard of Inspectors determines thatsuchdamages are theresult of faultornegligenceattributabletotheshipowner ….

  6. The PCA will allow: • repair costs, • loss of earnings, • and in general all costs related to the repair itself.

  7. The PCA will not allow claims for • agents’ fees, • attorneys’ fees, • telephone conversations, • and the like. • Further, costs that would have been incurred by the vessel regardless of the accident are not allowed.

  8. The PCA requires proof that every item being claimed was: • related to the accident; and • paid for (this is shown by presenting the PCA with copies of cancelled checks, bank wire transfers, or any other affirmative proof of payment)

  9. LOU WORDING … In consideration of the Panama Canal Authority consenting to the release from detention or arrest of the M/V “…………………” …., we THE P&I CLUB, hereby undertake to pay to you on first written demand such sums as may be determined by the administrator of the Panama Canal or other competent bodies within the Panama Canal Authority or on final recourse therefrom to the competent body or court, or as may be agreed with us to be recoverable from the M/V “…………..” in respect of the said incident, including interest and costs provided that our liability hereunder shall not exceed the sum of USD ……… U.S.DOLLARS.

  10. LOU WORDING … Should the amount established in this letter of undertaking prove to be insufficient in relation to the purpose of this guarantee as established herein, the Panama Canal Authority can request the issuer to exchange this document for one that covers more adequately the responsibilities herein.

  11. LOU WORDING This undertaking is executed by ____________ of ___________________ for and on behalf of THE P&I CLUB, pursuant to authority received from them on _______ , within the limitations contained in this letter and it is understood and agreed that this letter shall not be binding upon _____________ or _______, but be binding only upon THE P&I CLUB.

  12. LOU - Discussion points 1-Non-negotiability, administrative arrest 2-Issuance of invoice. 3-Damages. Claims for manpower. Claims for cost of investigation. 4-“competent bodies within the PCA” 5-not-binding on agent?

  13. SIMPLIFIED FACTS: 1. Two PCA linehandlers allegedly slipped and fell onboard. 2. No investigation was held by the Board of Inspectors. 3. The linehandlers are temporarily unable to work.

  14. PCA sends invoice: • Incapacity of linehandlers • Medical expenses • Ambulance • Miscellaneous

  15. Points for discussion: 1. No investigation. 2. claim vs. invoice. 3. actual damage to the PCA. -social security covers incapacity, medical expenses and ambulance.

  16. OIL POLLUTION CLAIMS • The Panama Maritime Authority (PMA) • The Panama Canal Authority (PCA).

  17. OIL POLLUTION CLAIMS Article 151: A negligent act or omission in violation of the provisions on the safety of navigation in Canal waters of the Organic law and the Authority regulations, relating to the use of the Canal and its facilities, traffic administration, and pollution prevention in Canal waters, shall be considered an administrative offense. … Article 158: Offenses related to maritime safety and pollution are considered violations of the provisions on safety of navigation in Canal Waters. ….

  18. OIL POLLUTION CLAIMS • Article 166: The proceedings shall be initiated through a formal statement containing, as a minimum, the following information: • 1. Identification of the alleged offender(s). • 2. The reasons justifying the proceeding, …. • 3. Designation of the investigating official, … • 4. Reference to the Regulation assigning jurisdictional competency…. • 5. Any temporary measures taken to ensure the effectiveness of the investigation, … • 6. Indication of the alleged offender’s right to make allegations within ten working days, following his notification.

  19. OIL POLLUTION CLAIMS Article 179: The resolution concluding the proceedings shall set forth the reasons for such a decision, and shall address all the issues presented by the offenders, and derived from the proceedings. …., and the corresponding sanction. The resolution shall also contain a statement of the offender’s appeal rights, the authority to which he may appeal, and the time allowed for the appeal.

  20. OIL POLLUTION CLAIMS Discussion Points: 1. The same issues with the LOU arise (LOU issued to Risk Management); 2. PMA issues a fine; 3. PCA issues a fine as per above procedure—through the General Counsel’s Office; 4. PCA does not return the LOU because Risk Manager has an invoice:

  21. OIL POLLUTION CLAIMS PCA INVOICE INCLUDES: • Labor • Equipment • Miscellaneous • Environmental degradation

  22. OIL POLLUTION CLAIMS • No investigation. No one determined “fault”. No right of action by either party. b. Labor in payroll c. Miscellaneous? This is the equivament of “undefinedorundetermineditemssubjecttospeculation” whenvesselsclaim. d. “environmental damage”? No authority. Disguised “third” fine.

  23. CONCLUSIONS • I believe the PCA is the finest governmental institution in Panama. • What I criticize is the lack of procedure for claims against the vessels. • Procedure does not guarantee due process to the vessel owners • As a Panamanian it bothers me because the very few cases per year that this happens, taint for no reason the otherwise impeccable image of the PCA.

  24. THANKS FOR LISTENING

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