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Legal Implications of the ISM Code on the Limitation of Shipowner's Liability

Drago Pavić ; Split

Puni tekst: hrvatski pdf 1.078 Kb

str. 57-70

preuzimanja: 832



The objectives of a safe management and operation of the ship as imposed by the ISM code being a part of the SOLAS convention are the criteria by which a court or arbitration will assess the responsibility of the shipowner in the implementation of the Code. The shipowner will establish his own regulation system and will be obliged to prove that it is being duly implemented. Any failure in this respect on is part can have an adverse effect upon limitation of liability, the rights from marine insurance contract and general average. The implementation of the ISM Code, combined with the required system of control and written reports, practically increases the possibility of the claimant to challenge the shipowner's right to limitation of liability. Non compliance with the provisions of the ISM Code, alongside with meeting the general prerequisites for a loss of right to limitation (Limitation Convention 1976, article 4) can be taken as a reason for the shipowner's loss of right to limitation of liability. When the shipowner is a legal entity (a company), he can lose the right to limitation of liability provided the damage has been caused with intent or by qualified negligence (as defined in the above mentioned article 4) of the management, its members or high-ranking officials, i.e. senior level executives. The actions and omissions of these persons will be regarded as if committed by the company itself, since they represent the company's ''alter ego''. Qualified negligence of the shipowner's servants or agents regardless of its degree or extent, does not lead to the shipowner losing the right to limitation. The legal effect of the ''Designated person's'' negligence resulting in limitation of liability depends upon the person's position in the hierarchy of the shipping company's management board. According to the ISM Code that person does not belong to the senior level executive staff within the company thereby the qualified negligence of that person alone does not result in losing the right to limitation of liability. This is also valid in cases when the ''Designated person'' has been appointed by the ship management.

Ključne riječi

shipowner's liability; limitation of liability; ISM Code (1994);

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