Ship passengers and industry participants have been invited to make submissions to the Department of Infrastructure and Regional Development (Infrastructure) in relation to Australia’s possible ratification of the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea 1974, as amended by the 2002 Protocol (Athens Convention).
The consultation has been implemented in light of a combination of the recent growth experienced in the Australian cruise shipping industry (having increased passenger numbers over the previous 2 years by roughly 20 per cent each year [Carriage of Passengers and their Luggage by Sea Discussion Paper]), the general expansion of cruise shipping globally, and the lack of Australian flagged cruise ships.
The Convention introduces layers of protection based on individual passenger limitations that vary depending on whether an incident can be characterised as relating to “shipping”. When considering a ‘worst case scenario’, of several thousand passengers on a ship, the limit could theoretically amount to a figure around A$3bn. The possibility of a security failure where a terrorist is allowed on board, for example, if considered a shipping incident – is a concerning example (sufficient war risk insurance will be required).
The Current Regime
Australia is currently not a party to the Athens Convention, with any claim made by a consumer of cruise services to be made either subject to common law causes of action including negligence or contract, or through the Civil Liability Act of an Australian State (each with their peculiarities). Such actions will also be subject to various time bars that differ from State to State (for example in Victoria there is a discretion to extend time bars in certain circumstances that does not apply in Western Australia). It is common in Australian jurisdictions that the time bar for claims in tort is 3 years and 6 years for contractual claims.
Passengers characterised as consumers, are otherwise protected by the Australian Consumer Law (ACL), that provides a set of guarantees that are not able to be excluded by contract, and that apply in circumstances where there is a relevant connection to Australia. An example of such a guarantee is that services will be provided with an acceptable level of care and skill (section 60).
The current regime is considered to be complex and uncertain for passengers and operators. Some issues include:
- Exclusive jurisdiction clauses in passenger contracts
- Choice of law rules and forum shopping
- Difficulty in proving liability under current Australian law
- Uncertain recovery amounts
- No guaranteed recovery
The Athens Convention
28 Member States are a party to the Athens Convention and the 2002 Protocol including most major flag states and the UK. The key features of the Convention include:
- Carriers must have financial security to cover death or personal injury for 250,000 SDR (roughly A$450,000) per passenger
- A claim can be brought directly against the ships financial securer
- Claimants must prove that a carrier was at fault for non-shipping related incidents (including trips and falls)
- For injury or death that arises out of a shipping incident the carrier will be strictly liable up to 250,000 SDR’s (A$450,000) per passenger
- For injury or death that is caused by a shipping incident the carrier will potentially be liable up to an overall limit of 400,00 SDR’s (A$730,000) per passenger
- Claims for loss of luggage or vehicles are limited to roughly A$4,000 for cabin luggage, A$23,000 for vehicles and A$6,000 for “other luggage” per passenger
- Generally, the time limit to make a claim is two years (except where the specific law of forum allows for the suspension of a time bar)
- Claimants are able to bring a claim in another jurisdiction that is party to the Convention (provided there is a sufficient connection with the jurisdiction chosen)
- Contractual limitations contrary to the Convention are void
Written submissions are due by 31st January 2018.
For advice in relation to the current regime in Australia, or the effect of any future change, the team of specialist maritime lawyers at TML is able to assist.