On 14 June 2024, the dredging vessel “Vox Maxima” collided into the “Marine Honour”, which was anchored in the Western Anchorage in Singapore.  The allision resulted in approximately 400 tons of oil leaking from the cargo tank of the “Marine Honour” with the resulting oil spill contaminating large stretch of the coast in the southern and eastern parts of Singapore.

It was reported in the news that the “Vox Maxima” suddenly lost engine power and the ability to steer which resulted in the allision.

Those unfamiliar with maritime law were surprised when it was reported in the news that the “Marine Honour”, which was stationary at the time of the allision, is liable compensate for the damage caused by the oil pollution.  In this edition of the Notes from the Bar, we examine the compensation regime in Singapore in relation to oil pollution.

International Convention on Civil Liability for Oil Pollution Damage 1992 (“CLC 1992”)

Singapore is a signatory to the CLC 1992.  The convention is adopted in Singapore and given force of law pursuant to the Merchant Shipping (Civil Liability and Compensation for Oil Pollution) Act 1998 (“CLC 1992 Act)”.

The CLC 1992 applies to oil pollution caused by discharge of oil that was carried on board a vessel as a cargo.  This covers oil being shipped on board tankers, bunker barges and any other vessels that were converted to carrying oil in bulk as cargo.  The CLC 1992 Act does not apply to bunkers carried on board vessels.

Section 3(1) of the CLC 1992 Act provides that where any oil is discharged or escapes from a ship, the owner of the ship shall, except as otherwise provided by the CLC 1992 Act, be liable;

• for any damage caused outside the ship in the territory of Singapore by contamination resulting from the discharge or escape;

• for the cost of any measures reasonably taken after the discharge or escape for the purpose of preventing or reducing any damage so caused in the territory of Singapore by contamination resulting from the discharge or escape; and

• for any damage caused in the territory of Singapore by any measures so taken.

The compensation regime imposed by the CLC 1992 Act is one of strict liability.  The owner of the vessel where the oil is discharged from is liable to compensate for any damage and cost of measures taken to reduce the damage regardless of fault.

The exceptions to this strict liability are set out at Section 4 of the CLC 1992 Act.  In order to avoid liability, the owner of the vessel has to prove that the discharge of oil was caused by one of the following;

• resulted from an act of war, hostilities, civil war, insurrection or an exceptional, inevitable and irresistible natural phenomenon;

• was due wholly to anything done or left undone by another person, not being an employee or agent of the owner, with intent to do damage; or

• was due wholly to the negligence or wrongful act of a government or other authority in exercising its functions of maintaining lights or other navigational aids for the maintenance of which it was responsible.

Although the CLC 1992 Act imposes a strict liability for loss arising from the oil pollution, it also provides for certain restrictions on the liability of the owner of the vessel involved.  Section 5 of the CLC 1992 Act provides that the liability of the owner under Section 3 of the CLC 1992 Act for any impairment of the environment is taken to be liability only in respect of any resulting loss of profits and the cost of any reasonable measures of reinstatement actually taken or to be taken.

International Convention on Civil Liability for Bunker Oil Pollution Damage 2001 (“BUNKER 2001”)

The CLC 1992 Act covers damage for oil pollution caused by discharge of oil that was carried on board a vessel as bulk cargo.  For oil pollution caused by discharge of oil carried on board vessels as bunkers is covered by a different convention, the BUNKER 2001 Convention.

The BUNKER 2001 Convention is enacted and given force of law in Singapore pursuant to the Merchant Shipping (Civil Liability and Compensation for Bunker Oil Pollution) Act 2008 (“BUNKER 2001 Act)”

The BUNKER 2001 Act is modelled after the CLC 1992 Act and provides for strict liability against owners of vessels in relation to oil pollution caused by discharge of bunkers.  The term “bunker oil” is defined in the BUNKER 2001 Act as “any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of a ship, and any residues of such oil”.

The extent of liability under both the CLC 1992 Act and BUNKER 2001 Act are identical.  Section 3 of the BUNKER 2001 Act provides that if the discharge of oil from a vessel to which the CLC 1992 Act applies, there is no additional liability under the BUNKER 2001 Act.  This avoids any overlap in a situation where a ship carrying oil as cargo also discharged bunkers in the same incident.

The exclusions and restrictions on liability under both the CLC 1992 Act and the BUNKER 2001 Act are also identical.

Tonnage limitation

Both the CLC 1992 Act and the BUNKER 2001 Act provides that the owner of the Vessel involved may avail itself of the relevant tonnage limitation provisions.

The Convention on Limitation of Liability for Maritime Claims 1976, as amended by the Protocol of 1996 does not apply to claims falling within the CLC 1992 Convention.  However Section 6 of the CLC 1992 Act provides that the owner may apply to Court to limit its liability based on the tonnage of the vessel.

For a vessel in excess of 5,000 tons, the tonnage limitation applicable is 4.51 million Special Drawing Rights together with an additional 631 Special Drawing Rights for each ton of its tonnage in excess of 5,000 tons up to a maximum amount of 89.77 million special drawing rights.

The value of a Special Drawing Right fluctuates.  It is currently approximately valued at 1 SDR = USD1.315340.  As such, for a vessel measuring 5,000 tons, the tonnage limitation amount would be in the region of approximately USD5.93 million.

Claims between Marine Honour and Vox Maxima

Although the owners of the “Marine Honor” may be liable for the damage caused by the oil pollution in the first instance, the owners of the “Marine Honour” may be able to bring a claim against the owners of the “Vox Maxima” and seek compensation for the loss and damage suffered by the “Marine Honour” as well as to seek an indemnification of all claims paid out by the “Marine Honour”.

The determination of liability between the “Vox Maxim” and the “Marine Honour” would be dealt with in the usual manner involving contact between two vessels, and the quantum would be subject to the usual rules of assessment of damages.

Depending on the quantum of the claim by the “Marine Honour”, the extent of the cost of cleaning up the oil spill and third party claims, the owners of the “Vox Maxima” may consider establishing a tonnage limitation.  While the tonnage limitation convention may not apply to the “Marine Honour” as its liability falls under the CLC 1992 Convention, the owners of the “Vox Maxima” may wish to invoke the provisions of the Convention on Limitation of Liability for Maritime Claims 1976, as amended by the Protocol of 1996.

Claims by third parties

Any third party who suffered any loss and damage arising from the oil pollution may be entitled to claim against the “Marine Honour”.  However, such claims must be valid and legitimate claims, properly supported by adequate evidence of the loss and damage suffered.

Obviously, such claims must have a valid causal nexus with the oil pollution.  For example, property physically damaged by the oil spill would be regarded as a legitimate claim.  Any reasonable cost incurred in cleaning the oil spill would be regarded as a legitimate claim.

Claims for loss of profit would be included in the list of recoverable loss.  An example would be operators of pleasure crafts who lost business during the period that the clean up operation took place would likely to be able to claim for their losses.

Less obvious would be operators of small businesses like F&B outlets at East Coast Park that saw fewer customers when the beach was closed.  Similarly, it would be difficult to ascertain if a reduction in business is claimable even though the beach is re-opened but there are lesser customers.

Apart from claiming against the “Marine Honour”, it is technically possible for third party claimants to make their claim against the owners of the “Vox Maxima”.  There are however a number of obstacles to claims against the “Vox Maxima”.  Firstly, such claims would be claims based on the tort of negligence.  It would be difficult for the third party claimants to obtain evidence showing the negligence of the Master or crew of the “Vox Maxima” as there is currently no information on the cause of the engine failure.  Unless the quantum of the claim is large enough, it might not be economically justifiable to incur cost to compel the owners of the “Vox Maxima” to produce documents showing whether there was any negligence in the maintenance of the vessel’s engines.

Further, it is questionable whether a claim against the “Vox Maxima” falls under the Admiralty jurisdiction of the Court.  The High Court (Admiralty Jurisdiction) Act 1961 provides that the Court has admiralty jurisdiction to hear claims falling within Section 3 of the Act.  The closest head of claim falling within Section 3 is “any claim for damage done by a ship”.  However, as any damage that was caused would have been caused by the oil spill, it is questionable whether  a claim by third party claimants against the “Vox Maxima” falls within the definition of “any claim for damage done by a ship”.

Unless the third party claimants can bring their claims within the ambit of the High Court (Admiralty Jurisdiction) Act 1961 and arrest the “Vox Maxima” for security, a claim against her owners may face the additional difficulty of having to enforce a Singapore court judgment in a foreign jurisdiction as opposed to an in rem judgment against the vessel.

Any potential third party claimant who suffered any loss or damage due to the oil spill are advised to see professional legal advice in order to determine what is the best course of action to be taken.

Disclaimer: This article is for general information only and not intended to constitute legal advice. We shall not be liable for any errors or omissions, nor shall we be liable for reliance on the contents of this article.