Changing course - On the concept of 'fault of the ship'

THE Dutch Supreme Court has recently passed a noteworthy judgment relating to collisions in general and to the definition of 'fault of the ship' in particular. The judgment is particularly interesting as the last leading decision by the Supreme Court on this topic dates from January 1940, and its infamous 'broken rudder stock' judgment.

That 1940 judgment concerned the fate of the Rubens and the Synthese, the former of which went off course, colliding with the latter. The cause was found to be the breaking of the rudder stock. It was uncertain whether any person was at fault in this respect, and no lack of maintenance and/or inspection of the ship was established. The Supreme Court, nevertheless, held that the owner of the Rubens was liable, even if negligence had not been established. The decision of the Supreme Court in this case was not without its critics. It was an interim solution, a position between the two dogmatic opinions on this topic - the risk and the fault doctrine.

According to the risk doctrine, there is fault on the part of the ship if the ship is sailing or moored incorrectly due to a cause on board, regardless of whether there is a fault on the part of one of the aforementioned persons. On the other hand, the Netherlands was also a party to the collision conventions of 1910 and 1960 which include the concept 'fault of the ship', which basically implies negligence.

Almost 62 years later, the Supreme Court has changed course. Or, in the words of the Supreme Court, in connection with the introduction of Book 8 of the New Civil Code and in light of current views in the literature in the Netherlands and case law in other countries which, like the Netherlands, are a party to the two collision conventions, it has revised the meaning given to the concept of 'fault of the ship'.

Since 1991, Dutch transport law has been regulated by Book 8 of the Civil Code (CC). The Netherlands is a contracting state to most of the international conventions on transportation, and many provisions in Book 8 CC are either based on international conventions or are incorporations of such conventions.

The provisions on collisions are based on the collision conventions of September 1910 and March 1960. These conventions have a rather limited scope except where there is physical contact between ships. In this case, the conventions of 1910 and 1960 only apply if (a) damage was caused to another ship or property and/or persons on board another ship and (b) if this occurred as a result of a faulty manoeuvre or non-compliance with collision regulations.

In certain respects, Dutch law deviates from the text of the conventions. To get straight to the point, collision in the framework of Book 8 CC encompasses not only more than the normal sense of the word but also more than the scope of the conventions. In addition to the definition of collisions in both conventions, the provisions under Dutch law not only apply when ships come into physical contact with each other but also if the damage has been caused by a ship without any physical contact having taken place. A faulty nautical manoeuvre or a breach of collision regulations is not a premise.

This last situation, for example in the case of damage due to a fire on board, is normally referred to as a fictitious collision. The relevant sections apply when a ship causes damage to property regardless of any physical contact.

On September 26, 1991, several ships were moored in the De Paal yacht marina, Zealand Flanders. The Casuele and De Toekomst were moored right next to each other. A fire broke out on the Casuele and spread to De Toekomst. The cause of the fire was unknown. The owner of the latter ship claimed compensation from the owner of the Casuele.The Court of First Instance rejected the claim. The Court of Appeal then overruled it, stating that if it was established that the fire first arose on board the Casuele, in principle the fault of the Casuele was given and the owner of the ship was liable for the damage except in the event he could prove that it was caused by force majeure. The cause of the fire was unknown, so force majeure could not be proven and the Court of Appeal continued on the path laid by the Synthese/Rubens case.

The Supreme Court itself left that path or, in any event, adjusted its opinion in line with developments in the law. On the basis of the considerations as set out in the introduction to this article, the Supreme Court held that it is time to depart from the doctrine laid down in Synthese/Rubens, establishing the following criteria for 'fault of the ship':

"The foregoing leads to the conclusion that there is fault of a ship if the damage is the result of:
(a) an error of a person for whom the owner of the ship is liable pursuant to art. 6:169-6:171;
(b) an error of a person or persons who is/are carrying out or has/have carried out work in favour of the ship or the cargo, which error was made within the scope of their employment;
(c) the materialisation of a special danger for persons or things brought about because the ship did not meet the standards which could be set under the given circumstances."

The first two grounds relate to human error. The third ground relates to the occurrence of special danger, as referred to in Article 6:173 CC. The said article provides that the possessor of a moveable thing is liable when a special danger to persons or things materialises and this danger has been brought about because the thing does not meet the standards applicable under the given circumstances. The Supreme Court establishes a corresponding rule with regard to the liability of the owner of a ship. This is remarkable as ships are explicitly excluded from the scope of this provision (the Supreme Court considered this as well).

This third ground appears to lean toward the old doctrine of the Supreme Court in 1940, although, in this particular case, that may well be just in appearance. In this fictitious collision, the cause of the fire had remained unknown. In line with these criteria, the cause of the damage and the division of the burden of proof were discussed. The Supreme Court held:

"The Court of Appeal will have expressed an incorrect legal view if it misunderstood that pursuant to art. 8:1004 paragraph 2 the damage is borne by the party who suffered it if the cause thereof cannot be determined. It must be noted in this respect that the fire itself cannot be deemed the cause of the damage for which the owner of the ship is liable. Fire is indeed always the result of one or more circumstances or events"

The underlying cause is the relevant cause. If nothing can be established with regard to the underlying cause of the fire, it cannot, therefore, be established whether the ship did not meet the requirements which could be set under the given circumstances as referred to under (c) above. The owner of the Casuele escapes liability.

The current definition is once again a middle-of-the-road solution, but, this time, a different one. It is a compromise between international maritime regulations and the general Dutch law of obligations. On the basis of the decision by the Supreme Court, it cannot be said that the Netherlands is truly in line with developments in international law. Although the conventions of 1910 and 1960 work on the premise of the fault doctrine, they have a more limited scope than the provisions of Book 8 of the Civil Code. The situation of fictitious collisions is not internationally regulated.

The Supreme Court has now given new criteria on the basis of, amongst others, the interpretation of the conventions

1. in the case of a fictitious collision and
2. adding elements of the general Dutch law of obligations.

As it does not follow from the reasons for the judgment that these criteria merely apply to fictitious collisions, these criteria will now apply to all collisions whether real or fictitious.

A purer solution would be to judge 'fault of the ship' in real collisions in accordance with the fault doctrine of the conventions of 1910 and 1960, and fictitious collisions in accordance with the current criteria the Supreme Court has given. This would allow the deviation from the conventions to be judged in accordance with the general Dutch law of obligations. This would, however, probably also imply an amendment of the comparatively recent text of Book 8 CC.