International jurisdiction issues in the aftermath of the Sea Diamond accident
This is a case regarding a ship accident occurred near the island of Santorini in 2007. The incident raised international interest and spiraled serious debate involving domestic political parties, due to its environmental dimension. The judgment has been rendered very recently [Piraeus 1st Instance Court 464/2014], and is still unreported. It is a very lengthy one, dealing with a number of issues, such as civil liability, conflict of laws, environmental law, and domestic Civil Procedure. I will focus on the international jurisdiction issue, which has been raised by one of the respondents. The court examined thoroughly the possible bases of jurisdiction with respect to the insurer of the ship, which was a foreign company with its seat in Luxemburg. The Piraeus court concluded that none of the provisions of the Brussels I Regulation can establish the international jurisdiction of Greek courts in regards to the foreign insurer.
The facts: On April 6, 2007, the Sea Diamond, a ship under Greek flag, sank into
the Aegean Sea, at the Caldera Gulf, in close proximity to the island of
Santorini [for details see http://en.wikipedia.org/wiki/MS_Sea_Diamond]. The
claimant is the Municipality of Santorini. It initiated proceedings against the
ship owner, the technical and financial administrator, and the insurer. The
claimant filed an action early March 2012. It sought damages for environmental and
tortious liability. It also asked the court to oblige the respondents to
proceed to the raising of the ship, so as to cease the ongoing ecological disaster
taking place in the region. Finally, it asked the sum of 10 m € for pain and
suffering, caused by the defamation of the island in the international
community.
The ruling:
The court ordered the respondent to take the steps necessary, in order to
remove Sea Diamond from the sea bottom on their own expenses. It also granted
an 8 m € relief to the Municipality for pain and suffering caused by the
accident and the omission of the respondents to remove the ship from the sea
bottom.
However, with regard to the foreign insurer, the court
declined its international jurisdiction on the basis of the following
conclusions:
a. Art.
5.3 Brussels I Reg. is not to be applied, because the chapter on insurance [Art.
8-14] prevails over the former provision.
b. Art.
5.5 Brussels I Reg. is not to be applied, because the subject matter of litigation
was not a dispute arising out of the operation of a branch, agency or other
establishment. This point was made by the court because the claimant tried to
establish international jurisdiction on the grounds of the existence of a
branch of the foreign insurer in Greece, which the latter actually denied.
c. Art.
9.1 b & 10 Brussels I Reg. are not to be applied, and therefore a direct
action by the injured party against the insurer is not possible, because the
provisions aforementioned allow such an action only if the applicable law provides
for such a remedy. In light of the fact that English law is to be applied,
which does not provide for a direct action, there are no grounds for applying
the above rules.
d. Art. 6.1 Brussels I Reg. is not to be
applied, because no close connection of the claims has been proven. In
particular, the claim against the respondents from 1-3 focused on the tortious liability
issue, whereas the claim against the respondent under 4 (insurer) dealt solely
with the insurance liability issue. Therefore, no risk of irreconcilable judgments
could result from separate hearings and decisions.
Comments: No doubt this case will continue to the second
instance, and reach the Greek Supreme Court. I will follow the developments and
report on the following steps of the dispute. Prima facie, I think the court
was right in declining its jurisdiction. What I cannot confirm, is whether
English law actually does not provide for a direct action by the injured party
against the insurer. If anyone wants to enlighten me / the followers of this
blog, her / his comment would be very welcome.
Labels: Brussels I Regulation