Victrawl P/L v A.O.T.C. Limited

[1993] FCA 677

VICTRAWL PTY LIMITED v. A.O.T.C. LIMITED and OTHER CO-OWNERS OF ANZCAN CABLE
No. NG673 of 1991
FED No. 677
Number of pages - 14
Shipping And Navigation - Public International Law

(1993) 117 ALR 347

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
IN ADMIRALTY
LOCKHART(1), GUMMOW(2) AND COOPER(3) JJ

CATCHWORDS

Shipping And Navigation - limitation of liability - whether limitation of liability provisions of the Limitation of Liability for Maritime Claims Act 1989 may be invoked after the commencement of that Act in respect of a prior occurrence.

Public International Law - Convention on Limitation of Liability for Public International Law provisions of Convention have "the force of law in Australia" - relevance to interpretation of Australian statute of Vienna Convention on the Law of Treaties, 1969.

Navigation Act 1912

Federal Court of Australia Act 1976

Admiralty Act 1988

Limitation of Liability for Maritime Claims Act 1989

Gates v Gaggin (1983) 51 ALR 721

James Patrick and Company Limited v Union Steamship Company of New Zealand Limited (1938) 60 CLR 650

HEARING

SYDNEY, 3, 4 June 1993

#DATE 29:9:1993

Counsel and solicitors for Victrawl Pty Limited: Mr B.W. Rayment QC,

Mr A.W. Street and Mr W.M. Fitzsimmons instructed by Phillips Fox.

Counsel and solicitors for A.O.T.C. Limited and
other co-owners of Anzcan Cable: Mr R.B. Macfarlan QC

and Mr J.L. Allsop instructed by Ebsworth and Ebsworth

ORDER

THE COURT answers the questions raised in the Stated Case as follows:

Question 1

1. Having regard to the date of the relevant occurrence,

before the coming into effect of the Limitation of Liability for Maritime Claims Act 1989 (Cth), is the plaintiff precluded from invoking the provisions of the Convention of 1976, set forth in the First Schedule to the said Act?

Answer: Yes.

Question 2

2. Having regard to the date of the relevant occurrence,

and the fact that the plaintiff first applied for limitation pursuant to the Convention of 1957, set forth in Schedule 6 to the Navigation Act 1912 (Cth), after 31 May 1991, being the date on which the said Schedule 6 was repealed, is the plaintiff precluded from invoking the provisions of the said Convention of 1957?

Answer: The Court finds it inappropriate to deal with

this question.

Question 3

3. If the answer to the first and second questions is in

the negative, may the plaintiff elect as between the two limitation regimes before judgment in the proceedings?

Answer: This question does not arise.

Question 4

4. If the answer to the first question is in the

negative, and if the plaintiff is able to limit its liability pursuant to the said Convention of 1976, may the defendant Coulston avail himself of the limitation of liability of the plaintiff, irrespective of whether it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result, within the meaning of Article (4) of the said Convention of 1976?

Answer: This question does not arise.

THE COURT ORDERS that Victrawl Pty Limited pay the costs of A.O.T.C. Limited and other co-owners of Anzcan Cable of the Stated Case.
Note: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules.

JUDGE1

LOCKHART J I agree with the reasons for judgment of Gummow J, the answers which he proposes to the questions asked in the case stated and the order for costs proposed by his Honour.

JUDGE2

GUMMOW J This is a Stated Case, pursuant to s. 26 of the Federal Court of Australia Act 1976, by a Judge of the Court (Sheppard J). The Stated Case poses important issues of construction of the limitation of liability provisions in the Limitation of Liability for Maritime Claims Act 1989 ("the 1989 Act") and of the relationship between that statute and Part VIII of the Navigation Act 1912 ("the Navigation Act"). Part VIII, ss. 330-338, was inserted in the Navigation Act by s. 65 of the Navigation Amendment Act 1979 ("the 1979 Act") and was headed "Limitation and Exclusion of Shipowners' Liability". Sub-section 104 (3) of the 1979 Act had repealed Part VIII of the Merchant Shipping Act 1894 (Imp.) ("the 1894 Act"), insofar as it was part of the law of the Commonwealth.

1. Section 503 (which was in Part VIII of the 1894 Act) created various limitations upon liability where certain occurrences took place without "actual fault or privity" of the owners of a ship, British or foreign. The validity of the repeal of s. 503 by sub-s. 104 (3) of the 1979 Act was upheld in Kirmani v Captain Cook Cruises Pty Ltd (No. 1) (1985) 159 CLR 351.

2. Section 330 of the Navigation Act, as amended by s. 178 of the Statute Law (Miscellaneous Amendments) Act (No. 2) 1982, provided that the term "Convention" meant the International Convention Relating to the Limitation of the Liability of Owners of Sea-going Ships, signed at Brussels on 10 October 1957, as amended by the Protocol signed at Brussels on 21 December 1979 ("the 1957 Convention"). Section 333 provided, with an exception not presently material, that the 1957 Convention had "the force of law as part of the law of the Commonwealth".

3. In sub-s. 3 (1) of the Admiralty Act 1988 ("the Admiralty Act") the term "Liability Convention" was, prior to amendment by the 1989 Act, defined as meaning, inter alia, the 1957 Convention, together with:
   

"(a) any other international convention that is in force in relation to Australia and makes provision with respect to the limitation of liability in relation to maritime claims."

Section 25 of the Admiralty Act, before amendment effected by the 1989 Act, both created a new right or entitlement under federal law in relation to the 1957 Convention and invested this Court with jurisdiction in respect of matters concerning that right or entitlement. The legislation thus operated not only to impose liabilities and create obligations but also to give jurisdiction to this Court with reference to them; see The King v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 165-6 per Dixon J Section 67A of the National Health Act 1953, construed in Australian Health Insurance Association Limited v Esso Australia Limited (Full Court, 12 August 1993, unreported), may be seen as a further example of legislation which operates in this fashion.

1. Section 25 of the Admiralty Act is in the following terms:
   "25. (1) A person who apprehends that a claim for compensation
   

under a law (including a law of a State or a Territory) that gives effect to provisions of a Liability Convention may be made against the person by some other person may apply to the Federal Court to determine the question whether the liability of the first-mentioned person in respect of the claim may be limited under that law.

(2) Subsection (1) does not affect the jurisdiction of any other court.

(3) On an application under subsection (1), the Federal Court may, in accordance with the law referred to in that subsection;

(a) determine whether the applicant's liability may be so limited and, if it may be so limited, determine the limit of that liability;

(b) order the constitution of a limitation fund for the payment of claims in respect of which the applicant is entitled to limit his or her liability; and

(c) make such orders as are just with respect to the administration and distribution of that fund.

(4) Where a court has jurisdiction under this Act in respect of a proceeding, that jurisdiction extends to entertaining a defence in the proceeding by way of limitation of liability under a law that gives effect to provisions of a Liability Convention."

Sub-section 25 (4), permitting the entertainment of a defence by way of limitation of liability, rather than by the institution of a distinct proceeding, is in accordance with the procedures which operated under the earlier Imperial legislation. These were explained in Gates v Gaggin (1983) 51 ALR 721 at 723-5, and The Law Reform Commission, Report No. 33, "Civil Admiralty Jurisdiction", para. 299. See also Beauchamp v Turrell (1952) 1 Lloyd's Rep 266, where limitation of liability under s. 503 of the 1894 Act was pleaded as a defence and judgment was given for a sum reduced to allow for the limitation.

1. Schedule 2 of the 1989 Act omitted the previous definition in sub-s. 3 (1) of the Admiralty Act of "Limitation Convention" and substituted a definition which identified only the Convention on Limitation of Liability for Maritime Claims adopted by the International Conference on Limitation of Liability for Maritime Claims at London on 19 November 1976 ("the 1976 Convention").

2. Section 3 of the 1989 Act defines the "Convention" as the 1976 Convention (the English text of which is set out in Schedule 1 to the statute) and s. 6 states:
   "6. Subject to this Act, the provisions of the Convention,
   

other than paragraphs 1 (d) and (e) of Article 2, have the force of law in Australia."

Schedule 3 of the 1989 Act operates to repeal Division 1 of Part VIII of the Navigation Act and thus repeals s. 333 of the Navigation Act. This, it will be recalled, provided that the 1957 Convention relevantly had "the force of law as part of the law of the Commonwealth".

1. As I have said, the 1976 Convention is set out as Schedule 1 of the 1989 Act. The applicable rules of interpretation of the 1976 Convention are those recognised by customary international law as codified by the Vienna Convention on the Law of Treaties of 1969 ("the Vienna Convention"); see the authorities collected in Minister for Foreign Affairs and Trade v Magno (1992) 37 FCR 298 at 305. The Vienna Convention came into force on 27 January 1980, in accordance with Article 84 thereof. Article 4 states that without prejudice to the application of any rules set forth in the Convention, to which treaties would be subject independently of the Convention, it applies "only to treaties which are concluded by States after entry into force of the present Convention with regard to such States"; see Rosenne, "The Temporal Application of the Vienna Convention on the Law of Treaties" (1970) 4 Cornell International Law Journal 1 at 21-22. As will appear, the applicable date for the 1976 Convention in relation to Australia is later than 27 January 1980.

2. The 1976 Convention came into force as part of the law of the United Kingdom on 1 December 1986. The circumstances which led to the 1976 Convention are discussed by Sir Barry Sheen in his article "Limitation of Liability: The Law Gave and the Lords Have Taken Away" (1987) 18 Journal of Maritime Law and Commerce 473, and by Mr Richard Shaw in his paper "Practice and Procedure" in the publication by the Institute of Maritime Law The Limitation of Shipowners' Liability: The New Law 113. The learned authors point to the difficulties which had arisen from the British decisions construing the phrase "actual fault or privity" in the 1894 Act, and to the more liberal interpretation given by other European countries to the "fault or privity" requirements of the 1957 Convention. Sir Barry Sheen continues (at 484-5):
   

"(T)he uncertainty which ensued from these decisions led shipowners all over the world and their underwriters to seek for some certainty about their right to limit their liability. In June 1976, the Council of the I.M.O. (the International Maritime Organisation, as it is now called) decided to convene a diplomatic conference to consider the adoption of a convention on limitation of liability for maritime claims, based upon a draft formulated by the Comit Maritime International (C.M.I.) at Hamburg in 1974 and revised by I.M.O. The diplomatic conference was held in London in November 1976. It was then decided that the words 'actual fault or privity' no longer afforded sufficient protection to shipowners. Shipowners were prepared to agree (to) higher limits of liability in exchange for certainty of the right to limit their liability. The test as to what conduct would prevent a shipowner from limiting his liability was laid down in Article 4 of the Convention in these words:

'A person liable shall not be entitled to limit his liability if it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result.'"

The inadequacy of the existing limits on quantum of liability was explained in the following passage from the Second Reading Speech in the House of Representatives for the Bill for the 1989 Act (Hansard, 12 April 1989, pp 1482-3). The Minister said:

"The inadequacy of the 1957 Convention is demonstrated by the fact that the total amount of the compensation fund for claims involving an incident of a ship of 10,000 gross tonnage would be only about $3.22m. If there were 193 claimants - the number of people killed in the Herald of Free Enterprise disaster in 1987 in Belgium - the average amount per passenger would be $16,700. The equivalent figures for passenger claims under the 1976 Convention would be $39m and $202,000, a twelvefold increase. . . .

Article 6 of the Convention establishes upper limits for two types of claims: claims for loss of life or personal injury and property claims. These limits are expressed in units of account. A unit of account is the special drawing right of the International Monetary Fund. For personal claims, liability for claims concerning ships with tonnage not exceeding 500 tonnes is limited to 333,000 units of account, or about $520,000. For larger ships, further units of account are added for each tonne in excess of 500, on a sliding scale. Therefore, the limit for a ship of 10,000 gross tonnage would be 3,914,000 units of account or about $6.1m. For property claims - that is, claims such as for damage to other ships, property or harbour works - the system of determining the upper limit is similar. The limit for a ship of 500 gross tonnage is 167,000 units of account or about $260,000; for a ship of 10,000 gross tonnage it is 1,753,500 units of account or about $2.7m. On top of this, article 7 of the 1976 Convention provides for the establishment of a separate fund for loss of life or personal injury to passengers. Here the shipowner's liability is limited to 46,666 units of account multiplied by the number of passengers the ship's certificate authorises it to carry to a maximum of 25 million units of account. Therefore, the maximum compensation available to passengers on the Abel Tasman would be about $39m. As a trade off for the vastly increased amounts of compensation available, the Convention provides for a virtually unbreakable system of limiting liability. It declares that a person will be deprived of his ability to limit liability only if it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such a loss, or recklessly and with knowledge that such loss would probably result."

1. Before turning to the agreed facts, it is necessary to consider the commencement date of the 1989 Act. Section 2 thereof stated:
   "2. (1) Subject to subsection (2), this Act commences on
   

a day to be fixed by Proclamation.

(2) If this Act does not commence under subsection

(1) within the period of 18 months beginning on the day on which it receives the Royal Assent, it commences on the first day after the end of that period."

The Royal Assent was given on 30 November 1989.

1. In the Second Reading Speech (at 1483) the Minister pointed out that it was necessary to allow for Australia's accession to the 1976 Convention and the denunciation of the 1957 Convention "to coincide with the commencement of the Act". Article 13 of the 1957 Convention stated:
   

"Each High Contracting Party shall have the right to denounce this Convention at any time after the coming into force thereof in respect of such High Contracting Party. Nevertheless, this denunciation shall only take effect one year after the date on which notification thereof has been received by the Belgian Government which shall inform through diplomatic channels all signatory and acceding States of such notification."

The instrument of denunciation was signed by the Minister for Foreign Affairs and Trade on 21 May 1990 and received by the Belgian government on 30 May 1990. In accordance with Article 13, the denunciation took effect "one year after the date" of receipt of notification, that is to say on 31 May 1991.

1. The instrument of accession to the 1976 Convention was executed by the Minister on 1 February 1991 and it was received on 20 February 1991. Therefore, the Convention, pursuant to Article 17 (3) thereof, entered into force on "the first day of the month following the expiration of ninety days after the date on which (Australia) deposited its instrument". That was on 1 June 1991.

2. No commencement date was fixed by proclamation under sub-s. 2 (1) of the 1989 Act. Accordingly, by force of sub-s. 2 (2) the Act commenced on the first day after the end of the period of 18 months beginning on 30 November 1989. In this context "months" is to be read as calendar months; Acts Interpretation Act 1901 ("the Interpretation Act") s. 22 (b). It follows that the Act commenced on 1 June 1991. That was a Saturday, but this is not a case where sub-s. 36 (2) of the Interpretation Act requires any different result.

3. I turn now to the agreed facts. A significant date is 1 June 1991.

4. On 13 April 1991, the fishing vessel "Lorna Dorn", which is owned by the plaintiff and was skippered by Mr D.T.A. Coulston, in the course of his employment by the plaintiff, damaged a cable owned by the defendants and the said defendants suffered loss. After 1 June 1991, the plaintiff sought, in respect of that occurrence, to invoke the limitation of liability provided for in the 1976 Convention. On 31 October 1991, it invoked the jurisdiction of this Court under s. 25 of the Admiralty Act by filing a Statement of Claim in proceeding G673 of 1991. The plaintiff sought declarations that, in accordance with the 1989 Act, it was entitled to limit to the amount derived by 167,000 units of account any liability arising out of the above circumstances, and that upon constitution of the limitation fund the defendants would be barred from exercising any right in respect of the above claim against any other asset of the plaintiff. The plaintiff alleged in the Statement of Claim that on 13 April 1991 in the approximate position of latitude S34 02.22' and longitude E151 46.50', the "Lorna Dorn" was fouled on the ANZCAN Cable ("the Cable"). The plaintiff pleaded that whilst it did not admit liability it expected that the defendants might make a claim against it for loss of or damage to property occurring in connection with the operation of the vessel, together with consequential loss resulting therefrom, within the meaning of para. 1 (a) of Article 2 of Schedule 1 to the 1989 Act.

1. Article 2.1 (a) of the 1976 Convention is as follows:
   "2. 1. Subject to Articles 3 and 4 the following
   

claims, whatever the basis of liability may be, shall be subject to limitation of liability:

(a) claims in respect of loss of life or personal injury or loss of or damage to property (including damage to harbour works, basins and waterways and aids to navigation), occurring on board or in direct connexion with the operation of the ship or with salvage operations, and consequential loss resulting therefrom; . . ."

1. By their Defence, the defendants alleged that as a matter of law the 1989 Act had no application. This was because the event giving rise to the claim had occurred on 13 April 1991, that is to say before 1 June 1991.

2. By their Amended Cross-Claim filed 12 December 1991, the defendants as cross-claimants sought a declaration to the same effect. Then, by its Defence to the Amended Cross-Claim, filed on 17 December 1991, the plaintiff sought, in the alternative, to limit its liability in respect of the said occurrence, pursuant to the 1957 Convention, as made applicable by the then repealed provisions of Part VIII of the Navigation Act.

3. In proceeding G935 of 1992, commenced 18 December 1992, the defendants in proceeding G673 of 1991 allege that the damage to the Cable was caused by the negligence of the Master, Mr Coulston. In his Defence, Mr Coulston alleges (and the defendant in their Reply deny) that if liability may be limited under the 1976 Convention, then he may avail himself of the limitation of liability of the plaintiff in proceeding G673 of 1991. The defendants contend that, even assuming the 1976 Convention is the relevant regime, Mr Coulston would not be entitled to limit his liability pursuant to Article 4 of the 1976 Convention.

4. By order made 6 April 1993, proceeding G935 was "consolidated with the Cross-Claim filed in proceedings (sic) G673 of 1991". The case was then stated in proceeding G673.

5. Four questions are stated for determination by the Full Court. The questions are as follows:
   1. Having regard to the date of the relevant occurrence,
   

before the coming into effect of the Limitation of Liability for Maritime Claims Act 1989 (Cth), is the plaintiff precluded from invoking the provisions of the Convention of 1976, set forth in the First Schedule to the said Act?

Question 2, as drawn, wrongly postulates the date of repeal of the operation of the 1957 Convention as 30 May 1991. It should be re-drawn to refer to 31 May 1991. It then reads:

2. Having regard to the date of the relevant occurrence,

and the fact that the plaintiff first applied for limitation pursuant to the Convention of 1957, set forth in Schedule 6 to the Navigation Act 1912 (Cth), after 31 May 1991, being the date on which the said Schedule 6 was repealed, is the plaintiff precluded from invoking the provisions of the said Convention of 1957?

In the event, both parties agreed that the second question should be answered "No", with the result that the plaintiff is not precluded from invoking the provisions of the 1957 Convention. There being no contradictor before the Court, it is inappropriate to deal with the second question, save to the extent that it may be necessary to do so in considering the first question. The debate before us turned upon the applicability of the 1976 Convention.

3. If the answer to the first and second questions is in

the negative, may the plaintiff elect as between the two limitation regimes before judgment in the proceedings?

4. If the answer to the first question is in the

negative, and if the plaintiff is able to limit its liability pursuant to the said Convention of 1976, may the defendant Coulston avail himself of the limitation of liability of the plaintiff, irrespective of whether it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result, within the meaning of Article (4) of the said Convention of 1976?

1. Under the Imperial law, which predated the operation in Australian municipal law of the 1957 Convention and the 1976 Convention, limitation of shipowners' liability and the jurisdiction of the courts in relation thereto depended wholly upon statute; see the discussion in McIlwraith McEacharn Ltd v Shell Co. of Australia Ltd (1945) 70 CLR 175 at 196 by Starke J. In particular, neither the courts of Admiralty nor those of common law recognised any general law principle that the liability of shipowners, whether for torts or contracts, was limited to the value of the ship and freight; a different view was taken by the law of other maritime nations: "Marsden on the Law of Collisions at Sea", 9th Ed., 1934, pp 161-4.

2. English statute law commenced in 1734 with the statute 7 Geo. II, c. 15. The rationale of the legislative schemes which followed was described by Gibbs J in China Ocean Shipping Co. v The State of South Australia (1979) 145 CLR 172 at 193, as follows:
   

"(W)hen, as is not uncommon, a number of separate actions are brought by different claimants, it is necessary that there should be a procedure for distributing the total amount for which the shipowner is liable

proportionately amongst the various claimants . . . Without such a procedure, the 'shipowners could not be fully protected and claimants would be remitted to a competitive scramble for the aggregate sum, in which the hindmost would come off as the hindmost proverbially do': per Lord Sumner in Mersey Docks and Harbour Board v Hay

(1923) AC at 379."

The British legislation, before the 1894 Act, invested jurisdiction first in the High Court of Chancery and then, after legislation in 1860 and 1861 (discussed by Starke J supra) in the courts of common law and the High Court of Admiralty. This history is to be understood when reading the following passage from the judgment of Dixon J in James Patrick and Company Limited v Union Steamship Company of New Zealand Limited (1938) 60 CLR 650 at 673:

"(T)he foundation of the relief, administered first in Chancery and afterwards in admiralty, is the provision on the part of a shipowner of the fund representing his maximum liability. The court then administers the fund brought into court by the shipowner. The court ascertains the claims upon it, marshalls them and

distributes the fund rateably among the claimants. In principle the title to relief of such a nature is a substantive right enforceable by independent proceedings. It is more than one of the conditions affecting the amount of the loss or damage to be awarded in the collision action."

1. As I have earlier indicated, the juridical nature of the rights now involved under the federal law of this country is to be understood from a consideration which begins, as regards this Court, with s. 25 of the Admiralty Act. This both creates fresh obligations and imposes fresh liabilities under federal law and invests this Court with federal jurisdiction in respect of the relevant species of "matter", within the meaning of ss. 76 and 77 of the Constitution. The creation of a new class of "matter" in this way involves more than what in other contexts might be treated as procedural law; cf Arnotts Limited v Trade Practices Commission (No. 1) (1989) 21 FCR 297 at 303-4. The Parliament pursuant to Chapter III of the Constitution has augmented the class of matters in respect of which the Court has jurisdiction. Furthermore, in doing so, the Executive together with the Parliament has detached Australia from one international system of maritime law and attached it to another. This is not the class or character of activity which is fairly to be described as procedural in nature.

2. The essential question in the present dispute concerns the temporal delimitation of that new species of "matter". In particular, does the new federal right (and concomitant liability) as to limitation of liability extend to limitation of liability for claims in respect of damaged property, which damage was sustained before the commencement of the 1989 Act?

3. In answering that question, it is necessary first to set out further provisions of the 1976 Convention.

4. Chapter I, Articles 1 - 5, is headed "The Right of Limitation", Chapter II, Articles 6 - 10, "Limits of Liability", Chapter III, Articles 11 - 14, "The Limitation Fund", Chapter IV, which comprises Article 15, "The Scope of Application" and Chapter V, Articles 16 - 23, "Final Clauses".

5. Article 1 is headed "Persons Entitled to Limit Liability". It provides that shipowners and salvors may limit their liability in accordance with the Convention, for claims set out in Article 2. The term "shipowner" means the owner, charterer, manager and operator of a seagoing ship, and the liability of a shipowner shall include liability in an action brought against the vessel herself. An insurer of liability for claims subject to limitation shall be entitled to the benefits of the Convention "to the same extent as the assured himself". Articles 1.4 and 1.7 are as follows:
   "1. 4. If any claims set out in Article 2 are made
   

against any person for whose act, neglect or default the shipowner or salvor is responsible, such person shall be entitled to avail himself of the limitation of liability provided for in this Convention.

. . .

7. The act of invoking limitation of liability shall not constitute an admission of liability."

I have referred earlier to the relevant portion of Article 2, which sets out the claims which are subject to limitation of liability. Article 3 excepts certain claims from limitation. Article 4 deals with conduct barring limitation and is, as I have indicated, an important provision for shipowners and insurers. I have set out the text earlier in these reasons.

1. Article 11 is headed "Constitution of the Fund". Paragraphs 1 and 2 of the Article should be set out in full:
   "11. 1. Any person alleged to be liable may constitute a
   

fund with the Court or other competent authority in any State Party in which legal proceedings are instituted in respect of claims subject to limitation. The fund shall be as constituted in the sum of such of the amounts set out in Articles 6 and 7 as are applicable to claims for which that person may be liable, together with interest thereon from the date of the occurrence giving rise to the liability until the date of constitution of the fund. Any fund thus constituted shall be available only for the payment of claims in respect of which limitation of liability can be invoked.

2. A fund may be constituted, either by depositing the sum, or by producing a guarantee acceptable under the legislation of the State Party where the fund is constituted and considered to be adequate by the Court or other competent authority." (Emphasis supplied)

Article 12 deals with the distribution of the fund among the claimants in proportion to their established claims against the fund, and provides for the subrogation of insurers.

1. Limitation of liability may be invoked even though a limitation fund has not been constituted under Article 11. This is so provided in Article 10, which is headed "Limitation of Liability Without Constitution of a Limitation Fund". The text of Article 10 is as follows:
   "10. 1. Limitation of liability may be invoked
   

notwithstanding that a limitation fund as mentioned in Article 11 has not been constituted. However, a State Party may provide in its national law that, where an action is brought in its Courts to enforce a claim subject to limitation, a person liable may only invoke the right to limit liability if a limitation fund has been constituted in accordance with the provisions of this Convention or is constituted when the right to limit liability is invoked.

2. If limitation of liability is invoked without the constitution of a limitation fund, the provisions of Article 12 shall apply correspondingly.

3. Questions of procedure arising under the rules of this Article shall be decided in accordance with the national law of the State Party in which action is brought."

1. However, the invocation of limitation of liability under Article 10, without constitution of a limitation fund under Article 11, leaves the party invoking the limitation still at hazard. This is because the barring provisions of Article 13 do not operate before the constitution of a limitation fund. Article 13 is headed "Bar to Other Actions". Its text is as follows:
   "13. 1. Where a limitation fund has been constituted in
   

accordance with Article 11, any person having made a claim against the fund shall be barred from exercising any right in respect of such claim against any other assets of a person by or on behalf of whom the fund has been constituted.

2. After a limitation fund has been constituted in accordance with Article 11, any ship or other property, belonging to a person on behalf of whom the fund has been constituted, which has been arrested or attached within the jurisdiction of a State Party for a claim which may be raised against the fund, or any security given, may be released by order of the Court or other competent authority of such State. However, such release shall always be ordered if a limitation fund has been constituted:

(a) at the port where the occurrence took place, or, if it took place out of port, at the first port of call thereafter; or

(b) at the port of disembarkation in respect of claims for loss of life or personal injury; or

(c) at the port of discharge in respect of damage to cargo; or

(d) in the State where the arrest is made.

3. The rules of paragraphs 1 and 2 shall apply only if the claimant may bring a claim against the limitation fund before the Court administering that fund and the fund is actually available and freely transferable in respect of that claim."

1. The right or entitlement of the plaintiff to apply to this Court for determination of the question whether its liability might be limited under the 1989 Act, as a law giving effect to the provisions of the 1976 Convention, is conditional upon the apprehension of a claim for compensation against the plaintiff under that law. Such an apprehension could not arise before 1 June 1991. This follows from the commencement date of the 1989 Act. There could not previously have existed any claim against the plaintiff for compensation under a law giving effect in Australia to the 1976 Convention.

2. The next step is to ask whether a claim for compensation under the 1989 Act could arise on or after 1 June 1991, but in respect of an occurrence before that date. That is the crucial question for this case.

3. Section 6 of the 1989 Act states, with exceptions not here relevant, that the provisions of the 1976 Convention have the force of law in Australia. Therefore, one turns to the terms of the Convention. These are concerned with (i) claims (ii) which may be subject to limitation of liability, (iii) being claims in respect of the occurrences set out in Article 2, and (iv) with the step of invoking limitation of liability, and the consequences thereof.

4. The term "occurrence" as a term used to describe that out of which the relevant classes of claims arise is used in Article 5 (dealing with counter-claims) and in Article 11 (dealing with the constitution of the fund). Other articles use the cognate concept of claims which "arise on any distinct occasion": see Article 6 (the general limits), Article 7 (limits for passenger claims) and Article 9 (aggregation of claims).

5. As a general precept of interpretation, the regime created by the Convention would, in the absence of a contrary intention, be construed as not attaching new legal consequences to facts or events which had occurred before its commencement and as, in that sense, having a "prospective operation", i.e. in respect of facts or events occurring after the State in question became a party to the Convention pursuant to the procedures in Articles 16 and 17. The general precept as applied at common law is discussed in many authorities including Fisher v Hebburn Limited (1960) 105 CLR 188 at 194 per Fullagar J and Geraldton Building Co. Pty Ltd v May (1977) 136 CLR 379 at 401-2 per Mason J.

6. Of course, the common law primarily is concerned with obligations arising purely under municipal law and not with the external affairs or international obligations which arise between Australia and other State Parties (and bodies with international personality) under or pursuant to international agreements. However, the general rule under customary international law is that a treaty does not bind a Party in relation to any act or fact which took place before the date of entry into force of the treaty with respect to that Party; see the authorities discussed in the work by Chief Justice Elias "The Modern Law of Treaties", 1974, pp 46-49; see also Halsbury "The Laws of England", 4th Ed., Vol. 18, page 927. Article 28 of the Vienna Convention which is headed "Non-retroactivity of Treaties" restates that position in the following terms:
   

"Unless a different intention appears from the treaty or is otherwise established, its provisions do not bind a party in relation to any act or fact which took place or any situation which ceased to exist before the date of the entry into force of the treaty with respect to that party."

1. In argument, there was some consideration of whether the relevant international obligations created by the 1976 Convention were wholly consistent with Article 28 of the Vienna Convention. In particular, counsel for the plaintiff pointed to Article 15 of the 1976 Convention. Paragraph 1 thereof states:
   "15. 1. This Convention shall apply whenever any person
   

referred to in Article 1 seeks to limit his liability before the Court of a State Party or seeks to procure the release of a ship or other property or the discharge of any security given within the jurisdiction of any such State. Nevertheless, each State Party may exclude wholly or partially from the application of this Convention any person referred to in Article 1 who at the time when the rules of this Convention are invoked before the courts of that State does not have his habitual residence in a State Party or does not have his principal place of business in a State Party or any ship in relation to which the right of limitation is invoked or whose release is sought and which does not at the time specified above fly the flag of a State Party."

1. The submission was that this indicated that it was enough that limitation of liability was sought before a court or release of a ship or discharge of security was sought, after the entry into force of the 1976 Convention. However, para. 1 of Article 15 is concerned with the taking of steps by "any person referred to in Article 1". Those persons are identified under the heading "Persons Entitled to Limit Liability" in Article 1 by reference to the various categories of claims which are set out in Article 2. That in turn invites attention to the other articles which deal with the occurrences and occasions giving rise to the liability, the subject matter of a claim, and to the possibility, pursuant to Articles 10 and 11, of the invocation of limitation of liability after such occurrence or occasion.

2. Accordingly, I would not treat Article 15 of the 1976 Convention as establishing the appearance of "a different intention" to the position as stated in Article 28 of the Vienna Convention concerning acts or facts which took place before the date of entry into force of the 1976 Convention with respect to Australia.

3. In enacting s. 6 of the 1989 Act and giving the 1976 Convention, relevantly, the force of law in Australia, under Australian constitutional law it was for the Parliament to choose the means by which effect was to be given to the 1976 Convention. This was subject to the proviso that the means chosen were capable of being reasonably considered appropriate and adapted to that end: Richardson v The Forestry Commission (1988) 164 CLR 261 at 288-9, 311-312, 336, 345-346.

4. There is much to be said for the view that the 1989 Act might not be reasonably considered as appropriate and adapted to the end of carrying into effect the 1976 Convention if the 1989 Act, including its amendments of the Admiralty Act, had other than a prospective operation. Further, in a matter of statutory interpretation, purely pursuant to municipal law, there is the general precept to which I have earlier referred. There are, in my view, no considerations in the body of the 1989 Act itself which displace what then would be the prima facie construction. This would place the occurrence on 13 April 1991 beyond the pale, within which fall occurrences on or after 1 June 1991.

5. I have already indicated my conclusion as to the inappropriate nature of any classification of the laws with which the Court is here concerned as "procedural" in character.

6. Accordingly, in my view, question 1 should be answered "Yes". This means questions 3 and 4 do not arise. It is, as I have indicated, inappropriate to answer question 2. The plaintiff should pay the costs of the defendants of the Stated Case.

JUDGE3

COOPER J

I have read the reasons for judgment of Gummow J. I agree

with the answers which he proposes to the questions asked in the case stated for the reasons he has given. I also agree that Victrawl Pty. Limited should pay the costs of A.O.T.C. Limited and Other Co-Owners of Anzcan Cable of the case stated.