Alert

Erika Process: French Appeal Court Pronounced Judgment

The French Cour d’Appel (“the Court”) in Paris was charged with reviewing the judgment of the Paris Tribunal in 2008 concerning the damage resulting from the sinking of the tanker Erika off the coast of Brittany, France in 1999. This catastrophe resulted in heavy losses of crude oil and considerable damage along a 400km stretch of the French coast, as well as consequential damage for the local economies. The court case had been initiated by the affected regions as well as by a number of other civil parties.

The Court published the arrest on March 30, 2010. It basically upheld the lower court judgment; but while doing so, it revisited all the fundamental considerations. It should be emphasized that this is a process under criminal law, notably under the French law of July 1983, which establishes that harmful environmental damage caused willingly, or by acts of omission or negligence, is a criminal offence.

The earlier judgement, as confirmed by the Court, breaks new ground:

• this is one of the few cases where the consequences of the collapse and sinking of a vessel were judged under criminal law;
• among the accused parties is the classification society RINA; and
• the boundaries between French law, International Conventions, and European law had to be revisited.

The parties accused of wrongdoings were: the owner of the vessel, Mr. Savarese, acting as director of the company, Tevere Shipping; Mr. Pollara, the executive of Panship Management, in the capacity of operator of the ship; the classification society RINA; and the oil company TOTAL, which was identified as the “real shipper”.

The Court established that there is no conflict between the French law on environmental pollution and the MARPOL Convention. According to the Court, the definition of oil pollution under MARPOL is so wide that the sinking of a tanker due to earlier negligence or omissions can be seen as wrongdoing.

The Court also established that the 1992 Civil Liability Convention for Oil Pollution (“CLC”) provides coverage for civil liability; but after examining the position of the accused parties, it concluded that:

• while the owner may benefit from civil compensation under CLC, it is not protected for its role under criminal law;
• the operator is not covered by the terms of the CLC and cannot benefit from “channeling”;
• the classification society has an equally independent role and cannot be brought under the cover of the CLC; and
• TOTAL, the shipper, was guilty of certain wrongdoings (see below), but can benefit from the “channeling” protection under the CLC.

In an earlier related court case involving Erika, the Court also asked advice from the European Court of Justice (“ECJ”) concerning the definition of “waste” under European waste legislation. The ECJ determined that the leaking and dispersion of persistent oil at sea, be it in small or large quantities, but with the properties to harmfully damage the environment, is illegal in EU territorial waters if it is clear that such an incident could have been avoided. (This implies that a substance or product when lost during transport could become “waste”.) The ECJ pointed out that, according to European law, the “owner” of the “waste” is responsible for “discarding’” the waste in an acceptable manner. If this is not done correctly, the “polluter pays” principle would be applicable.

The Court has not insisted on following ECJ’s route, but it determined that French law is not incompatible with European law.

This is not the place to concisely summarize 400-plus pages of the Arrest; but suffice it to state the essence of the judgment below:

• All four parties have been found guilty of “environmental crime”, but for different reasons and with different responsibilities.
• The owner knew that the vessel was heavily attacked by corrosion, but he nevertheless requested and obtained the International Oil Pollution Compensation Funds (“IOPC”) certificate in order to continue to lease the vessel for further commercial operation.
• The operator had been informed by class of the need for important repairs; some repairs were done, but not enough by far. The Court suggests that the cost of repairs were minimized for commercial reasons, thus inviting disaster.
• The inspector of RINA was familiar with the poor condition of the vessel and the worrying degree of corrosion. Even in the port of departure, Dunkirk, the inspector had indicated that the certificate of compliance may be withheld. The vessel nevertheless was allowed to leave port and the inspection report was faxed later. RINA had, on a number of occasions, issued certificates of compliance without prior inspection. It had also warned the operator and the owner that the safety management system was inadequate, but they failed to take corrective action.
• TOTAL was recognized as the “real shipper.” It had established a charter party agreement with the operator. Although it checked vessel compliance under the usual vetting procedure, this internal acceptance had expired and the Court concluded that TOTAL violated its own rules concerning the allowable age of a chartered tanker and its technical condition. It should have been more careful in accepting the vessel for a further transport to Italy. Moreover, the weather conditions were awful, but TOTAL insisted on departure.

On the basis of defining the guilt of each of the accused parties, the Court assessed the fines. The total amounted to 200 million euros, slightly up from the previous judgment. However, the Court also held that TOTAL was exempt from civil liability under the terms of the CLC, while considering that it had already paid compensations on a voluntary basis for a total amount of 170 million euros.

After studying the arrest, all four accused parties decided independently to appeal the judgment further, but several of the civil parties expressed dissatisfaction as well.

Unfortunately, after more than ten years of legal wrangling, one can therefore only conclude with “to be continued”.

Erik Mink is a Senior Associate with Interel European Affairs, an EU Public Affairs consultancy with offices in Brussels, Berlin, London, Madrid, Paris, Prague, and Washington, D.C., as well as a network of affiliates in other key capitals in Europe. Interel is a strategic partner with Blank Rome.

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