Lloyd's Maritime and Commercial Law Quarterly
DIRECT ACTIONS AGAINST THE INSURER IN A MARITIME SETTING: THE EUROPEAN PERSPECTIVE
Vibe Ulfbeck*
The article examines the EU rules on jurisdiction and choice of law in relation to direct actions against the insurer in maritime cases. It is shown that the rules on jurisdiction presuppose that a decision as to the substance of the case has been made and the consequences of this unusual set-up are examined. It is shown that the rule creates uncertainty and gives rise to some unwanted consequences and that the problems are particularly prevalent within maritime law. It is argued that the basic problems could be solved by a simple amendment of Brussels I, Art 11(2).
1. INTRODUCTION
It is a basic principle in most jurisdictions that contracts are only binding upon their parties. As a starting point therefore, an injured party must sue the tortfeasor, who in turn must claim under its liability insurance. However, if the tortfeasor is insolvent or for other reasons difficult to approach, the question arises whether the injured party can sue the liability insurer directly. In maritime cases this is highly relevant in practice and the question can arise in a variety of different types of case.1
2. DIRECT CLAIMS IN DIFFERENT EUROPEAN SYSTEMS (SUBSTANTIVE LAW)
Only to a limited degree are there general, international rules regulating the question of direct claims. Examples include the international rules allowing for direct actions against the insurer in cases concerning oil pollution from ships2 and the EU rules providing for
* Professor of Law at CEVIA, Faculty of Law, University of Copenhagen and at the Scandinavian Institute of Maritime Law, University of Oslo.
1. First, a direct action may relate to a cargo claim. Thus, if cargo is damaged during transit and the carrier is liable, the consignee may want to sue the liability insurer of the carrier (the P&I Club) directly. In this case, there will be a contractual relationship between the claimant (the consignee) and the insured. Secondly, a direct action may relate to situations in which there is no contractual relation between the claimant and the insured. For instance, in case of a collision between two vessels, the owner of the damaged vessel may wish to sue the liability insurer of the other vessel. Likewise, direct actions may be relevant in relation to personal injuries suffered in connection with the collision. Finally, direct claims may be relevant in relation to pollution cases in which an insured vessel can be held liable.
2. Conventions containing provisions on direct claims that are currently in force are the International Convention on Civil Liability for Oil Pollution Damage 1969 and the International Convention on Civil Liability for Bunker Oil Pollution Damage 2001.
LLOYD’S MARITIME AND COMMERCIAL LAW QUARTERLY
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