Paper by Alex. Rein
The right of global limitation of liability is peculiar to maritime law; moreover, it is one of the most characteristic features of this ius speciale. What was the philosophy on which it was originally based? One answer seems simple and satisfactory: navigare necesse est, in spite of the horrendous perils of the sea. It was deemed necessary to encourage the capitalist to invest money in the risky business of maritime ventures. Or, expressed in modern language, maritime ventures had to be subsidized. The history of the institution, however, is more complex than that, but this is not the time and place for an historical study. For present purposes it is enough to say that the institution has had an extraordinary vitality and still exists in varying forms in the law of all maritime countries.
It could hardly have survived if its only justification had been its original premises, but the reasons supporting its continued existence have been perceived in practice more than realized in legal philosophy. One reason for its universal survival is probably that even those who are most critical of the whole idea are reluctant to take away subsidies to their industry if competing industries do not follow suit.
Common to all past and present systems of limitation is that the privilege is reserved for the owners and operators of ships (some systems include charterers) and their servants. Originally, the protection of servants was not an object in itself; rather, it was a means of making the protection of the principal effective. These relatively minor variations in the various systems with respect to the selection of persons entitled to limitation shall not be dealt with in this paper. For the sake of simplicity the person so entitled shall be referred to as "owner."
Limitation of liability as referred to in this paper is global limitation, i.e., limitation of the owner's liability for all claims subject to limitation that arise on a certain occasion (for example, an accident), during a certain time, or in connection with a certain venture (for instance, a voyage). Limitation of liability for the individual claim (the unit limitation in the carriage of goods, etc.) shall not be discussed. But in recent years separate "global" limitation regimes for claims of a special nature (for example, oil pollution damage) have been introduced.
About the Author
Alex. Rein. Born 1913. LL.B. University of Oslo 1938. Member Norwegian Bar 1945, Supreme Court Bar 1948. Partner, Wikborg, Rein, Ringdal & Waelgaard, Oslo and Bergen. Chairman Norwegian Maritime Law Association 1964-70. Member Executive Council, Comite Maritime International 1976.
Citation
53 Tul. L. Rev. 1259 (1979)