The Athens Convention: Limitation - Suspension and Interruption Periods: Warner v Scapa Flow Charters [2018] UKSC 52 - Jonathan Chambers

Tue, 30 October, 2018

In the recent decision Warner v Scapa Flow Charters [2018] UKSC 52, the Supreme Court considered the Athens Convention and whether Scot’s law as the law of the forum could affect a period of “suspension” or “interruption” of a limitation period and its effect on whether a particular claim was time-barred.

Background

Mr Warner chartered a vessel for a week of diving off Cape Wrath in Scotland. On 14th August 2012, when in full diving gear, he fell on the deck of the vessel. However he went ahead with the dive. He got into trouble and despite the assistance of other divers he died. His widow brought a claim against owners Scapa Flow Charters (SFC).

The Claim

Mr Warner’s widow issued a claim against SFC alleging negligence and sought damages both as an individual and as guardian of their young son, Vincent, who had been born in November 2011. The claim was issued on 14th May 2015.

SFC lodged a defence that the action was time-barred under the Athens Convention, which, in the case of a death occurring during carriage, imposes a time bar of two years (and not the normal three years in English and Scots law) from the date on which the passenger would have disembarked.

At first instance (the Outer House), the widow’s claims both for herself and her son were struck out as time-barred. On appeal (before the Inner House) the widow’s claims for herself were held to be time-barred but those in respect of her infant son were held not to be time-barred.

The Issue

The issue was whether Scot’s law as the law of the forum could effect a period of “suspension” or “interruption” of a limitation period so as to permit the widow’s and the son’s claim to continue.

The Athens Convention

The Athens Convention has the force of law in the UK pursuant to section 183 and Schedule 6 of the Merchant Shipping Act 1995. It also applies to domestic UK sea carriage under  The Carriage of Passengers and their Luggage by Sea (Domestic Carriage) Order 1987 (SI 1987/670). It does not need contractual incorporation albeit it can be contractually incorporated both intentionally and unintentionally.

Article 16 of the Athens Convention, provides:

(1) Any action for damages arising out of the death of or personal injury to a passenger or for the loss of or damage to luggage shall be time-barred after a period of two years.

(2) The limitation period shall be calculated as follows:

(a) in the case of personal injury, from the date of disembarkation of the passenger;

(b) in the case of death occurring during carriage, from the date when the passenger should have disembarked, and in the case of personal injury occurring during carriage and resulting in the death of the passenger after disembarkation, from the date of death, provided that this period shall not exceed three years from the date of disembarkation;

[…]

(3) The law of the court seized of the case shall govern the grounds of suspension and interruption of limitation periods, but in no case shall an action under this Convention be brought after the expiration of a period of three years from the date of disembarkation of the passenger or from the date when disembarkation should have taken place, whichever is later.

The parties were agreed that Mr Warner would have disembarked no later than 18 August 2012.

The Arguments

On its appeal, SFC argued that

(1)   The natural meaning of the words “grounds of suspension and interruption of limitation periods” in Article 16(3) was they they must be grounds which give rise to a break in a period or course of events which is already in train; and/or

(2)   The words “grounds of suspension and interruption of limitation periods” have a technical meaning derived from certain civil law systems, where a distinction was drawn between a “suspension” and an “interruption”.

a.      A “suspension” was said to refer to the situation in which a limitation period, which had started to run was paused by an event, such as the onset of mental incapacity, and then resumed its running when the incapacity ceases with the rest of the period remaining.

b.      An “interruption” was said to refer refers to a situation in which the limitation period, having been halted by an event, commences afresh when the halting event ceases and the time which has expired before the halting event does not count towards the running the limitation period.

Thus, SFC argued that a suspension or an interruption operates only if the limitation period had already begun to run before the pausing or halting event occurred. If that was right, then the Scots law of limitation enacted in section 18 of the Prescription and Limitation (Scotland) Act 1973 did not contain such “grounds of suspension and interruption” as to extend the limitation period. This was because, section 18 of the 1973 Act only postponed the start of the limitation period instead of interrupting or suspending it as the Athens Convention envisages. Therefore the claim by the infant was time-barred by the two-year time bar.

The Supreme Court

The Supreme Court dismissed SFC’s appeal and held that the claim advanced on behalf of the minor son was not time-barred.

The Supreme Court, adopting an “uniform” and non-technical approach to the words “suspension and interruption” in Article 16(3) of the Athens Convention, held that

(1)   A “suspension” in its natural meaning could readily cover the postponement of the start of a limitation period

(2)   This was so even though there was a valid distinction between  a “suspension” and an “interruption” such that

a.      In an “interruption” of a prescription period which had been running, the period commences again as of new and the prior period is in effect cancelled.

b.      However in the case of a “suspension” if the prescription period has started to run, the running of time resumes at the point it was before the suspension so that the time which has passed before the suspension counts towards the prescription period.

The Supreme Court held that an interpretation of Article 16(3) which led to the conclusion that domestic rules which have the effect of postponing the start of a limitation period were of no effect would give rise to serious anomalies.

Many legal systems suspend the operation of prescription or limitation when a claimant is a minor or is subject to a recognised legal disability such as mental incapacity. If SFC were right, the Convention would recognise as a ground of suspension a legal incapacity which arose after the prescription or limitation period commenced, but rather oddly would not recognise such incapacity that predated the start of that period. Thus a minor born before the commencement of the prescription or limitation period could not take advantage of the added year for which article 16(3) provided but a minor born after the commencement of the period would benefit from that added year.

The Supreme Court, quite sensibly, held that the words “the grounds of suspension … of limitation periods” were sufficiently wide to cover domestic rules which postpone the start of a limitation period as well as those which stop the clock after the limitation period has begun.

However, in fact, section 18 of the Prescription and Limitation (Scotland) Act 1973 did not in law postpone the start of a limitation period. If a Scottish Claimant’s legal disability predated the start of the limitation period, the Scottish provision simply instructed the court to disregard the time thereafter when the Claimant was under a legal disability. However the practical effect of the disregard on the calculation of the expiry of the three-year limitation period would be the same as a postponement of the start of the limitation period.

The Supreme Court held that even if the period of limitation was subject to a “suspension and interruption”  the limitation period imposed by Athens was nevertheless subject to the long stop in Article 16(3) “… of three years from the date … when disembarkation should have taken place …”. A domestic “suspension” provision could not defer the expiry of the Convention’s limitation period beyond that long stop.

Conclusion

This is a very sensible decision removing any difference of approach to a domestic limitation regime which might draw a distinction between a “suspension” and “limitation” and reflects English obiter dicta in Higham v Stena Sealink Ltd [1996] 2 Lloyd’s Rep 26. However the best advice remains: issue a claim within 2 years in a shipping case!

For a copy of the judgment click here

Jonathan Chambers

Jonathan has a broad practice covering all aspects of commercial and transport law.  

He is consistently ranked by Chambers UK and Legal 500 as a Leading Senior Junior, with Chambers UK (2018) commenting “A tenacious advocate with an admired intellectual capacity. His redoubtable practice focuses on complex cases involving personal injury and fatality”  and “He is easy to work with and responsive. He quickly identifies the issues”  and Chambers UK (2016) commenting that he is “Noted by peers for his meticulous preparation, strong advocacy skills and easy manner with clients” and Legal 500 (2016) describing him as “Very well prepared

Jonathan has a strong international practice and he is qualified to practise in England & Wales, Northern Ireland (practising) and Australia (currently non-practising). He has also advised on disputes involving Australia, Canada, the Channel Islands, Hong Kong, Northern Ireland, Scotland, Singapore, and the United States of America.

Jonathan has acted in disputes involving many of the major airlines, cruise and tour operators, UK airports and the CAA. He also acts on behalf of shipyards, ship-owners, rig owners, crewing agencies and shipping unions and the Royal Yachting Association. He is involved in a large volume of wet and dry shipping cases including cargo claims, pilotage, collisions and groundings. International ship-building, rig-construction and repair cases are also a strong feature of his practice.

He frequently acts in inquests involving aviation and maritime incidents and the civil claims which follow.

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jonathan.chambers@quadrantchambers.com