This appeal arose from Tasmanian Ports Corp Pty Ltd v CSL Australia Pty Ltd (The Goliath) [2025] FCAFC 53 (CMI2657). In that decision, the Full Federal Court held that since Australia exercised the reservation permitted by art 18.1.a of the LLMC 1976, claims falling within arts 2.1.d [claims in respect of the raising, removal, destruction or the rendering harmless of a ship which is sunk, wrecked, stranded or abandoned, including anything that is or has been on board such ship] and 2.1.e [claims in respect of the removal, destruction or the rendering harmless of the cargo of the ship] are excluded from limitation altogether, notwithstanding that the same claims may also fall within another limitable subpara, including art 2.1.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].

This decision of the Full Federal Court of Australia reversed the decision of Stewart J in CSL Australia Pty Ltd v Tasmanian Ports Corp Pty Ltd (The Goliath) [2024] FCA 824 (CMI2530). Stewart J had held that Tasmanian Ports Corp Pty Ltd's (TasPorts') wreck removal claims were limitable under art 2.1.a, notwithstanding that they fell within art 2.1.d, which was subject to an art 18.1 reservation in Australia.

CSL Australia Pty Ltd (CSL) appealed to the High Court of Australia. The central question was whether a claim that answers to both art 2.1.a and art 2.1.d LLMC remains limitable under art 2.1.a, despite Australia’s reservation excluding the application of arts 2.1.d and 2.1.e, or whether the reservation removes such a claim from the limitation regime in its entirety.

Held: Appeal dismissed.

Gageler CJ, Gleeson, Jagot JJ

The Full Federal Court did not err in allowing the appeal. CSL argued that the exercise of an art 18.1 reservation in Australia amounts to the LLMC without arts 2.1.d and 2.1.e, such that a shipowner being able to 'limit their liability in accordance with the rules of' the Convention includes only arts 2.1.a, 2.1.b, 2.1.c, and 2.1.f. Accordingly, on this construction, the question was whether TasPorts' claims fell within the scope of arts 2.1.a, 2.1.b, 2.1.c, or 2.1.f. Their Honours rejected this contention.

Their Honours agreed with TasPorts' construction that although claims may fall within more than one subpara, in so far as a claim is within both art 2.1.a and 2.1.d, the effect of an art 18.1 reservation is that the claim is excluded from limitation under art 2.1 altogether. That does not read down art 2.1.a, or subject that subpara to a gloss not apparent from its text. Rather, effect must be given to the language of art 18.1, which permits a State Party to 'exclude the application' of arts 2.1.d and 2.1.e. On that construction, there was no textual, contextual or historical basis for confining the reservation to claims falling solely within arts 2.1.d and 2.1.e. That conclusion was consistent with the reasoning in the UKSC decision in MSC Flaminia (CMI2640) and the HKCFA in Star Centurion (CMI2253).

Their Honours further held that the UKSC decision in MSC Flaminia did not answer the question to which this appeal gave rise. The significance of that decision confirmed that a claim may fall within more than one subpara of art 2.1, and that the extent to which the Convention expanded upon, and protected rights of limitation, is embodied in its text, which must be given its ordinary meaning in context. By contrast, the decision in the HKCFA in Star Centurion was treated as persuasive in three respects:

• First, on comity within international law, an instrument should have the same meaning for all States which are party to it;
• Second, the conclusion in Star Centurion did not depend on, nor did it conclude that art 2.1.d was an exclusive code for wreck removal claims;
• Third, the exercise of an art 18.1 reservation must be the same for each State Party exercising that right. Where that reservation is exercised, it excludes claims within the respective scopes of arts 2.1.d and 2.1.e entirely.

Their Honours also relied on the Convention travaux préparatoires, which indicated that an art 18.1 reservation was intended to have substantially the same practical effect as the exclusions in art 3, save that the former depends upon the choice of the State Party exercising the reservation. Further, the 1996 Protocol upholds this functional equivalence between arts 3 and 18.1.

In reaching that conclusion, their Honours considered that neither Twitt Navigation (CMI1726) nor art 21 of the Vienna Convention on the Law of Treaties assisted CSL’s construction. Additionally, nothing in the text, context, or purpose of art 18.1 supported limiting the reservation to claims falling solely within arts 2.1.d or 2.1.e. Their Honours emphasised that to accept CSL’s argument would impermissibly introduce a gloss on the text of the Convention.

Gordon, Edelman JJ

Gordon and Edelman JJ agreed that the reservation in art 18.1.a operates on an 'all or nothing' basis. In their Honours’ view, once a claim falls within arts 2.1.d or 2.1.e, it is excluded from limitation under the Convention altogether, regardless of whether it might also be characterised under another subpara in art 2.1. That conclusion was said to be compelled by the text, context, and history of art 18, and to avoid the uncertainty that would follow from treating the reservation as only partially effective. Their Honours likewise regarded this construction as consistent with the approach adopted by other State Parties and with the reasoning of the HKFCA in Star Centurion, the UKSC in MSC Flaminia, and the decision of the SC of the Netherlands (the Hoge Raad) in The Wisdom (CMI160).

Their Honours further rejected any suggestion that art 18.1.a should operate in a materially different manner from art 18.1.b, observing that the travaux préparatoires supports the view that reservations under art 18.1 function, in practical terms, as optional exclusions from limitation.