On 5 March 2012, the tanker Alfa 1, while on its way to bunker a vessel in Elefsis anchorage, collided with the submerged wreck of a passenger vessel and sank. After its sinking, 450 m³ of oil leaked from the tanker, leading to pollution of 24 km of shoreline. The vessel had insurance coverage as required by art 7 of the CLC 1992.

The shipowner immediately contacted a clean-up company and employed it to clean up and restore the environment. The clean-up contractor finished its work on 28 April 2013 and initiated civil proceedings on 1 August 2013, demanding payment of EUR 15,853,962.30 for its services.

In the Multimember Court of First Instance of Piraeus, the IOPC Fund intervened and asked the Court to award the claimant its fees, limited to EUR 3,489,923, or in the alternative EUR 3,824,760. The Court of First Instance decided that the shipowner and insurer were jointly liable and should pay the claimant EUR 14,485,962.30 plus interest calculated from the date of the serving of the civil claim against the defendants. It did not award EUR 1,368,000 from the initial fees claim for the chartering of a tug. It also rejected the intervention of the IOPC Fund.

On 11 October 2016, the IOPC Fund concluded a private settlement with the claimant and paid it EUR 12,000,000. The claimant allocated an equivalent part of its claim against the shipowner and the insurer to the IOPC Fund.

The claimant and the defendants appealed to the Court of Appeal of Piraeus, Shipping Division. The claimant sought to be awarded the full amount of its claim and the IOPC Fund intervened in support. The defendants called for the rejection of the claim, or in the alternative, for it to be limited to 4,510,000 units of account.

Held: The claimant's appeal and the intervention of the IOPC Fund as a third party are upheld. The defendants' counter-appeal is declined. Decision 1943/2015 of the Court of First Instance is annulled. The shipowner and insurer are jointly liable to pay the claimant EUR 15,853,962.30 with interest on the invoices dated 11 January 2021 and 3 June 2013.

The Court of Appeal applied arts 7.1, 7.8, and 7.11 of the CLC 1992 in combination with the provisions of art 9 of Law 314/1976, which ratified the CLC 1969 (amended by Law 2881/2001). Article 9.1 of Law 314/1976 states that the owner of a Greek or foreign vessel or floating structure which arrives at, or departs from, a Greek port or bay or sea terminal and is carrying up to 2,000 mt of oil, or is permanently or temporarily anchored or berthed within Greek territorial waters (without conducting transfers), and its cargo tanks are used for storage or processing of oil in bulk, irrespective of its quantity, is required to maintain insurance or other financial security in the sums equal to at least the limits of its liability, calculated by multiplying its dwt with 600 units of Special Drawing Rights (SDRs), in order to cover its civil liability for oil pollution within Greek territory. It is also required to carry a certificate under art 7.1 of the CLC 1992.

Article 9.2 of Law 314/1976 clarifies that the provisions of the CLC 1992 apply in the case of art 9.1. The Court interpreted this provision as an expansion of the right of third parties to directly bring a claim against the insurer of the vessel as provided for under art 7.8 of the CLC 1992. The Court rejected the insurance company's argument that because the wrecked vessel was carrying less than 2,000 mt of oil, insurance of the vessel was not obligatory, and that the clean-up company could not claim against it directly applying art 7.8 of the CLC 1992.

Articles 5.1 and 5.3 of the CLC 1992 provide that the shipowner must first constitute a liability fund before being entitled to the benefit of limitation of liability against third party claims. Since the shipowner did not constitute a fund, it cannot invoke this limitation.

The price list for the services of the clean-up company was notified before it undertook any cleaning actions on behalf of the shipowner and insurer. The shipowner and insurer agreed in writing to the price list, and did not express its objection to any work or the invoices sent by the clean-up company. The defendants' argument that the claimant asked for excessive charges was declined.

The Court of First Instance wrongly refused to award the amount of EUR 1,368,000 for the chartering of the tug vessel. That amount should be awarded to the claimant.

As to the calculation of interest, the Court of Appeal rejected the Court of First Instance's decision that the payments were demanded from the date of the serving of the civil action against the defendants and awarded the legal interest for the invoices sent to the defendants on 11 January 2011 (EUR 13,313,925.80, EUR 1,049,237.50, and EUR 539,818.50) and on 3 June 2013 (EUR 133,607.50, and EUR 817,373).

[For the partially successful appeal to the Supreme Court, see Aigaion Insurance Co SA v Environmental Protection Engineering SA, Decision 784/2021 (CMI1548).]