These proceedings were instituted by the plaintiff following an incident on 27 August 2006, when the defendant vessel MV Coral Water collided with the plaintiff's fish farm in Maltese territorial waters. The plaintiff claimed that it suffered serious damage including, among other things, damage to its fish pens (cages) and other equipment, and more substantially damage as a result of the escape of tuna held in the pens.

The plaintiff filed an action requesting the Court to determine that the collision was caused solely due to the defendant vessel’s gross negligence, to liquidate the damages caused, and to order the defendant to pay the full damages.

The defendant contested the action. The defendant argued that there was no gross negligence, there was no damage, and that in any event, should the Court determine that the defendant vessel was responsible for any damage, it had the right to limit its liability to not more than 1,000,000 SDRs. This right emanated from the provisions of the International Convention on the Limitation of Liability for Maritime Claims 1976 (the LLMC 1976, as amended by the 1996 Protocol) as transposed into Maltese law.

With respect to the issue of limitation of liability, the plaintiff argued that as the MV Coral Water was found to be responsible, it could not be afforded the right to limit its liability in view of the particular facts and circumstances of the case. The plaintiff contended that the master acted grossly negligently, and although no criminal liability was imputed to the master, the plaintiff contended, among other things, that the master should have used large-scale navigational charts as opposed to small-scale ones when navigating through Maltese waters.

Accordingly, the plaintiff contended that the defendant vessel should not be allowed to benefit from the limitation of liability principle. The plaintiff based its reasoning on art 4 of the LLMC 1976/1996 relating to conduct barring limitation which states that '[a] person liable shall not be entitled to limit his liability if it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result'.

With regard to the plaintiff’s submission, the defendant vessel emphasised that in order for the provisions of art 4 to be invoked, two circumstances are required: first, the loss must result from a personal act or omission, committed with the intent to cause such loss. Secondly, it must have been caused recklessly and with knowledge that such loss would probably result. The defendant vessel claimed that the first requirement was not satisfied since the magisterial enquiry had determined that the incident was purely involuntary. With regards to the second requirement, the magisterial inquiry concluded that the incident occurred not through the recklessness of the master and crew, but rather as a result of external factors over which they had no control.

Held: Leaning on the maxim lex specialis derogat legi generali, the Court determined that specific maritime legislation supersedes the general principles of Maltese law relating to principles of culpa aquiliana (tort liability based on negligence) found in the Civil Code. However, the Court noted that it will first determine whether the incident occurred due to the defendant vessel’s gross negligence. If from the evidence brought forward, the Court is satisfied that gross negligence has been proved by the plaintiff, it would then proceed to determine the damages and limitation of liability.

That being said, the Court determined that the alleged incident did not occur due to gross negligence of the defendant vessel, and that this occurred due to the plaintiff’s fault. In view of this, the Court did not determine damages, nor did the Court apply the provisions of the LLMC 1976/1996 to limit them.

[For the successful appeal to the Court of Appeal, see CMI1896.]