An oil leakage from the defendant’s grounded vessel, the MMM Galveston, caused severe damage not only to the surrounding sea but also to the fishery resources of Shandong Province. The plaintiff, Shandong Provincial Oceanic and Fishery Administration, claimed that the defendant shipowner along with its insurer, the West of England Shipowners Mutual Insurance Association, should provide compensation of RMB 30 million plus interest. The two defendants argued that: first, the plaintiff failed to prove that the damage to the fishery resources was caused by the oil leakage; second, the plaintiff had also failed to ascertain the exact amount of the losses.

Held: Plaintiff is entitled to part of the compensation.

Since this is a case which involves oil damage that occurred in China, both Chinese domestic law and the International Convention on Civil Liability for Oil Pollution Damage 1992 (CLC 1992) shall be applied. The relevant evidence, which had been cross-examined and acknowledged by both parties, shows that: first, the damage to the fishery resources was caused by the oil leakage; second, the total cost to restore the natural fishery resources was RMB 14,310,900.

Therefore, pursuant to the relevant provisions of Chinese domestic law and arts 2, 3.1, 5, 6, 7 of the CLC 1992, the plaintiff was entitled to compensation of RMB 14,310,900, the distribution of which, however, would be from the fund for limitation of liability for maritime claims which had been established by the two defendants.