Limitation funds cannot be used to cover interest claims

Supreme Court judgment 28 June 2018, HR-2018-1260-A, (case no. 2017/2118), civil case, appeal against judgment, The London Steam-Ship Owners Mutual Insurance Association Ltd., The Roc Maritime Inc. c/o Franco & Franco, Cosco (H.K) Shipping Co Ltd. (Counsel Gaute Gjelsten) v. The state represented by the Ministry of Transport and Communication (The Attorney General represented by Ole Kristian Rigland)

Justices: Kallerud, Sverdrup, Bergsjø, Noer, Matningsdal

After an oil spill accident outside of the Norwegian coast, a limitation fund was constituted pursuant to the Maritime Code section 177, cf. section 231 et seq. The fund consisted of a liability part pursuant to section 232 subsection 1 a, and an interest component pursuant to section 232 subsection 1 b. The total claim against the fund, of which the state's claim in connection with the cleanup operation constituted the main part, exceeded the total amount of the fund. The Supreme Court found that only the liability amount pursuant to section 232 subsection 1 a – and not the interest component pursuant to section 232 subsection 1 b – was to be part of the creditors' distribution base. The Court held that the rules on limitation of liability are clear and incompatible with the idea of including the interest component in the distribution base. Other sources of law were partially unclear and suggested no other solution.

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