By Anne Legars
After the Torrey Canyon (1967), Arrow (1970) and Irving Whale (1970) oil pollution disasters, the public demanded greater accountability for polluters whose ships caused oil pollution. At the time, there was no adequate mechanism to ensure victims of oil pollution would be compensated. This led to the creation of the Marine Pollution Claims Fund (MPCF), which was essentially a fund of last recourse.
In 1989, legislative amendments changed MPCF into the Ship-Source Oil Pollution Fund (SOPF), making it a fund of first and last recourse for the victims of oil pollution damage from ship sources in Canadian waterways (including Canada’s Exclusive Economic Zone), and aligning the Canadian regime to international conventions.
Based on the “polluter pays” principle, SOPF is an ‘’access to justice’’ option – in addition to the regular court system – for victims of ship-source oil pollution. Where SOPF had paid compensation to claimants for pollution damage caused or preventive measures taken, the Administrator is obligated to take all reasonable measures to recover that payment from the shipowner or any other responsible party. Oil shippers and receivers, not shipowners, made the original contributions to the Fund. However, no demands for contributions have been made since 1976 as the Fund is fully capitalized.
This year, the Fund is celebrating thirty years of compensating victims of oil pollution. Thirty years after its founding, it is worth taking stock and looking back at what has been accomplished, as well as consider recent and upcoming developments:
Over 400 claims have been submitted to the Fund and over $26 million in compensation has been paid to Canadian claimants. In addition, almost $12 million was paid by the International Oil Pollution Convention (IOPC) Fund after the sinking of the tanker Rio Orinoco in 1990 off Anticosti Island.
The claims portfolio itself demonstrates the value of the Fund as a means to cover the cost of oil pollution response: 23 per cent of claims have been caused by “mystery” spills and 80 per cent of the amounts paid over the last decade have been for pollution damage caused or preventive measures taken in relation to derelict or abandoned vessels.
Attempting to uphold the “polluter pays” principle, the Administrator of the Fund has been involved in 46 court cases, with increased efforts being made to recover from polluters in the last three years. During that period, $2.3 million was recovered in and out of court, and twenty actions were filed.
As the lead federal agency for marine oil spill cleanup, the Canadian Coast Guard (CCG) has been the largest claimant of the Fund, accounting for more than sixty per cent of the claims received by the Fund. However, an increase in diversity of claimants has been noted in the past few years. More than ever, the Administrator is prioritizing outreach to increase access to justice to less frequent claimants bearing the brunt of oil pollution, such as harbours and ports, local governments, businesses, and Indigenous communities.
The governing legislation was amended several times, incorporating more and more international conventions and aligning it closer to the international regime, while also including some new CCG-specific provisions.
In December 2018, legislative amendments introduced a simplified, fast track “Small Claims Process” for claims under $35,000, which will provide payment of eligible claims within 60 days. The Fund’s per incident liability cap was removed, thereby allowing unlimited compensation following an incident. In addition, the Administrator of the Fund can now provide emergency funding to CCG for its response operations in exceptional situations.
At the same time, the Office of the Administrator of the Fund is engaged in a continuous improvement process and is open to questions and challenges from the public about its claims management process. The Administrator considers stakeholder engagement as the best way to ensure that the Fund is and remains relevant and efficient to provide access to justice.
In view of the recent legislative amendments, this anniversary year offers a perfect opportunity to engage the Fund’s stakeholders in this conversation, to ensure that this alternative access to justice option is known and understood by stakeholders, and that it is accessible and user-friendly for claimants, while remaining fair and reasonable for the ultimate responsible party.
Anne Legars has served as Administrator of the Ship-source Oil Pollution Fund (SOPF) since May of 2016. Over the past 25 years, she has worked extensively on maritime, transportation, environment and trade files, issues and policies as a lawyer, a trade association representative, and head of organizations. Anne Legars is a member of the Quebec Bar. She holds a Bachelor’s Degree in Political Science from Institut d’Études Politiques de Grenoble, France. She also holds a Bachelor, a Master and a Post-graduate Degree in Law from Université de Grenoble II, France, as well as a Bachelor in Law equivalency and a LL.M. from Université de Montréal. She is also a Certified Association Executive (CAE).