INTRODUCTION
An oil spill is an uncontrolled release of crude oil, gasoline, fuel, or any other type of liquid petroleum hydrocarbon. Oil spills became major environmental hazards in the 1960s. Oil spills can pollute the water, air, and land. Although the term “oil spill” most commonly makes people think of spills in the water, like the Deepwater Horizon oil spill in the Gulf of Mexico in the year 2010[1], as well as the Exxon Valdez spill that occurred in Alaska in the year 1989[2], oil spills may happen on land too. Oil spills are very dangerous and may cause serious damage to people, animals, and plants depending on the amount released and the type of oil spilt.
There are many causes of oil spills, including:
- Human error
- Technical malfunction
- Natural disasters like hurricanes and earthquakes
An oil spill may cause an impact on the environment in the short or long term. The longer it is in contact with water, soil or air, the more time hydrocarbons have to contaminate these media. Oil spills in the ocean are harmful to aquatic life because they prevent sunlight from crossing the surface, and further reduces the amount of dissolved oxygen. Birds on the surface, upon contact with oil, lose the insulating properties of their feathers and die of hypothermia. Marshes and mangroves are very often affected negatively by oil spills. Beaches and shorelines once covered in oil lose tourism and economy. The most hard-hit industry in an oil spill is the fishing industry. Fishes, especially shellfish, are often contaminated with oil and unable to breed. The long-term impacts of oils spills are not completely understood because there are many uncertain variables when it comes to oil spills.
This article will discuss further discuss Indian laws applicable to oil spills. It will also discuss liability in case of oil spills.
MAJOR SPILLS IN RECENT HISTORY
The largest accidental oil spill in recent history occurred near the Gulf of Mexico on the 20th of April 2010. It was none other than the BP Deepwater Horizon oil spill[3]. A well drilled by the oil platform and sealed by the concrete cap was blown apart by a surge in natural gas. The gas rose to the rig’s platform, caught fire and spread havoc, killing 11 workers, and injuring 17 others. The platform shortly after capsized and sank[4]. A U.S district estimated that around 134 million gallons of oil were released, and about 2,100 km of the U.S. Gulf coast were covered with oil before the well was capped. In the consequent lawsuit, the oil company BP was held responsible and was ordered to pay $65 billion as compensation to those affected[5].
The biggest spill in India happened off the coast of Mumbai on 7th August 2010, when two vessels MSC Chitra and MV Khalijia collided. The collision caused MSC Chitra to tilt at 80 degrees pouring more than 400 tons of oil in the first few hours out of the total 800 tons that was spilt. This oil spill also severely damaged the mangroves along the coast of Mumbai, Thane, and Raigad districts by reducing their oxygen generating capacity[6].
LIABILITY UNDER INDIAN LAW
Liability for damage caused by oil spills can be divided into three major categories:
- Liability in case of pollution from ships:
At present, the Merchant Shipping Act (MSA) of 1958[7], checks marine pollution and determines liability for oil pollution in India. The Merchant Shipping Act follows various international conventions, for example, the International Convention on Civil Liability for oil pollution damages of 1969, and the International Convention for the prevention of Pollution of Sea by Oil of 1954[8].
Broadly speaking, the Merchant Shipping Act has three parts that primarily deal with oil pollution in India. They are:
- Part X-B, which oversees the civil liability for damage caused by oil pollution,
- Part X-C, which controls the international oil pollution compensation fund,
- Part XI-A, dealing with the prevention and containment of oil spills at sea.
This act applies to every Indian ship, regardless of its location, and every foreign vessel while it is docked at a port or any place in India or within the territorial waters of the nation or any marine territory over which India has exclusive authority to control marine pollution. This act does not apply to warships or ships owned or operated by the state for purposes other than commercial ones.
Under the MSA, part X-B provides liability for damage caused by oil pollution[9]. Generally, the owner of the ship is held responsible for oil pollution damage, “which has escaped or been discharged from the ship as a result of the incident”[10]. According to section 352-I (2), the owner may restrict his liability in any damage caused by the oil spill arising from any incident(s), provided he can prove before the court that the damage-
- “resulted from an act of war, hostilities, civil war, insurrection, or a natural phenomenon of an exceptional, inevitable, and irresistible character; or
- was wholly caused by any act or omission done with intent to cause such damage by any other person; or
- was wholly caused by the negligence or the wrongful act of any government or other authority responsible for the maintenance of lights or other navigational aids in the exercise of its functions in that behalf”[11].
In the case of World Tanker Corporation v SNP Shipping Services Pvt. Ltd.[12], the Supreme Court observed that “whole purpose of limitation of liability was to protect the owner from large claims far exceeding the value of the ship and cargo, which can be made against him all over the world in case his ship meets with an accident, causing damage to the cargo, to another vessel or loss of personal life or personal injury”. Subsection two of section 352-J of the Act further prohibits the owner from limiting liability in cases of negligence.
- Liability for pollution from tanks of vessels:
Liability for tarring of beaches that occurs due to operational discharge of bunker oil from ships or tankers is governed under the International Convention on Civil Liability for Bunker Oil Pollution Damage. The convention requires the owners to maintain compulsory insurance cover and ensures quick compensation to the persons affected by oil spills. It further provides for direct action which allows a claim for compensation of damage against the insurer.
India, however, is not a part of the convention. The only available remedies are general tortuous liability and polluter paying principle along with the MSA to fix liability.
- Liability in case of pollution from offshore installations:
Part XI-A of the Merchant Shipping Act covers offshore installations. It covers the prevention and containment of pollution of the sea by oil and sections 356 (K to M) provide for the containment of accidental pollution while section 356 (O) gives power to the central government to frame rules for the same purpose. Section 356 K of the act allows the central government to take measures to prevent or contain the oil spilt in case the person failed to follow the notice served to him[13]. Under section 356K, part X-B, “any expenditure by the central government due to non-compliance of the person to whom the notice was served may be recovered from them and shall be a charge upon all or any tanker, ship other than a tanker, mobile off-shore installation or off-shore installation of any other type owned by that person or persons which may be detained by the Central Government until the amount is paid”[14]. This ensures that the primary liability of preventing and containing the oil spill lies with the owner, agent, or operator and not the state.
CONCLUSION
Oil spills have horrifying effects on the marine life. A big spill, like the Deepwater Horizon can affect lots of lives, as many people depend on the fishing industry for their livelihood. Apart from the huge loss in business to the fishermen, tourism too is hard hit. One thing that we have learnt from various spills is that international corporation is the need of the hour. We need an effective international regime to contain any spills, as well as make sure that every nation has a contingency plan for future spills. Time and again, we have had much criticism on the limitation of liability. While delimiting liability make sound lucrative, the truth is that strict liability is working well with only minor drawbacks.
India has a huge coastline. A spill like the Deepwater Horizon would wreck the entire economy of the country. The country follows the civil liability rule for oil pollution damage and holds the owner responsible. A change one would like to see here would be to hold both the owner as well as any allied person closely associated with the spill under criminal liability. At present, the Merchant Shipping Act does not differentiate between accidental and operational discharge of oil. This needs to be updated. India relies heavily on marine routes for trading with nations across the world. To preserve these routes, we must ensure that any tragedy like the Deepwater Horizon spill does not occur on our shore. Since we still are a developing nation, any spill would take a heavy toll on our economy.
Author’s Name: Shradha Ahuja
References:
[1] Richard Pallardy, ‘Deepwater horizon oil spill’ (Encyclopedia Britannica), https://www.britannica.com/event/Deepwater-Horizon-oil-spill Accessed 13th September 2021
[2] The editors of Encyclopedia Britannica, ‘Exxon Valdez oil spill’ (Encyclopedia Britannica) https://www.britannica.com/event/Exxon-Valdez-oil-spill Accessed 13th September 2021
[3] Richard Pallardy, ‘Deepwater horizon oil spill’ (Encyclopedia Britannica), https://www.britannica.com/event/Deepwater-Horizon-oil-spill Accessed 13th Sep 2021
[4] Oil spills (National Oceanic and Atmospheric Administration), < https://www.noaa.gov/education/resource-collections/ocean-coasts/oil-spills> Accessed 13th Sep 2021
[5] John P. Rafferty, ‘9 of the biggest oil spills in history’ (Encyclopedia Britannica) < https://www.britannica.com/list/9-of-the-biggest-oil-spills-in-history> Accessed 13th Sep 2021
[6] ‘Mumbai oil spill continues, 300 containers tumbled into water so far’ (The Times of India, 9th Aug 2010) < https://web.archive.org/web/20110811095808/http://articles.timesofindia.indiatimes.com/2010-08-09/mumbai/28319409_1_oil-spill-msc-chitra-cargo-ships> Accessed 13th Sep 2021
[7] https://legislative.gov.in/sites/default/files/A1958-44.pdf
[8] Puneet Rathsharma, ‘Oil Spill Liability and Responses under Indian law: Time for an Integrated Regulatory Framework?’ (Indian Journal of Projects, Infrastructure and Energy law, 2nd Sep 2021) < https://ijpiel.com/index.php/2021/09/02/oil-spill-liability-responses-under-indian-law-time-for-an-integrated-regulatory-framework/> Accessed on 14th Sep 2021
[9] Puneet Rathsharma, ‘Oil spill liability in India and responses under Indian Law: Time for an Integrated Regulatory Framework?’ (Indian Journal of Projects, Infrastructure and Energy Law, 2nd Sep 2021) https://ijpiel.com/index.php/2021/09/02/oil-spill-liability-responses-under-indian-law-time-for-an-integrated-regulatory-framework/ Accessed 14th Sep 2021
[10] The Merchant Shipping Act 1958, s 352 (I)
[11] The Merchant Shipping Act 1958, s 352 (I)
[12] World Tanker v SNP Shipping Services Pvt. Ltd. AIR 1998 SC 2330
[13] Saadiya Suleman, ‘Oil spills: Law on liability with special reference to the Indian regime’ 4BLJ 2011(1) 48 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2044827 Accessed on 14th Sep 2021
[14] The Merchant Shipping Act 1958, s 356K.
