Transport Committee on April 21st, 2009

[Mark Gauthier]

Mr. Gaudet, I would answer that a maritime lien continues to apply even if there is a transfer of ownership. That is one of the characteristics of a maritime lien. That does not apply to other types of claims. If the maritime lien is legitimate and can be proven valid, whether a vessel is sold during a trip is of little importance. The maritime lien continues to apply to that vessel.

[Roger Gaudet, Bloc, Montcalm, QC]

Are you sure that things would be that easy, even in international waters? The fact that some vessels have to be seized clearly shows that there is a problem.

[Mark Gauthier]

I am not saying that it is always easy to do, but I can tell you that the legislation permits it. Of course, a ship has to come to port. It is unlikely that it would be seized on the high seas.

[Roger Gaudet, Bloc, Montcalm, QC]

What are some of the concerns from the legal community?

[Mark Gauthier]

According to the Canadian Maritime Law Association, the maritime lien is designed rather broadly in order to protect suppliers. According to them—and I say "them" because they of course represent their clients—it could happen that supplies were not ordered by the ship's owner or agent, but rather by a charterer or someone else. Under those conditions, the ship would be subject to the maritime lien. This is one of our concerns. I also believe, as my colleague Mr. Rysanek indicated, that by introducing a maritime lien for suppliers in Canadian law, we are moving away somewhat from international law, but are closing the gap with the situation in the United States. That is at the heart of most of the problems. At the Port of Montreal, if a ship is put up for sale by order of the Federal Court, American suppliers get paid before everyone else, and Canadian suppliers might not be paid back their receivables. We must re-establish a certain fairness between the situation in Canada and that in the United States.

[Roger Gaudet, Bloc, Montcalm, QC]

That said, I would like to ask you a question about something that has come to mind. At the time of the Exxon Valdez oil spill, off our coasts, why were the persons responsible judged in the United States? It appears that the American justice system takes precedence over the Canadian system to establish our regulations and laws.

[Mark Gauthier]

The section we are dealing with is limited to the provision of services to ships. It does not address the issue of pollution, which is already covered by other parts of the act. Mr. Rysanek did refer to that earlier.

I am quite familiar with issues of pollution and would add that if pollutants reach Canadian waters, regardless of their origin, Canadian legislation would apply. I cannot affirm whether or not the Exxon Valdez entered Canadian waters, but I would tend to believe that it did not.

[Roger Gaudet, Bloc, Montcalm, QC]

The Exxon Valdez tragedy occurred in Alaska, in a Canadian zone. Earlier, you yourself, said that the case was heard in the United States. It appears that the settlement was not satisfactory. That is simply an observation.

As for the enforcement of the regulations, will the coast guard be in charge, or will you hire new officers?

[Jerry Rysanek]

It is the ship inspectors as well as the coast guard, particularly the vessel traffic management, which is responsible for verifying the existence and validity of a number of certificates a ship has to have in order to operate in Canadian waters. It will be an added responsibility to verify that they also have their insurance certificate.

Failure to produce an insurance certificate attracts all kinds of penalties, which are set out in the legislation.

[Roger Gaudet, Bloc, Montcalm, QC]

Thank you, Mr. Chair.

[The Chair, Conservative, Merv Tweed]

Mr. Watson.

[Jeff Watson, Conservative, Essex, ON]

Thank you, Mr. Chair.

Thank you to our witnesses for appearing and for the tremendous level of detail in the answers here, so much so that I think I'm now swimming in a lot of detail. Let me just take a few steps back and make sure I understand this.

Let me just start with a general question first, drawing your attention to the slide on page 9, compensation for oil pollution in Canada. Who gets compensated? Is it the Government of Canada, for example, for cleaning up a spill? Is it for businesses that are harmed, say fishermen or others? Is it for communities that are harmed? Who exactly gets compensated by these various funds?

[Jerry Rysanek]

There is no limitation on who gets compensated. Compensation is available to both public and private claimants. Public claimants could be governments, civil authorities, and so on. In terms of private claimants, it could be any party that suffered pollution damage, including fishermen. History shows, if I look at some of the international claims, that fishing claims are some of the biggest claims filed for pollution damage.

[Jeff Watson, Conservative, Essex, ON]

And all of those claims together can't exceed the limits of the liability. Is that correct?

[Jerry Rysanek]

At the moment, where we have legislation today at $500 million per incident, compared to some of the spectacular cases in Europe, it would not be enough to cover the claims of incidents.

[Jeff Watson, Conservative, Essex, ON]

That wasn't the thrust of the question, whether it was enough. What I'm suggesting is that when we set maximum liability, that's supposedly to cover all claims. That's not per claim?

[Jerry Rysanek]

It should be enough for all the claims.

[Jeff Watson, Conservative, Essex, ON]

Okay. So if I understand it correctly, there are three tiers of coverage under current law for these. There's the International Convention on Civil Liability for Oil Pollution Damage, 1992, correct? That's the ship owners' liability.

[Jerry Rysanek]

Yes.

[Jeff Watson, Conservative, Essex, ON]

The second is the International Oil Pollution Compensation Funds. Is that also by an international convention in 1992?

[Jerry Rysanek]

Yes.

[Jeff Watson, Conservative, Essex, ON]

Who administers that, by the way?

[Jerry Rysanek]

It's the International Oil Pollution Compensation Funds, which is an organization established in London that has the responsibility, under the convention, to administer and pay claims.

[Jeff Watson, Conservative, Essex, ON]

The third one is a domestic fund under Transport Canada, the Ship-Source Oil Pollution Fund?

[Jerry Rysanek]

Yes.