Decision ID: 000019

In June 1996 the 1971 Fund Executive Committee recalled that it had at its 48th session endorsed the Director’s view that a claim for environmental damage presented by the Government of Fujairah was not admissible under the 1969 Civil Liability Convention and the 1971 Fund Convention,since it was calculated on the basis of a theoretical model. The Committee noted that the Fund’s lawyer in the United Arab Emirates (UAE) had expressed the view that the claim for environmental damage based on a theoretical formula would not be admissible under UAE law. It was further recalled that the owner of the Seki had entered into a Memorandum of Agreement with the Government of Fujairah, that pursuant to the Memorandum the shipowner had deposited US$19.6 million with a bank in the UAE, that the Government had drawn on the deposit for US$16 million in respect of the claim for envronmental damage and that the Director had reminded the Government of Fujairah of the 1971 Fund’s position in respect of claims for environmental damage. The delegation of the UAE stated that the position taken by the Committee as regards evidence of the loss suffered was not acceptable and expressed the view that compensation should be assessed on the basis of equity if the damage could not be quantified, since otherwise the denial of compensation would lead to injustice. That delegation further stated that it would be for the competent national court to take a final decision and that the Government’s lawyer had expressed the view that such claims would be accepted by the UAE courts. That delegation also expressed the view that the Memorandum of Agreement between the Government of Fujairah and the shipowner was a private agreement and should not therefore be discussed in the Executive Committee.