The Second Circuit Court of Appeals has ruled that an American ship classification society, the American Bureau of Shipping (ABS), was not liable to Spain for environmental damages that occurred when a tanker it had certified sank off the coast of Spain. Reino de España v. Am. Bureau of Shipping, Inc., No. 10-3518 (2d Cir. 8/29/12). The case involved the tanker Prestige, which had been classified by ABS throughout its working life and sank in November 2002, releasing oil that washed onto the Spanish coastline.
Spain asserted that ABS should have detected the structural problems that caused the ship to sink during ABS’s inspection in April and May 2001. In light of prior law limiting liability of classification organizations to ship owners for ships that sink, Spain conceded that ABS would not be liable if it had been merely negligent. Spain asserted, however, that ABS had been reckless in its inspection and therefore would be liable for damages resulting from the sinking. The district court granted ABS’s summary judgment motion, ruling that it owed no duty to coastal nations like Spain unless a pre-existing relationship between them would support finding such a duty.
The Second Circuit affirmed, but on a different basis. Confirming that U.S. maritime law applied to the case, the appellate court analyzed Spain’s evidence of ABS’s recklessness and concluded that no reasonable jury could find ABS reckless in undertaking a classification survey, i.e., inspection, that conformed to the rules applicable at the time of the survey. Thus, assuming for purposes of argument that ABS owed Spain a duty, the the Second Circuit held that no reckless breach had occurred and that ABS must prevail.