Web alert: new Court of Appeal decision considers relationship between Athens Convention and contribution claims

In The South West Strategic Health Authority v. Bay Island Voyages [2015] EWCA Civ 708, the Court of Appeal was asked to determine whether the two year time bar under Article 16 of the Athens Convention would apply to a contribution claim brought by the employer of a passenger, against the carrier under the Civil Liability (Contribution) Act 1978 (“the 1978 Act”).

The claimant was a passenger aboard a vessel and was participating in a team building exercise arranged by her employer, The South West Strategic Health Authority (“SWSHA”). During this exercise she was injured and her solicitors commenced proceedings against the carrier, Bay Island Voyages (“BIV”). Unfortunately the claimant’s solicitors failed to comply with the two year limitation period under the Athens Convention and the claimant’s claim was held to be time barred.

As a result the claimant then commenced proceedings against her employer, SWSHA, on the basis that she was injured during the course of her employment. In response, SWSHA issued a contribution claim against BIV under the 1978 Act. BIV argued that the claim against them was time barred under the Athens Convention. At first instance the Court agreed with BIV, however, SWSHA appealed to the Court of Appeal.

The Court was asked to consider two questions. Firstly, whether the Athens Convention (particularly Article 14) governed contribution claims against the carrier. Secondly, the Court was asked to consider whether the application of the limitation period under Article 16 extinguished a cause of action entirely, or instead whether it barred a remedy (in other words left the underlying right to bring a claim intact). The subtle distinction was important as a claim by SWSHA could only be brought under the 1978 Act if the underlying cause of action was not extinguished.

The Court of Appeal (Tomlinson LJ giving judgement) held that in respect of the first question, the Athens Convention dealt only with claims as between passenger and carrier. In light of this it was found that a claim for a contribution was unaffected by the provisions of the Convention.

In terms of the second question, it was held that the two year time bar in Article 16 related only to the remedy (i.e. the legal action for damages brought by the passenger) and did not extinguish the claim itself. The Court found that the language used in the Convention supported this view and was designed only to restrict the remedy available to a party, but not the claim itself.

The appeal was allowed and SWSHA was therefore able to proceed with its claim against BIV under the 1978 Act, even though the claim had been brought outside the two year limitation period.

As a consequence of this decision it now seems possible that a carrier could still face a claim after the two year limitation period under the Convention has expired, and specifically if a claim were to be brought by a third party as a contribution claim under the 1978 Act. Whilst the likelihood of this occurring is relatively slim and would require the involvement of a third party employer, (or in a similar vein a local education authority, or primary healthcare trust) to whom a claim could be brought against in the first instance, it is certainly a possibility.

Members should therefore be mindful of this decision if responding to claims in England and Wales which would be governed by the Athens Convention, and particularly if it appears that a claim has been brought outside of the two year limitation period.

The full text of the decision of the Court of Appeal can be found here.