Analysis on the Civil Liability of Third-Party Ship Management

Abstract

Third-party ship management is the management of ships by professional companies independent of shipowners and charterers. It is the result of the mature development of the international shipping industry and the refinement of the division of labor in the industry. Since its emergence in the 1950s, it has played an increasingly important role in improving the flexibility of ship operations, reducing ship operating costs, and improving the level of professional services. In China, it has only been about 21 years since the first ship management company was born, and the whole industry is still in the process of exploration. The relevant legal provisions are not sufficiently clear. Theoretical studies on ship managers have also focused on management strategies and less on civil legal liability. To better understand the legal liability of ship managers, this paper identifies the concept and characteristics of ship managers based on the fundamental theories of civil law. The civil liability of ship managers is discussed in terms of breach of contract, tort, and contract negligence, taking shipping practice and standard agreements into account. According to the different legal provisions and judicial practice, it is proved that the liability of ship managers is becoming increasingly strict. They must be partially responsible for the safe and proper operation of the ship, and the legal status is not only as of the shipowner's agent. The paper also analyses the situations where the ship manager may not benefit from the limitation of liability and suggests that this should be considered in the management agreement or legal regime.