In 1963 there was a collision between three ships (including the Abadesa) in the River Scheldt causing damage to the ships and their cargo. In 1966, the owners of the Abadesa commenced an action to limit their liability for the damage caused by the collision.

On 18 November 1967, the value of the pound sterling dropped. This was followed on 22 November 1967 by the Merchant Shipping (Limitation of Liability) (Sterling Equivalents Order) 1967 (the 1967 Order), the effect of which was to increase the limitation amount in GBP. In February 1968, the Admiralty Registrar held that the limit of the plaintiff’s liability was GBP 333,855, 14s, 5d based on an equivalent of GBP 27, 13s per 1,000 gold francs.

The owners and cargo interests of the Abadesa (the plaintiffs) appealed on the basis that the 1967 Order should not apply retrospectively, and that where damages were to be calculated in a currency other than GBP, the appropriate date to calculate the conversion was the date when the damage occurred. The Merchant Shipping Act 1958 (which gives domestic effect to the Convention on the Limitation for Maritime Claims 1957 (the LLMC 1957)) contains nothing to show that it is intended to apply retrospectively.

The defendants submitted that art 3.1.b of the LLMC 1957 substitutes gold francs for GBP for the purpose of calculating the limit of liability, the value of the equivalence should be applied by the Court at the time when the limit falls to be determined, which is what the Registrar did.

Held: Appeal dismissed.

Article 3.b of the LLMC 1957 is embodied in s 1 of the Merchant Shipping Act 1958, which gives the Court power to assess the limit of liability in GBP at the rate of gold francs in force at the time when the party seeking limitation comes before the Court. The correct method of dealing with both the statutory instruments (the 1967 Order and the earlier 1958 Order) is to treat them as procedural and not legislative. That is, each instrument is directed at stating only the rate of conversion into gold francs at the time the instrument was made. This means in this case, that the Admiralty Registrar should have applied the 1967 Order at the time he made the decree of limitation on 21 February 1968. This he did, and therefore the plaintiffs' appeal must fail.