PANAMA Law and Practice Contributed by: María Teresa Diaz, Nadya Price and Joaquín De Obarrio, Patton Moreno & Asvat
2.4 Procedure and Requirements for Establishing a Limitation Fund Constitution of the Limitation Fund The constitution of the limitation fund for the payment of claims is subject to the following rules. • Any person alleged to be liable may consti - tute a fund with the court or other competent authority in any state in which legal proceed - ings are instituted in respect of claims subject to limitation. • The fund shall be constituted in the sum of those amounts set out in the article relating to general limits, and special articles relating to passenger claims, together with interest thereon from the date of occurrence giving rise to the liability under the date of the con - tribution of the fund. • The fund thus constituted shall be available only for the payment of claims in respect of which limitation of liability can be invoked. • The fund may be constituted either by depos - iting the sum or by producing a guarantee which is acceptable and which the court or other competent authority considers to be adequate. In Panama’s Maritime Courts, the guarantees usually accepted are cash (certifi - cate of judicial deposit), cashier’s or certified cheques drawn against banks licensed to operate in Panama, and irrevocable payment guarantees issued by those banks. Parties Entitled to Petition the Limitation of Liability Law 8 of 1982 regulates parties who are recog - nised as having substantive legitimacy or stand - ing to limit the liability of the claims described in said law. The rules contained therein are in essence the same rules contained in Article I of the 1976 Convention on Limitation of Liability for Maritime Claims.
In this respect, Law 8 of 1982 establishes that ship-owners and salvors have standing to limit their liability arising from the claims described under said law. The different categories of per - sons who have standing and are entitled to limit liability are as follows: • the ship-owner, understood as the registered owner of the vessel, and other parties who may be considered as owners (ie, the char - terer, the manager and the operator of an ocean-going vessel); • the salvor of the vessel, understood as any person rendering services in direct connec - tion with salvage operations; • any persons for whose actions, defaults or neglect the ship-owner or salvor is respon - sible may avail themselves of limitation of liability; • regarding in rem claims, the law establishes that the liability of a ship-owner shall include liability in an action brought against the vessel itself; and • any insurer of liability for claims subject to limitation in accordance with Law 8 of 1982 shall be entitled to benefits to the same extent as the assured themselves. It should be noted that Law 8 of 1982 clearly states that the act of invoking limitation of liabil - ity shall not constitute an admission of liability. Limitation of Liability Fund Calculation Law 8 of 1982 establishes that the liability limits for claims (excluding the claims of passengers) will be calculated as discussed here. In respect of claims for loss of life and personal injury, the following applies. • 333,000 units of account for a vessel with a tonnage not exceeding 500 tons.
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