The Fund - Content
The Role of the Fund
The Fund may be used as a fund of last resort or of first resort; the choice is that of the claimant.
Fund of Last Resort. The claimant may file a claim against the owner of the ship responsible for oil pollution damage (up to the owner’s limit of liability) and can then submit to the Fund a claim for compensation for damages or for a portion of damages that haven’t been reimbursed to him (this could be due to the fact that the limit exceeded the owner’s liability limit, or because the owner was not financially solvent to compensate the claimant).
Fund of First Resort. The claimant may submit his claim directly to the Fund. The Administrator has the obligation of investigating and assessing the claim. If the claim is established, the Administrator will offer a settlement to the claimant, who will then have 60 days to accept the offer. The Response Organizations (as defined in the Canada Shipping Act, 2001) may not use the Fund as a Fund of First Resort but may use it as a Fund of Last Resort.
When the ship owner is insured, the Fund asks that the claimant first submit his claim to the insurer and to present a claim to the Fund, if the claimant and the insurer are unable to agree within the statutory deadline to submit a claim to the Fund.
Once the claimant has been paid, the Fund is subrogated to the rights of the claimant and the Administrator is obligated to take all reasonable measures to be reimbursed by the ship owner, the insurer or by any responsible third-party.