4
inside the locks. If an inside-the-locks claimant disagrees with the
amount offered by the Commission, he or she may sue on the claim in
the United States District Court for the Eastern District of
Louisiana.
Section 1412 of the Act, 22 U.S.C. 3772, provides that if a vessel
is damaged outside the locks, the Commission must adjust and pay those
claims not exceeding $120,000, and again, the award must be reduced by
the contributory negligence of the vessel or its crew. Any claims for
outside-the-locks damage greater than $120,000 must be submitted by
the Commission to Congress, along with a report stating the facts
behind the claim and the Commission's recommendation for settlement.
The Act does not permit outside-the-locks claimants to sue if they are
dissatisfied with the Commission's award--the award is final.
Claims in both categories are barred unless, before leaving the
canal, the damage is called to the Commission's attention and the
Commisson's Board of Local Inspectors (BLI) conducts an investigation.
The Act empowers the BLI to summon witnesses, administer oaths, and
require the production of necessary documentation. The BLI hearing
transcript and findings are admissible evidence in court actions on
claims.
PRIOR LAW
From 1912 to 1951, an appropriated fund agency known simply as the
Panama Canal operated all aspects of the canal except for the
railroad, which was operated by the Panama Railroad Company. During
this period, the liability for inside-the-locks damage to vessels,
cargo, crew, and passengers was the same as it is now. The agency had
authority to pay all claims, without limitation, for damage occurring
inside the locks, and essentially insured all such claims. As for
outside-the-locks damage, from 1912 until 1940 the Panama Canal had no
liability whatsoever--no claims could be filed and sovereign immunity
blocked any legal action for injuries sustained. In 1940, Congress
partially waived sovereign immunity outside the locks, establishing
basically the same scheme that now exists. The Panama Canal was
authorized to pay outside-the-locks claims not exceeding $60,000, and
those over $60,000 had to be submitted to Congress. Still, no suits
could be brought on claims for damage outside the locks. This a pect
of sovereign immunity did not change. Apparently, no claims ove
$60,000 were ever filed during this period, so none was ever sent to
Congress.
In 1951, the Panama Canal Company, a federal corporation, took
over operation of the canal. Since control of the canal was changing
from a federal agency to a corporation, Congress felt that the
company's liability for damages should be comparable to other
corporations. It removed any restrictions on the company's ability to
settle claims and on the company's amenability to suit. Thus, from
1951 to 1979 the Panama Canal Company could settle and pay any claims
against it, sue, and be sued like every other corporation.