12
provision could be drafted in such a way that it would have the
effect of prohibiting stale claims while, at the same time, allowing
the majority of timely claims to be settled without the need of
trial.
The final subject which the subcommittee has asked to be ad-
dressed is the status of those vessel damage claims awaiting sub-
mission to the Congress under section 1415 of the Panama Canal
Act, that is, nonlocks cases where the amount of the claim exceeds
$120,000. Let me preface my remarks here by stating that the first
two such claims (involving the vessels Swan Arrow and Texaco
Connecticut were forwarded to the Office of Management and
Budget [OMB] earlier this year. Clearance by that agency was ob-
tained last month and those claims, along with the Commission's
report and recommendations concerning them, are now before the
Congress.
In addition to those two, the Commission has received 13 more
claims for vessel damage sustained outside the canal locks in which
more than the statutory limit of $120,000 has been demanded.
Three of these appear to have been adequately documented and are
undergoing review in the agency. We expect that review to be com-
pleted soon and the claims to be forwarded to the Congress,
through OMB, in the near future. The remaining 10 claims did not
contain the necessary supporting documentation required to be
submitted to the agency by the Panama Canal Act. The owners
have been requested to provide the missing evidentiary material
and, upon its receipt, the claim-analysis process will be resumed.
Since the Commission cannot predict when the necessary documen-
tation will be provided, we cannot estimate when these claims will
be ready for transmittal to the Congress.
In closing, Mr. Chairman, I would like to state that if this com-
mittee favors amending the Panama Canal Act to provide that the
Commission will adjust and pay all meritorious claims against it
for vessel accidents at the canal, regardless of where they occur or
of the amount of the damages, we would be prepared to provide ap-
propriate legislative language after consultation with other con-
cerned agencies. Such a system was in affect between 1951 and
1979 and was considered to be a just and equitable one.
Mr. Chairman, I thank you for the opportunity to appear before
you today to address this important subject. If you or the other
members of the subcommittee have any questions, I would be
pleased to answer them at this time.
[The full statement of Dennis McAuliffe follows:]
PREPARED STATEMENT OF DENNIS P. McAULIFFE, ADMINISTRATOR, PANAMA CANAL
COMMISSION
INTRODUCTION
Mr. Chairman, members of the subcommittee, I am Dennis P. McAuliffe, the ad-
ministrator of the Panama Canal Commission. I am pleased to appear before you
today regarding claims procedures for vessel damage as they currently exist in the
Panama Canal.
Mr. Gianelli has asked me to expand on his testimony, but before turning to the
points which I have been asked to address, I would like to say a few words about
vessel accidents at the canal in general. With its three sets of locks and its narrow,
twisting, rock-lined channels, the Panama Canal poses perhaps the most difficult
challenge of its kind to safe navigation anywhere in the world. For that reason, the