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mentary support for related, recoverable elements of these claims (such as drydock-
ing costs, charges for marine surveys, and loss of use) take more time.
These built-in delays notwithstanding, the Commission is constantly seeking ways
to improve all of its services to world shipping, and the field of claims settlement is
no exception. We would welcome any suggestions from the shipping community as
to how, within the parameters of the statutes under which we must operate, our
services in this area might be improved. I do feel, however, that we are presently
doing a good job here and we will continue to do so.
In closing, Mr. Chairman, I would like to state that if this committee 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
appropriate legislative language after consultation with other concerned agencies.
Such a system was in effect 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 ad-
dress 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.
Mr. HUBBARD. Thank you very much.
This first question is to both or either of you: according to Com-
mission accounting procedures, $6 million dollars per year is col-
lected in a reserve fund to pay for the locks claims exceeding
$120,000. Could you please inform the subcommittee on the lower-
ing effect of the tolls should the $6 million dollars not be collected
or how would this lower the tolls?
Mr. McAULIFFE. All told, the amount of money set aside for acci-
dents amounts to approximately 3.7 percent of the total revenues
collected; so, therefore, a savings of about one-half of that might be
passed on if that class of accident were not collected for.
Mr. HUBBARD. Mr. Gianelli, do you have anything to add?
Mr. GIANELLI. No.
Mr. HUBBARD. When the Panama Canal Agency was the appro-
priated fund agency from 1912 to 1951, did the agency have a re-
serve fund even though no claims over $60,000 were submitted to
Congress during that time?
Mr. McAULIFFE. No, sir, there was not such a fund.
Mr. HUBBARD. What, prior to the enactment of Public Law 96-70,
was the average time lapse for claims over $120,000 from the date
of accident until the settlement of the claim?
Mr. GIANELLI. Mr. Chairman, we do not have the precise aver-
ages for the types of claims you have indicated. There are so many
imponderables relating to claims that it is difficult to judge precise-
ly how rapidly a claim can be completed after all of the review
process. Having spent a considerable amount of time going over
claims as well as the procedures that we use for the processing of
claims, it is my opinion that the time for processing claims now is
substantially the same as it was prior to the treaty.
Mr. McAULIFFE. Mr. Chairman, may I add a little bit to that?
One of the problems with respect to processing the claims is that
there is such a wide variation in the way that the facts are pre-
sented. For example, a number of ships that might have some sort
of claim will not actually file the claim, the final claim with all the
documentation for example, until such time as the ship might be
serviced for other reasons. So you might have a considerable period
of time before you can really get an exact handle on what the
amount of the damage would be.