87
vant or determinative. I do not mean to impugn in any way the good faith of anyone
associated with the Panama Canal Commission, but rather to call attention to the
fact that the system currently utilized is alien to the American system of jurispru-
dence.
The current statute, therefore, lacks essential fairness because it differentiates be-
tween "in lock" claims and "out of locks" claims. With respect to the former an
administrative and judicial remedy to resolve those claims is provided while as to
the latter the Panama Canal Commission is stripped of its decision making function
and no judicial remedy is afforded.
Although the Board of Local Inspectors performs the same function in both types
of claims, the elimination of settlement authority and judicial review in "out of
locks" claims prevents a claimant from presenting all relevant evidence to the
Panama Canal Commission to allow a full and fair evaluation of the claim, which
results in a lack of procedural due process, the claimant is deprived of any judicial
remedy.
When the special report from the Commission gets to Congress, the method of
handling it, at least to me, despite the reserch I've done, is unclear. It is entirely
probable that in most cases the report of the Commission will differ from what the
claimant considers fair and equitable, especially given their lack of input into many
of the ciritical steps leading to the report findings and recommendations.
Congreess, with innumerable pressing problems both foreign and domestic should
not be made judge and jury on these routine claims although they are of immense
importance to the individual claimants.
I submit that common fairness dictates that the normal judicial process be enlist-
ed to determine and evaluate the "out of locks" claims in the same manner as now
mandated for "in lock" claims. Furthermore, to encourage the amicable resolution
of claims the Panama Canal Commission should be given settlement authority for
all claims involving its employees' actions. If the claim cannot be settled, jurisdic-
tion should be vested in the United States District Court, our traditional admiralty
court, whose experience and capability is clear. This could easily be done by amend-
ing the Panama Canal Act of 1979.
The funds with which to pay such claims should be provided from the tolls paid
by the shipowner users of the Canal. I am informed that any tolls collected exceed-
ing the Commission's budget are paid to the Republic of Panama. There is. no just
reason for doing so until all costs associated with the operation of the Canal, includ-
ing damages to ships and others caused by the fault of Panama Canal Commission
employees, are included. If the tolls were so utilized the taxpayers of the United
States would be the beneficiaries in that the users of the Canal would be paying for
the claims through the tolls collected.
Any amendment to the current situation should be retroactive so as to encompass
the claims arising since passage of the Panama Canal Act of 1979. However, if this
is not possible, another possible solution for existing claims would be to submit
pending disputed claims to the United States Court of Claims under the Congres-
sional Reference Statute (28 U.S.C. 1492 and 2509) for determination. Although
this is not the preferred solution, it would be preferable to the present statute and
in large measure would free Congress from the burden of handling those claims.
I thank you for the opportunity of addressing you today. If you have any ques-
tions, I would be pleased to try to answer them.
Mr. HUBBARD. Thank you for your excellent presentation. We lis-
tened to you with interest knowing your background in admiralty
law and as a law professor at New York Law School. We have no
choice at this point but to stand in recess until about 1:30.
[Whereupon, at 12:45 p.m., the subcommittee was recessed, to re-
convene at 1:30 p.m. this same day.]
AFTERNOON SESSION
Mr. HUBBARD. We finished the comments of Peter, Ernie, and
Harry. It was time for questioning.
Mr. Luciano, you state that you recommend the limit should be
raised on settling outside-the-lock claimants for the Commission.
What do you feel is a realistic limit to put on these claims before
submission to Congress?