95
STATEMENT OF RICHARD H. BROWN, JR., ESQ., KIRLIN, CAMP-
BELL, & KEATING, REPRESENTING THE AMERICAN STEAMSHIP
OWNERS MUTUAL PROTECTION, & INDEMNITY ASSOCIATION,
INC.
Mr. HUBBARD. Mr. Brown, we have already had several questions
pile up for you. Before the questions, we look forward to hearing
your testimony and both you and Mr. Beale can know that if you
do summarize, your full text will be entered in the record.
Mr. BROWN. Thank you, Mr. Chairman. I will summarize my
comments and thank you for the opportunity of being here today.
I represent the American P & I Association, which has insurance
coverage for P & I risks which are essentially nonhull risks. They
include personal injury, cargo damage, pollution, things of that
sort. On the subject of insurance which has been mentioned several
times earlier today, there are several things to bear in mind.
First of all, both hull and P & I insurance involve substantial de-
ductibles on the part of the shipowner. The reason for the deducti-
bles is to keep the premium costs down and it is not infrequent
that the deductibles are $25,000 or $50,000 per occurrence.
So there is in those regards a substantial uninsured risk on the
shipowner's part. In addition, ordinarily loss of use of the vessel is
not insured. Loss of use of a vessel and the substantial casualty
may run to several hundred thousand dollars which is usually an
uninsured risk.
As to risks which are insured and covered by an insurance com-
pany, just as in our own automobile insurance, if we have a bad
loss or a bad loss experience, our premiums go up. The same is true
for shipowners. If they have a bad loss record, their premiums go
up.
Therefore, it is a very important point for shipowners and under-
writers that when a casualty occurs that is the responsibility of
some party not insured or not the shipowner, that a recovery be
made against the party who is negligent or whose servant was
negligent.
I think it goes beyond the mere question of insurance and who
pays. I think it is a basic American principle and sound public
policy that a party injured by the negligence of another be compen-
sated by the negligent party for that injury and that is true with
regard to the United States under the Federal Tort Claims Act, the
Suits in Admiralty Act, and so forth.
In connection with Panama Canal operations, it is especially im-
portant, as a matter of principle, that the Panama Canal Commis-
sion be liable for the negligence of a Panama Canal pilot for one
reason which has been mentioned here before:
No. 1, almost unique in the world's waterways, the Panama
Canal pilot is a control pilot, not merely an adviser to the master.
He has control of the vessel from the time he takes it over. There
is a second feature which has not been mentioned which is that if a
pilot is in charge of a vessel, even though not employed by the
owner and that pilot is negligent, the vessel itself is liable to third
parties; so, for example, if ship A and ship B are passing through
the Panama Canal and ship A has a Panama Canal pilot on board
who is negligent, causing a collision with ship B, if there is no re-