HELIOS RUEHLS MARINE DIVISION PRESENTS THE ISM

INTRODUCTION TO THE ISM CODE FOR LAWYERS: 

INITIAL CLASS MEETING HAND OUT

(C) 2019 by Helisos Ruehls , Inc.

PHOTO CREDIT MUHAMMAD MAHDI KARIM VIA WIKIMEDIA COMMONS

Image PD Clipper ship

The following was originally prepared as a class hand out for a formal CLE class offered by Helios Ruehls Marine Division

THE PRESENT LEGAL REGIMES FOR LIMITATION OF LIABILITY, AND CORPORATE LIABILITY, AND CULPABILITY WHICH CRYSTALLIZED IN THE 19 CENTURY ARE FOREVER CHANGED BY THE ADOPTION OF THE INTERNATIONAL SAFETY MANAGEMENT CODE (ISM).
Before the ISM was adopted by international convention marine accident investigators and other forensic experts involved in modern shipping were introducing changes in the findings of causation into global admiralty courts. No longer believing in "proximate cause" alone as a basis for determining post accident liabilities or culpability testifying navigational experts began to explain the "Causation matrix". Under the old system ship owners were allowed to limit their liability in the wake of an accident to usually the value of the hull post accident (often nothing); and it was almost unheard of for a shore based owner or manager to be charged criminally in the wake of an accident.ISM imposes a new general duty on everyone from deckhand to CEO, or owner. That new collective duty is to 'develop a corporate culture of safety. While anyone in the causation matrix may be charged under the code; the code is very clear that this culture of safety begins at the top of the corporate organization. The code also provides the legally trained reader with many useful details in how to establish this 
Culture of Safety in such a way that it can withstand administrative / regulatory scrutiny. A serious "good faith" effort at adhering to the Code may not bring about a classic limitation of liability but it should keep corporate officers out of jail and reduce fines. Limitation of the old style is still technically possible, but ever increasing unlikely. Every maritime personal injury lawyer;every maritime insurance defense lawyer , and certainly every maritime corporate counsel should set about becoming an expert in the ISM Code. Indeed the Code's management / inspection system creates a position of auditors, some are corporate employees, others are Classification societies , at at least one must be neither an employee of the shipping company nor connected to the relevant classification society. We think this position would best be filled by an admiralty lawyer well versed in the `ISM Code and related US law. Such an arrangement provides the ship owner and managers with prevent advice that may prevent trouble. The participating lawyer receives the opportunity to present his services as more than a litigator, but as a counselor. 

WHAT IS THE ISM CODE?

The "ISM" Code refers to the "International Safety Management Code" promulgated by the International Maritime Organization (IMO) of the United Nations. It is a detailed code of safety management that describes how vessel owners, operators and management are to "establish a culture of safety" in ship operations.

DOES THE ISM CODE HAVE THE FORCE OF LAW IN THE UNITED STATES?

Yes, internationally it is an outgrowth of the Safety of Life at Sea (SOLAS) Convention, a

multilateral maritime safety treaty that the United States is signatory to. This convention was amended starting in the late 1990s and continuing into 2017, and anticipated to be periodically amended beyond, to provide for a code that the current and anticipated future ICM Codes model. By our last count in addition to the United States 63 other seafaring nations representing approximately 99% of the world's shipping by tonnage are signatory to the convention and are actively engaged in enforcement of the code. By virtue of the US

Constitution, such international treaties as the U.S. is signatory to are part of the "law of the land". In addition, the U.S. has adopted most elements of the treaty into statutory law and detailed regulation. The U.S. adopts most of the "code" by Federal Statute at 46 USC 32013205 and detailed Coast Guard enforced regulations may be found in 33 CFR Part 96 Subpart D. The U.S. Coast Guard is the "Responsible Administration" as suggested in the Code. However, the USCG relies mostly on its "Trusted Agent" the American Bureau of Shipping (ABS) for the day to day administration of the Code including issuance of the various "documents of compliance" and the routine performance of certain of the required "third party audits" of the ship owner's resulting Safety Management Program.

NOTE: It may be useful at times to be able to cite to the elaborate history of the Code's development much as it is occasionally desirable to bring into pleadings and memorandums in support, the legislative history of a statute or the evolutionary process of detailed regulations. The vocabulary and citation system of the IMO and its related Marine Safety Committee (MSC) are different from, but bears some similarity to the American system of legal citation. A few noteworthy points follow:

1. Adoptions by the IMO Assembly are a bit like the enabling statutes in U.S. admiralty law that direct the U.S. Coast Guard (USCG) to promulgate detailed safety related regulations. The sub body that the IMO Assembly usually addresses is their own MARINE SAFETY COMMITTEE (MSC). The MSC generally does the work of generating technically detailed codes. The IMO Assembly sometime also addresses national governments and their maritime safety administrations or agencies in a general way advocating state action in pursuit of compliance with IMO/ MSC generated safety codes. Adoptions by the IMO Assembly are cited by the letter "A" followed by a numeric part and section identifier. An example of an Assembly citation would be "A.596 (15)" which called on the MSC to develop guidelines for shipboard and shore based management to ensure safe operation of RoRo ferries. Marine Safety Committee "resolutions" are often reflected in resulting nation state detailed regulations verbatim. An example of an MSC Resolution citation would be MSC. 353 (92) which describes amendments entered into force for the Code on 1 January 2018.
2. THE ISM CODE is codified "International law" and has been adopted into statute and regulation by most of the 63 nations signatory to the SOLAS Convention.

OBSERVABLE RESULTS OF THE WIDE SPREAD INTERNATIONAL ADOPTION OF THE CODE:

1. While not a lot of case law and related precedent has emerged yet,(Feb.3,2020) There is an observable trend towards the Code being an instrument for defeating actions in limitation of liability. The requirement of the Code for ship owning /operating companies to create a "culture of safety" has a natural inhibiting effect on the ability of management and owners to claim that an accident was due to actions or conditions "beyond the "probity and knowledge" of the owner.
2. There is a growing trend in the U.S. and internationally to hold various levels of management individually civilly liable and / or criminally culpable for a growing number of accidents.

IS THERE A CONCISE GUIDE TO THE ISM CODE AVAILABLE IN PRINT?

"THE ISM CODE, International safety Management Code With Guidelines For

Implementation (last edition at this writing 2018) ,

IMO Publication Sales Number: ID117E

ISBN Number (978-92-801-1696-0

This is an 84-page complete guide including citations and many direct quotes from the code meant as a hand book for all those involved in the Code compliance effort. REMEMBER THAT THE CODE FOR MANAGEMENT DOES NOT CONTAIN MUCH IN THE WAY OF EQUIPMENT RELATED TECHNICAL DATA. THE REQUIRED SYSTEM IS A MANAGEMENT SYSTEM SUBJECT TO FREQUENT PERIODIC PERFORMANCE AUDITING.

LAWYERS HAVE A ROLE TO PLAY IN THE DEVELOPMENT OF EACH CORPORATE CODE AND SUBSEQUENT PERFORMANCE AUDIT PROGRAMS. THE CODE MUST

BE DESIGNED WITH "DUE DiLLlGENCE" IN MIND. SHOULD DUE DILLIGENCE BE FOUND WANTING SUBSEQUENT TO AN ACCIDENT; PROVING A GOOD FAITH

EFFORT MAY BE THE DEFENSE THAT REDUCES JUDGEMENT AMOUNTS OR

CRIMINAL PENALTIES IMPOSED. 02019 Inc

OBSERVATION: Both the ISM Code and U.S. detailed regulations require periodic corporate internal and third party ISM program performance audits. The ABS offers services for most of these but THE ABS is the compliance document issuing authority. The convention provides at article 2.3:

"Any organization performing verification of compliance with provisions of the ISM Code should ensure that the personnel providing consulting services and those involved in the certification procedure are independent of one another. " [See MSC. 208 (81)].

Admiralty lawyers aren't quite in a compliance market for their services relative to the code but they can cite to the above section in soliciting counseling roles at both the original design of the corporate Code compliance system and during the continuing auditing processes. THE CODE IS ABOUT  "DUE DILIGENCE" and that is the only thing that will keep corporate income intact and managers out of prison in the wake of serious, especially death dealing accidents. In the event that due diligence is found wanting in a particular instance A GOOD FAITH EFFORT appears to have an effect in reducing the severity of consequences for managers.

HELIOS RUEHLS. INC. MOST URGENTLY SUGGESTS TO ALL SHIPPING COMPANY EXECUTIVES AND MANAGEMENT TO BRING SKILLED ADMIRALTY LAWYERS FAMILIAR WITH THE CODE INTO THE EARLY PLANNING STAGES AS COUNSELORS AND TO CONTINUE TO BRING THEM INTO THE CORPORATE INTERNAL AUDITING PROCESSES AT LEAST ANNUALLY.

AT PRESENT THE ISM APPLIES UNDER AMERICAN LAW AND REGULATION DIRECTLY TO LARGE SEAGOING AMERICAN FLAG SHIPS. HOWEVER THE "SUB CHAPTER M" NEW REGULATIONS FOR THE AMERICAN TOWING INDUSTRY INCLUDING INLAND OPERATIONS REFLECTS THE KEY CONCEPTS THAT WE ITALICIZED  IN THE TEXT. MORE OVER WE ARE STARTING TO SEE SUCH LANGUAGE  APPEARING IN DISTRICT COURT DECISIONS. REWRITING OF REGULATIONS AND COURT PRECEDENT ARE EXPECTED TO DRIVE THE CONCEPT OF A CORPORATE CULTURE OF SAFETY ACROSS TH ENTIRE AMERICAN SHIPPING INDUSTRY INCLUDING EVENTUALLY THE DOMESTIC TOWING AND OFF SHORE SERVICE VESSEL 

THE INTERNATIONAL SAFETY MANAGEMENT CODE FOR LAWYERS

LESSON PLAN 1 : INTRODUCTION

OBJECTIVES:

1. To impart to the student, an understanding of the relationship of the

International Safety Management Code (ISM Code) to the International Maritime Organization (IMO) of the United Nations (UN).

2. To introduce the student to the common acronyms and abbreviations used in describing the ISM Code.
3. To impart to the student, the legal status of the ISM Code both as codified International Law and as related U.S. federal law and regulation.
4. To introduce the student to the US and international structure of the administration of the of the code.
5. To impart to the student a basic understanding of the institutional evolution (similar to a legislative history) of the ISM Code within the IMO and its transition into U.S. law and regulation.
6. To provide to the student key elements of citation to the code, and the relevant U.S. law and regulation.
7. To identify to the student, the key secondary source that all lawyers advising shipping companies in the application of the Code should have on hand and be familiar with.
8. To describe to the student, the role of the lawyer as legal counsel to corporate officials attempting to design, implement, or audit performance of their corporate ISM Code Program.

If you have serious questions about ISM obligations and compliance contact our resident ISM expert via E-mail or phone

William H. Toohey III AFNI

Toohey Marine LLC

Master Unlimited

ISO 9001:2015 Lead Auditor Class
(Bureau Veritas)

ISM Lead Auditor (ABS Certified)

IMCA CMID Vessel Inspector

Vessel Compliance/Training/Safety Officer

Cell: 504-432-1958

Email: skiffrunner@gmail.com

SEE:https://americanadmiraltybooks.blogspot.com/2019/07/our-senior-legal-correspondent-with.html
for a growing number of informative posts on the ISM (International Safety Management Code)

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