slide1 n.
Download
Skip this Video
Download Presentation
Mass damage cases in the energy industry: Rapid claims mechanisms

Loading in 2 Seconds...

play fullscreen
1 / 14

Mass damage cases in the energy industry: Rapid claims mechanisms - PowerPoint PPT Presentation


  • 99 Views
  • Uploaded on

Mass damage cases in the energy industry: Rapid claims mechanisms. Michael Faure & Franziska Weber 4 th July 2014. Overview. Introduction Efficiency Criteria Case study: Assessing the GCCF Design Suggestions Conclusions. 1. Introduction. Case example: oil pollution

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Mass damage cases in the energy industry: Rapid claims mechanisms' - byron


Download Now An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

Mass damage cases in the energy industry:

Rapid claims mechanisms

Michael Faure & Franziska Weber

4th July 2014

overview
Overview
  • Introduction
  • Efficiency Criteria
  • Case study: Assessing the GCCF
  • Design Suggestions
  • Conclusions
1 introduction
1. Introduction

Case example: oil pollution

 Compensation schemes for the aftermath of disasters

Central problem: lengthy mass litigation

2 efficiency criteria
2. Efficiency Criteria

Costsofaccidentlaw –

Calabresi‘sframework

  • Primary costs
  • Secondarycosts
  • Tertiarycosts
2 efficiency criteria1
2. Efficiency Criteria

Startingpoint:

  • Forms of alternative disputeresolution (ADR) workfaster and reduce follow-on damage
    • hencereduceprimarycosts
  • ADR ischeapertoadminister

 hencereducestertiarycosts

  • Consider: Incentives structureofstakeholdersin lawenforcement
2 efficiency criteria3
2. Efficiency Criteria
  • Victims‘ incentives
  • Court: substantial damage
    • cost: theduration?
    • Fewresources (egadvancepayments)
  • Relaxed (ADR) proceduralrulesinvitefrivolouslawsuits
  • Free-ridingless an issuewith individual damageclaims
  • Groupingclaimsreducescosts, RA, FR & mayallowforinformationtoentertheenforcementresponse
    • Additional problems?
2 efficiency criteria4
2. Efficiency Criteria

2. Enforcers‘ incentives

  • Capture playsmore in non-judicialstructures
    • Composition/financing/appeal
    • Whataboutthegrouprepresentatives?
      • Consider: errorcosts (spreading)
  • P/A problem in particularmasscases
  • Nofurtherdevelopmentofthelawwith ADR

3. Administrative costs

  • Higher formasses; higher in court

 Fromtheoutset: ADR assumedtobelesscostlytoadminister

2 efficiency criteria5
2. Efficiency Criteria

Essential trade-off

  • Balancingspeed vs. thoroughnessoftheprocedure
  • Potential tortfeasorneedstobeincentivizedtotake optimal care
  • Ensuringcompensation

= Design ADR in a waytouseitsadvantageswithoutfallingvictimtoitsflaws

3 case study assessing the the gulf coast claim facility gccf
3. Case study: Assessing theThe Gulf Coast Claim Facility (GCCF)
  • Case: DeepwaterHorizonOil Spill Accident
  • Private claimsfacility
  • A settlementstructureunder OPA
    • Claimanthastheoptiontofilewiththe GCCF or in court
    • Independent trustees & administrator
  • Paymentsmade: US$10.7 billion of available US$20 billion
  • Currentlyclosed: residual cases in court
3 the gccf analysis
3. The GCCF: Analysis
  • In essence: fast compensation at modest administrative costs
  • Potential toforestall follow-on damages
  • Easy forms, nolawyer, at victims‘ choice
    • Parallel courtproceedings
    • Frivolouscomplaints
  • Taking care ofindependence
    • Governingstructure
    • Involvingvictims in settinguptheprotocol (clear, predictablecriteria)
  • But?
3 the gccf outcome
3. The GCCF: Outcome

… A meaningfulsteptoachievethe

bestofbothworlds …

4 design suggestions speed versus accuracy
4. Design suggestions: “Speed versus accuracy“
  • Two-stepsystem: „time an issue vs. noissue“
  • Funds needtobeensured, preferablybytortfeasorhimself
  • Assessment ofclaims: tortlawcriteria
    • Standardizationofvarioustypesofpayments
    • Case-by-casebasis
    • Court: an option
  • Ensuredeterrencefunction
  • Consider potential opportunisticbehaviourofthevictims
    • setcleareligibilitycriteria
  • Roleforcourts: marginal review
5 conclusion
5. Conclusion
  • Importance of law enforcement
  • Necessity to provide speedy compensation (for a certain category of victims)
  • Need for an enforcement solution that incorporates „the best of both worlds“
    • More payments to victims that for the administration ….
  • Experimentation phase
ad