Liability cap

A liability cap is a contractual or statutory ceiling on the amount an owner or carrier must pay for a claim. Maritime law is built on such limits: the 1976 Convention on Limitation of Liability for Maritime Claims, as raised by the 1996 Protocol, lets shipowners cap most claims by reference to vessel tonnage; the Hague-Visby Rules cap cargo claims at 666.67 SDR per package or 2 SDR per kilo; and pollution regimes set their own ceilings. Limits are tonnage-based or unit-based and can be broken only by conduct such as the owner’s personal intent or recklessness with knowledge that loss would probably result.