To go boldly where no litigator has gone before

Picture the scene: two privately owned, manned capsules collide in space. Once the passengers have been rescued and the debris cleared, the debate over responsibility will start. But how can the owners bring effective legal claims?

This scenario would make a terrible film plot (perhaps unless written by John Grisham) but in real life it is becoming increasingly possible.

We are seeing a dramatic increase in space activity by commercial operators, planning to provide space tourism and explore (and exploit) the moon. This is encouraged by NASA, which wants private companies to operate in the lower Earth orbital so it can concentrate on deep space exploration.

But what thought has been given to space litigation – is it an alien concept?

In the absence of a contract between the private operators involved, which would make the legal position more straightforward, resolving such a dispute is complicated and throws up many questions, not least which courts would have jurisdiction and which law would apply.

The treaties

The first (space) port of call is a suite of space treaties, which date back to the 1950s. The treaties start from the premise that space is not a jurisdiction to be claimed by a nation: “Outer space, including the Moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means.”

The treaties’ starting point is that the state launching a space object is responsible for it. In relation to liability, they provide that:

• The nation launching the object is liable for damage caused by that object or its component parts, on Earth or anywhere else;
• ‘Fault’ is required if the damage occurs in space, but not for damage caused on Earth;
• A private party wanting to pursue a claim under the treaties needs to convince its own government to bring a claim on its behalf against the launching nation, within a year; and
• Diplomatic negotiations follow. If they fail, a claims commission is constituted to look at the issue. The commission’s decision is only final and binding if both parties consent. Otherwise, it is just a recommendation.

Even between nation states, this process has its challenges. It relies on goodwill to be effective and the scope of liability is not always clear.

The process has only been invoked once, by Canada when the Soviet Union satellite Cosmos 954 fell on its territory in 1978. Canada claimed for the cost of the clean-up of radioactive contamination rather than property damage and there was a dispute as to whether this cost was covered. The dispute eventually settled without admission of liability.

The treaties are even more problematic now that private companies are operating in space. Convincing a government to get involved within a year could be difficult and launching states may also be reluctant to co-operate and pay compensation if they have to then recover it from a private operator.

Furthermore, the strict liability rule for damage caused on Earth exacerbates this where the private operator was not itself at fault, such as where another space object caused theirs to crash, or their space object was subject to a cyberattack.

Private claims

As an alternative to this process, the treaties also allow for a claim in a local court. Faced with such a claim, the court would have to apply its own jurisdictional rules to the dispute.

To establish jurisdiction, a party will need to show that it has served the defendant in the jurisdiction, the defendant is domiciled in the jurisdiction, or there is sufficient connection between the jurisdiction and the events complained about.

While head offices of major corporations are still Earth-based, it is likely that a claimant will be able to satisfy at least one of these tests.

The other major, potentially more problematic, question is applicable law. If the event leading to liability takes place in space, which country’s laws apply? Does the principle that space is not subject to national appropriation extend to national law? Will countries be willing to accept the judgment or another country’s court when it seeks to extend its reach into space?

There are also prospects for, shall we say, satellite litigation. Most launching nations require companies to have licences and insurance in place. However, with so many open questions about liability and large sums involved, we are likely to see coverage disputes and long chains of defendants.

What now?

Space law is an area ripe for development, sooner rather than later. As the cosmos opens up to tourists and colonists, the law will need to get ever more innovative and private companies will need the co-operation and support of nations to drive change through. Space may be the final frontier but for the law, it is an extremely challenging one.

This article was first published in Litigation Futures, see here.