Grace Ocean Private Ltd and Synergy Marine Private Ltd, Singapore-based owner and manager of the ship Dali that collided into the Francis Scott Key bridge in Baltimore in March this year, have agreed to pay nearly $102 million to resolve a civil claim brought by the U.S. Department of Justice (DoJ) in Maryland.
Dali had a 21-member crew out of which 20 were Indians. Synergy has Indians in key positions, has a large base in India, and employs thousands of Indian seafarers.
The DoJ had alleged in court after a multi-agency investigation that the collision was largely due to two onboard blackouts caused by poor engineering and safety practices for which the manager and the owner of the ship were responsible. The blackouts had a cascading effect and rendered the ship’s propulsion system, rudder and bow thruster inoperable. The crew was unable to operate the anchor system. All these led to the ship going out of control and colliding on the bridge, it submitted in court. The DoJ claim from the owner and the manager was mainly to cover the salvage operation, bridge wreckage clearing, as well as the clearing of the water channel to the Baltimore port.
Synergy, however, has said: “The settlement strictly covers costs related to clearing the channel, which we would have been responsible for in any case, and is not indicative of any liability, which we expressly reject for the incident that led to the collapse of the Francis Scott Key Bridge. No punitive damages have been imposed as part of this settlement. In accordance with the settlement, the United States has dismissed its claim.”
The $102 million payout will be covered by Protection & Indemnity insurance.
Limited liability claim
Synergy says Synergy and Grace Ocean will continue to pursue its original limited liability claim of some $43 million against which the DoJ had claimed the damages which have now been settled. “Grace Ocean and Synergy are prepared to vigorously defend themselves in the limitation of liability proceedings pending before the Federal Court in Baltimore and to establish that they were not responsible for the incident,” says a Synergy statement.
Soon after the accident in which six people lost their lives, some marine insurance experts in the U.S. were saying the losses that would need to be paid for include loss of life, the destruction of the bridge, disruption of road traffic as well as the disruption to the busy Baltimore port itself and ships stranded as a result. The payout was expected to equal or surpass the $1.5 billion payout for the cruise liner Costa Concordia’s capsizing in 2012, which is the highest-ever marine damages payout so far.
The DoJ has said in its statement that the recent settlement does not include any damages for the reconstruction of the Francis Scott Key Bridge. The State of Maryland has filed a separate claim on this. The DoJ statement talks about the blocking of shipping traffic as well as the cutting of a key transportation artery.
Some 45 claims for damages have been filed in U.S. courts regarding Francis Scott bridge damage. Synergy sources say that out of these, some 40 relate to purely economic losses.
Meanwhile, an opinion has emerged among insurance experts that a century-old U.S. Supreme Court ruling called the Robins Dry Dock ruling is a precedent against purely economic claims in the marine sector.
As per that, a disaster such as an oil spill, the ramming of a bridge, or a collision blocking a channel may have “extremely” broad economic repercussions, therefore reasonable limits on liability are necessary in such cases.
Published - October 26, 2024 01:12 am IST
