Owner, operator of Dali cruise ship that crashed into Baltimore bridge agrees to pay $102 million

The cargo ship Dali is stuck under part of the Francis Scott Key Bridge structure after the ship struck the bridge on March 26, 2024. | Photo Credit: AP

Grace Ocean Private Ltd and Synergy Marine Private Ltd, the owner and operator of the Dali, which collided with the Francis Scott Key Bridge in Baltimore in March this year, have agreed to pay nearly $102 million to settle a claim brought by . US Department of Justice (DoJ) in Maryland.

Dali had 21 employees among them 20 Indians. Synergy has Indians in key positions, has a large base in India, and employs thousands of Indian seafarers.

The DoJ alleged in court after a multi-company investigation that the collision was due to two power outages caused by poor engineering and safety procedures on the part of the ship’s manager and owner. The power outage had a devastating effect and rendered the ship’s propulsion, rudder and bow thruster inoperable. The crew could not use the anchor system. All of this led to the ship being out of control and crashing into the bridge, which was brought to court. The DoJ claim from the owner and operator was to include salvage work, the demolition of the bridge building, and the clearing of the waterway to Baltimore Harbor.

However, Synergy, said: “This compensation fully covers the costs related to the removal of the station, which we would have been responsible for wherever it was, and it does not show liability, which we clearly deny the incident that led to the collapse. of Francis Scott Key Bridge. No punitive damages have been awarded as part of this settlement. In accordance with the agreement, 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 their original limited liability claim of approximately $43 million in which the DoJ sought damages that have now been paid. “Grace Ocean and Synergy intend to vigorously defend themselves against the limitations of the proceedings pending in the State Court in Baltimore and the finding that they were not responsible for this incident,” Synergy said in a statement.

Shortly after the accident in which six people died, some marine insurance experts in America were saying that the losses that will need to be paid include the loss of people, the destruction of the bridge, the disruption of traffic and the disruption. in the busy port of Baltimore itself and ships are stranded as a result. The payout was expected to equal or exceed the $1.5 billion payment for the Costa Concordia sinking in 2012., which is the highest marine damage settlement ever.

The DoJ said in its statement that the latest repairs did not include any damage to the reconstruction of the Francis Scott Key Bridge. The State of Maryland filed a separate claim in this regard. The DoJ’s statement mentions the blocking of shipping traffic and the cutting of an important transportation artery.

45 claims for damages have been filed in US courts regarding the damage to the Francis Scott Bridge. Synergy sources say that of these, about 40 are related to economic losses alone.

Meanwhile, a view has emerged among insurance experts that the 100-year-old US Supreme Court decision called Robins Dry Dock is a precedent against purely economic claims in the maritime sector.

Accordingly, a disaster such as an oil spill, bridge collapse, or derailment collision may have “severe” economic impacts, so reasonable limits of liability are required in such cases.