Container ship explosion major accident! Freight forwarder huge compensation of 290 million US dollars...

2024-05-27 16:10

Recently, the protracted legal case surrounding the fatal "MSC Flaminia" incident finally ended with the freight forwarder Stolt-Nielsen agreeing to pay a $290 million settlement.

In 2012, the MSC Flaminia, a container ship chartered by MSC, suffered a fatal fire while sailing in the Atlantic Ocean, which not only killed three crew members, but also attracted widespread attention from the global shipping and logistics industry.

In the aftermath of the fire accident, a lengthy litigation process ensued over the attribution of liability and legal compensation.

Global chemical logistics giant Stolt-Nielsen Group informed a U.S. court this week that the two sides had reached a settlement in the long-running case and agreed to pay up to $290 million in damages, acknowledging some responsibility for the accident.

While the specific terms of the settlement are confidential, the settlement amount was disclosed in Stolt-Nielsen's first quarter 2024 results. The results report showed that the Norwegian company received $133 million from its insurer to partially settle MSC Flaminia's claims.

In 2018, the U.S. District Court for the Southern District of New York ruled in the devastating fire that occurred aboard the MSC Flaminia in July 2012, finding that Deltech, a manufacturer of dangerous goods, and Stolt Tank Containers, a freight forwarder, were responsible for the fire.

However, Deltech and Stolt appealed the ruling.

But in July 2023, the U.S. Court of Appeals upheld its 2018 decision on the preliminary ruling on the 2012 incident on MSC Flaminia and clarified the respective proportions of liability:

Freight forwarder Stolt takes 45% of the responsibility, while cargo owner Deltech takes 55% of the responsibility. The carrier MSC, the ship owner Conti, the ship operator NSB, the terminal and other parties are not liable.

It is understood that the accident occurred on July 14, 2012, when the ship "MSC Flaminia" was on its way from New Orleans to Antwerp, carrying about 6,500 TEUs of cargo. Smoke emanated from the ship's No. 4 cargo hold, and the crew judged that the container had caught fire, and immediately released carbon dioxide to suppress it.

In response to the fire, the crew sent a seven-man fire brigade to prepare fire hoses next to the hatch, and when they tried to set up the fire hoses, an explosion occurred in the cargo hold.

As a result of the accident, three crew members were killed, one of whom was missing and two were seriously injured. The ship itself also suffered serious damage, in particular, most of the cargo containers in the stern of the No. 4 hold were completely destroyed.

The "MSC Flaminia" is a container ship with a capacity of 6,750 TEU. At the time of the fire, it was more than 1,000 nautical miles from land in the middle of the Atlantic, and the crew was forced to abandon ship after the incident and was rescued by other ships that came to the rescue later.

The investigation of the accident revealed that the NVOCC (freight forwarder) Stolt Tank Containers had 29 tank containers on the ship, three of which were located in Cargo Hold 4 where the explosion occurred.

On May 29, 2013, the ship's owner, operator, etc. filed a claim against Stolt and Deltech (the manufacturer of dangerous goods), alleging that the tank containers were the cause of the fire and that Stolt had not adequately warned of the danger of the cargo.

The accident caused huge damage to the MSC Flaminia, and the shipowner, Conti, paid a high price in the process of salvaging and repairing the ship. The Owners claimed that the vessel had been chartered to MSC during the period when the vessel was out of service.

The arbitrators rendered an award in July 2021, agreeing to award approximately $200 million to Conti. Last year, MSC's appeal against the decision was rejected by the court.

After more than a decade of development, misdeclaration and mispackaged cargo is still one of the biggest problems facing the shipping industry.

Here's a reminder: Do not declare dangerous goods as ordinary goods, and do not lie or conceal them. This is not only a disregard for the safety of others' lives, but also a great damage to one's own corporate reputation and interests.

The impact of misrepresentation and concealment of dangerous goods on ships and the shipping industry as a whole is far-reaching.

First of all, this may lead to serious safety accidents during the transportation of the ship, such as fire, explosion, etc., which seriously threatens the life safety of the people on board. Secondly, once an accident occurs, it will not only cause huge economic losses, but also have a serious negative impact on the reputation and credibility of the shipping industry.

In addition, misrepresentation and concealment of dangerous goods may also involve legal issues, and those responsible may face huge fines and even criminal liability.

Therefore, we strongly urge the majority of shippers to strictly abide by relevant laws and regulations, truthfully declare cargo information, and ensure that dangerous goods are handled and transported correctly. This is not only the respect for the safety of others' lives, but also the responsible attitude for the long-term development of the enterprise itself.

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