A health and safety fine
When an accident occurred on a vessel, the local authorities brought proceedings against the ship manager (who also acted as the crew manager). The accident happened onboard when a wire on one of the vessel’s cranes snapped whilst it was being replaced, striking a crew member who sustained serious injuries as a result.
The authorities brought six charges under local maritime health and safety legislation against the crew manager. One of the main charges alleged that the crew manager had failed to take responsible steps to protect the health and safety of an employee.
The crew manager sought legal advice and, as a result, pleaded guilty to some of the charges, with a view to avoiding protracted and costly legal proceedings. This resulted in a fine of USD 100,000, which the crew manager duly paid.
As the fine related to crew negligence and, under the ship management agreement, the owner was obliged to indemnify the manager. The owners refused to do so and the manager contacted ITIC for advice. With ITIC’s assistance, pressure was placed on the owner and his P&I Club to reimburse the crew manager.
Difficulties were encountered when it was discovered that the P&I Club would only cover certain fines and penalties discretionally. However, the matter went before the P&I Club’s Board of Directors who agreed to cover the fine in full.