Maybe it’s time to retire the Limitation of Liability Act of 1851

In addition to the terrible loss of lives the containership Dali’s crash caused on March 26, it also resulted in a catastrophic structural failure of Baltimore’s Francis Scott Key Bridge, which could cost $2 billion or more to replace. The vessel’s Singapore-based owner, Grace Ocean Private Limited, and its operator, Synergy Marine Group, could end up paying only a fraction of that price. Six days after the tragedy, they filed a petition in U.S. District Court seeking to limit their share of responsibility for the bridge strike to just $44 million.

The companies cited provisions set forth in a 173-year-old law called the Limitation of Liability Act of 1851.

The U.S. Congress enacted the law on March 3, 1851, at a time when shipowners were often held financially responsible for losses and damages resulting from circumstances beyond their control — including storms, pirate attacks or unforeseen mechanical problems. The legislation stipulated that if a company was unaware of the danger and had no hand in causing it, it could be sued for no more than the value of the vessel and what it carried on board. The act applies to U.S.-flag and foreign-flag vessels involved in incidents occurring on the inland or offshore waters of the United States.

Over the years, some shipping companies have used the law to circumvent accountability for the damage their vessels caused. The first well-reported case involved the sinking of RMS Titanic in 1912. Roughly 1,500 of the 2,200 passengers and crew on the ship perished, the youngest being 19-month-old Sidney Goodwin.

Survivors, and the families of those who died, sued British shipowner Oceanic Steam Navigation Company and vessel operator White Star Line for compensation. They argued that the ship’s master ignored ice warnings, took the vessel into a dangerous area at too high a speed and that the crew lacked the lifeboat evacuation training it needed. Even though the sinking did not occur in U.S. waters, the Supreme Court still permitted the companies to file petitions under the Limitation of Liability Act of 1851. The court declared that it was an accident and in no way caused by them or with their knowledge. Newspapers on both sides of the Atlantic mocked the claim, and afterwards began calling the legislation the “Titanic Law” — ridiculing the fact that both Oceanic Steam Navigation Company and White Star Line callously used it to shield themselves from the loss of life and property that resulted.

Since then, maritime companies seeking to avoid responsibility for the catastrophes their vessels created have continued to exploit the Limitation of Liability Act of 1851. Another prominent example was the Deepwater Horizon incident. On April 20, 2010, the Panamanian-registered semi-submersible drilling rig was working in the Gulf of Mexico’s U.S. Exclusive Economic Zone. It experienced a well blowout that killed 11 crewmembers, igniting a fireball visible from 40 miles away. The rig sank two days later, leaving oil gushing from the wellhead in what became the worst marine oil spill in human history. An estimated 134 million gallons of crude oil rose up to the surface, fouling 1,300 miles of coastline across five states. Cleanup efforts for the spill continue all these years later.    

Based on the Limitation of Liability Act of 1851, vessel owner Transocean filed a petition in federal court stating that it should only be responsible for $27 million in damages, or the value of the sunken vessel. When it was shown that the company did not perform required emergency systems maintenance, nor did it properly train crewmembers on how to activate them, the court denied its claim. After years of costly litigation, Transocean finally agreed to a $1.4 billion plea deal for violating the 1990 Clean Water Act and other laws, which will to some extent go toward ensuring that U.S. taxpayers won’t have to foot the entire bill for economic and environmental losses stemming from the incident. 

An even more recent instance involved the U.S.-flag cargo ship El Faro, which was owned by TOTE Maritime and operated by its subsidiary Sea Star Line. On Sept. 29, 2015, the ship departed Jacksonville, Fla., bound for San Juan, Puerto Rico. Two days later, on Oct. 1, after getting pounded by Hurricane Joaquin’s 40-foot waves and 115 mph winds, the vessel went down with its entire crew of 33 — the highest death toll from a U.S. commercial vessel sinking in nearly 40 years. A few weeks later, TOTE filed a Limitation of Liability Act of 1851 petition, claiming that the ship “was in all respects seaworthy,” and that the company had no responsibility for its loss.

The National Transportation Safety Board and U.S. Coast Guard reports into the disaster placed part of the blame on the vessel’s dead captain. But they also cited a “weak safety culture” at TOTE Maritime as a cause — including a lack of shoreside support for the vessel as the hurricane barreled down on it, fitting the ship with outdated and unusable open lifeboats, violations of rest period and work hour laws, inadequate crew training, and operating a vessel that official inspections showed had a “disturbing” increase in safety discrepancies in the years before the sinking. TOTE ultimately settled lawsuits related to the sinking out of court.

Considering the new laws, mandated safety improvements, and advanced technology that govern modern shipping, it is obvious that the Limitation of Liability Act of 1851 has outlived its usefulness. Maritime companies should no longer be allowed to use this antiquated regulation to try to avoid financial responsibility and accountability for the operation of their vessels. It’s past time to either revamp this law or let it go.

Till next time, I wish you all good health and smooth sailin.’

Capt. Kelly Sweeney holds the license of master (oceans, any gross tons) and has held a master of towing vessels (oceans) license, as well. He has sailed on more than 40 commercial vessels and lives on an island near Seattle. He can be contacted by email at