Working Conditions Aboard the San-Francisco

The Liberian-flagged container ship 'San Francisco', which has been docked at Santa Cruz de Tenerife since December 18, 2025, has successfully completed its fire damage repairs and left its berth at the south pier for sea trials on June 4, 2026. The vessel arrived under tow from Takoradi, Ghana, after suffering a fire in its engine room. Upon its arrival, it was initially docked at the East Dock but was later relocated to the end of the south pier to facilitate repairs, especially after the floating dock 'Ultra 22000' arrived at the scene. The berth was granted by the Port Authority and Maritime Authority, considering it was the off-season for cruise ships. By June 5, the 'San Francisco' was anchored at position 28° 04' N 015° 23' W, marking a significant milestone in its recovery journey. For more details and photos, visit the link: https://www.puentedemando.com/el-buque-portacontenedores-liberiano-san-francisco-abandona-el-puerto-tinerfeno-despues-de-cinco-meses-de-estancia/

In the recent case of MSC Flaminia (No. 2) [2023] EWCA Civ 1007, the Court of Appeal has firmly dismissed the appeal by charterers MSC against the shipowners Conti. This ruling clarifies the limits of liability amidst a backdrop of significant operational challenges faced by the vessel, which is now known as CMA CGM San Francisco. After experiencing an explosion and fire in cargo hold number 4, Conti incurred major expenses for salvage operations, cleanup of contaminated cargo, removal of firefighting water, disposal of charred metal, and repairs—while MSC placed the vessel off hire during this tumultuous period. In accordance with arbitration proceedings initiated under their contractual agreement, a tribunal subsequently awarded Conti around USD 200 million in damages. In response, MSC sought to limit their liability in line with the 1976 Convention on Limitation of Liability for Maritime Claims, as amended by the Protocol of 1996 (the 'Convention'). This legal framework allows charterers to limit liability to certain claims, with MSC potentially reducing their financial obligation to approximately GBP 28.2 million, contingent on the success of their appeal. Conti has acknowledged that limiting liability is permissible for certain third-party claims, such as those from other cargo owners. However, the shipowners contested MSC's ability to limit liability concerning specific costs, including: (a) expenses related to the decontamination of cargo, (b) the removal of firefighting water from the ship’s holds, (c) payments made to local authorities for pollution control, and (d) costs associated with the disposal of burnt waste material from the vessel. In their appeal, MSC asserted that the High Court made errors on four principal points: 1. The understanding that claims involving the removal and destruction of cargo did not extend to matters between owners and charterers. 2. The interpretation of Article 2.1(f) as only including claims aimed solely at minimizing loss. 3. Treating the arbitration award as a singular claim rather than identifying its subset of limitable and non-limitable claims. 4. The assertion that none of Conti's claims qualified as consequential loss, thus not fitting within Article 2.1(a). Conti's arguments centered on the assertion that charterers may only limit liability for claims arising from entities classified outside of the 'shipowner' group as defined in Article 1.2 of the Convention. Key deliberations during the ruling drew parallels to The CMA Djakarta (2003), focusing on how the Convention should be construed apart from English law assumptions. Notably, the Court remarked on the 'remarkable' implications of a shipowner's claims being satisfied from a liability fund contributed by the same shipowners. The High Court's decision to rule against MSC was partly upheld by the Court of Appeal, which granted only limited rights to the charterers concerning specific types of claims, predominantly those from third parties outside the defined 'shipowner' category. Even though the Court of Appeal did not grant permission for further appeal, the House of Lords had previously allowed the case to be escalated due to its inherent significance. Although settled before reaching the House of Lords, subsequent Supreme Court approval in obiter with the judgment in The Ocean Victory [2017] UKSC 35 indicates strong endorsement of the Court of Appeal’s perspective. Ultimately, the Court emphasized that the Convention’s primary objective is to enhance liability limits compared to the 1957 Convention, without extending the charterers' limits beyond those previously recognized. As it stands, the decision sets a precedent preventing entities classified as 'shipowners' by the Convention from limiting their own liabilities in claims made by other entities under the same classification. The possibility of MSC appealing remains open, leaving the future interpretation of these maritime liability limitations in suspense.

In a significant legal decision, the Mediterranean Shipping Company (MSC) has seen its bid to cap its liability at $35 million rejected by a British court. This ruling stems from a tragic explosion on July 14, 2012, in cargo hold No. 4 of the vessel 'MSC Flaminia' while it was in mid-Atlantic waters, en route from Charleston, South Carolina to Antwerp (operating under the name 'CMA CGM San Francisco') at coordinates 48°13' N, 27°56' W. The incident, which tragically resulted in three fatalities, occurred during MSC's tenure as the charterer of the vessel. A 2021 arbitration tribunal determined that MSC had failed to uphold its time charter agreement, consequently ordering the company to pay $200 million in damages to a subsidiary of the German shipping consortium Conti for losses related to the catastrophe. The explosion was attributed to divinyl benzene (DVB), a hazardous chemical that poses fire risks if mismanaged. Despite MSC having paid a portion of the awarded damages, the company sought to reduce its overall liability, arguing against full compensation for the vessel and remaining cargo. However, in a ruling made public on September 1, 2023, the appeals panel unanimously sided with the lower court's decision, rejecting MSC's attempt to escalate the matter to the UK Supreme Court.

In a significant ruling delivered on September 10, a New York District Court has determined that MSC, the Swiss shipping giant, is not liable for the catastrophic explosion and ensuing losses linked to the MSC Flaminia fire that occurred in July 2012. This tragic incident resulted in the loss of three crew members' lives and caused extensive destruction to thousands of cargo containers. The court's decision underscores MSC's legal standing in relation to this maritime disaster.