Experts: Crashed ferry's owners may look to limit liability
The owners of the Seastreak Wall Street, the ferry that crashed while docking Wednesday in lower Manhattan, are expected by legal experts to invoke a 19th-century federal law unique to the shipping industry as a way to limit exposure to lawsuits, legal experts said.
By using the Limitation of Liability Act of 1851, owners often try to cap their legal exposure to the diminished value of the vessel after an accident, a tactic New York City tried unsuccessfully after the fatal 2003 Staten Island Ferry crash involving the Andrew J. Barberi, which killed 11 and injured more than 70. The Barberi was valued at $14 million, but the city ultimately paid out nearly $88 million.
Wednesday's Seastreak accident injured at least 85 passengers, two critically, when the 140-foot catamaran ferry from New Jersey had a hard docking near the South Street Seaport. The cause of the crash is being investigated by the National Transportation Safety Board.
If ferry owner Seastreak Llc successfully invoked the limitation law, it would cap liability for the accident somewhere between the original $6 million cost of the damaged ferry to about $8 million, which includes the cost of a recent retrofitting, said one maritime construction expert.
Lawsuits from Wednesday 's accident would easily exceed $8 million, said Brooklyn attorney Sanford Rubenstein, who handled some of the Barberi suits.
"I would not be surprised at all if the owners tried to limit liability," Rubenstein said. "I would say, I would be very surprised if they don't."
Seastreak general counsel Thomas Wynne didn't return numerous requests for comment Wednesday about the legal issues.
James Ryan, a maritime attorney in Manhattan who also had clients injured in the Barberi case, expected Seastreak to try to limit liability in lawsuits filed in federal court, the usual place where maritime cases are filed.
"The [legal] exposure is likely great," said Ryan.
Still, vessel owners can't limit exposure to lawsuits if they were aware of carelessness or negligence that caused an accident or loss.
The limitation law, passed to help spur investment in the shipping industry, has surfaced in other big cases, including the sinking of the Titanic in 1912 and the Andrea Doria in 1956.