Sarosh Zaiwalla comments published in The Financial Times

The Financial Times

20th January 2012

Focus shifts from ship’s captain to company

By Sally Gainsbury and Cynthia O’Murchu

Rescue workers were still scrambling to find survivors from the ill-fated Costa Concordia this week when Pier Luigi Foschi, Costa Cruises’ chief executive, blamed the ship’s captain for the wreck and described the rest of the crew as heroes.

But as the week progressed, the company’s strategy to make Captain Francesco Schettino the face of the disaster off the coast of Italy was shaken by comments from passengers, crew and even revelations about some of the company’s own practices.

As the fallout from the accident continues, the question of who was to blame will be played out in the courts as all parties seek to limit the damage.

Costa’s effort to quickly isolate a culprit – the captain who had made a showy move close to shore to “salute” a fellow sailor – has been called surprising by some industry experts and may pose some risk to the company as investigators begin to wade through prior practices of the Italian operators, a unit of Miami-based Carnival Corp.

“These incidents are complicated; it requires a reviewing of the black box and really understanding what has taken place,” said William Wright, maritime expert for Cruise Lines International Association, a North American cruise lobby.

“The standard procedure is to put the captain on administrative leave while the investigation is conducted. But it appears that they were very quick to put the blame on the captain,’’ said Mr Wright, who is also senior vice-president of marine operations at Royal Caribbean International, a competitor to Costa.

Legal experts said the company is vulnerable to possible claims of corporate liability as, in addition to 29 people dead or missing, details of a chaotic evacuation emerge and the authorities seek to avert an environmental disaster by removing 500,000 gallons of unspent fuel from the cracked hull.

Codacons, the Italian consumer rights association, on Thursday told the Financial Times that it was organising a civil class action suit that so far has attracted 200 passengers. Codacons plans to demand €50,000 for each passenger.

Craig Allen, law professor at the US Coast Guard Academy, told the FT the company may underscore the actions of the captain as renegade but that does not always mean the corporation is off the hook.

A pattern of what the company allowed over time is also important, he said. “You have a duty to enquire whatever a shipowner could find out by looking at the details [of routes taken] and if they failed to take action. That’s negligence.’’

Sarosh Zaiwalla, a lawyer and maritime expert in London, said a big question was whether Captain Schettino was “on a frolic of his own’’ and, if he was, if Costa either “knew about it or could find out”.

Unauthorised route detours are not considered uncommon in passenger shipping: they are known in the industry lexicon as a “thrill diversion” or “fly-by”. A reef off the Orcas island between Vancouver and Seattle even bears the name “Elwha Rock” in memory of one misjudged manoeuvre in the 1980s.

Captain Schettino, now under house arrest, has become a target of outrage after prosecutors accused him of conducting a “reckless manoeuvre’’ and leaving the ship as passengers were still struggling to find lifeboats.

The captain told reporters in the hours just after the incident that the ship had hit uncharted rocks. He later said in court that he had sailed the cruiser, with 4,200 people aboard, just a few hundred metres near the island to sound a horn in “salute” to a former captain living there.

The company’s statements have focused on the captain with little said about the rest of the crew. However in media interviews, passengers have complained that the evacuation was hampered by crew who did not know how to unleash lifeboats and delays in sounding alarms.

The crew themselves, in media interviews, said that the alarm was late and that they were instructed to tell passengers that the ship had suffered an electrical problem.

Passengers also said the ship had not yet held its evacuation drill. Although this is usually done before the ship leaves port, the law does allow the drill to be held within 24 hours of embarcation.

Mr Foschi defended the company’s safety record on Monday and said “all our crew members behaved like heroes. All of them.’’ As for the captain, Mr Foschi said that he had taken “unapproved, unauthorized, unknown to Costa’’ manoeuvres that were “contrary to our written rules of behaviour”.

But the company’s message became muddled as Mr Foschi admitted later that the same 114,500 tonne vessel had done the same manoeuvre – even closer to the Giglio – in August last year with the company’s approval.

Burson-Marsteller, Costa Crociere’s spokespeople in London, said the “normal” route guides keep its passenger cruise liners five miles from the coast of Giglio. They also said that on August 14 – the day the company sanctioned a route closer to the island – the ship was authorised to sail only as close as 500m from shore.

Later in the week, the company had little to say about a revelation by Lloyd’s List, a maritime industry information service, that showed the ship actually moved in as close as 230m to shore in August.

And on Friday IHS Fairplay, another maritime information service provided the FT with data showing that in 2010 two separate Costa cruise ships had also sailed close to the coast of Giglio. Costa declined to comment on the new data but Mr Foschi earlier said that it was possible that other ships had deviated from their agreed courses.

Most ships by regulation carry a radio transmitter which signals the ship’s position, course and identity.

It is that data – which goes back several years – that may now detail how often Costa’s cruise ships took a different route.

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