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Author Topic:   COSTA CONCORDIA Aftermath

jimh posted 11-18-2014 09:43 AM ET (US)
Recent maritime news sources have covered proceedings in Italy in which the cruise ship operator COSTA CRUISES is being sued for damages by the island of Giglio, the site of the capsize of the COSTA CONCORDIA. The huge ship was wrecked there, and it took about two years to remove it from its grounded position near the shore of the island.
The island of Giglio is asking for compensation in the amount of US$190-million. The major basis for the claim is the image of the island has been tarnished. The population of Giglio is 1,450, so the damages being sought represent a harm per person of more than US-$131,000.
The more than 3,000 passengers of the COSTA CONCORDIA have received compensation from COSTA CRIUSES already. For the psychological damage they suffered and for any lost items, passengers who otherwise were not physically injured each received approximately US-$14,000.
If the claims of damage to the image of the island of Giglio are sustained in the legal action, we will then have the rather bizarre outcome in which the residents of Giglio will receive compensation for the ship wreck due to their image being damaged (on a per-capita basis) that will be almost ten time greater than the compensation afforded the passengers who had to endure the actual shipwreck. This comparison is for two groups in which none of the group members were actually injured. On this basis, it is apparently ten time more damaging to live near a ship wreck than it is to be on the ship that wrecked.
Cf.: http://www.marinelink.com/news/concordia-damages-island380941.aspx

martyn1075 posted 11-18-2014 01:19 PM ET (US)
Its a crazy world we live in. Sometimes the most rational and logical ways of thinking get overturned to be the opposite and it leaves you will the trout look on your face.
For example we live in fairly cold rain forest where we easily get more than half a year of rain. Our weather conditions combined with steep terrain keep us in a car or some means of covered transportation to allow us to travel A to B such as work. This is how we make our money to pay for taxes etc. Families with kids in sports, work trucks not going to use a bikes to carry saw blades and chainsaws on their backs yet we spend several millions of tax dollars same people who drive their cars to widen roads and walkways to put in the green bike lanes. All of which get used for maybe 3 months of the year by a very select few of individuals. They also pay nothing to be on the road. Tell me how that makes any sense? Well of course it doesn't make any sense and I see the same idea with this ruling if it actually does get sustained.
I'm sure many of the passengers will try to individually sue in addition to any compensation and the company is aware of this. Nobody wins in this situation but the island residents who are asking for more are a bit out of line imo. One can always ask for more but it doesn't mean they will get it.
cvyarb posted 11-18-2014 11:58 PM ET (US)
The passengers (the ones not injured) are hindered by the limitation of liability clause that all cruise ships incorporate into their tickets, under one of the IMO's conventions (name escapes me). Those limitations can sometimes be set aside, but effectively the passengers have entered into a binding contract limiting their recovery. The exceptions are, generally, going to be reserved for those seriously injured and also require that the owner (interpretations here vary in case law) was negligent. Here, the residents of the island /island as an entity never contractually agreed to any binding limitations.
I haven't been following this closely at all, but in general admiralty law is a complex (although I think elegant) mixture domestic and international law, depending on the scenario. It will be interesting to see how this suit pans out.
wezie posted 11-19-2014 07:54 AM ET (US)
The island residents did not really get rich the last few months during the much exagerated recovery of the ship. Just slightly rich. Now real greed.
I do not remember hearing any of the Eyeties regreats of sinking British oil tankers in the Med. during the last war. Done forgot that one.
RandyV posted 11-19-2014 10:28 AM ET (US)
On a similar note, why did the US government officials decide that families of people killed in the 9/11 terrorist attack by radical Muslim terrorists deserve to get hundreds of thousands of dollars based on a calculation of their potential earnings yet families of our servicemen and women only get $100,000 death benefit? Not to sound uncaring for those who suffered (and are still suffering) but somehow Congress decided that we tax payers are responsible for private persons death benefits far in excess of those who willingly put their lives on the line for our country. This is a travesty and disgrace to our service men & women.
It is apparently ten times more damaging to be a civilian killed by radical Muslim terrorists using jets as their weapon than it is to be a soldier killed in service to our country.
c1walts posted 11-26-2014 09:52 AM ET (US)
Jim, I think that you are comparing apples to oranges. The article you linked to in your post clearly states that the Island of Giglio is suing for $190M due to the loss of tourism, which they account as 45,000 people.
Based on 45,000 tourists lost to the island, the payout from $190M USD would be $4,222 USD/tourist, not resident.
The populous of Giglio will likely never see a check from the awards if the island wins their lawsuit. In fact the article states that the money would be used to: "reconstruct the image of Tuscany as a top tourist destination" and will require "years of work, substantial investments and costly national and international advertising campaigns".
jimh posted 11-26-2014 10:19 AM ET (US)
I believe there is a critical flaw in your analysis: the tourist will not receive any compensation. The residents of Giglio will be the beneficiaries of the award, if their claim in sustained. Tourists will get nothing.
The article has been revised from its initial form. I see the claim has been increased to US-$274-million. That suggests the per-capita harm to the residents of Giglio has been calculated to be US-$189,000 per resident. On that basis one might plan on moving to any community where there has been a notorious ship wreck. It could be very beneficial. Under this sort of thinking, imagine what the residents of Whitefish Bay are owed due to the sinking of the Edmund Fitzgerald.
c1walts posted 11-26-2014 02:01 PM ET (US)
Sorry for the confusion, but I never indicated that tourist would receive any money awarded from settlement. Only meant as an indicator to the claim of $190M from the island of Giglio.
The $4222 per tourist is the normalized amount specified for the $190M claim (from the loss of 45,000 tourists).
The way you are normalizing the data is not correct.
No resident of the island is going to see any money except in the form of investments (likely infrastructure) and national and international advertisement/marketing to increase tourism.
It appears that the lawsuit was filed to compensate the region for a lack of tourism caused by the wreckage, not to go to the residents directly.
jimh posted 11-26-2014 05:36 PM ET (US)
The settlement of the claim, if there is any, is paid in some way to Giglio. Yes, an individual resident, say a new born baby, is not getting a check for $189,000, but the money is going to some entity on the island, which must represent collectively the population. How that entity spends the money is another story, but, first, of course, they have to sustain their claim of harm having occurred to them. I think you could make a counter-claim, that is, the ship wreck made the island famous, and perhaps has increased the tourism.

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Author	Topic: COSTA CONCORDIA Aftermath
jimh	posted 11-18-2014 09:43 AM ET (US) Recent maritime news sources have covered proceedings in Italy in which the cruise ship operator COSTA CRUISES is being sued for damages by the island of Giglio, the site of the capsize of the COSTA CONCORDIA. The huge ship was wrecked there, and it took about two years to remove it from its grounded position near the shore of the island. The island of Giglio is asking for compensation in the amount of US$190-million. The major basis for the claim is the image of the island has been tarnished. The population of Giglio is 1,450, so the damages being sought represent a harm per person of more than US-$131,000. The more than 3,000 passengers of the COSTA CONCORDIA have received compensation from COSTA CRIUSES already. For the psychological damage they suffered and for any lost items, passengers who otherwise were not physically injured each received approximately US-$14,000. If the claims of damage to the image of the island of Giglio are sustained in the legal action, we will then have the rather bizarre outcome in which the residents of Giglio will receive compensation for the ship wreck due to their image being damaged (on a per-capita basis) that will be almost ten time greater than the compensation afforded the passengers who had to endure the actual shipwreck. This comparison is for two groups in which none of the group members were actually injured. On this basis, it is apparently ten time more damaging to live near a ship wreck than it is to be on the ship that wrecked. Cf.: http://www.marinelink.com/news/concordia-damages-island380941.aspx
martyn1075	posted 11-18-2014 01:19 PM ET (US) Its a crazy world we live in. Sometimes the most rational and logical ways of thinking get overturned to be the opposite and it leaves you will the trout look on your face. For example we live in fairly cold rain forest where we easily get more than half a year of rain. Our weather conditions combined with steep terrain keep us in a car or some means of covered transportation to allow us to travel A to B such as work. This is how we make our money to pay for taxes etc. Families with kids in sports, work trucks not going to use a bikes to carry saw blades and chainsaws on their backs yet we spend several millions of tax dollars same people who drive their cars to widen roads and walkways to put in the green bike lanes. All of which get used for maybe 3 months of the year by a very select few of individuals. They also pay nothing to be on the road. Tell me how that makes any sense? Well of course it doesn't make any sense and I see the same idea with this ruling if it actually does get sustained. I'm sure many of the passengers will try to individually sue in addition to any compensation and the company is aware of this. Nobody wins in this situation but the island residents who are asking for more are a bit out of line imo. One can always ask for more but it doesn't mean they will get it.
cvyarb	posted 11-18-2014 11:58 PM ET (US) The passengers (the ones not injured) are hindered by the limitation of liability clause that all cruise ships incorporate into their tickets, under one of the IMO's conventions (name escapes me). Those limitations can sometimes be set aside, but effectively the passengers have entered into a binding contract limiting their recovery. The exceptions are, generally, going to be reserved for those seriously injured and also require that the owner (interpretations here vary in case law) was negligent. Here, the residents of the island /island as an entity never contractually agreed to any binding limitations. I haven't been following this closely at all, but in general admiralty law is a complex (although I think elegant) mixture domestic and international law, depending on the scenario. It will be interesting to see how this suit pans out.
wezie	posted 11-19-2014 07:54 AM ET (US) The island residents did not really get rich the last few months during the much exagerated recovery of the ship. Just slightly rich. Now real greed. I do not remember hearing any of the Eyeties regreats of sinking British oil tankers in the Med. during the last war. Done forgot that one.
RandyV	posted 11-19-2014 10:28 AM ET (US) On a similar note, why did the US government officials decide that families of people killed in the 9/11 terrorist attack by radical Muslim terrorists deserve to get hundreds of thousands of dollars based on a calculation of their potential earnings yet families of our servicemen and women only get $100,000 death benefit? Not to sound uncaring for those who suffered (and are still suffering) but somehow Congress decided that we tax payers are responsible for private persons death benefits far in excess of those who willingly put their lives on the line for our country. This is a travesty and disgrace to our service men & women. It is apparently ten times more damaging to be a civilian killed by radical Muslim terrorists using jets as their weapon than it is to be a soldier killed in service to our country.
c1walts	posted 11-26-2014 09:52 AM ET (US) Jim, I think that you are comparing apples to oranges. The article you linked to in your post clearly states that the Island of Giglio is suing for $190M due to the loss of tourism, which they account as 45,000 people. Based on 45,000 tourists lost to the island, the payout from $190M USD would be $4,222 USD/tourist, not resident. The populous of Giglio will likely never see a check from the awards if the island wins their lawsuit. In fact the article states that the money would be used to: "reconstruct the image of Tuscany as a top tourist destination" and will require "years of work, substantial investments and costly national and international advertising campaigns".
jimh	posted 11-26-2014 10:19 AM ET (US) I believe there is a critical flaw in your analysis: the tourist will not receive any compensation. The residents of Giglio will be the beneficiaries of the award, if their claim in sustained. Tourists will get nothing. The article has been revised from its initial form. I see the claim has been increased to US-$274-million. That suggests the per-capita harm to the residents of Giglio has been calculated to be US-$189,000 per resident. On that basis one might plan on moving to any community where there has been a notorious ship wreck. It could be very beneficial. Under this sort of thinking, imagine what the residents of Whitefish Bay are owed due to the sinking of the Edmund Fitzgerald.
c1walts	posted 11-26-2014 02:01 PM ET (US) Sorry for the confusion, but I never indicated that tourist would receive any money awarded from settlement. Only meant as an indicator to the claim of $190M from the island of Giglio. The $4222 per tourist is the normalized amount specified for the $190M claim (from the loss of 45,000 tourists). The way you are normalizing the data is not correct. No resident of the island is going to see any money except in the form of investments (likely infrastructure) and national and international advertisement/marketing to increase tourism. It appears that the lawsuit was filed to compensate the region for a lack of tourism caused by the wreckage, not to go to the residents directly.
jimh	posted 11-26-2014 05:36 PM ET (US) The settlement of the claim, if there is any, is paid in some way to Giglio. Yes, an individual resident, say a new born baby, is not getting a check for $189,000, but the money is going to some entity on the island, which must represent collectively the population. How that entity spends the money is another story, but, first, of course, they have to sustain their claim of harm having occurred to them. I think you could make a counter-claim, that is, the ship wreck made the island famous, and perhaps has increased the tourism.