Report from the Guardian on March 12th has noted that British shipping companies that sell old vessels to be scrapped cheaply in dangerous, low-paid conditions in South Asian countries like Bangladesh, India or Pakistan can now be sued in London for workers’ deaths or injuries.
In a historic ruling, a first of its kind, by any higher court anywhere in the world, the court of appeal of England and Wales has held that a shipping company in London selling vessels in South Asia could owe a legal ‘duty of care’ to shipbreaking workers in Bangladesh even though there were multiple third parties involved in the transaction.
The pivotal ruling means that Hamida Begum, wife of Khalid Mollah who fell to his death in 2018 while working high up on a 300,000 tonne oil tanker on the beach at Chittagoing, can now sue the shipping company Maran in the United Kingdom in London.
With the latest ruling, the legal spotlight might shine the light on the lax environmental and health and safety measures in Bangladesh. The ruling may open the gates for other causes and force Asian shipbreaking yards to improve the working environment.
The decision comes on the heels of two other long-running cases where impoverished communities in low-income countries were also given permission to sue multinational corporations or their subsidiaries in London for alleged environmental damages and pollution.
The UK Supreme Court, in February, ruled that a group of Nigeria farmers and fishers could sue Royal Dutch Shell in the English courts because of pollution in a region where the Anglo-Dutch energy giant has a subsidiary. Shell has argued that they are not responsible.
Another pivotal ruling came in 2019 when the UK Supreme Court ruled that the Zambian villagers could sue UK-based mining conglomerate Vedanta in the English courts for alleged water pollution because it owed villagers a duty of care and could be held responsible as they were the parent body of the mining company working in Zambia.
In the last 15 years, around 216 workers have died at the shipbreaking yards of Chittagong, including 7 so far this year. There are many cases where people ended up with disabled and seriously injured.
Working in Chittagong has been notoriously known for being precarious, dirty and dangerous, but shipping companies have been able to avoid responsibility by altering the ownership of the vessels in the last minute, and by using tax havens and middlemen. Hundreds of people, most without contracts, are injured or die every year in falls, explosions and accidents.
The coastal environment is heavily polluted with oils, asbestos and dangerous chemicals and few people can work for more than a few years in the intense tropical heat without being physically injured.
London based law-firm, Leigh Day, argued that Mollah’s accident was inevitable and that Maran (UK), which sold the tanker for demolition to a Dubai-based company, would have had the understanding that it was going to Chittagong for demolition and should have foreseen the risk of injury to workers such as Mollah demolishing it. The law-firm also made the point that due to Bangladesh’s weak regulations, the shipping industry has been taking deliberate advantage.
The law firm argued that the outcome was that the ship owners get the highest prices for scrap vessels in the practical certainty that they will be broken up in Bangladesh where health and safety standards are lower than in the more expensive but safer yards.
Maran, however, argued that it did not have any control of the ship’s destination and there was nothing it could or should have done to avoid the risks to the deceased.
But Lord Justice Coulson said: ‘… the appellant could, and should, have insisted on the sale to a so-called ‘green’ yard, where proper working practices were in place’.
According to NGO Shipbreaking Platform, more than 70 per cent of approximately 800 vessels that reach the end of their operating lives every year are broken up in Bangladesh, India or Pakistan.
Standard practice is that sales of end-of-life ships are not conducted directly between ship owners and ship breakers themselves, but through demolition cash buyers who assume the credit risk, with the result that ship owners are distanced.
Leigh Day director Martyn Day welcomed the appeal court decision.
‘The English courts have been shown to be sympathetic to these claims by communities whether in Africa or Asia bringing claims against British multinationals.
‘Whether it is oil-spill claims against Shell, mine pollution claims against Vedanta or this claim in relation to shipbreaking, London has proved to be one of, if not the only, capitals in the world where claims can successfully be brought,’ he said.