What Is the Limitation of Liability Act of 1851?
The Limitation of Liability Act was passed in order to protect American vessels from competition by foreign vessel owners. Foreign vessels in those days, had immunity from claims. It was felt that American vessels would have a competitive edge over their foreign counterparts, if there was a limit set on American vessel owners’ liability after an accident. Under the law, a vessel owner can move to limit the extent of his liability to the value of the vessel. In the case of the Deepwater Horizon, Transocean is expected to claim that the value of the vessel is just 26,764,083. The Deepwater Horizon semi submersible rig sank just over 24 hours after the explosion. Before the explosion, the value of the rig was estimated at about $650 million. As an offshore injury attorney who has been closely following developments related to the Transocean oil rig explosion, I’m not really surprised that the company has chosen this option. Shipping companies often do this especially, when there is a mari
