The former owners of the 'Ekta' oil supertanker, formerly known as the 'Maran Centaurus', are facing legal action after a ship-breaker died while working to dismantle it. AFP
The former owners of the 'Ekta' oil supertanker, formerly known as the 'Maran Centaurus', are facing legal action after a ship-breaker died while working to dismantle it. AFP
The former owners of the 'Ekta' oil supertanker, formerly known as the 'Maran Centaurus', are facing legal action after a ship-breaker died while working to dismantle it. AFP
The former owners of the 'Ekta' oil supertanker, formerly known as the 'Maran Centaurus', are facing legal action after a ship-breaker died while working to dismantle it. AFP

Widow of 70p-per-hour shipbreaker killed in Bangladesh fall wins landmark case to sue UK tanker owner


Nicky Harley
  • English
  • Arabic

The widow of a ship-breaker who fell to his death won a landmark case to sue the British owners of the vessel.

Khalil Mollah died in an accident in March 2018 while working 70-hour weeks for just 70p-per-hour and without protective equipment in the Zuma Enterprise Shipyard in Chattogram, Bangladesh.

He was dismantling the Ekta oil tanker, formerly known as the Maran Centaurus, after it was deliberately run aground on a beach.

Lawyers for Mollah's widow, Hamida Begum, told The National it is an important test case, which ruled that the shipping industry "owes a duty of care" to beach workers even after vessels have been sold. It will apply to all European countries.

“All the big shipping nations of Europe will send hundreds of ships to South Asia,” Oliver Holland, lawyer for Leigh Day said.

Labourers walking on the muddy beach of Chittagram where mega freighters have been left for disassembling by low paid workers. Jonas Gratzer/LightRocket via Getty Images
Labourers walking on the muddy beach of Chittagram where mega freighters have been left for disassembling by low paid workers. Jonas Gratzer/LightRocket via Getty Images

“It’s the first time in any European court where it’s been recognised that shipping companies can be found liable for sending their vessels to South Asia when workers are injured or die.”

The UK's High Court in London heard that the owners, Maran (UK), sold it for $16 million to a middleman knowing that if it was going to be scrapped at a 'safer' yard in China the figure would have been nearer $10m and that it owed a duty of care to the worker.

The company argued for the case to be thrown out because they had sold the vessel and were not responsible for the death.

Three judges rejected its appeal and the case will now proceed to trial.

“I consider that the duty of care alleged in this case, although faced with formidable hurdles, cannot be dismissed as fanciful,” Lord Justice Coulson said.

Mr Robert Bright QC, for the defendant, said that it was not the shipowner who sent the ship to Chattogram or who controlled its ultimate destination.

He said there was "no relationship of proximity" between the shipowner and Mollah, that the defendant did not have control over working conditions and if he had not been killed while working on the defendant's ship, "he might just as easily have been killed or injured when working on some other ship".

“He was, said Mr Bright, already at risk every day of his working life,” Lord Justice Males said.

“That is a submission which, in my view, does the defendant no credit.

“A tanker which has come to the end of its working life cannot just be abandoned or scuttled by its owner.

“The choice was straightforward. Either the ship could be sent for dismantling in the relative safety of a dry dock in China or it could be run aground on a beach in the Indian subcontinent to be broken up by hand by workers who were not even provided with rudimentary safety equipment and where fatalities and serious injuries were both common and notorious.

“It might be thought that any responsible owner faced with that choice would opt for safety. But not so. Chinese shipyards would have been prepared to pay $10m for the ship but a buyer in the subcontinent, which did not have to bear the expense or go to the trouble of providing safe conditions for its workers, would pay more.”

His reviews were reiterated by Lord Justice Bean.

“I am not attracted by the argument 'if Mr Mollah had not been killed working on our ship, he could just as easily have been killed or injured working on someone else's',” he said.

“On the claimant's case, the defendant obtained the highest possible price for the vessel and sought to wash their hands of responsibility for anything, however foreseeable, which happened after that.”

The International Labour Organisation says there are "unacceptably high" numbers of deaths in the ship-breaking industry.

Mr Holland said that the industry deliberately sells off its ships through various companies specifically to avoid liability if they do end up on the beaches of South Asia.

Up to 700 large ships are scrapped every year and of the 11 million tonnes of oil tankers demolished in 2018, only 80,000 tonnes were broken up in safer Chinese and Turkish yards.

It is estimated that Chattogram is the graveyard for about 200 large ships a year.

The 300,000-tonne Ekta, which was more than 330 metres long and eight storeys tall, was one of the largest oil tankers yet built when it was launched in 1995.

In November 2009, the vessel and its 28 crew were taken hostage by pirates while travelling to Jeddah in Saudi Arabia with $140m of crude oil.

It was released only after a shootout and the payment of a large ransom.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”