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Dispute Caused by a Japanese Ships Allision with a New Terminal of Tonnage of 450,000 settled in Compensation of 55 Million Yuan through Mediation14

[Case Brief] Approximately at 11:16 on May 18, 2012, the Japanese ship "Gao Ling" allided the 0.45 million tons terminal which belongs to the plaintiff Ningbo Shihua Crude Oil Terminal Co.Ltd. (hereinafter referred to as Ningbo Shihua) during the process of berthing due to improper operation, resulting in damage to the terminal. Immediately, the terminal was required to stop production by the administrative organ of the port. After the accident, our court arrested the offending ship "Gao Ling in accordance with the application of Ningbo Shihua. On May 31, 2012, China Reinsurance (Group) Corporation provided a total guarantee of 63 million Yuan to the plaintiff for the two defendants with respect to the accident involved, and recognized the defendant, Burney Japanese Co., Ltd. as the ship-owner of the ship Gao Ling and the defendant Burney International Co., Ltd. was the bareboat charterer of the ship Gao Ling. Then our court released the arrested ship "Gao Ling". On June 27, 2012, the Ningbo Shihua brought a lawsuit to our court and requested our court to order the two Japanese defendants to jointly compensate the losses of 116 million Yuan arising from the repair and idling period of the terminal. Upon the organization and mediation by our Court, Ningbo Shihua reached a mediation agreement with the two defendants that the two defendants paid a total amount of 55 million Yuan to Ningbo Shihua for its losses.
[Typical Significance]
This case is about the dispute over liability for damage caused by  vessel allision with terminals by Japanese foreign ship and is concerned by all parties due to its big social influence. The terminal (jointly built by Sinopec and Ningbo Port Group) involved in the case of vessel allision is located at East Coast, Daxie Island, Ningbo, which is the largest crude oil terminal in Asia, and is also the only ultra-large type crude oil terminal in our country. It is designed for an annual throughput capability up to 17 million tons, which can effectively relieve tension of crude oil unloading and berth capacity of Yangtze River Delta and areas along the Yangtze River, and better meet the fast-growing demand for regional imported crude oil. The time of allision occurred on the third day after the official opening of the terminal and the vessel involved in the case was just the first foreign ship berthed. As the special court of the place where the vessel was arrested and the accident occurred, Ningbo Maritime Court's fair and equitable settlement of the dispute has a great practical significance for protecting the actual losses of operators of terminals and building a port judicial environment with equality and rule of law. During the trial, there is a big controversy between both parties regarding the allision accident with or without fault, the calculation of the terminal's operation cost and the rationality of the restoration and reinforcement program for the terminal. In order to reduce losses and fix the amount of compensation, our Court organized the parties and their respective commissioned experts to conduct a public hearing. The plaintiff shall actively carry out the restoration and reinforcement work for the terminal to restore the terminal
s original design capacity on the basis that both parties have no objection to the terminals damage detection conclusion. The strengthening project of terminals involved in the case began on May 15, 2013, and was organized for acceptance on September 11, 2013, with an audit cost of 7,433,316 Yuan. Finally, on the basis of a solid investigation of the case facts, the court explained the litigation risk to both parties and guided both parties to continue to narrow their cognitive gaps. Eventually, an agreement was reached where the two defendants were recognized to compensate the plaintiff for a total amount of 55 million Yuan for the terminal allision losses, which was approved by the parties, and the case achieved good legal effect and social effect. People's Court Daily, China Water Transport, China Communications News, Zhejiang Legal News as well as provincial and municipal television stations, radio stations and other major medias all have reported the case in a timely manner.

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