Adriatic Tankers I71what may have been, as claimed, a temporarily ailing company out of business with the consequent loss of jobs. However, by 1994 evidence of serious abuses brought more action by the ITF, including legal advice to crews, as well as more arrests of ships by creditors.The FallThe above outline of conditions leading to the foundering of Adriatic Tankers as a company provides the framework for the later, more detailed analysis of cause and effect. The collapse when it came did so rapidly as a result of the combinations of the related events described above. Very important in trying to survive financially were the attempts by Adriatic to retain a cash flow by delaying the payment of crew wages and allotments. These actions resulted in hardships, stresses, discontent and loss of morale among the seafarers, and the subsequent victimisation and mistreatment of crews who objected. This in turn led to the further neglect of the ships and their physical deterioration. By 1994, a number of suppliers of bunkers, stores and equipment were also complaining that they were not being paid, and reports appeared in the press of vessel detentions under port-state control due to deteriorating conditions and non-compliance with international safety regulations. In this period the company cut back further on repair expenditure, even where safety was obviously involved. The company continued to borrow widely in the US, Japan, South Africa, Switzerland and the UK with some success, and issued statements indicating their positive financial and operational attributes. They blamed most of the problems on administrative difficulties and vindictive trade union actions. By 1995, time was running out. Adriatic Tankers was being avoided by several charterers, the company was expelled from Intertanko, declassified by DNV, and they lost P&I cover, while the news of many bounced cheques was surfacing. There was a simultaneous race to obtain warrants for the arrest of the ships on behalf of seafarers and other creditors. The banks and financial bodies also acted to repossess the ships as the major mortgagees. The value of some of the vessels on sale was found to be less than 30 per cent of the initial loans. Some ships were as a result totally abandoned. The company was now on the rocks �or so it seemed.
