The Kaitaki ferry lost propulsion on its approach into Wellington Harbour on 28 January 2023, with more than 800 people on-board. It then issued a mayday.
When the mayday was issued, passengers were called to muster, lifejackets were supplied to those on-board.
The ferry then re-gained limited power, and made its way to port in Wellington, where its passengers were able to safely disembark and come ashore.
At the time, there was strong southerly winds, with gusts of up to 45 knots and swells of three metres around the entrance to Wellington Harbour.
If the anchors didn't hold, the vessel could have grounded at Sinclair Head.
The incident was caused by a failure of a rubber expansion joint. This resulted in the Kaitaki's main engine shutting down, leaving the ferry adrift.
Maritime NZ Director, Kirstie Hewlett, says this was a very dangerous incident, and it is good to see KiwiRail take accountability by pleading guilty.
"There were significant failings that caused the ferry to lose power.
"Poorly managed maintenance and processes on the Kaitaki meant its passengers, crew and the environment were put at risk.
"All operators need to ensure their vessels are well maintained, regularly serviced and properly managed," Ms Hewlett says.
"This is an alarming example of what can go wrong when maintenance is poorly managed.
"We have been clear to KiwiRail about our expectations around the management of its fleet, and KiwiRail has undertaken significant work since," Ms Hewlett says.