The ferry was carrying well-wishers and girlfriends of sailors on the heavy cruiser USS Louisville as it left the harbour.
Many of their smaller single deck ferries were fitted with rails and seating on their roofs for the enjoyment of passengers.
In January and February 1938, Louisville (CL/CA-28), a Northampton-class cruiser, undertook a Pacific goodwill tour which took her to Hawaii, Samoa, Australia, and Tahiti.
The cruiser with 600 uniformed sailors lining the decks left her berth at Woolloomooloo with a band playing and onlookers cheering.
Between Garden Island and Bradleys Head, Rodney passengers shouted to the skipper to take the ferry around to the cruiser's port side.
The shift in weight wobbled the ferry precariously in the wash of the Louisville, and Rodney began to capsize with passengers falling down the steeply sloping deck.
Louisville took 26 survivors on board, 18 of whom were unconscious and taken to the ship's hospital for treatment by a navy surgeon; all but one survived.
The final death toll was not confirmed until the ferry was raised from the bottom of the harbour and the bodies of seven of those trapped inside were recovered.
As part of the ruling, the judge stated that if the fine was not paid within three weeks, the ferry would be put up for sale to cover the costs.
[2] Her name was changed again in 1939 to Regalia and she continued to serve in the Rosman Ferries fleet, moored at Mosman Bay through to the 1970s or 1980s.