The Fine Print

November 2018 Multimedia By Joan Wenner, J.D.

Many marinas both big and small have slip renters sign a written agreement, most commonly on an annual basis. They are important documents, and ones not simply to be glossed over and signed without a second thought, and particularly as they relate to liability for damages to the boats. In this article readers will understand why.

Along with the cost, time period of the rental, and, among other things, requirements that the boat owner maintain the craft in a seaworthy condition and keep it adequately insured at all times, as well as be responsible for independent workmen hired to come on the premises to work on the boat, the agreement will spell out the terms of liability for damages to the boat and/or marina premises for negligence in the event of an accident or occurrence.

First a few words about marinas that do not use a written slip or boat space rental agreement, although certainly most do. In those instances, the marina is required to exercise what is called ‘ordinary care’ for the boats in its slips, but generally not legally responsible for damage to boats in its care unless acts of the facility have risen to what amounts to ‘gross negligence’ which is a higher level than ordinary negligence under the law. And the legal burden of proving gross negligence is on the boat owner or the insurer.

Where there is a written slip rental contract it can be a whole different story. Most people have heard the phrase, “a contract is a contract” and perhaps in no instance is that more true than with the typical slip rental agreement. By far the majority of them have what are known in the legal world as “hold harmless” or exculpatory clauses, and with some exceptions, they have been quite often enforced with a vengeance by those courts called upon to interpret them in marine contracts. Bottom line is that these clauses in slip rental agreements absolve the marina from virtually all liability as valid contractual negotiations between parties dealing at arms’ length. (You can always not rent a slip at that spot and go somewhere else is the theory, though of course in practice, the marinas in the locale where you want to be are likely all using the same form agreement or something very similar.)

The following recent case is particularly illustrative. A couple owned a houseboat named the A-OK, which they moored at a nearby marina. After noticing a fuel leak near the starboard engine fuel pump, the husband approached the marina’s service department to discuss needed repairs. The service manager told him they couldn’t do the work in the time frame requested, but suggested that one of the marina’s maintenance workers be hired to repair the leak. After receiving assurances the maintenance worker was qualified to perform the repair work, the husband hired him to install a new fuel pump after investigation that that was the problem.

Three days later, the boat owner returned and after starting the houseboat and letting it run for a period of time, heard a loud thud that was later described as an explosion. Flames that the husband couldn’t extinguish engulfed the hatch area where the engines were located and subsequently engulfed the entire houseboat. The fire also spread to other docks and ultimately destroyed three other craft. A lawsuit predictably followed against the marina with the boat owner claiming negligence by the facility’s maintenance worker in improperly installing the fuel pump that was judged the cause of the fire and the marina’s liability for assuring the worker was qualified when in fact he was not.

The marina for its part said that an exculpatory clause printed in each renter’s boat space rental agreement completely exonerated it from any liability for damages from the fire to any one. And at least this court enforced it in the marina’s favor. Here’s the language the court looked at (and is the standard wording found usually in the paragraph labeled Insurance):  The Landlord will not be responsible for any injuries or property damage resulting, caused by or growing out of the use of the dock or harbor facilities; that the Tenant RELEASES AND DISCHARGES THE LANDLORD FROM ANY AND ALL LIABILITY for loss, injury, or damages to person or property sustained while in or on the facilities of Landlord, including fire, theft, vandalism, wind storm, high or low waters, hail, rain, ice, collision or accident, or any other Act of God, whether said boat is being parked or hauled by an Agent of Landlord or not.

In this case the marina was released from any liability for its own negligence (that it had admitted), as the wording in the agreement was held sufficiently clear to determine the parties’ intentions. The slip agreement clearly shifted the risk of loss to the boat owners.  In short, the court said, “all means all.” Unless, and there’s usually an ‘unless’ in the law, a case deals with gross negligence or recklessness, as opposed to ordinary negligence.

A similar result came in another case involving damage to a houseboat from a hurricane level storm at a Gulf area marina where it had not been secured in the same manner as had other boats that survived major damage. After an abrupt wind shift, the craft broke away and was destroyed. (The craft had been tied down at each end, but the owners claimed the marina should have tied it down from all four corners anticipating the probability of a substantial wind change.) Under the circumstances the court held the marina had acted reasonably prudently in its actions and was not held liable for damages.

And speaking of storms, for those in Florida, since 1994 marinas cannot force evacuation of vessels by their owners following the issuing of a hurricane watch or warning.  However, in a law passed last year, and which most marinas have added appropriate language to slip agreements or in a special notice attached to it, they can charge “reasonable fees” for the marina securing boats to protect marina property, minimize damage to the craft, or take steps to protect the environment once a watch is posted. It further prevents the facility from being held liable for any damages to boats by a hurricane, unless they do some act that is clearly negligent.

If you’re saying to yourself, “I’ll just let my insurance company battle it out if something happens”, remember that hopefully you weren’t negligent in the legal sense in anything you did, but also people today know all too well what can happen when just a single claim is made with their insurer–maybe no renewal, or if renewed, perhaps at a substantially higher premium to fully insure the craft.

It must be remembered that slip agreements will definitely provide that the craft be kept adequately insured with “complete marine insurance, including hull [property] coverage and indemnity and/or liability insurance.”

Read a slip rental contract carefully. It is always extremely important to understand what you’re signing. If a judge is later called on to interpret the language, the decision may not be the one you expected.

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