In our last newsletter, we commented that a Federal District Court in Florida found that the provisions of 46 USC 183 which permitted vessels to limit liability did not apply to certain recreational vessels.
In that case, the plaintiff Kays rented a Kawasaki Jet Ski from Keys Jet Ski. Their 13 year old son operated if off crowded Smathers Beach in Key West and collided with an open 25 foot fishing boat which resulted in his death.
Keys sought relief under the Limitation of Liability Act which Kays moved to dismiss because the Act did not apply to pleasure craft in general or the jet ski in particular. Keys appealed dismissal of their action.
The Circuit Court reversed.
The Act’s purpose in 1851 was to promote investment in domestic commercial shipping. Despite the logical appeal of applying the Act only to commercial vessels, and repeated calls to amend the Act, Congress which created it failed to make a change in what has been criticized as a hopeless anachronistic
Act. Held, the District Court erred in finding that the Act did not apply to pleasure craft. The Jet Ski was a "vessel", for there was no distinction between it and small motor boats capable of being used as a mans of transportation on water which likewise were subject to the Act.
Keys Jet Ski, Inc v. Kays, (CA Fla. 1990) 893 F 2d 1225.
This update was called to our attention by attorney author Herb Markow whose series of books, "Small Boat Law" is reviewed in this issue of the EXPERT on page 2.
In Sisson v Ruby, 497 US __, 111L Ed 292 handed down on June 25th, 1990, the Supreme Court reviewed the rule for determining whether federal courts had maritime jurisdiction over a fire which started on a yacht moored at a marina had sued for damages arising out of the fire.
The owner of the yacht had filed a petition in the District Court for declaratory and injunctive relief arguing that the court had jurisdiction under 28 USC 1333(1). The court disagreed and dismissed the petition for lack of subject matter jurisdiction.
The Circuit Court affirmed.
The Supreme Court reversed. It stated that until recently, jurisdiction had been based largely on the "locality" test. However, in Executive Jet v. City of Cleveland, 409 US 249, 34 L Ed 2d 454 (1972) the court enunciated a new test which departed from the "locality" test. They held that "the wrong [must] bear a significant relationship to traditional maritime activity". (at page 268).
In Foremost v Richardson, 457 US 668, 73 L Ed 2d 300, a collision between an 18 foot pleasure boat and a 16 foot recreational fishing boat the court expanded the rule set forth in Executive Jet. Neither boat was involved in commercial maritime activities. The court rejected the argument that a substantial relationship with commercial maritime activity was necessary to find maritime jurisdiction.
Although the court recognize that commercial shipping was at the heart of admiralty jurisdiction, they also noted that interest cannot be adequately served if admiralty jurisdiction is restricted to those individuals actually engaged in commercial maritime activity, This interest can be fully vindicated only if all operators of vessels on navigable waters are subject to uniform rules of conduct. The failure to recognize the breadth of this federal interest ignores the potential effect of non-commercial maritime activity on maritime commerce…The potential disruptive impact of a collision between boats on navigable waters. When coupled with traditional concern that admiralty holds for navigation, compels the conclusion that this collision between two pleasure boats on navigable waters has a significant relationship with maritime commerce. (at pages 674-675).
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