Brais & Brais' Maritime & Boating Accident Lawyer News Blog in January 2011 reported on a recreational boat explosion at the Delray Harbor Club Marina in Delray Beach, Florida. This tragic event caused the death of Robert Romanelli and injured two others including the owner. The explosion also resulted in significant damage to nearby boats and docks. The Limitation of Liablity Act When presented with a maritime catastrophe which could potentially costs millions of dollars, marine insurance companies often seek the liberal protections of a little known statute called the Limitation of Liability Act. Enacted in 1851, the Limitation of Liability Act allows boat owners to limit their liability for any death, injury or property damage arising from a maritime accident occasioned without the boat owner's "privity or knowledge" to the post loss value of the boat. In the case of the Delray explosion, the owner claimed the value of the boat after the incident was only $1,000. The purpose of the Limitation of Liability Act was to "to encourage ship building and to induce capitalists to invest money in the branch of industry." However, since the Limitation of Liability Act is broadly worded, courts have found it to apply to not only ocean going tanker and freighter but to also recreational boats – even personal watercrafts! In essence, if applied, a recreational boat owner and his marine insurance company will pay miniscule damages even though the disaster caused significant injury and death. Another benefit the Limitation of Liability Act provides to boat owners and their marine insurance companies is the shortening of the statute of limitations to bring a maritime claim. Typically a victim of a boating accident has 3 years to bring a claim against the boat owner. However, the Limitation of Liability Act allows the boat owner to shorten that time period to only a few months. This places an undue burden on a person who is recovering from his injury or a bereaved family healing from the loss of a loved one. A common trick marine insurance companies employ is to file the "Complaint for Exoneration from or Limitation of Liability" on the heels of a maritime disaster in the hope that the injured person or family would not notice the shortened deadline or be unable to retain competent counsel in the shortened time to bring a claim. Such was the situation with the Delray explosion. The Delray Boat Explosion Exoneration / Limitation Proceedings Within 4 months of the Delray tragedy, the boat owner, insured by Progressive, filed a Complaint for Exoneration from or Limitation of Liability in Florida Federal Court. In a separate filing, the boat owner asked the court to find the post loss valuation of the vessel was $1,000, enjoin the victims from filing their claims in any other Court and limit the time period for which they could file their claims. After reviewing the Complaint for Exoneration from or Limitation of Liability, the Court noticed that the boat owner did not state he even received notice of a potential claim. The Court reasoned that the Limitation of Liability Act only provided its protections after the boat owner is notified of a claim in writing. Since the boat owner did not state he received written notice of a claim, he lacked legal standing to invoke the Limitation of Liability Act and dismissed the claim. This case is significant as it takes away an arrow in marine insurance companies quiver. No longer can they rush to the courthouse and file Complaint for Exoneration from or Limitation of Liability to catch the victims of boating accidents unguarded. Additional Information About the Limitation of Liablity Act & Victims' Rights If you would like to learn more about the Limitation of Liability Act please contact our Florida Board Certified Admiralty and Maritime Lawyers or read the following paper prepared by our firm and presented at the Southeastern Admiralty Law Institute: The Shipowners' Limitation of Liability Act: Pitfalls for the Unwary News Coverage of the Delray Boat Explosion
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