Limitation of Liability

Limitation of Liability

Individuals who have been injured while onboard ships or other types of vessels typically have questions regarding their rights to compensation under the law. The last thing a victim would contemplate is the possibility of being sued by a vessel owner, but it can happen. Why? In maritime law, there is a statutory remedy known as “limitation of liability.”

Under the law, vessel owners can seek to limit their liability after an accident occurs. This makes it imperative for an injured victim to work with a skilled Jones Act lawyer who has a thorough understanding of the intricacies of maritime law and how an owner might attempt to use the statute to limit damages.

The Law

The idea of limiting a defendant’s liability is not new to maritime law. Vessel owners can limit their liability to the post-accident or casualty value of the vessel after an incident occurs, except where the vessel owner had knowledge (or should have had knowledge) of the events that caused the incident. This is referred to as privity and knowledge.

The law applies to all vessels on the high seas, including those used on rivers, lakes and inland navigation which are also navigable or capable of navigation. However, it is important for injured victims to know that vessel owners will not be allowed to limit their liability if the injury-causing event occurred on a waterway that is not navigable. A lawyer who understands the limitation of liability Act can advise you on its applicability to your case.

Why Might a Vessel Owner Initiate a Limitation of Liability Proceeding?

There are a number of reasons why an owner would bring a limitation of liability action against an injured party. For example, if a recreational boat (Boat A) crashes with another boat (Boat B) and the passengers of Boat B sustain serious injuries, the owner of Boat A may decide to commence an action seeking to limit liability to all potential claimants to an amount equal to the post-collision value of the boat. This can be particularly troublesome for victims who have sustained catastrophic injuries because the value of the boat could be considerably less than what is needed to properly compensate the injured parties.

It should be noted, however, that vessel owners are not allowed to limit liability in claims involving maintenance and cure benefits for harmed seamen, wages owed to seamen and personal contracts, to include agreements for supplies, services and vessel repairs.

Injured individuals should also be aware that if the vessel involved in the accident has no value, the law provides a statutory minimum based on the tonnage of the vessel. Additionally, there is a statute of limitations on an owner’s ability to file a limitation proceeding. A vessel owner must institute an action within six months after getting written notice of a claim that might exceed the post-accident value of the vessel.

The attorneys at Lipcon, Margulies, Alsina & Winkleman, P.A. have a highly active maritime and admiralty practice involving cargo, drill and cruise ships, tankers, power boats, jet skis and many other vessels. We are well equipped to handle limitation of liability matters.

If you are an individual who has sustained injuries while onboard a vessel and you have questions about the applicability of limitation of liability to your case, contact our office to speak with one of our attorneys.