Limitation of Liability...
Limitation of Liability in Maritime Law
It's interesting that some elements of maritime law arose during the age of sail - but continue to be applied to modern vessels in the twenty-first century.
Limitation of liability is one of these. The concept arises regularly in maritime law. It dates back to the mid-nineteenth century when commerce was carried out by square-rigged sailing ships like the one pictured above. Under the Shipowners Limitation of Liability Act of 1851, a ship owner could limit liability to the post-casualty value of the vessel following a marine accident if they did not have privity and knowledge of the circumstances giving rise to the loss. In other words, if the vessel owner could show they didn’t have control over how the accident occurred, they could limit their liability… being on the hook for no more than the post-accident value. Why would such a law be enacted? It seems like nothing more than an opportunity for vessel owners to evade liability for damages or injuries after a collision, fire, or sinking. This very position has been taken by legal scholars on both sides of the fence, whether from the plaintiff's side or the defense side. Tim was asked to cover this issue by the Association of Trial Lawyers of America, outlining legal strategies for plaintiff attorneys confronted by this concept in their representation of injured commercial mariners, passengers, or recreational boaters. See Defeating Limitation of Liability in Maritime Law . But you have to remember that this was the mid-1800s. Congress was interested in fostering a strong mercantile industry. In order for shipowners of the day to feel safe that they wouldn’t lose the entire company if a clipper ship rounding Cape Horn was lost in a storm, they needed a financial incentive. That incentive came in the way of this legal protection of Shipowners Limitation of Liability Act of 1851. Althought it dates back to the days of sail-driven merchant ships, the concept is invoked in modern times, such as the tragic 2003 allision in which the Staten Island Ferry Andrew Barberi struck a pier while traveling at close to her sea speed of around 17 knots.
Limitation of liability is one of these. The concept arises regularly in maritime law. It dates back to the mid-nineteenth century when commerce was carried out by square-rigged sailing ships like the one pictured above. Under the Shipowners Limitation of Liability Act of 1851, a ship owner could limit liability to the post-casualty value of the vessel following a marine accident if they did not have privity and knowledge of the circumstances giving rise to the loss. In other words, if the vessel owner could show they didn’t have control over how the accident occurred, they could limit their liability… being on the hook for no more than the post-accident value. Why would such a law be enacted? It seems like nothing more than an opportunity for vessel owners to evade liability for damages or injuries after a collision, fire, or sinking. This very position has been taken by legal scholars on both sides of the fence, whether from the plaintiff's side or the defense side. Tim was asked to cover this issue by the Association of Trial Lawyers of America, outlining legal strategies for plaintiff attorneys confronted by this concept in their representation of injured commercial mariners, passengers, or recreational boaters. See Defeating Limitation of Liability in Maritime Law . But you have to remember that this was the mid-1800s. Congress was interested in fostering a strong mercantile industry. In order for shipowners of the day to feel safe that they wouldn’t lose the entire company if a clipper ship rounding Cape Horn was lost in a storm, they needed a financial incentive. That incentive came in the way of this legal protection of Shipowners Limitation of Liability Act of 1851. Althought it dates back to the days of sail-driven merchant ships, the concept is invoked in modern times, such as the tragic 2003 allision in which the Staten Island Ferry Andrew Barberi struck a pier while traveling at close to her sea speed of around 17 knots.