Friday, October 5, 2012

Boat, you're under arrest. Put your lines behind your stern so we can cuff you

From little acorns, Supreme Court cases grow. This whole escapade starts with Fane Lozman. He suspected Riveria Beach city officials were illegally conspiring to sell the city owned marina his houseboat resided in to private developers. In a fit of civic pique Mr. Lozman sued the city. The proposed redevelopment program later fell through, but the city was irked over the suit, and took action.

Catching Mr. Lozman in the act of walking his small dachshund, gasp, unmuzzled on marina property, and claiming he was using unlicensed workmen on his boat the city attempted to evict him. Mr. Lozman again sued the city, and prevailed. The city was found to have retaliated against him. But the city wasn't through with Mr. Lozman yet. They adopted new marina regulations that included the requirement that all vessels had to be able to move in the event of a hurricane, be registered as a boat, and have insurance.

In part Mr. Lozman couldn't comply with some of the new regulations. His houseboat didn't have a HIN number, so it couldn't be registered. The new regulations also implied you had to have a motor, which he didn't have, and I suspect at this point he just didn't want to. Notices sent Mr. Lozman, were ignored, and then on a fateful day the city used Admiralty law with a federal warrant to arrest the boat. And yes you can arrest a boat. It gets towed away, and is later sold at auction. The city actually buys it back, tries to sell it, so they claim, and later has it destroyed. This will show that meddler you don't mess with city hall, and now the case is being heard by the Supreme Court. Is it a boat, or not? That is the question.

So big deal, you might think, it floats, so it must be a boat, but in reality this Supreme Court decision could have a huge impact on the maritime industry.

Mr. Lozman claims it's not a boat, and hence the use of Admiralty law to arrest the boat was improper. His view is that this is a landlord/tenant dispute and should have been settled in civil court.

The city's view is it is a boat, and the city's definition of a vessel is anything that "floats, moves, or carries people or things on the water."

The entire case revolves around the interpretation of wording in the US code. "The word “vessel” includes every description of watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water." The crux of the issue depends on how you define "means of transportation."

Mr. Lozman's houseboat has no steering, motor, navigation lights or bilge pump. It's functional operation is completely dependent on being attached to land for power, water, sewage disposal, and communications. On top of this the houseboat, does not appear to be seaworthy by any standards I could muster.

So what could be the impact? If you're a floating casino structure, and become boat by definition, then you would now employ seaman who are now subject to federal, not state jurisdiction.  If you're hurt working on a boat then the Jones Act Law kicks in. Get hurt at work on land, then worker compensation laws are the remedy. Does the USCG regulate you, and can they board at any time for any reason?

So classification of whether something is a boat, or a "floating structure" is important to the owners of offshore oil platforms, floating casinos, dredges, afloat museums such as the USS Iowa, Midway, and USS Intrepid. Don't forget the thousands of other similar non-engine houseboats and many other types of floating structures. This also could affect the way boats are financed.

The use of Admiralty law by the city also created an end run around the Florida statutes. Florida law defines floating structure as "A floating barge-like entity with or without accommodations built thereon, which is not primarily used as a means of transportation on water, but which serves purposes or provides services typically associated with a structure or other improvement to real property. The term "floating structure" includes, but is not limited to, entities used as residence, place of business, office, hotel or motel, restaurant or lounge, clubhouse, meeting facility, storage or parking facility, mining platform, dredge, dragline or similar facility or entity represented as such. Floating structures are expressly excluded from the definition of a vessel as provided in ss. 327.02(36), Florida Statutes. Incidental movement upon water shall not in and of itself preclude an entity from classification as a floating structure. A floating structure is expressly included as a type of tangible personal property."

If the city of Riviera Beach hadn't used Admiralty law as a short cut, and arrested the houseboat, think of all the expenses it would have saved it's taxpayers. It never pays to be churlish. A decision is expected by June.

Just so you don't think Supreme Court Judges don't have a sense of humor, here are a couple of comments from the oral arguments:

Justice Kennedy referred to Mr. Lozman's houseboat as "That magnificent structure...mercifully it was destroyed"

Justice Kagan said "A vessel might include a inner tube with pennies pasted to it. “Now it carries things. “There are things on the inner tube, and it floats.”

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