In a recent decision out of the Eastern District of Louisiana, a bareboat subcharterer is liable to both the charterer and the vessel owner for damages to a vessel caused by the subcharterer’s negligence.
In the Robins Dry Dock rule, the court held that the vessel owner had a sufficient proprietary interest in the vessel to recover for loss of charter hire, despite the vessel being under a bareboat charter at the time of the damage.
In Shallow Water Equipment LLC v. Pontchartrain Partners LLC, a construction barge sustained damage to its deck when the subcharterer failed to use mats to support the use of an excavator on the deck of the barge. The charterer filed a breach of contract claim and demanded damages for loss of use of the vessel during the period when the subcharterer retained the vessel while the parties disputed the extent of the physical damage to the vessel. The vessel owner also filed claims against the subcharterer for lost charter hire during the months that the parties disputed the damage to the vessel and when the vessel was out of service for repairs.
The subcharterer attempted to escape liability to the owner by asserting a defense under the Robins Dry Dock rule. The rule requires a plaintiff to have suffered physical damage to property in which it has a proprietary interest to recover maritime tort damages for economic loss. The subcharterer argued the vessel owner merely had an interest in the future use of the vessel after its charter ended (a “right of reversion”), rather than a sufficient proprietary interest in the vessel.
While the court admitted that the argument was “clever,” Robins Dry Dock did not preclude the well-established rule “that the owner of a vessel has the right to recover from a tortfeasor who causes physical damage to the vessel.” The fact that a vessel is bareboat chartered at the time of injury did not establish that the vessel’s owner relinquished all proprietary interest, thereby barring recovery.
Thus, the court rejected the subcharterer’s contention that it owed no duty to the owner but merely owed a contractual duty to the charterer to repair the vessel or pay for any such repairs.
Cindy Muller is a maritime partner in Jones Walker's Houston office. She can be reached at 713-437-1859 0r [email protected].
