Legal playing field tilted against dead fishermen

Photos of late fisherman Josh Porter of Toledo, at right with girlfriend Denise Barrett Ramirez, are on display at the Fisherman's Memorial Sanctuary at Yaquina Bay State Park in Newport. (Photo by Lee J. Siegel)

When commercial fishermen and other seafarers die on the job, does the law provide justice for their survivors? The case of the Mary B II’s deadly sinking off Newport in January of this year shows the legal process tilts toward boat owners in several ways, largely to benefit the economy.

“Once a seaman dies, the estate has very few remedies,” said Joe Stacey, a Seattle maritime lawyer who represented late crewman Joshua Porter’s estate in reaching a settlement with the boat’s owner.

Chris Reilly, maritime attorney for Mary B. Anderson, whose company Mary B II LLC owned the vessel, conceded that if you ask the survivors of those killed, “I don’t think they would find justice in receiving money for a loved one’s life. … Don’t suffer from the illusion that our court system provides justice. It’s what we pursue, but I’m not sure how often it is delivered. … Congress decides whether it’s just or fair, and the rest of us just follow the law.”

Multiple legal factors work against survivors of dead seamen, particularly the 1851 Shipowners’ Limitation of Liability Act, which reduces or eliminates what a shipowner must pay injured seamen or survivors of those killed unless a judge rules the owner had “privity [close connection to] and knowledge” of negligence or other factors that made the boat unseaworthy. Most nations have similar laws or treaties.

“Although this law is unsavory in particular cases involving injury or death, most cases are about cargo damage,” said Martin Davies, director of Tulane University’s Maritime Law Center in New Orleans.  “That’s why it is a necessary evil. If we repealed limitation of liability, all shipping operators would increase rates to carry cargo to the United States. Everything imported or exported to the United States would cost more.”

Porter, 50, of Toledo; James Lacey, 48, of New Jersey; and skipper James Biernacki, 50, also from New Jersey, died Jan. 8 when the Mary B II was capsized by a large wave when trying to cross the Yaquina Bay bar after crab fishing.

Anderson, a retired California chiropractor and Biernacki’s mother, used the limitation law process to reach a Sept. 27 settlement between her company and Porter’s and Lacey’s estates. Her modest $500,000 liability insurance was a bigger factor in reaching the settlement, which exceeds $350,000, than her attempt to use the limited liability law, which wasn’t decided.

Davies said boat owners succeed half the time in limiting their liability. Even if they don’t, the law gives them an edge. Instead of waiting to be sued, possibly in multiple courts, the boat owner notifies survivors and requires them to respond in federal court, where a judge, not a jury, decides if the boat owner deserves limited or $0 liability.

Reilly, however, said the limitation law helped Porter’s and Lacey’s survivors because it brought the claims together and dealt with them quickly; defending separate lawsuits would have used even more of the boat owner’s $500,000 liability insurance, leaving less for survivors.

Even if shipowners lose attempts to limit liability, other laws work in their favor:

  • No minimum liability insurance is required for vessels, Stacey said, calling liability insurance on the Mary B II case inadequate. Taunette Dixon, of Newport Fishermen’s Wives, said most commercial fishing boat owners buy adequate insurance; her family pays $50,000 a year for a $5 million liability policy.
  • The fact the Mary B II was owned by an LLC, or limited liability company, rather than by Anderson directly shielded her personal assets from claims by survivors. Many small business owners set up LLCs.
  • Hull insurance payouts to owners of wrecked boats can’t be claimed by the injured, dead or their survivors. Nor can fishing permits, which law doesn’t consider part of a boat. Reilly wouldn’t say how much hull insurance Mary B II LLC got, and didn’t know if Anderson sold the boat’s crabbing permit, which he said was worth half the boat’s $150,000 to $175,000 purchase price. Her company is insolvent, he said.
  • The Jones Act of 1920 allowed seamen to sue ship owners for injury or death if they could show unseaworthiness or negligence by the owner, captain or crew members. Davies said the Jones Act “provides very limited remedies [economic damages] to kin of deceased seamen.”
  • When survivors of those killed sue under general maritime law, they can’t collect for lost future earnings or for loss of love and affection. “You are better off if you are killed walking across the crosswalk than you are on a job as a seaman,” Stacey said.
  • On June 24, the U.S. Supreme Court ruled 6-3 that punitive damages are not available for personal injury and death claims of unseaworthiness under general maritime law. They already were unavailable under the Jones Act. Stacey said punitive damages could prompt “change in the culture that accepts dangerous boats going to sea with incompetent captains.”

Britain passed the first limitation of liability law in 1734, Davies said. The 1851 U.S. law was meant “to allow vessel operators, which accept great risks transporting goods and persons on water, to escape unlimited liability, which can put them out of business or stifle further investment in maritime commerce and shipbuilding,” Maryland attorney Stephen F. White wrote.

The limitation act applies only in navigable waters. It applies to commercial fishing boats, cargo ships, cruise ships, motorboats, ferries, towboats, yachts, barges, even jet skis.

The U.S. House passed at least five bills to abolish the Limitation of Liability Act, “but they never passed the Senate,” Davies said. He would be hesitant to repeal it.

“If the United States repealed it, it would be the only place in the world with unlimited liability for maritime casualties,” he said. Freight rates would skyrocket, and “everybody in the world would try to bring their lawsuit here.”

 

(Next: Defending the boat owner.)

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