Tugboat Company in Fatal Duck Boat Crash Seeks to Limit Liability
It was a tragedy rarely seen in American waters. A group of sightseers in Philadelphia had boarded a "duck boat" for a tour of the City of Brotherly Love. Duck boats are six-wheel-drive, amphibious trucks built for the Army in World War II. These vehicles are able to bring men and supplies over the water as a ship, then pull up onto the beach and drive inland like a truck. In Philadelphia, the duck boats would tour the city's historic district, then head down a ramp and into the Delaware River for a quick boat ride before the end of the tour.
On this day, the engines that turned the duck boat's propeller died after the vehicle hit the water. The duck boat drifted out into the middle of a busy shipping channel where it was struck broadside by a barge being pushed by a tug. A 16-year-old girl and a 20-year-old man died when the boat went down in 40 feet of water. (Source: MyFoxPhilly.com)
Several lawsuits have been filed against the owners of the tug. The tug owners have recently asked that their liability for all damages arising from the collision be limited to $1.65 million. This is because of a little-known quirk of American law called the Limitation of Liability Act of 1851.
This historical throwback of federal admiralty law allows a shipowner to limit his liability in the event of an accident to the value of the ship involved. In 1851, prior to the rise of major insurance companies, a shipowner could be financially destroyed if any of his ships were involved in a serious accident. The Limitation of Liability Act allowed shipowners to cap their liability at the value of the vessel involved.
Fast-forward to 2010. Major insurance companies plus protection and indemnity syndicates provide liability insurance coverage for most major shipowners. Yet the Limitation of Liability Act lives on and shipowners are allowed by U.S. law to ask that their liability be limited through the 1851 statute. While most federal judges rarely grant petitions for these kind of limitations, the statute still allows shipowners advantages like influencing the jurisdiction where lawsuits are brought. In most cases, this helps defendants avoid a jury trial. Cases like these require an experienced admiralty law attorney to navigate the archaic and often bizarre requirements of this venerable statute.