The United States Supreme Court addresses only about one percent of the cases brought before it.  So it is significant when the Court takes up an issue affecting our industry.  In January, the Court issued an opinion in the maritime case of Lozman v. City of Rivera Beach.

The central issue in the Lozman case pertained to whether the petitioner’s floating home was a vessel.  The houseboat’s “status” was critical for the City of Riveria Beach’s claim for dockage fees and trespass that were based on the district court’s admiralty jurisdiction.

Courts have struggled with what is and isn’t a vessel nearly as long as industry has transported people and cargo by sea.  Seven years ago, the Supreme Court tried to clarify the definition in Stewart v. Dutra Construction, when it suggested that virtually anything capable of carrying persons and/or goods across water may qualify as a vessel.  The Lozman court has further refined the vessel status test, favoring a practicality based analysis.

Lozman’s houseboat was afloat and capable of towage across water,  characteristics which the lower courts found were sufficient to make it a vessel.  The Supreme Court disagreed.  It declared that the vessel status issue should be decided by analyzing whether a reasonable observer, looking to the structure’s physical characteristics and activities, could consider it designed “to a practical degree” for carrying people or things over water.  Such purposes were not the intended or actual uses of Lozman’s floating home.  Therefore, it did not meet the legal standards for vessel status.

Vessel status has far reaching legal ramifications and is relevant for establishing admiralty jurisdiction, determining seaman status, creating maritime liens, and pursuing other rights and remedies unique to admiralty law and maritime commerce.  However, as the Lozman  case demonstrates, the vessel status issue can be complicated and is often determined on a case by case basis.

Note: This article first appeared in WorkBoat Magazine.  It is also available on WorkBoat’s website.

“What is a vessel?”  It’s a simple question that should have a simple answer.  Yet for decades so called legal scholars have found the answer elusive.  This question has been the focus of numerous lawsuits.  Why?  Because vessel status is central in determining which courts, state or federal, have jurisdiction and to what rights and remedies parties engaged in maritime commerce may have and be entitled.

In 2005 we thought that the U.S. Supreme Court in Stewart v. Dutra Construction Co., 543 U.S. 481, answered the question when it set out the criteria that must be met to qualify as a vessel.  In Stewart, the petitioner, a marine engineer hired by Dutra to maintain its dredge SUPER SCOOP (described as a floating platform with a bucket that removed silt from the ocean floor and dumped it into adjacent scows), was injured while repairing a scow’s engine.  Stewart sued Dutra, claiming he was a seaman and the SUPER SCOOP, the vessel.  At issue before the court was whether the dredge was a vessel.

In order to reach its decision, the Court used The Rules of Construction Act which defines a “vessel” as including every description of watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water.”  1 U.S.C. § 3.  The Court concluded even though its primary purpose was not navigation or maritime commerce, the dredge was a vessel because it was “capable of being used as means of transportation on water.”  This is a broad definition, and was received by the maritime community as a signal from the Supreme Court that if it floats and is merely capable of being used for transportation of people or materials over water, it is a “vessel.”  Based on Stewart, just about any “contrivance” that floats was thereafter considered to be a vessel, and the lower courts have rarely refused to classify any “contrivance” that floats as a vessel.

Then, on January 15, 2013 the Supreme Court handed down its decision in Lozman v. City of Riviera Beach, Florida.

Petitioner Lozman’s floating home was a house-like plywood structure with empty bilge space underneath the main floor to keep it afloat.  He had it towed several times before deciding on a marina owned by the City of Riviera Beach (City).  After various disputes with Lozman and unsuccessful efforts to evict him from the marina, the City brought a federal admiralty lawsuit in rem against the floating home, seeking a lien for dockage fees and damages for trespass.  Lozman moved to dismiss the suit for lack of admiralty jurisdiction.  The District Court found the floating home to be a “vessel” under The Rules of Construction Act, which defines a “vessel” as including “every description of watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water,” 1 U.S.C. § 3, concluded that admiralty jurisdiction was proper, and awarded the City dockage fees and nominal damages.  The Eleventh Circuit affirmed, agreeing that the home was a “vessel” since it was “capable” of movement over water despite petitioner’s subjective intent to remain moored indefinitely.

When called upon to determine if the houseboat qualified as a vessel, the Supreme Court moved away from its Stewart test and directed that a contrivance or water craft may be a “vessel” when “a reasonable observer looking at its physical characteristics and activities could conclude that it was designed to any practical degree for carrying people or things on water.”  Now the court has required subjective criteria, i.e., what a reasonable person may think, be central to the test.

This is not a step forward.  Instead of providing clarity on the issue, this decision only makes the issue of what is or is not a vessel subject to more debate.  Instead of providing objective criteria, the court has now injected a significant subjective factor into the equation.  For every reasonable person who thinks a watercraft or contrivance is a vessel, there are bound to be others who will disagree.  It all depends on that person’s interest.

The Court addressed this criticism and recognized that while its approach was “neither perfectly precise nor always determinative,” it is workable and consistent and should offer guidance in a significant number of borderline cases.

By its decision in Lozman, the Supreme Court has only made answering the question more difficult.  Now, in addition to applying objective criteria, we are required to figure out what the “reasonable person” would conclude after looking at its physical characteristics and activities.  Every case has two sides, and each will argue that its opinion is the “reasonable” one.  One thing is certain; instead of providing clarity, this decision will only increase litigation.  Instead of answering the question Lozman raises more questions.