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Seaworthy: Can You Have Punitive Damage If It Is Not?

Many of you may already know that Tom Winslow, an attorney at Goldfinch Winslow Law Firm has an LLM in Maritime Law.  Just this past week a vessel, which is 656 feet long and weighs 71,000 tons, departed the Brunswick port bound for Baltimore about 1 a.m. Sunday. There was soon a fire on board. About 2 a.m., emergency responders, including the Coast Guard, were notified that the ship had capsized in St. Simons Sound off the shore of St. Simons Island.

The Golden Ray had 24 people aboard — 23 crew members and a pilot — along with 4,200 vehicles. Twenty people were rescued quickly, but the other four could not immediately make their way off.  Those four where rescued later.  With this type of action, the immediate question becomes whether the vessel was seaworthy.

If you have been to a marine industry function over the last few months, the buzz has been about punitive damages. Specifically, the discussions have revolved around the Supreme Court’s decision to consider a case to determine whether punitive damages were available to seamen who allege seaworthiness claims against vessel owners.

Punitive damages would drive the value of a maritime personal injury claims up significantly, as each claimant would argue that he could recover such damages at trial. Most importantly, punitive damage awards are not usually covered by standard marine insurance policies and, if awarded, could provide a significant uninsured exposure to the company. As such, the firm could be put in a situation where a jury provided a damage award to compensate the seaman, which would be covered by insurance and a punitive award that would not be covered by insurance. If a vessel owner did not have the resources to pay such a claim, it could jeopardize the solvency of the operation.

To put this issue in context, take a look at the claims that are usually alleged by a Jones Act seaman and how the courts handle each issue with regard to punitive damages. Each seaman will typically allege three separate and distinct claims when filing a lawsuit. These allegations include claims for negligence, seaworthiness and for maintenance and cure.

A claim for maintenance and cure does not require a finding of fault and provides the injured seaman with medical care and a per diem payment to assist him with some basic living expenses until he or she reaches maximum

With the goal of providing a complete overview of the status of punitive damages for marine claims, this article provides an over- view of the potential claims an injured seaman possesses, a description and history of punitive damages in maritime law, why the Supreme Court needed to address the sea- worthiness issue, and how the Supreme Court resolved the issue in the industry’s favor.

“Although negligence and seaworthiness claims are intertwined, they arise from two separate bodies of law. A seaman’s negligence claim against his employer was authorized by Congress via the Jones Act, and the seaworthiness claim is based upon the General Maritime Law, the body of common law created by the United States Federal Courts.”

The Supreme Court ruled that punitive damages were not recoverable for seaworthiness claims. The Court found that there was no historical precedent for punitive damage awards for seaworthiness claims under the General Maritime Law. Furthermore, the Court held that a Jones Act negligence claim and a seaworthiness claim were similar and duplicative in nature and that it would not make sense to treat the two claims differently as to the recovery of punitive damages. Based upon this reasoning, the Court held that punitive damages are not permitted with seaworthiness claims.

So, based upon the Supreme Court rulings of the last thirty years, marine employers and vessel owners are immune from punitive damages for seaman claims related to Jones Act negligence and the seaworthiness of the vessel. With the issue is settled, the maritime industry can now move forward with some degree of certainty when evaluating potential risks and the best methods for mitigating these risks.

However, marine employers and vessel owners must recognize that the Supreme Court has affirmed punitive damages in situations where the employer wrongly denies maintenance and cure benefits. As such, it is important that you make a well-reasoned and supported decision, anytime that denying an injured seaman maintenance and cure benefits is considered. Any termination that could later be determined to be willful and wrong could expose the company to a potential punitive award.

While some may agree or disagree with the decision it is now decided and now all parties can better value a case.  Should you have a maritime situation or get hurt on the water, please give us a call.   We wouldn’t want your case to get sunk because it did not have an attorney who was “seaworthy.”

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