Business, Legal & Accounting Glossary
A field of law relating to, and arising from, the practice of the admiralty courts (tribunals that exercise jurisdiction over all contracts, torts, offenses, or injuries within maritime law) that regulates and settles special problems associated with sea navigation and commerce.
The life of the mariner, spent far away from the stability of land, has long been considered an exotic one of travel, romance, and danger. Stories of pirates, mutinies, lashings and hasty trials—many of them true—illustrate the peculiar, isolated nature of the maritime existence. In modern times, the practice of shipping goods by sea has become more civil, but the law still gives maritime activities special treatment by acknowledging the unique conflicts and difficulties involved in high-seas navigation and commerce.
The roots of maritime law can be traced as far back as 900 B.C., which is when the Rhodian Customary Law is believed to have been shaped by the people of the island of Rhodes. The only concept in the Rhodian Laws that still exists is the law of jettison, which holds that if goods must be thrown overboard (jettisoned) for the safety of the ship or the safety of another’s property, the owner of the goods is entitled to compensation from the beneficiaries of the jettison.
Codes enacted by medieval port cities and states have formed the current U.S. maritime law. The eleventh-century Amalphitan Code, of the Mediterranean countries; the fourteenth-century Consolato del Mare, of France, Spain, and Italy; the twelfth-century Roll of Oleron, from England; and the thirteenth-century Law of Visby all drew on the customs of mariners and merchants to create the unique substantive law of admiralty that still exists today. Procedural differences existed between maritime cases and other civil proceedings until 1966, when the U.S. Supreme Court approved amendments to the Federal Rules of Civil Procedure that brought admiralty and maritime procedural rules into accord with those used in other civil suits. The substantive maritime law, however, has remained intact.
The terms admiralty and maritime law are sometimes used interchangeably, but admiralty originally referred to a specific court in England and the American colonies that had jurisdiction over torts and contracts on the high seas, whereas substantive maritime law developed through the expansion of admiralty court jurisdiction to include all activities on the high seas and similar activities on navigable waters.
Because water commerce and navigation often involve foreign nations, much of the U.S. maritime law has evolved in concert with the maritime laws of other countries. The federal statutes that address maritime issues are often customized U.S. versions of the convention resolutions or treaties of international maritime law. The United Nations organizes and prepares these conventions and treaties through branches such as the International Maritime Organization and the International Labor Organization, which prepares conventions on the health, safety, and well-being of maritime workers.
The substance of maritime law considers the dangerous conditions and unique conflicts involved in navigation and water commerce. Sailors are especially vulnerable to injury and sickness owing to a variety of conditions, such as drastic changes in climate, constant peril, hard labor, and loneliness. Under the Shipowners’ Liability Convention (54 Stat. 1693 ), a shipowner may be liable for the maintenance and cure of sailors injured on ship and for injuries occurring on land. Courts have construed accidents occurring during leave as being the responsibility of the shipowner because sailors need land visits in order to endure the long hours of water transportation.
Assigning responsibility for onboard negligence was a long-standing problem, but the Jones Act of 1920 (46 U.S.C.A. § 688 et seq.) solidifies the right of sailors to recover from an employer for injuries resulting from the negligence of the employer, a master, or another crew member. The 1920 Death on High Seas Act (46 App. U.S.C.A. § 761 et seq.) allows recovery by the beneficiaries of a sailor’s estate when the sailor dies by negligence, default, or wrongful act on the high seas “beyond a marine league from the shore of any state [territory or dependency].” A marine league is one-twentieth of a degree of latitude, or three miles.
Accidents suffered by nonmaritime persons on docks, piers, wharfs, or bridges do not qualify for the application of maritime law principles. However, personal injuries suffered while individuals were aboard a ship or as a result of an air-to-water airplane crash are considered within the jurisdiction of admiralty law.
The Longshoremen’s and Harbor Workers’ Compensation Act (33 U.S.C.A. § 901 et seq.) sets up a federal system to compensate injured maritime workers who do not sail. Through the Federal Office of Workers’ Compensation Programs, employees such as stevedores (workers who load and unload ships) and ship service operators can receive compensation for injuries suffered in the course of their employment. U.S. sailors benefit from Title 46 of the U. S. Code, which sets a schedule for sailors’ earnings and the conditions of their contracts. Title 46 also lists the qualifications for sailor employment (§§ 7301 et seq.), the hours and conditions of the employment (§§ 8104 et seq.), and the living conditions that must be provided (§§ 11101 et seq.).
Federal laws also address the problems that beset ships and the life-or-death decisions made by carriers. The Carriage of Goods by Sea Act (46 U.S.C.A. §§ 1300–1315 ) regulates the rights, responsibilities, liabilities, and immunities regarding the relationship between shippers and carriers of goods. The Salvage Act (46U.S.C.A. §§ 727–731 ) provides for compensation to persons who help save a ship or cargo from danger or help recover a ship or cargo from actual loss. To qualify for salvage remuneration, a person must not be acting in service of the ship or in performance of a contract, and the help given must have contributed at least in part to a wholly or partially successful salvage of the ship or goods.
The case-law of the United States is rich in the areas of sailors’ rights respecting the unseaworthiness of vessels, compensation for vessel suppliers and servicers, and the liabilities arising from collisions, towage, pilotage, and groundings. The Maritime Lien Act (46 U.S.C.A. §§ 31341–31343 ) gives a lien to any person who, upon the order of the shipowner, furnishes repairs, supplies, towage, use of dry dock or marine railway, or other necessaries to any vessel, without allegation or proof that credit was given. The Ship Mortgage Act (46 U.S.C.A. §§ 31301–31330 ) regulates the mortgages on ships registered in the United States, and also provides for enforcement of the maritime liens obtained through the Maritime Lien Act.
In case of collision or other damage to a vessel, an in rem proceeding is often used to recover damages. An in rem action is a lawsuit brought against an offending thing (in admiralty, usually the ship), whereas an in personam action is a suit brought against a person. Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims (1985) provides necessary details for the seizure of an offending owner’s vessel or property if a defendant vessel owner does not live in the state in which a suit is brought. The practical effect of Supplemental Rules B to E is to make it easier for a plaintiff to bring actions against out-of-state and foreign vessel owners and to provide for the attachment and garnishment of the offending vessel.
An important consideration in any lawsuit is venue. Under Article III, Section 2, of the U.S. Constitution, federal courts have the power to try “all Cases of admiralty and maritime Jurisdiction” (art. III, sec. 2). However, state courts can also hear admiralty and maritime cases by virtue of the “saving-to-suitors” clause of 28U.S.C.A. § 1333(1). This clause allows a plaintiff to sue in state court through an ordinary civil action when the court’s common law is competent to give a remedy. In such actions, the state court must apply the federal law of admiralty to the admiralty claims. Nevertheless, if a plaintiff believes he or she will fare better before a local tribunal, the option is available.
When no applicable federal statute exists, the governing law of a maritime case will be the uniform laws as expounded by the U.S. Supreme Court and applicable to all torts and contracts,
whether the case is tried in federal or state court. Maritime case law—not the general common law—will govern a contract dispute only if the subject matter of the contract pertained to water commerce. Maritime precedents will govern a tort claim only if the negligent or reckless actions involved commercial activity on navigable waters.
Charter parties are often a topic of concern in maritime law. A charter party, or charter, is an agreement among a shipowner, a crew (the charterer), and the owner of the goods to be transported. Charter parties come in three types: time, voyage, and demise. A time charter is the lease of a ship to a charterer for a specified period of time. A voyage charter is the lease of a ship for a specific number of voyages. A demise charter (so called because the shipowner effectively relinquishes ownership for a certain period, causing a “demise” in ownership interest) is usually a bareboat charter, which means that the charterer supplies the master and crew for the ship. Other demise charters provide that the shipowner’s master and crew take charge of the vessel.
In contrast to the usual contract practice of providing risk-of-loss insurance for one party, charters utilize what is called a general average. General average is the traditional, primitive form of maritime risk allocation whereby all participants in a charter agree to share any damages resulting from an unsuccessful voyage. Most parties to a charter obtain insurance to cover their portion of risk. However, because a charter involves multiple parties, and because insurance policies are subject to interpretation, insurance coverage does not always prevent disputes over damages.
Risk of loss is sometimes decided according to a bill of lading. This document confirms a carrier’s receipt of goods from the owner (consignor), verifies the voyage contract, and shows rightful ownership of the goods. In Lekas & Drivas, Inc. v. Goulandris, 306 F.2d 426 (2d Cir.1962), the SS Ioannis P. Goulandris had chartered to carry olive oil, cheese, and tobacco from the western Greek port of Piraiévs to the United States via the Strait of Gibraltar. On October 28, 1940, with the Ioannis docked in Piraiévs, Italy attacked Greece, and the Ioannis was requisitioned by the Greek government for a military mission.
On November 10, 1940, the Ioannis finally set sail with its cargo for the United States via the Suez Canal and the Red Sea, and around Cape Horn. After an arduous journey that included two crossings of the equator, hull damage, and lengthy repairs, the Ioannis came into port at Norfolk, Virginia, on May 3, 1941. En route, the tobacco had been damaged, much of the olive oil had leaked from its drums, and the cheese was “‘[m]elted with a terrible stench, and worthless.'”
Despite the Ioannis’s brave participation in wartime activities, the intended recipients (consignees) of the tobacco and olive oil sued the Ioannis and were able to recover for the losses suffered as a result of the damage. However, on the subject of the cheese, the court refused to allow recovery by Lekas and Drivas, which had consigned the cheese to itself.
Lekas argued that the crew of the Ioannis was negligent in storing the cheese in the structure at the stern above the main deck, known as the poop. According to Lekas, it was inappropriate for the cheese to be in the poop. The poop lacked ventilation, and it was not refrigerated. However, according to the bill of lading between Lekas and the Ioannis, special cooling was not necessary and had not been contracted for. The cheese was also stored on lighters (large, flat-bottomed barges used for loading and unloading ships) during the 35 days needed for repairs of the Ioannis, and Lekas claimed that this storage was improper. But because wartime conditions were responsible for the length of repairs and the lack of proper storage space for the cheese, the court ultimately held that the Ioannis was not negligent in its handling of the cheese.
In addition to the state and federal governments, municipalities can affect the private enjoyment of maritime activity. In Beveridge v. Lewis, 939 F.2d 859 (9th Cir. 1991), appellants Richard Beveridge, Peter Murray, Gregory Davis, and Peter Eastman challenged a Santa Barbara city ordinance (Santa Barbara Municipal Code § 17.13.020) that prohibited the anchoring or mooring of boats within 300 feet of Stearns Wharf from December to March. Santa Barbara had acquired ownership of Stearns Wharf in 1983, passed the ordinance in 1984, and started issuing citations for noncompliance shortly thereafter. Beveridge, Murray, Davis, and Eastman all owned boats moored or anchored within 300 feet of Stearns Wharf, and the four, represented by Eastman, brought suit against the city in 1989, seeking injunctive relief against enforcement of the ordinance.
At trial, Eastman argued that the Santa Barbara ordinance conflicted with the Ports and Waterways Safety Act of 1972 (PWSA) (33U.S.C.A. §§ 1221 et seq.), a federal act designed to reduce the loss of vessels and cargo, protect marine environment, prevent damage to structures on or adjacent to navigable waters, and ensure compliance with vessel operation and safety standards. The trial court dismissed the case, reasoning that the ordinance was neither preempted by, nor in conflict with, the federal statute.
On appeal, the Ninth Circuit Court of Appeals agreed that the Santa Barbara ordinance was not in conflict with the PWSA, because the federal act was not intended to limit a municipality’s control over its local shores. The appeals court also rejected the proposition that the enactment of the PWSA implicitly foreclosed the enactment of similar ordinances by municipalities, and Santa Barbara’s control over the Stearns Wharf was complete.
Admiralty and maritime matters will always deserve laws carefully crafted to suit the complexity and urgency of maritime endeavors. The international nature of high-seas navigation and its attendant perils demand no less. Federal, state, and local control of navigable waters can affect everyone from the largest charter party to a private boat owner.
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This glossary post was last updated: 8th October, 2021 | 0 Views.