U.S. Supreme Court Refines Definition of Vessel and Creates More Questions than Answers

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U.S. Supreme Court Refines Definition of Vessel and Creates More Questions than Answers

April 10th, 2013

In Lozman v. City of Riviera Beach, Florida, decided on January 15, 2013, the U.S. Supreme Court held that the floating home at issue in that case was not a “vessel” and, therefore, an eviction suit involving the home was not within the maritime jurisdiction of the federal court. The Court based its holding on a new test of what constitutes a “vessel”; whether a “reasonable observer,” looking at the craft’s physical characteristics and activities, would consider it designed to a practical degree for carrying people or things over water. This new test will likely open the door to increased litigation over whether a particular floating craft is a “vessel,” rather than reduce disputes over the status of various floating crafts.

In 2005, with its ruling in Stewart v. Dutra Constr. Co., 543 U.S. 481 (2005), the Supreme Court had broadened the definition of what qualifies as a “vessel,” adopting the statutory definition of “vessel”set out at 1 U.S.C. section 3 every description of watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water. Following the Stewart case, most courts adopted an “anything that floats is a vessel” analysis, focusing on whether the craft at issue was merely “capable” of transporting people or objects over water, regardless of the craft’s design or actual function. One result of the Stewart holding was that workers on nearly any kind of floating craft qualified as “seamen” under Jones Act.

In Lozman, the Supreme Court rejected the “anything that floats” approach and said that the 1 U.S.C. 3 definition of “vessel” must be applied in a practical, not a theoretical way. The Court then focused upon the physical features of the floating home at issue (no rudder or other steering mechanism, unraked hull, electricity connection to land, no portholes but regular doors and windows, no means of self-propulsion, etc.) and said that a “reasonable observer” would conclude that it was not designed to a practical degree to transport persons or things over water. The Court also considered the “behavior” of the home and whether it actually moved with any frequency over the water, transporting people or objects. The Court’s analysis of the physical features and use of the home harkened back to the type of “vessel status” analysis that the Supreme Court had seemingly rejected in Stewart.

The Court recognized that “borderline cases will always exist” and that “satisfaction of a design-based or purpose-related criterion” will not always be sufficient for application of the statutory word “vessel.” On the other hand, the Court said that there may be crafts that qualify as vessels because they are actually used for water transportation, even though they are in no practical way designed for that purpose.

The Supreme Court’s new “reasonable observer” test and analysis of the physical features and behavior of the craft appear to re-open the door that the Court closed with Stewart. Maritime employers again have an opportunity to argue that floating craft, upon which they employ workers, are not “vessels” based upon the physical design and use of the craft.

If you have any questions regarding the Lozman decision, please contact Mitch Griffin at mgriffin@cwlfirm.com or (415) 438-4600.