Opinion recap: Reasonable observer at dockside
on Jan 15, 2013 at 3:30 pm
Casting aside the simplistic notion that “anything that floats” is a watercraft whose use and activity is controlled by maritime law, the Supreme Court on Tuesday installed a “reasonable observer” at dockside to make the judgment about whether a floating structure qualifies, or not, as a “vessel.” The vote was seven to two, in favor of a maverick Florida owner of a houseboat who was constantly in hot water with marina owners, but now appears to have the last word: the marina probably will have to pay him, not the other way around.
The dissenters complained that the Court was introducing confusion and complexity into what should be straightforward and explicit, and thus upsetting the expectations of the entire maritime industry. The majority, in an opinion by Justice Stephen G. Breyer, insisted that its “reasonable observer” test would work in the real world of floating structures.
While this case turned on a boxy two-story floating home that Fane Lozman had lived in at various marinas in Florida, the Court treated his case (Lozman v. Riviera Beach, 11-626) as one with considerably wider impact on maritime law. What came out of it, in the end, was a reliance upon the traditional legal figure of the “reasonable man” (to be politically correct, now the “reasonable observer”) to make a common-sense assessment of the physical characteristics and activities of a floating structure, and then decide whether it was meant to be a vehicle of water transportation. Courts, of course, will be deciding what the “reasonable observer” would see, presumably on a case-by-case basis.
Under this test, not all houseboats will be exempt from maritime regulation, since many of them have motors to propel them, so a reasonable view of them is likely to be that they can be moved over water, carrying goods and people. But neither will all dockside structures used as homes, and ill-fitted for gliding over the waves, come under the new definition, because they probably will not be seen as transport vessels. It may take some time, and quite a bit of litigation, to see the difference between them, and between other floating structures.
The virtue of having such a watercraft treated legally as a “vessel” is that those who have commercial dealings with the owner are given the right to demand payment for the goods and services they supply, because maritime law gives them the right to sue when they have provided “necessaries” to such a craft and can’t collect. The vice of having such a watercraft deemed a “vessel” is that it could expand admiralty courts’ reach, and the Coast Guard’s registration and inspection duties, to too many craft that really have little to do with maritime commerce or safety.
Justice Breyer’s opinion for the majority was intent on one analytical goal: avoiding easy labels, such as the one that the Eleventh Circuit Court used to classify Lozman’s houseboat as a “vessel” — it floated, and it could be towed over water.
Taking a cue from an earlier Fifth Circuit Court opinion, where it was said that a broad interpretation of the word “vessel” could also mean “three men in a tub” or even “Jonah inside the whale,” Breyer said that “not every floating structure is a vessel,” and he excluded “a wooden washtub, a plastic dishpan, a swimming platform on pontoons, a large fishing net, a door taken off its hinges, or Pinocchio (when inside the whale) are not ‘vessels.'” (Recall, readers, that the Blue Fairy feared that Pinocchio had been swallowed by a whale, which presumably was afloat and, one supposes, could be towed.)
What matters in the federal law on “vessels,” the opinion said, was that it uses this language: “an artificial contrivance…capable of being used…as a means of transportation on water.” The opinion put in italics the phrase “as a means of transportation on water.”
What must be done for admiralty cases involving floating structures, the Court said, was to come up with a “practical” test, not a “theoretical” one. So, here is the formulation that emerged: “In our view, a structure does not fall within the scope of the statutory phrase unless a reasonable observer, looking to the home’s physical characteristics and activities, would consider it designed to a practical degree for carrying people or things over water.”
And to bring that general phrase down to earth (or, perhaps, down to the water line), Breyer suggested that “the facts of this case illustrate more specifically what we have in mind.” There followed a description of Lozman’s home that essentially stripped it of any pretense of being a boat. “In a word,” the Court concluded, “we can find nothing about the home that could lead a reasonable observer to consider it designed to a practical degree for ‘transportation on water.'”
The remaining nine pages of the opinion went beyond the attributes of Lozman’s houseboat to summon legal authorities to justify the new test. The Court also said that it would not send the case back to lower courts, to gather more facts, concluding that the Court knew enough to make its decision final. What it probably means for Fane Lozman personally is that he can now go back into lower courts, and lay a claim at least some of the $25,000 that the marina operator — the city of Riviera Beach, Florida — had posted in court to provide compensation for the city having “arrested” his houseboat, then bought it at auction, and then destroyed it when the city could not give it away. The Court’s opinion said nothing about what should happen next.
The Breyer opinion was supported by Chief Justice John G. Roberts, Jr., and by Justices Samuel A. Alito, Jr., Ruth Bader Ginsburg, Elena Kagan, Antonin Scalia, and Clarence Thomas.
Justice Sonia Sotomayor dissented, in an opinion joined by Justice Anthony M. Kennedy. They described the “reasonable observer” test fashioned by the Breyer opinion as based upon notions that have “never appeared in any of our cases.” The majority’s application of it here, the dissenters said, “effectively (and erroneously) introduces a subjective component into the vessel-status inquiry,” even while acting as it was creating an “objective” test. The majority, Justice Sotomayor wrote, “works real damage to what has long been a settled area of maritime law….Numerous maritime industries rely heavily on clear and predictable legal rules for determining which ships are vessels.” That will now be frustrated, the dissenting opinion said, by the majority’s “distorted application of our settled law.”
The dissenters also argued that the Court should have returned the case to lower courts to more extensively examine Lozman’s houseboat — an inquiry that, of course, would have had to be based on what was already known about it, since it no longer exists.
This decision, in plain English:
There is a special branch of law that controls disputes that involve business dealings between owners of boats and those who serve them. It is called “admiralty” law, and it has its own set of legal obligations and rights. An admiralty case is one that can only be decided in a federal, not a state court. And one of the rights that it gives businesses who deal with boat owners is to be paid when they provide goods and services that the boat needs during operation. If the owner does not pay up, the supplier can go into admiralty court and file a lawsuit directly against the boat itself. That allows a police officer, such as a sheriff, to take the boat into custody, so to speak, and hold it as a guarantee that paynent is made if the supplier wins the case.
The special admiralty court, though, only has authority over a boat if it qualifies, in a legal sense, as a “vessel,” described as a floating structure that is capable of being used to carry people or goods over the water.
In the case decided by the Court on Tuesday, a city-operated marina in Riviera Beach, Florida, had had a running feud with an owner of a houseboat, Fane Lozman. The marina contended that Lozman broke the marina’s rules, and failed to pay for the electricity and other services supplied by the marina. When Lozman, who had a local reputation as a stubborn challenger of authority, declined to pay up, the city decided to go into admiralty court, claiming that the houseboat was, indeed, a maritime “vessel” and so Lozman was obliged to pay for the “necessaries” he had received.
Lozman countered that his houseboat was not a vessel, in legal terms, so the admiralty court had no authority over it. The admiralty judge ruled for the marina, ordering him to pay the marina $3,039.88 for its services, plus $1 in damages for refusing to leave the marina after he had been evicted. Ultimately, the city had the houseboat seized. It put it up for auction, and, when nobody bid, the city itself bought it, and then destroyed it.
Lozman continued his fight in court, contending that his houseboat did not qualify as a “vessel,” and he took that issue to the Supreme Court when the lower courts ruled against him. On Tuesday, he won: the Supreme Court majority created a new legal definition for “vessel,” based mainly upon what a watercraft looks like and how it is used, and applied that definition to Lozman’s houseboat. The conclusion was that it was not a “vessel.”