Andrei Korottchenko Maritime Law Blog Toronto

Admiralty Court Rules Marina Owners Can Limit Liability

A recent decision of the English Admiralty court would be of considerable interest to marina owners, operators and insurers. In Holyhead Marina v. Peter Farrer [2020] EWHC 1750 (Admlty), Teare J. held that a marina owner could limit its liability pursuant to section 191 of the English Merchant Shipping Act 1995. 

In March 2018, Storm Emma caused catastrophic damage at Holyhead Marine in North Wales. There was evidence of considerable damage to 89 yachts moored at the marina. The marina owners were exposed to claims of around £5 million by yacht owners on account of alleged negligent design, construction and maintenance of the marina. 

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The marina owners commenced a limitation action seeking to limit the marina’s liability to £550,000. While a shipowner’s legal right to limit liability for a maritime claim has been “almost indisputable” for a long time, it was not clear that a marina owner was entitled to limit liability on the strict reading of the statute. 

The case turned on the judge’s interpretation of the word “marina”. The legislation provided for a right to limit liability to a dock owner, but did not expressly include a marina owner. Section 191 stated the following with respect to what constituted a “dock”:

dock” includes wet docks and basins, tidal docks and basins, locks, cuts, entrances, dry docks, graving docks, gridirons, slips, quays, wharves, piers, stages, landing places and jetties;

While Teare J. held that a marina was not a dock within the narrowest meaning of that work, the statutory definition was broad enough to extend to a marina owner: 

I have therefore reached the conclusion that the pontoons which make up the Marina at Holyhead are within the statutory definition of “dock”, being landing places, jetties or stages. The Claimants are, it is accepted, the owners of the Marina, that is, of the pontoons which make up the Marina and so are, in principle, entitled to the right to limit conferred by the 1995 MSA.

In the end, the judge found that the marina owners could limit liability pursuant to section 191 of the English statute. 

This case will be of considerable interest to Canadian marina owners, operators and insurers as well as yacht owners. Section 30 of Canada’s Marine Liability Act contains a very similar definition for a dock, which, as a result of the decision in Holyhead Marina v. Peter Farrer, would likely be extended to Canadian marinas. The Canadian legislation would likely enable a marina owner to limit liability to the greater of $2,000,000 or a formula based on the gross tonnage of the largest ship within the area of the marina pursuant to section 30 of the Marine Liability Act.

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