A significant part of the answer to our reader’s question will depend on whether the boat is Coast Guard documented or state registered, but there is no law that allows a service provider to simply grab a boat and hold it hostage without the involvement of a court or government agency.
Many of our readers are familiar with the enforcement procedure for a lien against a Coast Guard documented boat, and we have written about that procedure a number of times in this column (for example, “Foreclosing on Lien not Necessarily Worth the Cost,” The Log, Dec, 14, 2006). The procedure calls for a lawsuit to be filed against the vessel in Federal Court and the boat to be taken into custody by U.S. Marshals. This “maritime arrest” procedure is very expensive, and unless the claim amount exceeds $50,000, the arrest may not make sense, economically.
Alternatively, a service provider with a claim against a documented boat may want to file suit against the boat’s owner in state court. Work performed on a boat — whether or not the boat is Coast Guard documented — is fundamentally a contract for one person to perform a service for another person. The fact that the service is to be performed on a boat does not by itself force a claim into federal court, and a breach of contract lawsuit may be filed in state court. If a judgment in state court is rendered in favor of the service provider, he or she may then pursue all of the boat owner’s assets, including the boat itself.
The decision to proceed in Federal Court, and to spend that extra money, will offer two significant benefits to the person who is pursing the claim.
First, the U.S. Marshals will seize the boat at the very beginning of the lawsuit, with no warning to the boat owner. Referring back to our reader’s question, this is the ONLY circumstance that allows for a “sneak attack” against a boat with no warning to the owner.
The second benefit to the claimant is that only a Federal Court may order a boat to be sold free and clear of all liens, which will increase the value of the boat when it is sold at auction.
A claim against a state-registered boat may be pursued in state court and, if the service provider complied with the lien and vessel repair provisions of the California Harbors and Navigation Code, the court may issue a writ that calls for the boat to be taken into custody by the sheriff or the harbor patrol. Under California law, and in cases where the boat is already in custody of a lien claimant (for example, if the boat was left on the hard in a boatyard or in dry storage), and the claim is for unpaid storage or yard fees, the claimant may ask the DMV to conduct a lien sale under the California Boaters Lien Law.
Regardless of whether a state law or federal law procedure is used, there is no circumstance that would allow someone with a claim against a boat to simply grab the boat, tow it away and hold it hostage without a court order.
In our reader’s case, the tow company will need to return the boat immediately. The fees charged by the boatyard for storage and for haulout and launch are owed by the tow company, since those services were done without the knowledge or approval of the boat owner.
And the tow operator will probably be liable for any damage caused by its unauthorized repossession of the boat. If our reader is compelled to file a lawsuit for the return of the boat, the tow company may be liable for other damages.
Regardless of whether we are looking at a documented or state-registered boat, procedures for the enforcement of a claim against a boat are designed to be fair for both sides, even though it may be a little more expensive for a lien claimant to use those procedures rather than taking the law into his own hands. It should go without saying that both sides of a dispute like this should seek the advice of a competent maritime attorney.