Ask a Maritime Attorney: What is the significance of a slip license?

Question:

I recently received a letter from my marina, asking me to sign a new rental agreement which they are calling a “license” (the previous agreement was called a “wharfage contract”).  Can you explain the legal significance of a slip “license?” The terms of the two agreements are similar, except for a new provision that allows them to rent out my slip and keep all of the rental income if I go cruising. On a similar note, I have observed that many marinas are being re-configured to eliminate slips for smaller boats. This seems like a form of discrimination, especially in light of the fact that marinas use federal and state tax dollars to construct and operate their facilities. This has a direct impact on an entire class of boat owners who pay taxes like everyone else. Do the effected boat owners have any recourse for this type of discrimination?

Answer

These questions are actually a compilation of several emails that we have recently received from readers.  People are frustrated with the direction that the slip rental market is going, and they are looking for legal and political tools that will help to give boat owners a voice in that market. The best advice I can give is to look for an ally who can help with a political fight in Sacramento, because you simply do not have the basis for any kind of a legal battle.

The first question concerned the use of a new agreement described as a “license” rather than as a “wharfage contract” or “slip lease.” I suspect that the marina was advised to use the term “license” to avoid certain restrictions that may be associated with a tenancy that is characterized as a “lease.” For example, in most cases a lease allows the tenant to make exclusive use of the space, so long as he or she is not in default. This would prevent the short-term rental by a marina when a tenant leaves for a few weeks. However, your marina probably had no cause for worry. The law will look to past the title of an agreement and determine the rights of the parties based upon the substantive language. A 1994 case involving the use of Angel Stadium in Anaheim looked at this issue, and the court held that the label given to the tenant’s interest is of little importance. The judge noted that arrangements between landlords and tenants are so varied that it is increasingly difficult, and correspondingly irrelevant, to attempt to pigeonhole these relationships based on the title of the document.

The second question concerned the discrimination felt by boat owners when a marina is reconfigured to eliminate small boat slips. This is a frequent question and I wish I had better news for the people who feel they are being discriminated against. It is true that discrimination may be an issue where public funding is involved, but unfortunately the term “discrimination” has a very narrow legal application. Generally speaking, it applies to classes of individuals that the U.S. Supreme Court has found to be historically “suspect classes.” Most commonly, suspect classes are based on race or a recognized ethnic minority. Small boat owners are simply not going to qualify. And, if the rights of an established suspect class are not affected, the marina is free to do what they want so long as there is some rational justification, and they are not violating any law in the process.

Some of the pain that is felt by marina tenants can be traced to the fact that a slip rental is not treated under the law as a residential tenancy. Most of the laws that restrict the behavior of a landlord are limited to “dwelling units,” and at least one court has held that “the right to dock one’s boat at a particular berth or marina cannot be equated with the right to decent low-cost housing even if one chooses to live aboard the boat.” As such, tenancies ranging from boat docks to public storage units are effectively treated as a commercial relationship.

One political approach to the problems facing marina tenants would involve the enactment by the legislature of laws to address the various issues. Unfortunately, many of the problems, such as the elimination of small slips in favor of larger slips, would pit one class of boat owner against another. In the end, cold truth is that the non-boating public does not view yacht ownership as something worthy of their sympathy, and as such the legislature rarely spends time with boating issues.

A better solution would be to work with the Coastal Commission, land developers, and the California Division of Boating and Waterways to remove the obstacles to marina construction and expansion.  In the end, the best solution to the problem is to build more slips.

 

David Weil is licensed to practice law in the state of California and as such, some of the information provided in this column may not be applicable in a jurisdiction outside of California. Please note also that no two legal situations are alike, and it is impossible to provide accurate legal advice without knowing all the facts of a particular situation. Therefore, the information provided in this column should not be regarded as individual legal advice, and readers should not act upon this information without seeking the opinion of an attorney in their home state.

 

David Weil is the managing attorney at Weil & Associates (www.weilmaritime.com) in Seal Beach. He is certified as a Specialist in Admiralty and Maritime Law by the State Bar of California Board of Legal Specialization and a “Proctor in Admiralty” Member of the Maritime Law Association of the United States, an adjunct professor of Admiralty Law, and former legal counsel to the California Yacht Brokers Association. If you have a maritime law question for Weil, he can be contacted at 562-799-5508, through his website at www.weilmaritime.com,  or via email at dweil@weilmaritime.com.