Washington ruling hikes shipowners' risk of punitive damages

Legal experts say state supreme court decision threatens to create divided regime in unseaworthiness claims.

A decision by the highest court in the US state of Washington has raised the stakes for shipowners and operators facing crew claims for punitive damages in unseaworthiness lawsuits, legal experts said Monday.

The Washington Supreme Court ruled earlier this month that a mariner who sues for unseaworthiness can recover punitive damages.

Before that decision, federal and state courts had previously precluded awarding such damages, which are awarded in addition to regular damages as a way to punish a defendant for egregious behaviour, in such claims.

Fishing and shipping

And though the case known as Tabingo v American Triumph involved a crewman who was injured on a fishing trawler, the decision has significant ramifications for shipowners.

Two legal experts said at a Stamford event that they hope the decision will be reversed on appeal.

"The court did not get it right, and we really need some guidance from the Supreme Court," said Thompson Bowie & Hatch lawyer Sarah Yantakosol Gayer at a joint discussion by the American Bar Association TIPS Admiralty & Law Committee and the Women's International Shipping & Trading Association USA.

Appealing to a higher power

American Club vice president Boriana Farrar, who is also in-house counsel for the protection-and-indemnity club, said the US Supreme Court will have to step in if the federal Ninth Circuit Court of Appeals in San Francisco does not weigh in.

She says that if the decision were to stand, it might increase the risk of liability.

"The exposure really changes, but what a shipowner has to do, to provide a seaworthy vessel, doesn't change," she told TradeWinds on the sidelines of the Connecticut Maritime Association Shipping 2017 conference.

For more news from the Connecticut Maritime Association, Capital Link and other events this week, click here.