Are marinas nothing more than warehouses for boats? What about those increasingly popular “boatel” structures? Can you simply “forget” your boat in its marina slip and expect it to still be afloat when you return from your three-month vacation? The answers to these and many other common questions require an understanding of maritime bailment law.

A bailment arises when the owner of property (the “bailor”) leaves it in the care, custody and control of another person (the “bailee”), who in exchange for a fee, agrees to keep and protect the property until the owner returns. A contract is formed in which it is expected that the bailee will return the property to the bailor in the same condition as when the bailee received it. In the event the property is damaged during the bailment, the owner only needs to prove that it was delivered to the bailee in undamaged condition, and that it was returned in damaged condition. A rebuttable presumption then arises, that the bailment agreement was breached, and that the bailee is liable for the damage.

However, the bailee is not an absolute insurer of the property. If the bailee can show that the damage was caused despite its exercise of reasonable care (e.g., by an act of God, criminal act, or latent defect in the property itself), the bailee may still rebut the presumption, and escape liability for the damage.

In lawsuits arising from damage to property in storage, a Count alleging “Breach of Bailment” frequently accompanies a Count alleging “Negligence”. Most plaintiffs receive the benefit of the presumption and shift the burden of proof to the bailee by proving that they delivered their property to the bailee in good condition, but received it back in damaged condition. Therefore, the breach of bailment Count, based upon breach of contract, is favored over the negligence Count, which requires plaintiffs to demonstrate how the damage occurred, and that it was caused by the defendant’s breach of its duty of care.

Most marinas and boatyards seek to avoid becoming bailees. If their Slip Rental Agreements created bailments, marinas would have to exercise a heightened degree of care over the boats at their piers and on their premises, in order to return them undamaged to their owners. Marinas are very busy places, with boat owners, guests, and marine contractors virtually swarming over the piers, boats and yards. If a boat owner sent a mechanic to repair his boat’s engine, and the mechanic damaged the boat, there would be little likelihood that the marina could prevent the damage or even learn about it. The marina would not be in a position to defend itself from a breach of bailment claim by explaining that the damage had occurred despite its exercise of reasonable care.

For this reason, maritime law will not recognize the creation of a bailment relationship unless the bailee’s custody of the boat is exclusive – even against the owner of the boat. In an exclusive bailment, it is understood that nobody, not even the boat’s owner, may gain access to the boat without the knowledge and consent of the marina. In the event the boat is lost or damaged, this would put the bailee in the best, if not exclusive position to explain the loss. In an exclusive bailment, the marina would have to give its permission before anyone could go aboard the boat, and the marina would have the only set of keys.

Bailment relationships between boat owners and their marinas are not the norm. They require extraordinary security, constant checks of boats in the water, and great additional cost. Outside of a bailment relationship, boat owners cannot normally walk away from their boats and expect the marina to handle everything. Unless a bailment exists, courts have recognized an unwritten rule that boat owners must visit their boats periodically to maintain and inspect them. For this reason, under maritime law, most courts have refused to recognize the existence of a bailment unless there is an express written agreement between the parties creating one. In the absence of a written agreement, and under certain circumstances, the courts may still recognize a bailment, but only if it is proven that the marina has exclusive control over the boat. This occurs when boats are kept in dry storage areas completely controlled by the marina, or in rack storage (“boatels”) where access to the boat may only be gained by using the marina’s forklift. In such cases the marina acts more like a traditional warehouse. In the absence of a written agreement, bailments rarely apply to boats kept in the water.

Marina’s can lessen the odds of becoming a bailee, by stating in their written agreements that they do not intend to create a bailment. In the event a court should nevertheless determine that a bailment was created, the marina may further reduce its liability by including hold harmless and indemnity language in its agreements, by placing limits on its exposure to liability (e.g., repair costs only), and by inserting claim and suit-filing limitations in their agreements (e.g., claims made within 90 days and suits filed within one year).

Whether you are a marina seeking to avoid the duties of a bailee, or a boat owner seeking the most comprehensive care for your boat, the first step in understanding the nature of your relationship is to carefully read the Slip Rental Agreement before you sign. If you have any questions, you should consult with an attorney experienced in maritime law.