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bobfrost

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That sinking feeling leaves sailors with £250,000 bill

Sam Jones
Friday March 17, 2006

Guardian
It was an opportunity no self-respecting sea dog could turn down: the chance to take a brand new £320,000 yacht for a spin and get paid for the privilege.

Sadly, things did not go quite to plan when Bob Elliott and Mike Bailey agreed to deliver the state-of-the-art motor cruiser from Sussex to Dorset for £100. In fact, things went so wrong that the yacht ended up at the bottom of the Solent and the two sailors ended up in the high court, where they were yesterday ordered to pay almost £250,000 for a replacement.

The saga began on October 19 2003, when Mr Elliott, an experienced skipper, was hired by Offshore Nautical CI to take the Fairline Phantom 40 from Chichester to Weymouth.

He then sub-contracted Mr Bailey, an emergency lifeboat cox, to help him deliver the boat for half the £100 fee.

The pair set off in the dark that evening and travelled into the rough Needles channel at a high speed of about 18 knots (21mph). With Mr Bailey at the helm, the boat then struck a "substantial" grade-two navigation buoy which marked the port side of the channel for inbound vessels.

It suffered a huge fracture along its hull and listed badly on its starboard side as it took on hundreds of gallons of water.

A lifeboat which came to the rescue was trying to tow it to shore when the yacht sank and had to be dragged the rest of the way.

The Phantom, worth £320,000, was declared a constructive total loss. Although investigations revealed that the boat's on-board navigation equipment had malfunctioned in the rough seas, the insurers claimed the collision had been caused by negligence and refused to replace it.

Offshore then sued the sailors to recover the cost.

At the high court on Monday, Mr Justice Morison described the incident as a "disastrous adventure" and agreed that the pair had been negligent.

Ordering Mr Bailey to pay 85% of the boat's trade price, he said the father-of-four had "failed to understand his own responsibilities".

But he said Mr Bailey should not bear all of the blame and ordered Mr Elliott to pay the remaining 15%. Both men will also have to pay Offshore's legal costs.

A spokesman for Offshore said the the company was pleased with the outcome of the case.

Mr Bailey said that although he did not feel the accident was his fault, "it was a costly mistake and I'll have to pay for it financially for the rest of my life".

He added: "I was simply helping Bob out as a favour, but look where it's got me."

/forums/images/graemlins/frown.gif
 
Ah yes I remeber that one going down....

He is not wrong when saying he will be paying for it for the remainder of his life.

Being at sea in a professional manner has certainly always been a very serious business.

Insurance can pay, well least if its there in the first instance....

Equally so, you cant help but read into the story that Offshore Nautical CI appeared to be trying to get said delivery done on the cheap, bet they learnt a lesson or two that day.

Been a discussion here about this.

http://www.ybw.com/forums/showflat.php?Cat=0&Board=ym&Number=986356&page=0&fpart=all
 
This article makes an interesting point.
"Although investigations revealed that the boat's on-board navigation equipment had malfunctioned in the rough seas, the insurers claimed the collision had been caused by negligence and refused to replace it."
Firstly the boat was insured, contrary to the opinion in the other thread on this subject. Secondly, and most importantly the insurers refused to pay on the grounds of negligence, despite a claim here that navigational equipment had malfunctioned. I remember at the time of the accident there were claims that the buoy had been used as a waypoint and that the autopilot had steered the boat to it very accurately. That is hardly a malfunction unless the malfunction was that the autopilot could not be overridden or turned off. There is probably a lot more too this than we have seen, but the clear lesson is that if an insurance company can wriggle out of payment, it will. It would be interesting to know the full circumstances of equipment malfunction as against negligence, and who the insurers were. I also wonder if the judgment will be appealed.
 
"I also wonder if the judgment will be appealed. "

The trouble is, to appeal you have to have deep pockets and in this case by far the deepest pockets are those of the owners (ex-owners!) and the insurance company. Even if the crew could find lawyers to take on the appeal on a pro-bono basis (which they well might) they still face the other side's, and the court's costs if they lose.
 
Without knowing all the facts its difficult to comment on the incident.

It does seem to set a dangerous precedent in that it could be argued that anyone who hits a charted object has been negligent to some degree so does this mean none of us are insured should we hit a charted object?
 
Doesn't say which nav instruments were not working. I think (for what its worth!) that if the instrument failure meant that doing 18kts in the dark was unsafe then, yes they were negligent.

I thought it harsh though that the helmsman and not the skipper picked up the lions share of the damages. Helmsmen can make mistakes, but surely only the skipper can be negligent?
 
Re: Helmsman...

Was this a case of relying 100% on navigation equipment and not using their eyes?
There are plenty of visual refences in the needles to make sure you do not hit anything.
 
Re: Helmsman...

Unfamiliar waters unfamiliar boat distracted momentarilly then life ruined.

There but for the grace of God go I.
 
Is it normal for insurance companies to use negligence as a reason for not settling an insurance claim? Almost every accident has an element of negligence in it, whether it's getting the tides wrong and hitting a rock, failing to see a boat on Starboard, hitting a pontoon while mooring. Can we not claim for these things?
 
agree wholeheartedly. On the surface this looks like a good case of the insurance company finding any excuse to not pay. Personally I would like to know which company so I can avoid them like the plague.
 
[ QUOTE ]
Firstly the boat was insured, contrary to the opinion in the other thread on this subject.

[/ QUOTE ]

My experience of journalistic accuracy makes me believe that the other posters are far more likely to be correct than the "Grauniad" which tends to be scathing about boat owners in any case, reveling in the failure of Hartlepool's new marina.
As James says, how is negligence a defence against an insurance settlement? It is far more probable that either the vessel was not insured or insured with exclusions which were breached.
 
So even if Offshore had paid more and gone to a 'proper' delivery firm who did carry insurance, would that insurance firm also refuse to pay on grounds of negligence?

I hope that this story has another chapter to unroll.
 
Perhaps when the full judgment in this case is published, someone who knows where to look can post a link to it. That way we might be able to see why the judge decided that way. I still think we need to know more about what actually occurred, equipment malfunction versus negligence, and the insurance position. I also wonder if the owners decided it was easier to sue the skipper and helmsman, rather than go after the insurers, who have deep pockets to defend themselves with.
 
all risks where if the boat was damaged, irrespective of cause, the cheque came through the post next day (metaphorically speaking) are gone or going but if the insurers get off with this there doesn't seem a whole lot of point insuring your boat?
 
Even Pantaenius...

Even Pantaenius, who have an excellent reputation for paying up, specifically exclude damage resulting from "gross negligence and wilful acts". They define a wilful act as "A deliberate act, or the deliberate failure to act, in circumstances where there is a risk of loss or damage".
 
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