Owner wins claim against UK builder

[Tranona]

However in this case running a boat onto the rocks is going to cost regardless. Lift, shafts, props, hull repair, loss of use etc. Running the boat onto the rocks caused the problem, so I am surprised that the owner (a) did not have to pay for the normal repairs - £30k???) and then (b) get hit with some form of contribution as had he not run it on the rocks the boat would not have sunk in the first place.

According to the report £40k of the claim was excluded for the damage not attributed to the hull failure - presumably the shaft prop, rudder etc.

 

[jfm]

I am a bit surprised that they got the full amount of the damage.

There was however a heap of contributory negligence - he ran it onto the rocks!

However in this case running a boat onto the rocks is going to cost regardless. Lift, shafts, props, hull repair, loss of use etc. Running the boat onto the rocks caused the problem, so I am surprised that the owner (a) did not have to pay for the normal repairs - £30k???) and then (b) get hit with some form of contribution as had he not run it on the rocks the boat would not have sunk in the first place.

Boat owner didn't get the full damage. He had to pay (or likely his insurers did) the costs that would have flowed from the grounding if the boat had been built correctly

As regards the concept of contributory negligence you get into the beautiful and fine rules of damages and English law. The boat owner made no contribution to the defective building of the boat and so the losses that flowed from that failure, ie the failure to build the boat correctly, lie 100% at the boat builder's door. The consequences of the negligent act of grounding to the extent they would have occurred if the boat had been built correctly lie at the owner's door. The fact that the big loss wouldn't have occurred if the boat hadn't been grounded doesn't enter into the discussion because the boat owner owes no duty to the boat builder not to ground the boat and indeed it was reasonably foreseeable by the builder that the boat might be grounded and would sink faster if not constructed correctly.

 

[Deleted User YDKXO]

According to the report £40k of the claim was excluded for the damage not attributed to the hull failure - presumably the shaft prop, rudder etc.

I'm wondering how the rest of the bill came to £450k? Even if the boat was semi submerged, surely it could not have cost this much to repair and, if so, wouldn't it have been cheaper for Pearl to manufacture a new boat altogether? My guess is that this £450k is what Pearl tried to charge Austin for the repairs and is a grossly overestimated figure possibly in anticipation of a juicy insurance pay out.
Anyone know where the 20mm design thickness figure for the laminate came from? Surely this is not a figure which Pearl would volunteer to an owner or state in a contract?

 

[jrudge]

I emailed Iain as i corresponded briefly with him about Pearl earlier in the year ( I don't "know" him as such)

He replied as below with the comment "I don’t subscribe to any of these forums but if you want to share any of the above with them then please feel free." so here it is...

"We are obviously very disappointed with the verdict and although we had to concede that our moulding contractor didn’t build this particular boat to the exact specification in the area around the P-bracket, we were advised that the forces exerted we so severe that the ‘as designed’ laminate would have also failed – unfortunately this was very difficult to prove. We did have a witness that saw the accident and gave evidence but the speed of the boat was never a real issue, more the vertical forces exerted on the P-bracket. The case came down to the size of the crack at the time of the accident, we had proof that it was 30+” they claimed it was 6”, astonishingly the judge believed the claimants (which was in fact an insurance company) rather than us and therefore the case went against us."



So the initial size of the crack was I assume indicative of the impact force, which was then relevant to if the hull at Spec would have failed or not.

 

[Tranona]

I also thought the £450k was a lot, although if water had flooded through the whole boat even under the soles it could cause serious damage to electrics, engines etc, particularly if left. I was once involved in a similar case of grounding where the major damage was caused by water. They may well have had to remove engines and replace some of the systems, particularly if there was along delay between the incident and repairs.

The thickness of the laminate would have been in the approved lamination schedule and the boat was not built to the design specification. The actual thickness would have been calculated by the designer and you can see from the reported difference in strength between the two thicknesses how important it is to stick to the spec.

 

[sailorman]

I also thought the £450k was a lot, although if water had flooded through the whole boat even under the soles it could cause serious damage to electrics, engines etc, particularly if left. I was once involved in a similar case of grounding where the major damage was caused by water. They may well have had to remove engines and replace some of the systems, particularly if there was along delay between the incident and repairs.

The thickness of the laminate would have been in the approved lamination schedule and the boat was not built to the design specification. The actual thickness would have been calculated by the designer and you can see from the reported difference in strength between the two thicknesses how important it is to stick to the spec.

who moulded these hulls, in-house or s/c

 

[Neil_Y]

I skimmed through the judgment and no body seems to have done the maths on the reaction force from the spinning prop acting as a wedge between rocks and boat producing a substantial upwards force. Relating the force to the size of crack is misleading I think. However the question is, how strong should a boat be built and what forces do you design for? I suspect an Aqua star would survive a grounding better than some other boats but I would not expect it as a customer I'd keep clear of the hard stuff.

I've seen the result of impact damage to keels where the laminate suffers an upwards force at the rear, the external evidence is tiny as the damage is done at the point where the flexible laminate meets a rigid reinforcing structure which can be some distance from the initial impact force. I've also seen T bone collision damage and the external crack is tiny when compared to the over all damage.

Sad news for Pearl but a slightly odd case and I can see why the owner wasn't happy when he discovered the issues with laminate thickness.

 

[Aardee]

I emailed Iain as i corresponded briefly with him about Pearl earlier in the year ( I don't "know" him as such)

He replied as below with the comment "I don’t subscribe to any of these forums but if you want to share any of the above with them then please feel free." so here it is...

"We are obviously very disappointed with the verdict and although we had to concede that our moulding contractor didn’t build this particular boat to the exact specification in the area around the P-bracket, we were advised that the forces exerted we so severe that the ‘as designed’ laminate would have also failed – unfortunately this was very difficult to prove. We did have a witness that saw the accident and gave evidence but the speed of the boat was never a real issue, more the vertical forces exerted on the P-bracket. The case came down to the size of the crack at the time of the accident, we had proof that it was 30+” they claimed it was 6”, astonishingly the judge believed the claimants (which was in fact an insurance company) rather than us and therefore the case went against us."



So the initial size of the crack was I assume indicative of the impact force, which was then relevant to if the hull at Spec would have failed or not.

Can't Pearl claim damages from their Moulding Contractor?? - They're the ones that "didn't build this boat to the exact specification"

 

[Deleted User YDKXO]

The thickness of the laminate would have been in the approved lamination schedule and the boat was not built to the design specification. The actual thickness would have been calculated by the designer and you can see from the reported difference in strength between the two thicknesses how important it is to stick to the spec.

Yes I don't doubt that but I'm more interested in how this information came to be available to the Owner for him to use in a legal case unless the lamination schedule was part of his sales contract which seems unlikely. In my experience, manufacturers are usually extremely reluctant to divulge internal design and manufacturing data and especially so when a failure occurs which may lead to a claim against them. The case seems to hinge on the fact that the laminate thickness was designed to be 20mm at the P bracket. This is extremely sensitive information and I'm curious to know how it came to light, thats all. If Pearl volunteered the information at some stage, then one could say that they deserve to be hung IMHO

 

[jrudge]

Another scenario is "look it is only 7mm - that seems thin. Pearl what should it be?"

Now they could answer 7mm, but that then causes the design to be questioned, all models to be involved and so on. Or they answer 20 and deal with the issue.

In court if asked how thick should it be they can only really give the truthful answer I would imagine.

 

[Deleted User YDKXO]

Another scenario is "look it is only 7mm - that seems thin. Pearl what should it be?"

Answer: the thickness is within our normal manufacturing tolerances

Now they could answer 7mm, but that then causes the design to be questioned, all models to be involved and so on.

Design is a highly subjective area especially when it comes to products like boats. One designer could argue that a thickness of 7mm is sufficient to support the normal forces arising from driving the boat (and this was proven by the fact that the owner had used it for several months without mishap) whilst another designer could argue that 7mm was insufficient to withstand a grounding. Should boats be designed to resist groundings? I don't know and neither would the judge either IMHO because then he would have had to go on to define what a grounding is with regard to this particular boat

In court if asked how thick should it be they can only really give the truthful answer I would imagine.

When faced with a £450k bill, your lawyors find a way for you to answer that question without giving a figure like 20mm!

I'm playing devils advocate here with my businessman's hat on. I suspect that the owners of Pearl are none too happy with the way that this matter has been conducted and in particular the amount of ammunition that the Owner got hold of

 

[jfm]

"We are obviously very disappointed with the verdict and although we had to concede that our moulding contractor didn’t build this particular boat to the exact specification in the area around the P-bracket, we were advised that the forces exerted we so severe that the ‘as designed’ laminate would have also failed – unfortunately this was very difficult to prove. We did have a witness that saw the accident and gave evidence but the speed of the boat was never a real issue, more the vertical forces exerted on the P-bracket. The case came down to the size of the crack at the time of the accident, we had proof that it was 30+” they claimed it was 6”, astonishingly the judge believed the claimants (which was in fact an insurance company) rather than us and therefore the case went against us."

The critical factor in this case was the size of the crack right after the grounding. The claimants (boat owners/their insurers) needed to establish it was small, about 6 inches, while Pearl needed to establish it was large

Against that background IS's comment above is very odd Jeremy. If really he did have "proof" of 30 inches why didn't he adduce it? There is nothing in the judgement to suggest he gave this proof to the court, or even tried to. Generally the evidence (such as it was) pointed towards a mere 6 inch crack, hence Pearl lost. BUT all that said, my view is that Pearl's lawyers/experts did a very poor job:

First, they let the judge dismiss far too easily the possibility of the crack being 30 inches long on impact but closing up (by the inherent stiffness of GRP) so as to let in water at a rate typical of a 6 inch crack. I really think Pearl's lawyer lost the case for them at this moment. See last 2 sentences of para 38 where this critical point just wasn't dealt with properly from an engineering point of view.

Second, the data in the 4th column of the table in para 39 just cannot be right. You cannot measure flow in mm so the judge has far too little a grasp of the engineering. Let's make an educated guess that the 4th column means the opening of the gap - 10mm in this case. That means a cross sectional area of slightly more than 760mm sq. Now, if you had a sharp edged round hole of 760mm sq (ie a 30mm dia hole) basic bernouille calcs (.05pv^2 = pgh) give me about 200 litres/minute, which is close to the figure in the evidence 186 lpm. BUT the hole wasn't round - it was a rough edged crack in GRP with loads more friction and therefore I would want to test whether the difference of 200 vs 186 allows for that. This wasn't mentioned in court, yet the rough edges of the hole help Pearl's case

Third, a very critical item was flow rate actually made by the bilge pumps, apparently completely missed by Iain Smallridge's team. The judgement says "standard manual [for the pumps] indicated that generally the working capacity of bilge bumps would in practice be substantially reduced for various reasons and that the "norm" might be as little as 40% of their nominal capacity". Based on that, a 40% factor was used in the maths, with no onus of proof applied to the claimant (as it should have been) that the 40% was correct. The manual DID NOT SAY 40% was typical and the 40% number, preceded crucially by the word "might", would of course have been written by a pump manufacturer worried about product liability. You do not in ordinary English use "might" to precede the thing you expect to happen; you use it to precede the thing you expect won't happen (but which might happen). If say a 60% factor were used in the maths instead of 40% the outcome of this case changes remarkably, ie the crack would have to be 9 inches, which then undermines the very flimsy hearsay evidence about the crack size from the diver who refused to sign his statement. Yet Pearl's lawyers seem not to have got this maths point at all.​

IMHO Iain Smallridge has been let down by the very poor engineering analysis done by his team and Mr Shimell.

 

[Tranona]

Answer: the thickness is within our normal manufacturing tolerances


Design is a highly subjective area especially when it comes to products like boats. One designer could argue that a thickness of 7mm is sufficient to support the normal forces arising from driving the boat (and this was proven by the fact that the owner had used it for several months without mishap) whilst another designer could argue that 7mm was insufficient to withstand a grounding. Should boats be designed to resist groundings? I don't know and neither would the judge either IMHO because then he would have had to go on to define what a grounding is with regard to this particular boat


When faced with a £450k bill, your lawyors find a way for you to answer that question without giving a figure like 20mm!

I'm playing devils advocate here with my businessman's hat on. I suspect that the owners of Pearl are none too happy with the way that this matter has been conducted and in particular the amount of ammunition that the Owner got hold of

Think you will find that the laminate schedule is part of the information required to comply with the RCD. It was certainly central to a case widely discussed elsewhere on the forum concerning a Polish built yacht where the hull delaminated because it was not built to the approved spec.

Remember also that this case was not brought directly by the owner, but his insurers faced with a £450k claim and anxious to shift it onto somebody else. As jfm notes their lawyers did a better job of convincing the court their interpretation of somewhat unclear facts was the correct one, The defence was that even though the boat was defective it was not the defect that caused the damage, and that even if the boat had been built to spec it would not have been able to withstand the loads caused by the grounding.

In my view not a good day for boating in general, with a builder getting a big hit because an insurer (according to the builder) sought to recover the costs of the claim. The owner got his boat repaired anyway so he is not the loser.

BTW don't think the builder could withold any of the material facts. It would be clear that the hull was not properly constructed in that area just on principle without having the laminate schedule. The subsequent calculations on the design were done by an independent expert and accepted by both parties. There was no dispute about that - it was about the forces applied during the grounding and the seemingly dodgy assumptions on which subsequent analysis was based.

 

[Deleted User YDKXO]

Think you will find that the laminate schedule is part of the information required to comply with the RCD.

The judgement explicitly states that there is no specific requirement in the RCD for a particular laminate thickness in this area. However you may be correct in that a laminate schedule may be required to be placed in what's called the Technical File in order for the boat to be classified under the RCD. However whether the Owner or the judge or anybody else can access that Technical File is another matter altogether

Remember also that this case was not brought directly by the owner, but his insurers faced with a £450k claim and anxious to shift it onto somebody else. As jfm notes their lawyers did a better job of convincing the court their interpretation of somewhat unclear facts was the correct one, The defence was that even though the boat was defective it was not the defect that caused the damage, and that even if the boat had been built to spec it would not have been able to withstand the loads caused by the grounding.

Agreed but the whole basis of the claim rests on the fact that the laminate was 7mm thick instead of 20mm thick, which from Pearl's point of view is a fact that should not have come out

BTW don't think the builder could withold any of the material facts. It would be clear that the hull was not properly constructed in that area just on principle without having the laminate schedule. The subsequent calculations on the design were done by an independent expert and accepted by both parties. There was no dispute about that - it was about the forces applied during the grounding and the seemingly dodgy assumptions on which subsequent analysis was based

Thats maybe how the legal process panned out but again from Pearl's point of view, that's not how it should have panned out. Why were Pearl advised to accept the advice of an independent expert? Why did they reveal that the hull thickness should have been 20mm in the first place? Their lawyors put them in a position of having to argue the facts of the grounding and IMHO it should never have got to that position. I hope they didn't pay their lawyors' invoice

 

[Tranona]

Mike

Perhaps you ought to read the decision (if you have not done so already) as you will then see why it is impossible to "hide" the fact that the boat was not built to specification and why there had to be an independent analysis of the laminate. The case depended on whether the damage would have been the same if the boat had been built to spec and to determine that someone had to calculate the relative strengths of the laminate thicknesses and calculate forces involved in the collision. The first is relatively easy but the second is based on assumptions about the speed at the time of grounding and the impact that had on the hull in the suspect location. Then there was disagreement about the size of the crack (which would have varied according to the force of the impact), and again, in the absence of any clear facts the probable size of the crack was determined by calculations based on some assumptions about the speed of ingress of water and the evacuation rates of the pumps. This (as jfm notes) is where Pearl's case came unstuck because they claimed they had proof that the crack was 5 times bigger than calculated, but were unable to provide evidence of this in court. If they had, then the case might have had a different outcome.

If the claimants had failed under contract, they still had the alternative of claiming under SoG as "unfit for purpose" - irrespective of whether it was built to spec or not. There would then have been technical arguments as to whether a boat should be able to withstand such a grounding without breaching the hull.

BTW you might recall a similar case that was discussed here recently regarding a Jeanneau that grounded on a rock in Finland where the report was highly critical of the construction of the hull in a similar area, although more to do with the poor reinforcing around the IPS and the lack of watertight bulkhead which meant the boat flooded and sank. Jeanneau's response was that the design had been approved by both Volvo and their approval body. As with Pearl this type of data would be readily available and not something you can hide.

 

[Poecheng]

As to the discussion about whether or not Pearl (or those acting on their behalf) should have revealed the 20mm specification and how this was revealed, the answer is simple in that it was part of the contract which, no doubt, the claimant held already. It was part of the specification compliance with which was a specific term of the contract. That is why Pearl admitted that they had breached the contract - they had no choice. Even if the thickness had been 19.5mm they would be in breach of the contract.

Ruling paragraph 7 (emphasis added)
The case is somewhat unusual because it is admitted here by the defendant that the yacht was not built to contractual specification and that there was therefore a breach of clause 1.1 of the sale/building contract. This requires some further explanation. The yacht has twin engines with port and starboard propellers. On the underside of the hull, each propeller is supported by a P-bracket consisting, in effect, of a small tube, through which the propeller shaft passes, supported by a vertical bracket attached at the top to a horizontal "palm" which is affixed by a series of vertical bolts to a recess in the underside of the hull laminate. In accordance with the specification, the hull laminate is required to be 20mm thick. In order to create the recess into which the palm of the P-bracket is fixed, the hull laminate is moulded. According to the contract specification, the edges of the recess should have retained throughout the original 20mm thickness. However, it is common ground that in breach of the specification the edges around the recess did not retain the original 20mm thickness but became "thinned" to a thickness of only about 7mm.

 

[jfm]

As regards claimants finding out about the 20mm spec it was apparently in the contract as poacheng says. That seems unusual in this class of boat but that's what the judgement says. But even if it were not explicitly in the contract, it would I expect be disclosed as part of the discovery procedures

This (as jfm notes) is where Pearl's case came unstuck because they claimed they had proof that the crack was 5 times bigger than calculated, but were unable to provide evidence of this in court. If they had, then the case might have had a different result

tranona, note that the 6 inches was only somewhat "calculated". It was initially the subject of hearsay evidence about the diver's comments, and then a corroborative calculation was done. But that calculation was manifestly and profoundly flawed and Pearl were substantially let down by their expert/ legal team who didn't spot the flaw, IMHO. The calculation used a 40% factor based on flawed thinking, and if it had used the correct factor (which might have been much higher like 60 or 70%) then the calculation would have cast doubt on the 6 inch claim, not corroborated it. It seems crystal clear that this corroborative calculation was of critical importance in the case. The 6 inch result was absolutely critical, yet if that calculation had been done right it might have produced an answer of 10-12 inches thus doing the opposite of corroborating the 6 inches. At that point the claimants would have failed to show on B of P that the crack was only 6 inches, which they needed to do as a central plank of their case.

Pretty clumsy stuff IMHO. I reckon I'd have won this for Pearl ( and kept up my clean sheet when it comes to fighting insurance companies )

 

[petem]

As regards claimants finding out about the 20mm spec it was apparently in the contract as poacheng says. That seems unusual in this class of boat but that's what the judgement says. But even if it were not explicitly in the contract, it would I expect be disclosed as part of the discovery procedures

tranona, note that the 6 inches was only somewhat "calculated". It was initially the subject of hearsay evidence about the diver's comments, and then a corroborative calculation was done. But that calculation was manifestly and profoundly flawed and Pearl were substantially let down by their expert/ legal team who didn't spot the flaw, IMHO. The calculation used a 40% factor based on flawed thinking, and if it had used the correct factor (which might have been much higher like 60 or 70%) then the calculation would have cast doubt on the 6 inch claim, not corroborated it. It seems crystal clear that this corroborative calculation was of critical importance in the case. The 6 inch result was absolutely critical, yet if that calculation had been done right it might have produced an answer of 10-12 inches thus doing the opposite of corroborating the 6 inches. At that point the claimants would have failed to show on B of P that the crack was only 6 inches, which they needed to do as a central plank of their case.

Pretty clumsy stuff IMHO. I reckon I'd have won this for Pearl ( and kept up my clean sheet when it comes to fighting insurance companies )

JFM, could they appeal and make a better case? Perhaps you should offer your services!

 

[Portofino]

The way I read the judgement from a laymans law perspective,is this - its the 7mm thickness that resulted in the claim .
Even if there was not an accident and the owner somehow found out ( fitting a skin fitting by a yard engineer ) about the 7 mm he could have approached the builder ( with relevant proffessional reports ) asking for the " defect" to be rectified .

This is why Pearl ended up suckered in to court.As it paned out the owner found out another way 7 mm was a manufacturing defect at great expense to pearl .
Arguing over crack size / waterflow -I do not think helps -or wether that he was doing 2 knots or 20 knots .
Was it fit for purpose ? -the laminates around the P bkt ? Pearl found out the hard way .
The diver placed an emergancy patch / putty repair and the boat was lifted that evening .In this day and age I would have thought -any salvige diver ( for future legal hassle would take pic,s) and when on land ,everybody and thier dog in the yard inc owner, insurance accessor etc .
No calculation beats a picture which paints a 1000 words .
The crack was 6 inches that was accepted .

This may cast a light on future ins renewel of this modal

 

[Aardee]

I feel it's worth repeating the question - According to an earlier response from Iain, Pearl were using a Moulding Contractor to make the hull. Is it possible for Pearl to claim damages from them, as they were the ones that didn't build the hull to spec?