Safe Harbor Updates

How Much Do You Know About Punitive Damages In Maritime Law?

Posted: Jul 24, 2018 8:12:00 AM

The right to seek punitive damages might be diminishing in some areas of law, but such rights are only expected to continue expanding in the maritime industry.

Punitive damage awards are often very large compared to compensatory damages and usually trigger a right to collect attorney fees. In a recent LinkedIn article, Attorney Larry Altenbrun offers an insightful perspective on how laws pertaining to punitive damages are expanding, yet much remains in flux.

A Brief Legal History

Punitive damage laws dictate how defendants found responsible for pollution and other maritime misconduct might be punished, be they vessel owners, insurers, or employers.

In 2008, the U.S. Supreme Court began the modern legal precedent for these claims in Exxon Shipping Company v. Baker, allowing for the recovery of punitive damages in a marine pollution case, but reducing the amount of punitive damages in that case to a 1:1 ratio with compensatory damages for victims of pollution. The Supreme Court returned to the issue in the 2009 Atlantic Sounding v. Townsend case, where the Court approved of punitive damages in a seaman’s claim for  maintenance and cure (i.e. employer-paid medical care and living expenses while a seaman recovers from injury or illness).

Altenbrun also notes that the Court is expected to be asked to decide whether to expand claims for so-called “unseaworthiness” of a vessel—an issue that lower courts have, so far, disagreed upon. He notes that, currently, vessel owners operating in Washington and other Western states are most at risk for punitive damage claims.

Emerging Areas of Legal Contention

Meanwhile, new evidentiary issues, such as the use of experts and the admissibility of insurance, may now arise in maritime punitive damages cases. There are other evidentiary issues that will be important as this area of law develops, such as the discovery and admissibility of the financial records of vessel owners and the appropriate identification of the corporate employer or vessel owner.

Vicarious liability is another area of contention for the maritime law courts. Under vicarious liability principles, an employer is usually responsible for acts its employees committed in the scope of employment. In maritime law, a higher standard applies to punitive damages, although there is currently disagreement as to what the standard is.

In the meantime, courts are also in disagreement about what triggers punitive damages in the first place. “Willful and wanton” misconduct seems to be the standard, but courts have been known to apply higher and lower standards, based at times on the claim.

The availability of punitive damages in maritime law has been argued since the early-1800s,  expanding and contracting based on socio-political events, changing administrations, and new legal precedents. It seems as though we are in a period of expansion, but  with historical trends as a guide, the tide is sure to shift again. .

Safe Harbor is fortunate to have access to experts like Altenbrun and many others, who can assist in with important issues like damages, and how they can affect your business. For any questions, please contact us.

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