Updates to Shipowner’s Limitation of Liability Act Bring New Limits and Exclusions

Recent federal legislation includes important changes for maritime owners, operators and insurers. The amendments now exclude “covered small passenger vessels” from the Shipowner’s Limitation of Liability Act and set new limits on when passengers can bring claims against these vessels after an injury or death.

The following small passenger vessels, excluding wing-in-ground craft, are now considered “covered small passenger vessels” which are excluded from the Limitation Act:

The changes also add “covered small passenger vessels” to the provisions setting out minimum time limits to bring claims against vessels. Passengers aboard covered small passenger vessels now must have no less than two years to provide notice or bring an action after an injury or death. This means those operating a covered small passenger vessel may not contractually limit the time to bring a claim or notice of a claim against them to less than two years from the date of the voyage.

Many sections of the Limitation Act have also been renumbered. Below is a guide to prior statutory references with their new references and notations of whether changes have been made.

The amendments make no reference to Rule F of the Supplemental Rules for Admiralty or Maritime Claims or whether the concursus procedure remains available to those operating covered small passenger vessels, even if limitation is not available. These changes raise important legal questions involving retroactivity, proper claims handling procedures, and insurability of “covered small passenger vessels” now excluded from the Limitation Act. Read Barrett’s full breakdown of the changes here, and please reach out to Barrett Hails or any member of Phelps’ Admiralty team for advice and guidance.