Thursday, February 12, 2009

Ocean Planet dispute

Apparently everybody saw it. January 2006 at Key West Race Week. It was big news at the time, when Michael Kehew's heavily modified Kiwi 35 In Theory came to the regatta with high hopes but was sunk before the first gun. The owners of the modified Kiwi live in Rhode Island, where they prepped the boat for two years, painted it, put in a carbon mast, bought new sails, and had it trucked to Key West for the event. However, while docked prior to the event, In Theory was struck by another boat and sunk.

Three years later, Kehew is now in court. At the time, In Theory was docked at Key West when Bruce Schwab - a noted solo sailor - was trying to singlehand his Open 60 Ocean Planet away from the sea wall in rough weather (Schwab said his docklines had chafed through). Schwab collided with In Theory, but when his insurer refused to pay for the Kiwi 35, and with litigation required to occur in Florida, the situation languished. However, when Schwab started working and visiting RI, he established sufficient status under R.I. law and was served in November 2008.

Litigation has recently commenced in Newport, R.I. between Kehew and Schwab, but there are likely no winners in this case. The Kiwi 35 owners have already suffered a great loss. For Schwab, who assumed his insurance company had covered the claim, lost use of his boat and the anticipated earnings from the OceanPlanet Foundation’s fundraising/training sailing programs, resulting in him having to file for personal bankruptcy in 2007. The legal question appears to concern how Schwab’s insurance policy only covers liability in the case of negligence on the part of the insured, and not cases that involved acts of weather. The lawsuit is expected to take 2 years to resolve.

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12 Comments:

At 12:52 AM, Anonymous Anonymous said...

What a mess. Schwab seems to be in the position of having to prove he was negligent. Insurance companies that sell insurance with holes in their cover are an absolute pain. I have to insure my 14ft dinghy for £3000000 before I can race at my club and my small cruiser has to be insured for the same amount before I can have a mooring. Insurance companies know this and ought to be made to cover forseeable risks, of which breaking loose from one's mooring is surely one of the more obvious.


George Morris
Inverness
Scotland

 
At 4:56 AM, Anonymous Anonymous said...

The Kiwi was getting the shit kicked out of it and was about to sink before Ocean Planet ever hit it. They left the Kiwi tied to the wall in the Navy basin and a huge northerly came in. The Kiwi had two little fenders between the racks and the wall and the boat was getting absolutely pummeled. That's why Ocean Planet was trying to pull out, it was getting pummeled as well. The Kiwi guys are just trying to pass the blame. They weren't even there! That boat was going to sink regardless.

 
At 5:31 AM, Anonymous SKip said...

Anoymous, you are an idiot. I had a boat just down the dock from them that sat against the same sea wall. At the same time and was very similar in dimensions The boat was not ready to sink to begin with. Mr Schwab unfortunately got into some shit and usual insurance company tactics insued.

 
At 5:43 AM, Anonymous Anonymous said...

Were you there when it happened?? I was....

 
At 7:39 AM, Anonymous Anonymous said...

First off, why didn't Kiwi file a claim with his insurer, pay his deductible, get his boat repaired and go sailing?

Then it is his insurance companies job (which he pays for in the premium) to go attempt to collect from the other guy. If they are successful, then he gets his deductible refunded to him.

How simple is that? Unless Kiwi didn't have insurance to begin with.......

Second, all boat policies require "negligence" in order for the liability portion to pay out. I mean without negligence, no on has a legal responsibility to pay the other party. Now it will be the plaintiffs job to prove negligence. Did Schwab know this storm was coming? Did Schwab get the boat prepped for the oncoming blow, doubling up lines, installing chafe guards, getting extra fenders? When he decided the boat couldn't stay there any longer, did he plan his escape well? Did he use sufficient towing line, was it tied securely to fittings that wouldn't break off? Etc.

If Kiwi can prove that some of the critical decisions made were negligent, the insurance company will be obligated to pay the claim. And I am sure the Schwab's insurance policy must be providing his lawyers fees which would be SOP.

 
At 8:40 AM, Blogger Ibsailn said...

I wasn't there, but know Mike and Mark to not be the negligent type. I truly doubt the boat was in serious danger before getting crushed by the open 60.

I started sailing with them the summer after this event on Rumours and just last night helped bag the first ply of their new boat, a Roger Martin designed 35' skiff, again with racks....very cool boat.

 
At 10:01 AM, Anonymous Anonymous said...

I was there... and believe the guys from the Kiwi 35. OB was bashing into the seawall like crazy with blown fenders. They tried to pull away from the wall to relocate to the other side of the harbor and smashed into the Kiwi in the process. Only the skipper and maybe 1 other on board (is it negligence to try and move a large boat in heavy winds and seas with severely limited crew?). Only after cutting loose to relocate did OP smash into the kiwi, crushing her stern and causing her to sink.

Now... I tend to believe my ears rather than my lying eyes, but that's just me.

 
At 12:08 PM, Anonymous Anonymous said...

7:39 Anonymous is correct. The Kiwi's insurance should pay for his boat, irrespective of negligence. Is it possible that Kiwi wasn't insured? Therein lies the problem. In that case, Kiwi has no alternative but to sue Schwab, who turns it over to his insurance co. and they defend on the basis that it was "an act of god", ie, no negligence. If they lose, they pay, otherwise Kiwi bears the loss because he wasn't insured.

 
At 7:33 AM, Blogger Scuttleblog said...

Bruce told me that the Kiwi owners were paid by their insurance company for their insured losses, but he claims the boat was underinsured, and that the lawsuit is now to seek compensation for damages not covered by their insurance. I have not confirmed this with the Kiwi owners.

 
At 9:37 PM, Anonymous Anonymous said...

Curious that the entire wall side of Kiwi was smashed in with huge holes. Also curious that there was very minor damage to the stern of OP.
And just to clarify, no one was there when the blow started because they were not allowed to stay on their boats there.

 
At 12:33 PM, Anonymous Anonymous said...

If a guy has a J 24 and no insurance, and it is destroyed by someone else's boat, just b/c he has no insurance doesn't mean he does not recover. The person who destroyed his boat still has to pay for it. Wiorks the same way with cars guys - think that way.

 
At 4:49 PM, Anonymous Anonymous said...

Man your not from MI, We have no fault policy. You could be driving a lambo and get hit by a pinto and recieve NO money...

 

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