Risk Conversation®

Marine facilities such as marinas, yacht clubs and boatyards provide valuable access to vessel berthing, mooring and storage for boat owners. The amenities and services provided by these marine facilities can be a welcome resource for boat owners along any stretch of water.

The relationship between a marina, yacht club or boatyard and a vessel owner can be a mutually beneficial one, but complications in the use of such marine facilities can arise. For that reason, boat slip rights of usage should not be casual arrangements and typically should be memorialized in writing. Marina storage (e.g., wet slip, mooring and dry rack storage) agreements, in particular, are important because this is the best opportunity for the parties to settle on their formal, potentially long-term, contractual relationship. This is where the parties can establish their contractual rights and responsibilities along with rules, regulations, and specific restrictions relating to the boat owner’s authorized use of the facility.

Here are some recommended practices to consider when preparing storage agreements:

Review with an attorney:

• Work with a licensed attorney, preferably with maritime law experience, to draft agreements
• Consider having the attorney draft such agreements in template form for standardized use with multiple boat owners; material changes to the template should be discussed with the attorney
• Set up periodic reviews with the attorney to ensure all applicable legal developments are addressed in agreements
• Consult with an attorney to determine whether it is preferable to refer to the boat owner as a customer rather than a tenant by making it a license agreement

From a risk management standpoint, include the following in your agreement:

• Complete information on the vessel and all of its owners
• Reference to applicable local codes and ordinances so that by signing the document the boat owner attests that they have read these and will abide by them
• Safety requirements for boat owners
• Insurance requirements for boat owners
  • Boat owners should have adequate limits of both property damage and liability insurance and name the marine facility as an additional named insured
• Restrictions or limitations on “live-aboards” and Airbnb or similar living arrangements
• Notation of specific slip number or mooring/storage location, as well as ownership, access and usage permitted
• Appropriate limitations of liability for the marine facility and its staff
  • Prominently identify indemnification, defense, and hold harmless clauses
• The duration of time permitted for usage at the marine facility
• ADR (Alternative Dispute Resolution) Clause allowing for mediation and arbitration of disputes arising out of the contractual relationship

When signing agreements, consider:

• Requiring all boat owners to sign the contract annually
• Requiring proof of insurance from boat owners, including transients, at least annually
• Requiring all boat owners to provide state registration or federal documentation
• Managing the liability exposure that outside contractors may present through a premises access or similar process; this will require them to check in at your office, provide appropriate and adequate insurance, and indemnify the marina against liability

Marine facilities and boat owners cannot thrive without assistance and cooperation from all parties involved. Preparing a clear, concise written storage agreement can help prevent many potential issues from arising, and can provide a method of resolving disputes when something does arise.

For more tips on storage, as well as fueling, launching, housekeeping, and other key aspects of marina safety, download Chubb’s Achieving a Safe & Well-Maintained Marina tip sheet here.

John Venneman is Senior Marine Surveyor for Chubb’s Marine Risk Management Group. He is the current Vice President of the National Association of Marine Surveyors with over 20 years of experience as a marine surveyor and risk management professional. John is also on the National Fire Protection Association’s Technical Committee on Marinas and Boatyards.