Doesn't limiting the liability only work on commercial vessels and the passengers/crew on them? If you damage someone else's property or hurt people outside of the vessel you can't limit the liability.
When a maritime worker is injured during the course of his or her employment, a personal injury claim is the best means to obtain fair and just compensation
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The Limitation Act applies to all seagoing and non-seagoing vessels used to navigate the ocean as well as inland lakes and rivers. These vessels now include canal boats, barges, and lighters in addition to the larger cargo ships and other types of ships used on the high seas.
Recently, in 2005, the U.S. Supreme Court expanded the meaning of “vessel” to include — for purposes of the Limitation Act — pleasure craft, jets skis and houseboats.
An equally savvy attorney for a plaintiff may find a way to expand liability beyond the value of the vessel. I'm certainly no expert at maritime law. This is just my understanding from similar discussions.
Keep in mind, maritime law can be confusing. Usually when assessing liability they will proportion it to both parties. For example, and perhaps
@Wookie could add to the discussion, the defense attorney may be able to find somewhere in the Colregs where the Rainbow River vessels should have been displaying some sort of signal while docked in the navigation channel.
An example I am aware of is one most people are completely unaware of. If a vessel is anchored during the day (think of those hundreds of boats anchored on a sandbar), all of them should be displaying the day signal for being anchored. Which is a single black ball. I've never seen one, but if a vessel crashed into one of these anchored vessels the offending vessel's attorney could argue to put a portion of the liability onto the anchored vessel for not displaying the day signal.
My point is maritime law is not as logical as terrestrial law.