Florida Keys News
Sunday, October 14, 2012
Floating structures or vessels?
Supreme Court case could have wide implications

A pending decision from the U.S. Supreme Court on a Palm Beach county case that will decide whether federal or state laws determine the difference between a floating home and a vessel could have broad implications for some local marina communities, and maritime businesses nationwide, law professors say.

Local officials are monitoring the case, although they don't know right now how it will ultimately affect houseboats moored at local marinas.

"We are interested in the outcome," said Assistant Monroe County Attorney Susan Grimsley. "Then we will see what effect it may or may not have on county ordinances."

Depending on what the court decides, structures now registered as boats but used as permanent live-aboards could be subject to county taxes, whether at marinas or not. Motorless vessels not intended for travel or transport could be exempt from rules involving marine sanitation or safety equipment. Definitions and wording in state and local laws may have to be rewritten.

Facts of the case

At issue is the former floating house of a Riviera Beach activist and gadfly, Fane Lozman, who had battled the city over plans for development at the marina where he was moored.

Ultimately, Lozman refused to pay back-rent. Declaring Lozman's home a vessel, the city filed a court order under federal admiralty law statutes, which permit a vessel to be seized by a creditor. The U.S. Marshals Service did just that. The vessel -- or floating home -- was destroyed and Lozman brought suit.

Riviera Beach maintains it acted properly. Determining that Lozman's property was a vessel, city officials "arrested" the boat, according to state laws and the federal applications recognized by federal appeals courts with jurisdiction in Florida. But those applications currently differ in the federal courts serving various U.S. regions; there is no uniformity.

Conflicts in law

According to legal experts, Lozman's boat would be considered a floating home in Louisiana, Texas or California. Here, according to federal decisions in Florida, it is a vessel, and state laws reflect that.

The Supreme Court will decide which application should apply.

Lozman's two-story, 57-foot gray home had been towed to its mooring in 2005 and remained there until the city took it away. Such a taking would not have been permitted under land-based laws.

As Lozman's suit made its way through the federal courts, the 11th Circuit agreed that the home was a vessel, based on its 2008 opinion that called a floating casino a vessel, because it could be towed with people or things on it without sinking.

When Lozman's attorneys asked the Supreme Court to review that decision, they argued that because the home was not capable of being used in commerce to transport people or things, admiralty law should not apply. The justices agreed to hear the case, their first of the 2012 docket.

Lozman's home, his attorneys argued, was not a houseboat, which is intended for travel over the waters but may be found docked at a marina or elsewhere. Rather, it was an extension of the land, and as such, they argued, not under federal admiralty law.

"At what point is its use for transportation on the water?" Capt. Alan Richard, a Florida State University professor of maritime law, asked rhetorically. He and other admiralty law professors filed a friend of the court brief to the Supreme Court. That brief says if a structure like Lozman's is a vessel, then anyone injured while working on it -- such a painter or plumber -- would have to file claims under federal maritime law, rather than workers' compensation.

Workers on casino barges not intended to go anywhere -- except for relocation in emergencies or other matters -- would be considered seamen. If a debt was owed because of work done on it, contractors could file a claim under federal law and have the floating structure "arrested" to pay the debt, a remedy that makes admiralty law particularly distinct from land-based rules and procedures, which require that a lien be filed, with no seizure involved.

"The Supreme Court decision is likely to affect all the laws that govern houseboats, and could have a significant impact to the owners," Richard said.

Local implications

Reports of the case have drawn the attention of some residents of the Key West City Marina at Garrison Bight.

Tied to its slips -- along with live-aboard sailboats and proper seagoing houseboats of various shapes and sizes -- are what the marina defines as "floating structures."

"Some are vessels and some are floating structures," said city property manager Marilyn Wilbarger.

"If it is registered and has a motor and can move under its own power, it is considered a vessel."

Currently there are 95 live-aboards at Garrison Bight, of which 39 are classified as floating structures.

But depending on how the Supreme Court decides in the Lozman case, attorneys say, those definitions may no longer apply.

If the court agrees with Lozman and his supporters, then it is the intended use of the object -- in this case a home not intended to go anywhere -- that would determine its definition, rather than its equipment.

The mere existence of a motor, according to Richard, would not be enough for the distinction to be made.

He and other attorneys say more objects might be classified as floating structures. Some, which currently pay only a slip fee to a public or private marina, could have to pay property tax and lose their status as vessels.

That, attorneys for Riviera Beach argued, is part of the problem with Lozman's claim. Determining what a thing is by its applied use, they said, is too subjective.

In Monroe County, owners of 53 objects considered floating structures -- including the 39 at the Garrison marina -- pay what is called a tangible property tax.

It is computed on the basis of the sales price.

"It's kind of funny," said Monroe County deputy appraiser Deborah Hubbard.

"Some of the ones that were on [the defunct] Houseboat Row and at the city marina, I question how some of those got a vessel registration number. What a can of worms."

Honor system

Hubbard currently checks with the county tax collector to verify if a vessel number has been issued to a floating home. If it has one, then the tax does not apply.

Owners of some boats considered derelict have applied to pay the tangible tax. But those boats then sometimes are abandoned, and after the initial application, the tax is never paid again, Hubbard said.

Key West boat builder Timothy Behan owns a live-aboard at Garrison Bight that has never been used to transport anything and is intended to be a floating home.

He registered the floating home with the state as a boat, though he would prefer more clarity from the courts.

"In a permanent place, it should be treated as a home, because that's what it is," said Behan, who resents that the vessel status means his home can be boarded at any time by officers of the Florida Fish and Wildlife Conservation Commission or the Coast Guard.

"I don't care what you call me, an apple or an orange. But I want some consistency so that I know where I lie."

Whether that consistency will issue from the Supreme Court is anyone's guess for now.

"Mine truly is a floating home; it is not a boat, it doesn't go out," Behan said of his 48-by-16 foot floating home.

"I want to be a good citizen. I enjoy living there. But right now they classified it as a vessel, and I complied with their rules."

To Behan and some other Garrison Bight residents, the decision will have important future implications, considering his prediction that such floating homes will increase in number.

"I see this as the future of America, global warming or not," Behan said. "We are not making any new land and there will be more floating homes. It's the most affordable way to live in Key West."

jdesantis@keysnews.com

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