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Inc. v. Certain Underwriters at Lloyd's of London

United States District Court, S.D. Florida

May 30, 2017

KOL B'SEDER, INC., a Florida Corporation, Plaintiff,
v.
CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON SUBSCRIBING TO CERTIFICATE NO.154766 UNDER CONTRACT NO. B0621MASRSWV15BND, and GLASS-TECH CORPORATION, A Florida Corporation Defendants.

          OMNIBUS ORDER ON MOTIONS FOR SUMMARY JUDGMENT

          MARCIA G. COOKE United States District Judge

         This is an admiralty action stemming from the partial submersion of a yacht at a boatyard on the Miami River. Plaintiff Kol B'Seder, Inc. (“Kol B'Seder”) brings suit against Defendant Certain Underwriters at Lloyd's of London subscribing to Certificate No. 154766 under Contract No. B0621MASRSWV15BND (“Underwriters”) alleging breach of insurance contract, and against Defendant Glass-Tech Corporation (“Glass-Tech”) alleging breach of contract, breach of warranty of workmanlike performance, and negligence. (ECF No. 76 ¶ 1). I have jurisdiction under 28 U.S.C. § 1333.

         Pending are (1) Certain Underwriters' Motion for Final Summary Judgment (ECF No. 66), and (2) Glass-Tech's Motion for Summary Judgment Against Plaintiff & Motion for Summary Judgment Against Counter-Defendant (ECF No. 69). For the reasons that follow, I grant the Motions.

         BACKGROUND

         Kol B'Seder bought the M/Y Sababa, a now eighteen-year-old motor yacht, in 2002. (ECF No. 76 ¶ 2; ECF No. 53-1 at 15, 17). It did so planning eventually to offer charters to and from the Bahamas. (ECF No. 53-1 at 43-45). In the years following the purchase, Kol B'Seder's principal owner, Noreen Sablotsky, docked the yacht at her waterfront home (Id. at 62-63) and operated it in and around Biscayne Bay, the Miami River and, occasionally, the Bahamas. (Id. at 16). During the period relevant to this lawsuit, Kol B'Seder insured the vessel through Underwriters.[1] (ECF No. 79-1).

         Prior to the Sababa's partial submersion, Sablotsky did not know how often a vessel should undergo routine maintenance or be hauled out of the water for repairs.[2](Id. at 170-74). But she claims that someone checked the Sababa's engines and bilge systems weekly (Id. at 19, 116, 119), and that a scuba diver cleaned the yacht's hull monthly.[3] (Id. at 33). Despite those efforts, the passage of time was not kind to the Sababa. In 2008, she had engine trouble that took two years to fix. (Id. at 39). Also in 2008, the vessel required work on its rudder. (Id. at 132-34; ECF No. 68-2 at 16-18). In 2012, the vessel again had engine problems that required extensive repair work. (ECF No. 53-1 at 41, 135-40). It had repairs to its hull in April 2013 (Id. at 34-43; 135-40), [4] and in August 2015, Sablotsky's diver told his boss the yacht needed a haul-out. (ECF No. 68-4 at 17-18, 38).

         Then, in March 2016, Sablotsky claims the Sababa touched bottom in a channel leading to Biscayne Bay. (Id. at 63). Sablotsky says she did not feel an impact sufficient to suspect damage, and surmised that the vessel's propellers had simply kicked up mud. (Id. at 23-26, 63, 69, 71-72). She therefore did not stop to determine whether touching bottom affected the integrity of the hull. (Id. at 70-71). She also did not inform Underwriters of the incident. (ECF No. 66 ¶¶ 28, 30).

         Sablotsky testified that by that point, the Sababa had mechanical problems nearly every time she took it out. (ECF No. 53-1 at 43-47, 144-46). “Something kept - kept going wrong” (Id. at 45), “it just was never ending.” (Id. at 144-46). In her view, the vessel was not seaworthy to travel in the open seas: “And the boat, if you look at the - was seaworthy to the point of getting - I got insurance and it was safe in that it wasn't going to sink. But it was - it wasn't seaworthy to go anywhere, to the Bahamas. So I had a long list of things to do.” (Id. at 43).

         Sablotsky wanted the Sababa ready for trips to the Bahamas (Id. at 81-82), so she finally arranged to take it to Glass-Tech for a haul-out. (Id. 85-86). On April 29, 2016, a Friday, Sablotsky left the dock at her home and piloted the vessel to Glass-Tech's boatyard. (Id. at 153-58). On the way, she sent Glass-Tech owner Nelson Fernandez a text message asking if it was “[s]till ok to bring boat today?” (ECF No. 71-1 at 1). Fernandez texted back that she could “bring it over.” (Id.). She asked, “can we be there at like 1:30?” (Id.). Fernandez responded, “Yes. That's fine. I may not be able to haul till Monday. But it will at least be there and so we can haul it Monday. So bring it over when u can.”[5] (Id.).

         The Sababa arrived at the boatyard early that afternoon. (ECF No. 68-2 at 67-68). Sablotsky pulled alongside another vessel already tied to the dock (Id. at 158), and two boatyard employees caught and tied her lines to the other vessel. (Id. at 158-62). Sablotsky confirmed the work she wanted performed, gathered her belongings, and left. (Id.).

         By her own admission, Sablotsky did not:

• Advise Glass-Tech that the Sababa had not been hauled out for bottom maintenance in more than three years (Id. at 84-85);
• Advise Glass-Tech of the poor condition of the vessel (Id.);
• Advise Glass-Tech that she believed the vessel had run aground a month earlier (Id.);
• Instruct anyone at the boatyard to plug the vessel into shore power (Id.); or
• Plug the vessel into shore power herself. (Id.).

         As Fernandez had anticipated, Glass-Tech did not end up hauling the Sababa out on April 29, 2016. (ECF No. 76 ¶ 10). Two days later, on Sunday, a boatyard security guard discovered the vessel partially submerged. (ECF No. 68-2 at 30). Glass-Tech informed Sablotsky (ECF No. 53-1 at 91, 164 & Ex. O at 89), lifted the vessel out of the water, and took measures to preserve her equipment and machinery. (Id. at 180). At that point, Sablotsky told Fernandez via text message that the yacht “may have hit the bottom on the way out of the canal” a month before, that it “basically felt like it just touched the bottom, ” and that she just “kept going.” (ECF No. 71-1 at 19).

         Kol B'Seder filed an insurance claim with Underwriters that day. (ECF No. 53-1 at 92; ECF No. 71-1 at 10). Agnes Henderson of York Risk Services Group (“York”), the Underwriters' Third Party Administrator, handled the claim. (ECF 51-1 at 4.). Henderson called Sablotsky to find out if there had been an incident leading to the Sababa's partial submersion, and Sablotsky told her that she did not remember grounding the vessel. (Id. at 14). Sablotsky later said the same thing to York's surveyor, Stuart Hutchinson.[6] (ECF No. 68-3 at 20-21; ECF No. 68-6 at 1).

         Hutchinson surveyed the vessel on May 3, 2016. (ECF No. 68-6). He concluded, inter alia, the following:

Firstly, the design and installation of external rudder logs is poor.
This is not an uncommon failure.
It is my professional opinion that the external rudder and rudder log have been subjected to hydraulic forces over time, which contributed to or caused the tabbing holding the starboard rudder log to progressively fracture. Fastener penetrations and plumbing penetrations contributed to the transom becoming overly saturated.
Some of the repairs performed in 2008 failed, when the rudder log came adrift and moved aft causing transferred fatigue to tabbing on the inside rudder shelf.
It is my professional opinion that water had been ingressing the bilges in the engine space for some time thru the starboard rudder log and penetrations for the trim tab hydraulic plumbing.
The bilge pumps have in the past dewatered the vessel because the vessel was plugged into shore power and the battery bank feeding ...

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