United States District Court, D. Maine
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Z. SINGAL, UNITED STATES DISTRICT JUDGE.
Court conducted a five-day bench trial in this admiralty
action from August 8-14, 2017, at which it received witness
testimony and documentary evidence. The bench trial
transcript was filed on October 5 and 6, 2017 (ECF Nos.
95-98, 100). The parties submitted proposed findings of
fact and conclusions of law on November 6, 2017 (ECF Nos. 103
& 104) and responses to the proposed findings of fact and
conclusions of law on November 27, 2017 (ECF Nos. 110 &
111). In accordance with Federal Rule of Civil Procedure 52,
the Court has reviewed all of the evidence presented and now
FINDS for Plaintiff. Specifically, the Court makes the
following findings of fact and conclusions of law.
FINDINGS OF FACT
Parties and Vessels
W-Class Yacht Company, LLC (“W-Class”) is a
Delaware limited liability company in the business of
building, marketing, and selling vessels ranging from 22 to
135 feet. Donald Tofias is W-Class's managing member and
president. Tofias is generally known as a conscientious and
fastidious yacht owner who often has people working on his
W-Class has maintained its principal office at Newport
Shipyard in Newport, Rhode Island, for at least the past
fifteen years and has used that yard's services to do
repair, painting, refit, and other work on W-Class vessels
for the past fifteen to nineteen years. At all times relevant
to this matter, the vessels at issue were officially or
unofficially “home ported” at Newport Shipyard.
Motor Vessel Mare (hereinafter “M/V
Mare” or “Mare”) is a
45-foot, steel-hulled, 1946 Navy workboat built in Brooklyn,
New York. W-Class acquired the M/V Mare (USCG
Official No. 250428) in September 2009 and has owned the
vessel through the time of trial in this matter. During the
periods of 2012-13 and 2016-17, Mare was insured for
W-Class used Mare to assist in the marketing of
W-Class vessels, as a place to entertain guests, and
sometimes as a place for Tofias to live. Prior to the periods
at issue in this matter, W-Class undertook a number of
improvements to the vessel, including adding a mast,
spreaders, a boom and gaff, a stainless steel barbecue grill,
a swim platform, a stainless steel swim ladder, and a
stainless steel ladder from the deck to the roof of the
wheelhouse. W-Class also installed a new turbo diesel engine.
W-US-1, LLC (“W-US-1”) is a Rhode Island limited
liability company and a wholly owned subsidiary of W-Class.
Tofias is the managing member.
Sailing Vessel Wild Horses (hereinafter “S/V
Wild Horses” or “Wild
Horses”) is a 76-foot, cold-molded wooden vessel
built in 1997-98 at Brooklin Boatyard in Brooklin, Maine.
W-US-1 owned the S/V Wild Horses (USCG Official No.
1064210) at all times relevant to this matter and used the
vessel to run races.
Inc., d/b/a Front Street Shipyard (“Front
Street”) is a full-service marine facility in Belfast,
Maine, that undertakes new construction and vessel refit and
repair, with a focus on larger vessels over 150 tons. Front
Street has been in business since 2011. At all times relevant
to this matter, John B. “J.B.” Turner was Front
Street's president. As part of his duties at Front
Street, Turner organizes the general work flow in the yard
with two service managers and one project manager and
oversees particular refit projects.
Tofias first did business with Front Street in August 2011.
At that time, Tofias asked Front Street to set up an account
in the name of W-Class for work to be done on Wild
Horses. That work is not at issue in this matter.
Payments against invoices issued by Front Street for work on
Mare or Wild Horses as described below were
made by check from a W-Class bank account or by credit cards
issued to Tofias personally or to one of his companies.
was the practice of W-Class and W-US-1 to keep maintenance
logbooks aboard their vessels. A maintenance log is an
ongoing record of maintenance required on a vessel and what
maintenance steps are being taken. Prior to trial, Plaintiff
requested the production of logbooks from both vessels for
the period between January 1, 2013, and January 1, 2015.
W-Class and W-US-1 have not produced any logbooks whatsoever
for Mare and have produced only one logbook covering
the period from July 2013 to October 2015 for Wild
Horses. Tofias is unable to offer any explanation for
his inability to locate the missing logbooks. (See
Pl.'s Ex. 67.) The Mare logbooks would have
notations about maintenance and what was and was not working
on the vessel. The Wild Horses logbooks that were
produced noted maintenance needs and vessel conditions.
August 2, 2012, Tofias was seriously injured in a sailing
accident that incapacitated him for the following six months.
Because of Tofias's injury and his inability to use
Mare, he decided to undertake significant
renovations to the vessel.
True Course Yachting, Inc. (“True Course”) is a
yacht management company that assists vessel owners with
vessels under 100 feet by providing crew services, project
management, cleaning, and detailing. Regarding the project
management component of the business, True Course generally
acts as the “eyes and ears” for vessel owners
during a yard project. Ben Davis is the founder and principal
owner of True Course and a licensed captain.
to his incapacity, Tofias retained Davis and True Course to
be W-Class's project manager for the Mare
Davis retained Joseph Lombardi of Ocean Technical Services,
LLC, a marine surveying company, to survey Mare and
prepare a proposed scope of services for necessary repairs,
including replating the vessel's bottom. Lombardi
prepared and provided to Davis a written survey report
regarding the condition of Mare dated August 27,
2012. Lombardi also prepared a document entitled
“Requirements and Specifications for Drydocking and
Repair of M/V ‘Mare'” dated September 1,
the survey report, Lombardi noted, inter alia:
• “Moderate failure of the paint system throughout
the maindeck (foredeck, amidships and aft) and cabin trunk
area is causing rust/scale to break through.”
(Defs.' Ex. 38, Bates No. 004349.)
• “The bottom paint system has not been correctly
applied to recent shell plating doublers and is currently
peeling away.” (Id., Bates No. 004351.)
• “Condition of [the forepeak tank] is fair/good
with much rust/scale and some wastage of transverse frames
and intercostals due to water entering through BOMAR hatch.
Shell plating in space in poor condition.”
(Id., Bates No. 004353.)
light of the survey, Lombardi made several recommendations,
• “Anti-fouling paint system is somewhat failing
below the waterline and particular care must be taken with
respect to the bottom coatings as absence of coatings
inevitably lead[s] to plate loss due to potential (galvanic
corrosion). Remove existing paint system and renew with a
steel primer and an ablative anti-fouling system compatible
with an impressed cathodic system for the habitual berth of
the vessel.” (Id., Bates No. 004358.)
• “Repair/replace BOMAR dogging hatches and
gaskets on foredeck and aft deck.” (Id.)
• “Properly clean bilges of standing
oil/water.” (Id., Bates No. 004359.)
• “Replace broken bilge pump in engineroom.”
Lombardi concluded: “This vessel is in good cosmetic
condition, but requires significant steel shell plate work
and interior framing under the head. . . . Choices made to
double plate on hull [are] only delaying the day of reckoning
and this should be addressed; other areas of original shell
plating (bow and chines) need immediate repair.”
(Id.) Lombardi also concluded that the plate on
Mare's hull was ¼-inch thick.
Davis sent copies of the Lombardi reports to a number of
shipyards in the process of determining which yard should do
the Mare refit. Davis may have provided Front Street
with one or both of the Lombardi reports.
Although Davis compiled research and information on several
yards, Tofias did not rely on this research in choosing to
give the Mare refit to Front Street. Tofias
ultimately selected Front Street based on the recommendation
of Steve White, the owner of Brooklin Boatyard who also has a
stake in Front Street, and based on Turner's
representation that Front Street could handle the work and
had the necessary experience. Davis believed that Front
Street was in fact overqualified to do the work
based on the positive reputation in the yachting industry of
the individuals who ran the yard.
Front Street had worked on steel-hulled vessels before, but
not on steel-hulled vessels with as much square area as
Mare. Prior to the fall of 2012, Davis had never
been involved in a major refit of a steel-hulled vessel such
as Mare or overseen the replating of the bottom of
such a vessel.
September 25, 2012, Turner sent an email to Tofias and Davis
with the subject “Mare and 135.” As an attachment
to the email, Turner included a “bid for the work this
winter on Mare.”
Ex. 35.) Under “Plating Project, ” the attached
bid states, in relevant part:
The following estimate is for replating the hull on Mare per
the specifications provided. The replating work will begin 2
feet above the chine as marked on the boat. . . . Three
frames under the head will be replaced. The pipe used to
create the chine and receive the plating from the topsides
and bottom will be completely replaced. Sandblasting, priming
and painting will follow to create a seal against corrosion.
(Id.) The Court infers from the final sentence in
context that Front Street represented it would sandblast,
prime, and paint the new steel plates, as opposed to every
element in the vessel's bilge, to “create a seal
the body of his September 25, 2012 email, Turner states that
“as soon as there are drawings to begin the new
project, Front Street will be ready to start”
(Defs.' Ex. 35), but the reference to drawings is for a
different project than the Mare refit, a proposed
project to construct a new vessel.
Tofias did not accept the “bid” attached to
Turner's September 25, 2012 email. After further
discussion, Front Street submitted a second bid dated October
23, 2012. The primary difference between the September and
October bids is a reduction in the number of hours that Front
Street indicated would be needed to complete the project and
a reduction in the hourly rate in an effort by Front Street
to secure the project. Turner has no recollection of what
work, if any, was removed from the September bid to account
for the reduction in the number of estimated hours.
Tofias accepted the October bid, which was the final formal
written document concerning the Mare refit and
provided the baseline for the project. Neither the Lombardi
reports nor a separate Lombardi document superimposing hull
thickness readings on a drawing of Mare (Defs.'
Ex. 172) were used as a basis for Front Street's work on
the vessel. There was no written contract. Tofias
declined to sign a written contract offered by Front Street.
Front Street undertook the Mare refit between
October or November of 2012 and June or July of 2013.
Tofias authorized Davis to communicate progress on the
project to him, to approve invoices, and to represent to
Front Street what Tofias's decisions were regarding
issues that arose during the project. Once Tofias gave Davis
approval or authorization to take a position or to make a
move on the project, Davis was authorized to act as
Tofias's mouthpiece with Front Street and to pass along
Tofias's approval. Davis exercised such authority.
to four days a week during the course of the project, Davis
provided Tofias with project updates, including sending
Tofias via email photos and comments on the progress,
advising him of additions to the scope of work
recommendations from the yard, and reviewing and approving
Front Street invoices. Tofias asked Davis to review the
invoices because, as the person at the site, Davis had a
better understanding of the hours and tasks on the project.
During the periods of highest activity on the project, Davis
was at Front Street daily.
Tofias was only physically present at Front Street one time
during the Mare refit, but he was kept up-to-date
and fully informed of all aspects of the work done on
Mare by Front Street as a result of the frequent and
consistent flow of emails between him and Davis, as well as
between him and Turner. Davis discussed every aspect of the
Mare refit with Front Street because it was such an
Mare's hull at the time it was hauled at Front
Street was 3/16-inch thick. When the vessel was hauled, the
yard cut a small sample from the vessel's hull to
determine the overall thickness of the hull plating but did
not retain the piece or record from where it was cut. Turner
advised Davis via email that it was a good thing that Front
Street had not ordered a lot of ¼-inch steel plate
because it appeared that the plating was in fact 3/16-inch
thick. Davis read this email and was present at Front Street
during the replating. Tofias was also aware that Front Street
was replating Mare's bottom with 3/16-inch
plate. Three-sixteenths-inch steel plating is structurally
adequate for Mare.
part of replacing Mare's bottom, Front Street
applied two coats of Micron CSC anti-fouling paint to the
new steel plates after it properly prepared, profiled, and
primed them. “Profiling” steel is the process of
creating a rough surface on new steel to which primer can
adhere. If the steel is profiled to an insufficient degree,
the primer may not adhere. If the primer is applied too
thinly, the steel under the primer and bottom paint coat may
Front Street did not gauge the degree of profiling and the
thickness of the primer or keep detailed records of the
temperature and other conditions during the coating of
Mare's plates. However, the preponderance of the
evidence does not establish that Front Street applied the
coatings improperly, and Davis was satisfied with Front
Street's coatings work.
Front Street asked for authority to paint the bottom of the
fuel tanks on Mare, which authority was provided by
Tofias through Davis. However, Front Street failed to coat
the interior side of the new steel under the fuel
tanks. There was no reason why Front Street could not have
applied coatings to this area, and it was poor marine
practice for Front Street to leave this new steel uncoated.
welds made by Front Street during the replating of
Mare's bottom were not “pretty”
(8/10/17 Trial Tr. (ECF No. 97), PageID # 1354) but were
sound. The welds met applicable standards, had structural
integrity, and did not compromise the vessel's
Seakeeper gyro stabilizer reduces the side-to-side rolling
motion of a vessel. Although Tofias understood that the
purpose of a Seakeeper is to substantially eliminate the
rolling motion of a vessel in rough waters, the
Court understands that a Seakeeper also reduces a
vessel's rolling motion in all conditions.
some point, the possibility of installing a Seakeeper on
Mare arose in conversations between Turner, Davis,
and Tofias. Based on these conversations and Davis's
recommendation, the decision was made to install a
Seakeeper. Neither Front Street institutionally nor
the lead electrician who did the installation had ever
previously installed a Seakeeper on a vessel. Tofias
considers the Seakeeper to be an improvement to
preponderance of the evidence does not establish that Front
Street overcharged W-Class for the Seakeeper
Tofias was advised by Front Street that the existing wiring
on Mare should be replaced or rewired because it was
not up to current standards, but he was not told that the
existing wiring was unsafe. Tofias did not authorize the
rewiring work because it was not in his budget for the
project. He would have authorized the work, however, if he
had been told that the wiring was unsafe.
Front Street also painted some portion of Mare's
topsides, including the vessel's railings, decks, and
wheelhouse. There is no credible evidence that this work by
Front Street was deficient or was the cause of any subsequent
problem with the paint on Mare's
Whenever Front Street suggested to Tofias that additional
work was required during the refit, including additional work
on Mare's steel frames, Tofias authorized the
work. The only work suggested by Front Street or mentioned in
the written bids that Tofias did not authorize was the
addition of teak decks, rewiring the boat, and renovating the
windows and portholes. Although the Lombardi reports
mentioned that the Bomar hatches merited replacement, hatch
replacement or repair was not discussed with Front Street and
was never within the scope of work for the Mare
refit. Recoating every existing surface within the bilge was
also not within the scope of work.
When Mare left Front Street in the summer of 2013,
Davis was satisfied with all the work ...