Selling a home built boat—liability

[Reacher]

The recent post about looking to buy a  BandB motorboat got me thinking about the builder’s liability for future problems. How have people handled this?

 

I’m aware of “as-is” bills of sale and their limitations. And warranty disclaimers re boats and vehicles manufactured by others. But it seems the builder would have to make such a broad disclaimer about hull construction and quality, mechanical, fuel, and electrical systems, etc as to require a very steep price discount.

 

Sailboats should be less of a risk. Canoes and kayaks less yet.

 

Is this a concern?

[Andy B]

Some very broad-brush advice and thoughts ...

 

Your best phrases are "as-is" and buyer may schedule a survey or inspection.  You don't have to disclaim every feature of the boat.  If you say the engine is in working condition on the day of the sale (assuming you're not lying), that's not a representation of future performance.

 

One thing to keep in mind is an implied warranty of fitness--basically knowing that a seller intends to do with the boat and saying the boat will do this.  I think of this if I hear "This is an Everglades Challenge machine!".  Better to say "This boat has completed 2 Everglades Challenge races."  

 

Also be careful of making representations if you've got a buyer that wants you to vouch for things like the cost of needed repairs or how long equipment might last.

 

Even if there is a title, I always use a bill of sale.  That might save the buyer coming back needing some paperwork and also gives me a chance to insert some "as-is without representations" language where they sign.

 

I do think liability for our type of wooden boat is low.  Anyone buying a wooden boat should reasonably know it's an ongoing obligation, and the cost of these boats (compared to modern powerboats or big sailing vessels) is low enough that frankly there's not much to fight over. 

[Jonathan M. Cohn]

I second the vote for a Bill of Sale. These aren't to hard to draft yourself. Add in the as-is, no warranty language of your choice.

[Oyster]

Whats the old say, professionals built the Titanic  and Noah built the Ark. Whenever a used boat of any kind has had a bunch of hours and years under their belt, the best you can do is to represent the boat with the seasoned history.  Pick your buyer. Ask questions of their previous experience, if you are concerned about repercussions from selling a boat that you built yourself. 

 

 

As an owner of a home built boat with a lot of water under its keel and you are the helm, you will get the vibes of who is the right buyer. Of course I know that if you decide to sell a boat that you built, you will probably want to get rid of it as fast as you can. But if you are concerned about someone having a mishap of some sorts , or the boat being pushed beyond its limits and having a terrible event, then DO NOT SELL IT TO THE WRONG PERSON. 

 

If you only knew how terrible professionally built production hulls defy the laws of luck as they performs miserably while being operated by complete novices  , then you would probably not worry about many of these seasoned home built hulls  coming back to bite you, if you choose the correct buyer.  Of course the world is full of lawyers,   that for enough money they will find a way to create a claim against you if someone is willing to pay them enough.  That"s life in the modern world, you know. 

[Aphers]

This still dependent to some extent on the legal jurisdiction that you are in. 

I can't speak for the US where I assume the OP is based, but just in case any Europeans are reading, it's worth knowing that the Recreational Craft Directive applies to any new boat, and certainly complicates the sale of a home build. AFAIK you essentially have to keep it for five years before you can sell it, but I'm not an expert. I know it hasn't been a particularly well received regulation.

[Paul356]

Hey, Reacher,

 

Short and sweet, say I.  In other words, I endorse Andy's advice.  State "as-is" and "buyer may obtain a survey at buyer's expense if desired."  That's really about it.  I agree with using both the title and a bill of sale.  There are decent, short bill of sale forms available on the web.  The Wisconsin title and title transfer documents do not say a word about boat condition, so using a bill of sale to state "as-is", etc., is a smart move.

Remember if you're selling a trailer, you need to transfer that title, too.   Even in Wisconsin, where license plates aren't required for trailers, they are titled.  The trailer and "as-is," etc., can go on the same bill of sale as the boat.

[Reacher]

Thanks for the advice and comments. The boat I’m thinking of is a 22’ motorboat with a Mercruiser 3.0. Twenty five years old. I’m really thinking about conscience more than cash. I am confident that the boat is well constructed according to plans, but I would hate to have someone injured using something I built if it had anything to do with the hull or systems. A different scale than a dinghy.

 

I think Occer has it right—choose your buyer. Someone who understands a home built boat.

 

After some research and discussions it seems that selling “as is” is not quite the get out of jail free card we might think it is. It basically means that no other equipment is included other than  what is shown. And that no further work or maintenance will be done. However, I understand that as is does not cover any known conditions or defects that are not disclosed to the buyer. So an as is bill of sale should include a list of defects if any, and a healthy disclaimer about whether anything on the boat is in working order. Things get complicated.

 

Anyway, I used the boat this summer to make a 150 mile trip around Green Bay with some good stops, including Jackson Harbor on Washington Island.  Now I’m not so inclined to sell it.

 

 

[Reacher]

Oyster, sorry that your name was garbled in the previous post.

[Andy B]

Reacher, I disagree with the definition of "as-is" you found.  Here's the Black's Law Dictionary:

"In the existing condition without modification.  Under UCC 2-316, a seller can disclaim all implied warranties by stating the goods are being sold 'as-is' or 'with all faults.'  Generally, a sale of property 'as-is' means that the property is sold in its existing condition, and the use of the phrase as is relieves the seller from liability for defects in that condition."  Implied warranties are that the boat would be good for its ordinary purpose (ie, "does this thing float and sail?") and that it would be good for a particular purpose (ie, "will this thing be good for the Everglades Challenge?").

 

All said, I would be comfortable with only "as is" and recommending that buyer can get a survey.  I would not want to prepare a list of defects--do that, and if you miss one you face allegations of concealing a known defect when otherwise you were making promises about the fitness of the boat.  That's not a good position.

 

Edit:  sorry if this is a little intense, I care about legal definitions like some of you care about fenders hanging off the side while under sail

[Reacher]

Andy, I like the definition you quoted and have relied on it to buy and sell boats in the past without a problem. I agree that it would be impractical to try and list every little scrape and potential wear and tear defect on a used boat. Throw in a survey or sea trial and take your chances.

 

From what I understand the gray area creeps in about failure to disclose a known defect if it is significant. Such as a recurring problem, or a repair that has been attempted but not yet proven in use. Or more egregiously, attempting to conceal a defect. (A neighbor once asked me to use my OBD scanner to turn off the check engine light on a car he was selling. But he balked when I told him I charged to do something unethical.)

 

Anyway, I know all the members of this forum are honest and ethical. And expert craftsmen whose work is free of defects. Thanks again for the comments and advice. Signing off from this thread for now….
 

 

[Andy B]

@Reacher, totally understood, it is a murky area when there are dishonest sellers and buyers.  FWIW, forums like this, where people are open and honest, are really valuable.  I'd buy your boat site unseen just because there's a history (and because, as we both know, the CS-20 mk1 is the best iteration of the Core Sound boats there is!)