HMY Loses 2 Million Dollar Lawsuit

Does anyone else think it is odd that they went after the broker and not the boat builder? That Miami article does not even say what kind of boat it is.
Are brokers supposed to hire their own surveyors to survey every boat they sell just to protect themselves now?
If they knew of the problems and hid them I can understand this result. If they did not know, both parties are depending on the buyers surveyor to find any issues. The broker did not build the boat.
Why is the builder getting a pass? Are they still in business?

No. The boat was misrepresented by the broker, not the surveyor, the builder, or the owner.

"They cited a soldboat.com Internet ad as one example of misrepresentation, since it described the boat as ``like new,'' and capable of ``excellent sea keeping in all conditions.''

O'Neill's lawyers also claimed that Barboni showed the yacht buyer core samples of the boat's hull that were not from the actual boat, and were not representative of the actual thickness. According to court documents, HMY did not deny showing hull samples that were not from the actual boat being purchased."

No one else wrote the ads or showed the coupons to the buyer.

No, but they will think twice before making claims they can't demonstrate and they won't even think about pretending a coupon off another boat came from the one they are showing.

I read elsewhere that the boat in question was built by Inlet boatworks who is out of business. I never heard of them till this story came about. I'm under the impression that they did not build many boats.

I have a hard time agreeing with verdict here in that the broker is being held responsible, and very little, if any is residing on the surveyor and or builder. Let alone the owner for not doing his DD on the boat he was buying.

I'm sure there are 100's of way to slice the cake of responsibility, and I'm sure there are cases where brokers should be held responsible for misreprentation, but I don't see that in this case. however I have very little information to base my opinion on, so please take it with a grain of salt.

Just thinking aloud here.

The surveyor only documented what he (or she) looked at. The surveyor didn't take the boat out to open ocean and sea trial it. The surveyor didn't cut the coupons out of the hull. The builder sold a boat to a buyer who may or may not have ever had a problem. The buyer shouldn't be expected to have a degree in naval architecture or marine engineering.

If you buy used car and it turns out to be a lemon, is it your fault because you didn't know the frame was pop riveted together after an unreported wreck? A savvy buyer gets the best chance at avoiding problems but the boat market isn't just for repeat buyers. Due diligence for most buyers is a broker he can trust and a surveyor who has the opportunity to see everything. Most buyers won't pay for that opportunity and most brokers won't refuse to sell a boat "as is."

Why build such an unseaworthy boat? We really need to know who built it?

I'm surprised that the surveyor didn't get spanked also. He obviously didn't do a competent job. HMY went beyond puffing though. I suspect brokers will be making sure they post only facts and save the puffing for unrecorded talk in the future.

I completely agree. Therefore in your scenario, would the seller of the car (sold in as is condition) be held responsible, or the buy and the mechanic who looked at the car and stated it was in good condition?

Do we know it was built unseaworthy or did it become that way during the first ownership through that owner's action. Moot point anyway since the judgement is in.

"As Is Condition" doesn't absolve fraud or misrepresentation with boats, cars or anything else.

Of course. That's called Full Disclosure.

It looks like the only person who said it was unseaworthy was the plaintiff's expert witness. I have little doubt the defendant could have bought an expert witness to say otherwise.

If you use the information provided in the newspaper quotes you will find the builder in a few moments - but are you so certain the problem is the builder's fault that you are willing to go online and call its products unseaworthy because of a lawsuit against a broker? I wish I had that kind of insight as to what is wrong and what caused it ... I could save our clients a fortune.

Ahh, but you can only fully disclose what you fully know. If the broker didn't know the thing was a piece of crap he had no obligation to call it such. He would have been out of line if he had.

He did represent it as being fit for a service which the deivery trip proved otherwise. That is the crux of the case, he claimed it was fit for a purpose for which he had no basis to make such a claim. That and he claimed a sample coupon came from the boat when it did not. That is what nailed the brokerage and the broker.

"As is" doesn't mean something is a piece of junk nor is it a free pass for hucksters and frauds. It should be a reminder to buyers that they need to look much more closley and utilize experts in the field to protect their interest. In this case the brokerage did not perform that duty and that is not the fault of the buyer.

If the broker played games with a false core sample I can see that hanging them.
Here is where my problem is. The broker represents a 66' sportfish as ready for big water.(wouldn't you?)
The surveyor (1st one) gave it a green light.
Unless he knew otherwise (which he could have) I don't see why he is responsible for this boat's problems. I am sure there is more to this story that probably led to the verdict but I think this "precedent" opens the door for future lawsuits against brokers for problems they may know nothing about and did not create.
All boats have problems, new and used.
If you are buying a used boat you save considerable money in return for a boat that is not under warranty and has already been 'used' and possibly damaged along the way. A new boat at four times the price removes most of those risks but you are paying four times the price. On a big boat that is a lot of money.
I am not taking the broker's side on this one because it sounds like they could have deliberately misled the buyer. IF they did then they had this coming. However, I own a yard and a brokerage and this makes me want to have every boat we sell surveyed just for my own protection. Problem is, there is not enough money in this business to do that. However we do reject some listings just because they look like they could be candidates for this sort of thing.

The surveyor is there to look for exactly this kind of thing and should keep the buyer out of trouble. Just like you need to pick a trustworthy broker, you need to use a good surveyor. The broker is a salesperson. He may not know if a listed boat has structural issues and really should not be expected to.

Which is the insanely adulterated and vicious legal circle that it becomes.
No, of course you don't take the brokers word for it, so you hire a surveyor, who is an expert in the field.

When you buy a house, do you take the home owners word, or the agents word on where the property lines are, easements, mineral rights, etc.? Of course not. You buy title insurance. So I buy the house, and find that I didn't buy 18 acres, I bought 12. Who do I go sue? The seller? Because he / she said "it's 18 acres". The agent?

I'm not an expert in this. Nor do I claim to be. I do know that I have a broker and a surveyor who I trust and have proven their weight in gold. I have very little information on this particular scenario other than what was stated in the news article. My first impression of reading that is that the broker got a bad rap in the deal. Some level of accountability needs to be given to .....


Scratch that. We're going in a circle here, debating an issue that neither of us will win through legal obfuscation of responsibility.

Have a great day! Cheers!

You are absolutely correct, and neither should the buyer. The broker should have told the buyer that "this style of boat is made for open ocean dashes at high speed but until you perform a sea trial with a surveyor onboard, neither of us will know if this particular boat is capable of that use."

I have come across few brokers who will push to have the boat torn apart for a thorough survey, few owners willing to allow it, and fewer buyers willing to pay for that kind of inspection. I don't think this case is even really about the boat itself, it's about how a broker leads a less than fully aware buyer into a deal.

If we want the boating industry to survive, we can't let "buyer beware" become our banner.

Well put. I think HMY put themselves into the jackpot by making specific representations in writing that proved to be false (plus the coupon although that may have been shown as a representation of the manufacturer's work even though that's not how the jury took it). Foolish and unusual. I'm still amazed that the surveyor was found not to be negligent. It's his job & responsibility to find defects. He's the expert that everyone depends on. Nobody involved with a boat deal is expected to know more than him. I DK this surveyor, but at this point his reputation should be mud. He didn't do what he was paid for.