ITIC in the news: Yachts, knots, and legal shots by Robert Hodge in RINA's The Naval Architect

To see the article as it appears in RINA's The Naval Architect, click here. Please note that a membership is required to access. 

Yachts, knots, and legal shots

By Robert Hodge, General Manager, ITIC 

In my previous article for The Naval Architect, I explored the legal intricacies of intellectual property and how they intersect with the work of naval architects. This time, I turn to a more immediate and tangible concern: negligence. While intellectual property disputes often unfold in the abstract realm of ownership and rights, negligence claims strike at the very core of professional responsibilities: designing vessels that are not only beautiful but safe, functional, and compliant.

ITIC insures naval architects working across the full spectrum of vessel types, from passenger ships and bulk carriers to tankers and offshore support vessel. However, this article focuses specifically on yachts, where the blend of aesthetics, performance, and customisation introduces unique risks and legal exposures.

Drawing on real-world cases defended or paid by ITIC, this article examines how even seasoned yacht designers can find themselves entangled in costly legal disputes. These cases are not merely cautionary tales; they offer practical insights into risk management, documentation, and professional accountability.

The swan-necked exhaust: a case of missing drawings and misunderstood risk

One of the more complex and instructive cases involved a naval architect commissioned to design a series of motor yachts for a yard. As part of the contract, the naval architect was required to provide a drawing showing the down-flooding points of the yacht on an “as built” basis. This drawing was never delivered.

Subsequently, one of the yachts suffered water ingress through the engine inlet during heavy weather, causing significant engine damage. The yard alleged that they were unaware the water inlet was a critical down-flooding point and claimed that, had they known, they would have used stronger materials. They submitted a claim of €180,000 against the naval architect for engine damage and rectification costs.

ITIC defended the naval architect, pointing out that the yard’s own 3D model showed a swan-neck fitting on the engine inlet pipe, a design feature that only made sense if the yard understood the inlet’s vulnerability. Moreover, the naval architect was not responsible for the material used, which was found to be weak and non-compliant with class regulations.

Despite having a strong defence, ITIC acknowledged that the naval architect had breached the design contract by failing to provide the required drawing. This introduced litigation risk. A settlement of €55,000 was proposed and accepted, covering unrecoverable costs and mitigating further exposure.

This case underscores a critical lesson: even when the technical fault lies elsewhere, contractual obligations, especially those related to documentation, can expose naval architects to liability.

Cracked keels: the weight of miscalculation

Another case involved a yacht whose keel developed cracks shortly after delivery. The naval architect had miscalculated the structural loads, leading to a design that could not withstand operational stresses. The owner initiated a claim, and the dispute escalated into a lengthy legal battle.

The naval architect’s defence centred on the argument that the calculations were based on data provided by the client and that the design met the agreed specifications. However, expert analysis revealed that the structural integrity had been compromised due to errors in load distribution and material selection.

The legal costs mounted, and although the case was eventually resolved, it highlighted the high stakes involved in even seemingly minor miscalculations. In yacht design, precision is paramount, and the margin for error is slim. This case serves as a reminder that naval architects must not only rely on client data but also verify it independently and document their assumptions thoroughly.

Malfunctioning motors: the importance of role clarity

In another instance, a yacht experienced motor failures shortly after launch. The owner blamed the naval architect, alleging that the design had contributed to the malfunction. However, ITIC’s investigation revealed that the architect had no involvement in the selection or installation of the motor systems.

The claim was dismissed, but not before the architect incurred significant defence costs. This case illustrates the importance of clearly defining roles and responsibilities in contracts and communications. Naval architects must ensure that their scope of work is explicitly stated and that any third-party components or systems are clearly excluded from their liability.

Incorrect calculations and the cost of ambiguity

A particularly costly example involved a naval architect accused of failing to comply with a design agreement, resulting in a claim exceeding US$500,000. The dispute centred on whether the architect had exercised due care in their calculations and whether the final design met contractual expectations.

ITIC’s defence focused on the naval architect’s adherence to industry standards and the limitations of the original brief. However, the lack of clarity in the contract and the absence of documented design decisions made the defence more difficult. The case was eventually resolved, but it highlighted the financial and reputational risks of ambiguous agreements and undocumented assumptions.

Loss prevention: five practical steps

These claims provide guidance for avoiding negligence claims:

1. Document everything: from specifications to communications, detailed records are your best defence.
2. Verify client data: never assume that client-provided information is accurate. Conduct independent assessments.
3. Clarify scope: define your responsibilities clearly in contracts and avoid scope creep.
4. Communicate risks: warn clients about potential design limitations or trade-offs in writing.
5. Insure wisely: professional indemnity insurance is not just a safety net, it’s a strategic asset.

Conclusion: designing with defence in mind

As naval architects, you are trained to balance form and function, innovation and regulation. But you must also balance creativity with caution. The claims discussed here show that even the best designs can become liabilities if not backed by rigorous documentation and clear communication.