Boat / Yacht Share Factsheet
This factsheet is designed to inform and assist individuals who wish to set up a new boat sharing or fractional ownership scheme so that it operates legally, fairly and smoothly.
Owning a boat is a luxury that many people cannot afford on their own. Yachts and motorboats easily cost tens if not hundreds of thousands of pounds, and can be as much as millions. A group of friends, colleagues or other associates who want to buy a boat, or upgrade to a bigger or better boat might want to get together and share the costs between them.
However, cost is not the only reason for sharing a boat. Some people may be tempted to buy a boat, but are concerned that it will not be used frequently enough to warrant the purchase and that it may be wasted sitting on a trailer or in a marina. By sharing the boat with others these concerns can be alleviated and the boat is more likely to be used frequently.
Sharing a boat also means that if in the future you fancy doing some racing in the boat, there is a ready-made crew in the form of the group of sharers!
This factsheet describes a boat sharing arrangement which involves two or more people sharing the use of the boat and its costs, but not necessarily travelling together on the boat at the same time, unless of course they want to share their time on the boat together.
Types of Boat Sharing:
For smaller dinghies and other small boats it may be reasonably easy to borrow a boat from a local sailing club on a regular basis, but you will almost certainly need to be a member to do so, and use may be limited by time, availability and other factors.
Larger boats can be hired or chartered for holidays or sometimes just for the day, but this is very expensive, and you have no ownership in the boat and no knowledge about how other users have treated the boat. There will be strict limitations on where the boats can be taken and what they can be used for as well.
The next alternative is to purchase a boat, but as mentioned above, this is costly and can appear to be a poor investment if little use will be made of the boat by the single owner.
For people with the time and interest, there can be considerable savings to setting up your own private sharing or fractional ownership scheme between friends, neighbours or local contacts to share ownership of a boat and share all of the costs associated with keeping a boat.
Sharing and the Law:
Sharing is a concept that has been widely recognised in law for centuries, both as joint ownership of moveable assets, and as a method of owning land with other people through the legal mechanisms of joint tenancy and tenancy in common.
It is also possible to write contracts which allow assets to be shared with others even if ownership is not shared. For such a contract to be enforceable it is important that all parties provide ‘consideration’ (e.g. money, time or services) and that the sharing is not simply a gift by one person to others.
Although it is advisable in many situations to have a written agreement to regulate a sharing relationship, there is nothing in law to prevent an informal arrangement being agreed verbally. However, difficulties with a verbal agreement arise when one party wants to prove the contents of the agreement and the others disagree about what was said.
Boat share clubs or syndicates and similar unincorporated associations have no legal identity separate from the individuals involved in running the club, unlike companies. This means that club members will jointly carry the risk of liabilities incurred by of any other member of the group using the shared boat. Using a written legal agreement will enable the sharers to allocate most of these risks between themselves.