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entered into a yacht owners’ contract with AYC on May 26, 1998,
granting AYC the exclusive right to charter Moonshadow as a bare
boat charter.6 This contract continued until January 31, 1999,
when petitioners signed a new contract with AYC under terms
substantially similar to the prior year’s contract. This
contract was automatically renewed and remained in effect for the
year 2000. Under this contract, AYC had the exclusive right to
lease Moonshadow and to further sublease it to third-party
charterers. The lease granted AYC possession, dominion, and
control over the vessel. The terms of the contract provided that
AYC was responsible for the day-to-day management and operation
of Moonshadow to include: (1) Arranging charters through
advertising, boat show displays, distribution of brochures, and
AYC’s internet site;7 (2) providing certain services, to include
cleaning and inspection, provisioning and ground transportation,
and the personnel needed to perform these services; (3) handling
all reservations, collection of charter fees, Washington State
sales tax, daily insurance fund and service fees, payment of
5(...continued)
for hire.
6 A bare boat charter means that the charter party receives
a seaworthy vessel in “bare” condition; i.e., the charter party
provides its own skipper, bears the cost of supplies and voyage
costs such as fuel and port charges, and is directly responsible
for operating and maintaining the vessel during the charter.
7 Petitioners pay a separate fee to list and update a link
for Moonshadow on AYC’s internet site.
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Last modified: May 25, 2011