I'd have to know the whole story to judge. Having been a boat captain with a group of adults (other wardens) not knowing how to act, I can be somewhat sympathetic. I was looking for a buoy in the fog, and one of the wardens started blowing a harmonica. Had to educate him.
A boat is no place for kids to be running loose because there are dozens of ways to get hurt. Are you sure he simply didn't want to get sued?
There was a case where a woman was sueing a store for her slipping on a wet floor; thing was, it was wet because SHE had thrown a can of soda at her husband!