The answer is that she's a scallop diving boat, going about her work, quite properly, and there's a diver somewhere underneath. The point surely is: would you not make absolutely clear your intentions if you had any doubts about your indentity being misconstrued? Would you not, with a man in the water, employ every correct IRPCS signal to make sure approaching boats keep well clear? Would you, in short, with a human life at stake make your purpose unambiguous? Rather than an A flag that can't be seen, and lights during the day which risk being obscured by bright sun and no day signals.
No one was at fault; it was simply a misunderstanding that could, surely, have been prevented. If the sailing boat skipper (an extremely experienced yachtsman on passage back from Norway at the time) had had any inkling of what he was approaching, then things might have turned out differently, avoiding action taken earlier and a cheery wave would have ensued.