I am hoping this is some little lund with a 25hp on the back. if you tell me this is anything over 19' and at least an I/O then pay the $400 and bring the guy some beer as well so he will take care of you next time.
in answer to your question it is a little gray area when it comes to marine and I know this as I used to be in the biz back there and I have seen this go both ways in the past. the fact you found someone who has a shop rate of only $65 an hour I am guessing this is a small shop and the guy is doing good just to get by. dont be a dick about it but tell him nicely next time call me first before moving forward so you can budget accordingly.