The Principle is written as a shield, and a shield only works if every strap is fastened. Break it into its three requirements and check them one by one against the captain's turn of the wheel.
First, was the act done merely with knowledge that harm was likely? Yes. Sharman knows that swinging away from boat B puts boat C at risk. Second, was there criminal intention to cause harm? No. He is not aiming at boat C, he is running from a collision with twenty or thirty people. Third, was it in good faith to prevent other harm to a person or property? Yes, and this is the strongest part of his case, because the harm he is avoiding is a certain strike on a crowded boat while the harm he risks is only a possible strike on a boat with two, one he may even clear. All three straps are fastened, so the shield holds and the act is not an offence at all.
Let's summarize:
So option (A) is correct.