Point Landing, Inc. v. Alabama Dry Dock & Shipbuild. Co.

• Decision Date: 21 November 1958
• Docket Number: No. 17250.,17250.
• Citation: 261 F.2d 861
• Parties: POINT LANDING, INC., Intervenor, Appellant, v. ALABAMA DRY DOCK & SHIPBUILDING COMPANY et al., Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

261 F.2d 861 (1958)

POINT LANDING, INC., Intervenor, Appellant, v. ALABAMA DRY DOCK & SHIPBUILDING COMPANY et al., Appellees.

No. 17250.

United States Court of Appeals Fifth Circuit.

November 21, 1958.

T. K. Jackson, Jr., Mobile, Ala., H. Harrell Galloway, Mobile, Ala., Armbrecht, Jackson, McConnell & DeMouy, Mobile, Ala., of counsel, for appellant.

Albert J. Tully, Alexander F. Lankford, Mobile, Ala., Hand, Arendall, Bedsole, Greaves & Johnston and Holberg, Tully & Mobley, Mobile, Ala., of counsel, for appellees.

Before RIVES, BROWN and WISDOM, Circuit Judges.

JOHN R. BROWN, Circuit Judge.

Point Landing, Inc., the Intervenor, appeals from the order which denied it the right to intervene as a maritime lienor against the Tug J. F. Rader or its proceeds. The Court also rejected Intervenor's motion that the amount of the other and prior maritime liens, previously fixed by consent of the lienors without evidence, be set aside for determination after a hearing. All the Court granted was the right of Intervenor to share as a non-maritime lienor in any surplus remaining after maritime liens and court costs were satisfied. The latter, in the context of this case, was an empty victory as the maritime liens exceeded the $19,000 received on the sale of the vessel under the marshal's hammer.

All of this came about without a single stitch of evidence from a single party, on pleadings alone — several of which, to say the least, presented most glaring questions of fact. As such, it is another case of the shortest way through being the longest way around. It is a sharp reminder that terminating a case on pleadings alone is a tortuous process. Certainly is that so in admiralty, where characteristically pleadings are looked upon with great liberality primarily as the means through which inquiry as to the underlying intrinsic merits is conducted. Seldom may they be a bar to proceeding further.

The Motion to Dismiss the Appeal

Before we can get to a consideration of how such decisive results could thus occur, we are urged to dismiss the appeal for want of fundamental jurisdiction because of a failure to file bonds for costs on appeal, for costs as intervenor below, and to supersede the judgment of the District Court. In addition to these assertions of highly technical imperfections, it is claimed that the decree was not final and appealable and as an interlocutory order it was not one fixing rights and liabilities, hence not appealable under 28 U.S.C.A. § 1292(3).

None of these has any real merit. On the filing of the petition for leave to intervene, intervenor deposited $250 in cash with the District Clerk as security for costs. A local admiralty rule¹ literally permitted this. And where deposited pursuant to such rule, the terms and conditions of that rule, traditionally spelled out in the Stipulation for Costs which every proctor can recite in his sleep, are read into the act of deposit. There was thus a simultaneous triple compliance with the local admiralty rule, the Supreme Court Admiralty Rule 34, 28 U.S.C.A., and the requirement for an appellate cost bond. In effect, the deposit was to "* * * pay all costs awarded against him by this court, and, in case of appeal, by the appellate court * * *." See, The Amable, D.C.E.D.N.Y., 1940, 32 F.Supp. 451, 1940 A.M.C. 1160, and The Brantford City, D.C.S.D.N.Y., 1887, 32 F. 324.

We need not determine whether if construed as an interlocutory order, the decree here is one "determining" the rights and liabilities of the parties as 28 U.S.C.A. § 1292(3) requires. We think it is appealable as a final order. It denied as categorically as could be done the right to intervene as a maritime lienor. This was not altered by allowing the intervention as a non-maritime lienor to share in any surplus remaining. At the time the order was entered, the vessel had then been sold and the proceeds of the sale price ($19,000) deposited in the Registry by the marshal with his Return. Maritime liens had been fixed for $19,206.98 and, by the same order now appealed from, Intervenor had been denied the right to question this amount. To be told that it could come in to share in a surplus which could never exist after distribution of prior claims which it could never question is to close the door after it had been opened but a crack. Intervenor was actually and inextricably then in the cold exterior looking in on a warmer hearth. So long as that order stood, it could never get in, or getting in, could get nothing else. If that is not final, then the word has little meaning. Frozen Food Express v. United States, 1956, 351 U.S. 40, 76 S.Ct. 569, 100 L.Ed. 910; Columbia Broadcasting System v. United States, 1942, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563.

The failure to file a supersedeas bond is of no real significance to our appellate jurisdiction. The objection proceeds on a misplaced reliance on our former decisions in Canal Steel Works, Inc., v. One Drag Line Dredge, 5 Cir., 1931, 48 F.2d 212, 1931 A.M.C. 1053; The Kotkas, 5 Cir., 1943, 135 F.2d 917, 1943 A.M.C. 831, and The Manuel Arnus, 5 Cir., 1944, 141 F.2d 585, 1944 A. M.C. 417, certiorari denied 323 U.S. 728, 65 S.Ct. 63, 89 L.Ed. 584, 1944 A. M.C. 1351. In those cases, on the failure to supersede a dismissal of the libel, the vessel was released and nothing was before the Appellate Court since upon a reversal there would have been no way to make the order effective or reacquire custody of the thing, i. e., vessel. Here, the Tug J. F. Rader long ago passed from the picture. Substituted in her stead was the $19,000 now safely reposing in the Registry below under an order providing that, "* * all further proceedings in the District Court are stayed pending determination of this appeal." After such an order the District Court could not if it would and would not if it could, disburse these proceeds to the prejudice of Intervenor until our mandate on this appeal had been received. The res is very much alive, in the custody of the Court below, and thereby subject immediately to the orders of this Court.

The Merits

How Intervenor never quite got into the race for participation as a lienor against the Tug or her proceeds may be quickly summarized. On November 8, 1957, Alabama Dry Dock, an appellee, filed a Libel in rem asserting a maritime lien for repairs made in 1956. Three weeks later, Harrison Brothers Drydock, the other appellee, filed an Intervening Libel for repairs made to the Tug during the months of March-July 1957. No one filed a Claim to the Tug nor was any Answer filed. On December 20 and 23, respectively, default decrees were entered in favor of Alabama and Harrison.²

Two months later, on February 26, 1958, Alabama and Harrison each consented as to the other to the entry of a single order captioned "Final Decrees and Orders." Without any hearing or evidence, the decree fixed Alabama's lien at $2,314.40 and Harrison's at $16,892.58 aggregating $19,206.98. This decree ordered that the Tug be sold by the marshal under a writ of sale which was issued that day. The marshal advertised the sale for March 19, 1958, at which time Harrison bid it in for $19,000. It was not until March 27, over a week later, that Intervenor's petition to intervene was denied. Intervenor's subsequent motion for rehearing complaining that the matter had been adjudicated without evidence, proof or right of cross-examination of witnesses filed March 31, was not overruled until April 7. Thus, at each of the times the Court acted on the intervention, the Tug had been sold and the proceeds were then in the Registry.

Significantly, the so-called final decree of February 26 pursuant to a local Admiralty Rule³ ordered the Clerk to publish a notice calling upon all persons to "* * * propound their claims against the said Tug within thirty (30) days from the date of these final decrees and orders." The Clerk's command was simple and straightforward.⁴ Yet, when two days later, on February 28, 1958, Intervenor sought to file its petition for leave to intervene which, for these purposes, satisfied both a petition and a libel asserting a maritime lien, it was met by formal vigorous objections from Alabama and Harrison. Prior to the formal hearing on March 4 on Intervenor's petition to intervene, Harrison filed its detailed Answer in opposition. Alabama repeated it by an Answer subsequently filed with leave of Court. These Answers asserted that (1) Intervenor was guilty of laches because, with knowledge of the pendency of the libel proceedings since their commencement in November 1957, Intervenor had made no effort to come in; and (2) Intervenor had waived (never initially obtained) a maritime lien since it had taken as security for the payment of the cost of the marine engine a promissory note, a chattel mortgage on the Tug, and a mortgage on some Alabama real estate, and had actually instituted proceedings to obtain a State Court judgment on the note and to foreclose the mortgage under a posted sale. Copies of all of the significant papers respecting (2) were annexed as exhibits to the Answers.

Without hearing any evidence, and solely on the pleadings and counsel's arguments, the Court on March 27 denied Intervenor's petition to intervene as a maritime lienor, to reopen the consent decree of February 26 to hear proof on the amount of Alabama's and Harrison's claims, and to order a hearing to receive proof on the amounts and priority of the respective liens. It did permit Intervenor to share as a non-maritime lienor in any surplus.

By denying categorically the right to intervene as a maritime lienor, the Court inexorably held that either (1) a maritime lien never came into being as it was "waived", or (2) if conceived and born with nautical genes, it died from parental neglect and laches. Neither will do.

Laches is much more than time. It is time plus prejudicial harm, and the harm is not merely that one loses what he otherwise would have kept, but that delay...