Andros Compania Maritima SA v. Intertanker Ltd.

• Decision Date: 09 June 1989
• Docket Number: No. 86 Civ. 7578 (PKL).,86 Civ. 7578 (PKL).
• Citation: 714 F. Supp. 669
• Parties: ANDROS COMPANIA MARITIMA S.A., Plaintiff, v. INTERTANKER LTD., Interpetrol Bermuda, Ltd., and Henri Lehner, Defendants.
• Court: U.S. District Court — Southern District of New York

714 F. Supp. 669

ANDROS COMPANIA MARITIMA S.A., Plaintiff, v. INTERTANKER LTD., Interpetrol Bermuda, Ltd., and Henri Lehner, Defendants.

No. 86 Civ. 7578 (PKL).

United States District Court, S.D. New York.

June 9, 1989.

Healy & Baillie, New York City (John C. Koster, of counsel), for plaintiff.

Kennedy & Lillis, New York City (John T. Lillis, Jr., of counsel), for defendants.

OPINION AND ORDER

LEISURE, District Judge.

Plaintiff Andros Compania Maritima S.A. ("plaintiff" or "Andros") is a corporation organized and existing under the laws of the Bahamas. Complaint ¶ 2. Plaintiff, as owner of the vessel M.T. HAKUYOH, entered into a voyage contract with Intertanker Ltd. ("Intertanker"), who was to charter the vessel for deliveries originating in the South Pacific. A dispute arose under that contract and, pursuant to the terms of the contract, the dispute was arbitrated in New York. Andros was awarded $ 473,733.23, and on November 17, 1983, secured confirmation of that award in this Court. See Judgment No. 83,1888, 83 Civ. 2891 (JMC) (S.D.N.Y.1983) (the "judgment"). No part of that judgment has been satisfied.

The present action is an effort to collect the amount of that judgment, plus interest, from the three named defendants (collectively "defendants"). Andros sues Intertanker, which is apparently an inactive corporate shell without substantial assets. Complaint ¶ 8. It is alleged, inter alia, that Intertanker was a wholly-owned subsidiary of defendant InterPetrol Bermuda Ltd. ("InterPetrol"), and that Intertanker and InterPetrol were operated as a single business enterprise. Plaintiff therefore also seeks to hold InterPetrol liable for the amount of the judgment. Additionally, defendant Henri Lehner ("Lehner") is alleged to have dominated and controlled both companies, and therefore to be liable to Andros.

The ultimate merits of this corporate piercing action are not yet before the Court. Plaintiff initially moved for a preliminary injunction, seeking to have the assets of defendants preserved through their deposit into the registry of the Court, pending the ultimate resolution of the action. Defendants opposed that application, and responded that: 1) this Court lacks subject matter jurisdiction over the action, 2) this Court lacks personal jurisdiction over defendants InterPetrol and Lehner,¹ and 3) the doctrine of forum non conveniens requires dismissal of the entire action.

By order dated September 7, 1988 (the "9/7/88 Opinion"), this Court held that it had subject matter jurisdiction, but that an evidentiary hearing was necessary before the final personal jurisdiction and forum non conveniens determinations could be made. The Court declined to dismiss the Complaint against any defendants at that time. The parties were allowed to engage in discovery before the hearing. The hearing was held on May 3, 1989, after some delay by the parties, and particularly by defendant Lehner. By letter to the Court dated April 17, 1989, defendants requested a separate hearing on the determination of the preliminary injunction issues.

As indicated below, the Court finds that it has jurisdiction in this action over the defendant Lehner, but cannot exercise jurisdiction over InterPetrol. The forum is not impermissibly inconvenient, and the action will not be dismissed on forum non conveniens grounds.

BACKGROUND

Lehner alleges that he is a citizen of West Germany, and a current domiciliary of Bermuda. Affidavit of Henri Lehner, sworn to on May 7, 1987 ("5/7/87 Lehner Aff."), ¶¶ 2, 3. See also Affidavit of Henri Lehner, sworn to on September 24, 1987 ("9/24/87 Lehner Aff."), ¶ 3. Plaintiff vigorously disputes that claim, and has produced substantial evidence indicating that Lehner was, in fact, a domiciliary of New York. See generally, Affidavit of John C. Koster, Esq., sworn to on May 22, 1987 ("5/22/87 Koster Aff."), ¶¶ 1-7. See also, Affidavit of John C. Koster, Esq., sworn to on October 14, 1987 ("10/14/87 Koster Aff."), ¶ 3. This evidence includes prior sworn testimony by Lehner that he was, during the relevant period, residing in New York, that he gave out a New York telephone number where he could be reached, and that he avoided Bermuda for substantial periods because of an outstanding warrant for his arrest there. 5/22/87 Koster Aff., Exh. 3, pp. 53-59, 61.

At the hearing, which Lehner chose not to attend,² overwhelming evidence was introduced indicating that Lehner is in fact a domicilairy of New York. Numerous charge receipts and cancelled checks were produced which revealed extensive and systematic purchases, consistent with residence in New York.³ This evidence also revealed that Lehner clearly has access to, and perhaps actual ownership interests in, three residences in New York. These included an apartment on West 21st Street and a cooperative apartment on Fifth Avenue in Manhattan, and a home in Southampton. The sole evidence introduced at the hearing on behalf of defendants were cancelled rent checks on the 21st Street apartment, signed by Lehner's wife. See DX 1.

Additionally, Lehner has previously testified under oath that he maintains record storage facilities in New York, 5/22/87 Koster Aff., Exh. 6, pp. 68-69, 71, that he may have an ownership interest in one or more New York residences, 5/22/87 Koster Aff., Exh. 4, pp. 2-4, and that he has previously issued correspondence using a letterhead reflecting a New York address. 5/22/87 Koster Aff., Exh. 5. Lehner asserts, however, that he never conducted oil trading activities, either on his own behalf or on behalf of InterPetrol, in New York. 5/7/87 Lehner Aff., ¶ 8. See also, Affidavit of John T. Lillis, Esq., sworn to on October 27, 1987 ("10/27/87 Lillis Aff."), ¶ 3. One of Lehner's credit card payments in 1982 was made out of an account that InterPetrol maintained at Bankers Trust Company in New York. See, PX C-3.

On October 3, 1986, Lehner was present in the offices of a New York law firm for an arbitration proceeding. At that time, Lehner was personally served with a summons and complaint in connection with this action. See, Affidavit of Personal Service by Karl V. Reda, sworn to on October 8, 1986, attached as Exh. 1 to 5/22/87 Koster Aff.

During the relevant period, Lehner was the General Manager and President of InterPetrol. According to his testimony in other actions, the wholly owned subsidiary Intertanker would charter vessels on behalf of InterPetrol and its affiliates. InterPetrol would then use these vessels to transport oil or other cargo, pursuant to sales contracts executed between InterPetrol and third parties. See, Affidavit of John C. Koster, Esq., sworn to on March 27, 1987 ("3/27/87 Koster Aff.") ¶ 5, and Exh. B.

Both Intertanker and InterPetrol have ceased to be active, functioning business enterprises. See, 5/7/87 Lehner Aff., ¶ 5. Intertanker is currently the subject of an ongoing liquidation proceeding in Bermuda. See Affidavit of Philip J. Chesterman, Esq., sworn to on May 7, 1987 ("5/7/87 Chesterman Aff."), ¶ 8. No assets of Intertanker have been located in that liquidation. 5/22/87 Koster Aff., Exh. 8. Andros has filed a claim in the Bermuda Intertanker liquidation proceeding. 5/7/87 Chesterman Aff., ¶ 7.

Since 1982, InterPetrol has not engaged in active business activity. Its only endeavor since then has been the pursuit of litigation, adjustment, and arbitration of claims against third parties, which were generated while it was an active business concern. 5/22/87 Koster Aff., Exh. 6, pp. 20, 29; Exh. 3, p. 94. InterPetrol has not engaged in oil trading since 1982, and its only apparent assets are its claims for the debts still owed to it. Id. at p. 48. InterPetrol presently has no full or part time employees. Id. at p. 106. In addition to InterPetrol's legal pursuits in New York, Andros alleges that there is the possibility of InterPetrol storage facilities in New York, 5/22/87 Koster Aff., Exh. 6, pp. 69, 71, and that InterPetrol shareholder meetings were held in New York. 5/22/87 Koster Aff., Exh. 6, pp. 83-93; Exh. 3, pp. 64-65; Exh. 7.⁴ As noted above, InterPetrol maintained a checking account in New York prior to 1982.

Specifically, Andros asserts that Lehner and InterPetrol are currently pursuing various arbitrations and litigations, including lawsuits in state and federal courts in New York. 5/22/87 Koster Aff., Exh. 6, pp. 33, 39-40, 42; Exh. 3, p. 49. See also, 3/27/87 Koster Aff., ¶ 8. Prior to 1986, it is alleged that Intertanker was also involved in numerous similar litigation activities on its own behalf, and that Lehner was actively involved in those Intertanker endeavors. 5/22/87 Koster Aff., Exh. 6, pp. 66-69. After 1986, when this lawsuit was filed, the balance of those ongoing actions were abandoned or resolved. Id.

Andros seeks, in the preliminary injunction motion presently before the Court, to have any such recoveries preserved.⁵ Ultimately, by virtue of the allegations in the complaint or its status as a judgment creditor of Intertanker, to whom InterPetrol and Lehner allegedly owe money, Andros seeks to satisfy its judgment out of those funds. 3/27/87 Koster Aff., ¶ 4.

In an unrelated 1982 action against Intertanker in Bermuda, a former Intertanker accountant named John Hardy ("Hardy") testified extensively about the financial relationships between Intertanker, InterPetrol and Lehner. See, Exh. D, attached to 3/27/87 Koster Aff. That testimony indicated that InterPetrol owed substantial commissions to Intertanker, arising from Intertanker's chartering of ships on InterPetrol's behalf, and that InterPetrol ceased paying those commissions in 1979. Additionally, it is alleged that InterPetrol transferred all of the cash holdings of Intertanker to itself, and that, as of August, 1981, InterPetrol still owed Intertanker in excess of one million dollars. Id.

Defendants indirectly impugn the credibility of the Hardy testimony, dismissing him as an "apparently disgruntled" former employee....