Finkel v. Challenger Marine Corp., Civ. No. 69-1192.

• Decision Date: 10 August 1970
• Docket Number: Civ. No. 69-1192.
• Citation: 316 F. Supp. 549
• Parties: J. S. FINKEL, Plaintiff, v. CHALLENGER MARINE CORP., a Florida corporation, and Chris Craft Industries, Inc., a Delaware corporation, Defendants.
• Court: U.S. District Court — Southern District of Florida

316 F. Supp. 549

J. S. FINKEL, Plaintiff, v. CHALLENGER MARINE CORP., a Florida corporation, and Chris Craft Industries, Inc., a Delaware corporation, Defendants.

Civ. No. 69-1192.

United States District Court, S. D. Florida.

August 10, 1970.

Smathers & Thompson, Lane & Mitchell, Miami, Fla., for plaintiff, J. S. Finkel.

Dixon, Bradford, Williams, McKay & Kimbrell, Miami, Fla., for defendant, Challenger Marine Corp.

Scott, McCarthy, Steel, Hector & Davis, Miami, Fla., for defendant Chris Craft Industries, Inc.

MEMORANDUM OPINION

FULTON, Chief Judge.

This cause was tried to the Court without a jury. After having heard the testimony offered by the parties, and having considered all of the evidence and memoranda submitted on behalf of the respective parties, the Court makes and enters this Memorandum Opinion as its Findings of Fact and Conclusions of Law.

Jurisdiction

Initially, this suit was brought by the plaintiff against both the manufacturer and retailer of a 57 foot yacht, the cabin of which was customized to suit the particular desires of the plaintiff. Chris Craft Industries, Inc. was the manufacturer of the yacht and Challenger Marine Corp. was the retailer. Hereinafter, these defendants will be referred to as Chris Craft and Challenger. The contract for the sale and purchase of the vessel, including modifications to the decor of the cabin, was mutually executed and delivered in Florida. As hereinafter further explained, Challenger contracted with the plaintiff to deliver the vessel to the plaintiff at Bimini in the Bahama Islands, so that the payment of sales tax to the State of Florida could thereby be avoided.

In his complaint, the plaintiff sought damages from both Chris Craft and Challenger, claiming a right of recovery for negligence and/or breach of contract. The complaint alleges and the proof shows that, during the crossing from Miami to Bimini, furniture was permitted to ricochet around in the cabin, scratching, scuffing and nicking the paneling; and that after the vessel reached Bimini, but before delivery to the plaintiff, the vessel was grounded on a bar in the Bimini Harbor. The plaintiff claims negligence on the part of the defendants in connection with the crossing from Miami to Bimini and that the defendants breached a contract whereby the vessel was to be delivered to the plaintiff in Bimini in "new condition."

The parties to this cause entered into a Pretrial Stipulation in which it was stipulated that this cause is within the admiralty and maritime jurisdiction of this Court. The plaintiff now contends that his claim against the defendant Challenger is civil in nature; and that he is, therefore, entitled to recover damages flowing from a simple breach of a contract to furnish the plaintiff with a yacht in new order and condition. Challenger contends that plaintiff's claim, if any, is maritime in nature, based upon a tortious breach of contract arising out of a maritime transaction.

The plaintiff has made no claim against either defendant for negligent manufacture of the yacht in question. Hence, there is no issue of whether the yacht was manufactured in a good and workmanlike manner, or whether the yacht sold by the defendant Challenger to the plaintiff was in fact the yacht that the plaintiff had purchased. The wrongful conduct charged by the pleadings pertains to the crossing made by the yacht from Miami to Bimini, and her subsequent grounding in that harbor. It is, therefore, the conclusion of this Court that this action is maritime in nature rather than civil, and that any civil issues are pendant to the admiralty jurisdiction of this Court. Berwind-White Coal Mining Co. v. City of New York (C.A. 2, 1943), 135 F.2d 443; Admiralty Jurisdiction and Ship Sale Contracts, 6 Stanford L.Rev. 540 (1954).

At the outset of the trial, the plaintiff and the defendant Chris Craft entered into a stipulation for the dismissal of the plaintiff's suit against Chris Craft with prejudice. The stipulation was reduced to writing and filed with the Court. In that stipulation, the plaintiff agrees that he has no claim against Chris Craft for damages, negligence or breach of contract arising out of the grounding of the yacht at Bimini. The Court recognized and approved that stipulation and entered an order whereby this cause was dismissed as to the defendant Chris Craft with prejudice to the plaintiff and at the cost of the respective parties.

Liability

The plaintiff desired to purchase a 57 foot Chris Craft Constellation yacht for personal pleasure purposes. He had owned pleasure craft of varying sizes for some 17 years. He visited the Chris Craft factory at Pompano Beach, Florida, where he observed a hull of such a yacht in the production process. Upon inquiry, he learned that this was being constructed for Challenger, a distributor of Chris Craft products located in North Miami, Florida. The plaintiff thereupon contacted Challenger and began to negotiate with its sales manager, Ray Grissom.

The plaintiff indicated to Grissom that he desired to have certain alterations and changes made to the cabin of the vessel, primarily in the nature of a customized or special decor. The plaintiff and Grissom went again to the Chris Craft factory where they discussed the feasibility and cost of these proposed changes with representatives of the Chris Craft company. As a result of these discussions, an agreed price of $117,144.50 was reached between the plaintiff and Challenger for the purchase of the vessel, altered as desired by the plaintiff. In addition, it was agreed between the plaintiff and Challenger that the vessel would be delivered to the plaintiff in Bimini, Bahama Islands, so as to attempt to avoid the payment of the Florida State Sales tax upon the transaction. The parties are in dispute as to who suggested this device. The defendant Challenger made no special charge to the plaintiff for this delivery. Plaintiff did agree to reimburse Grissom and/or Challenger for personal expenses incurred in this delivery, including plane fare and governmental fees for Grissom's return from Bimini to Miami.

The yacht was delivered by Chris Craft to Challenger on or about March 15, 1969. On March 17, 1969, the plaintiff paid Challenger in full for the agreed sales price of the yacht. On March 18, 1969, Challenger issued a Bill of Sale to plaintiff. Shortly thereafter plaintiff executed a document on a form provided by the Treasury Department, Bureau of Customs, entitled "Oaths on Registry, License, or Enrollment and License of Vessel" in which he stated under oath that he was then the sole owner of the yacht. This oath was filed with the Bureau of Customs, after which a temporary private yacht license was issued to the yacht. Hence, title to the yacht passed from the defendant to the plaintiff on March 18, 1969.

At this point in time, the yacht was in the water at the premises of Challenger, in North Miami, Florida, when the yacht was delivered by Chris Craft to Challenger, it required certain minor alterations and changes that had to be made in order for the vessel to be fully outfitted and equipped as ordered by the plaintiff. In addition, there were certain "extras" that the plaintiff had ordered from Challenger which had to be installed by Challenger and for which the plaintiff was billed separately. The "extras" were not a part of the basic purchase price of the yacht. While this remaining work was being completed, the plaintiff's Captain was given the keys to the cabin doors of the yacht and he moved his personal possessions, and those belonging to the plaintiff and his wife, aboard the vessel.

It is not necessary for the Court to here decide where and when constructive delivery of the yacht took place. However, if such issue required resolution, the Court would hold that constructive delivery of the yacht took place in North Miami, Florida, at the premises of the defendant Challenger when title was transferred to the plaintiff and when the plaintiff, through his Captain, began to exercise dominion over the yacht.

The plaintiff was notified that the remaining work would be completed by April 25, 1969. On that morning, the plaintiff went to the premises of Challenger, where he paid the bill due to Challenger for the "extras."

On that day, after some delay occasioned by a misunderstanding regarding the validity of a check which the plaintiff had tendered in part payment of the remaining balance, the plaintiff, together with his wife and his Captain, set out for Bimini aboard another yacht owned and operated by plaintiff's friend. Somewhat later on the same day, plaintiff's yacht also set out for Bimini, with Grissom at the helm and another Challenger employee acting as mate.

Dudley Whitman, then President of Challenger, testified that on several occasions on the morning of April 25, 1969, prior to the departure of the yacht from Miami bound for Bimini, plaintiff was warned that the weather was not favorable for the crossing and that rough weather could be anticipated. Whitman testified that despite such warnings plaintiff insisted that the crossing be made that day. The yacht did encounter heavy weather between Miami and Bimini. As a result, certain furniture in the interior of the vessel moved about causing damage to furnishings and paneling in the nature of nicks, dents and scratches. Although plaintiff disputed the condition of the weather encountered on the crossing, the Court finds that the testimony of Grissom is entirely credible, both as to this fact and as to the other facts to which he testified at the trial.

Upon arrival in Bimini Harbor on the evening of April 25, 1969, Grissom deemed it unadvisable to attempt to bring the yacht to a designated dock because of the condition of the weather. He elected to anchor the yacht in the harbor for the night. The following morning when the weather had subsided, Grissom and his mate undertook to bring the yacht to the dock. In the...