Galehead Inc. v. M/V Anglia

• Citation: 183 F.3d 1242
• Decision Date: 09 August 1999
• Docket Number: No. 98-4922,98-4922
• Parties: (11th Cir. 1999) GALEHEAD, INC., an Oregon Corporation, Plaintiff-Appellant, Cross-Appellee, v. M/V ANGLIA, in rem, Defendant-Appellee, Cross-Appellant
• Court: United States Courts of Appeals. United States Court of Appeals (11th Circuit)

Page 1242

183 F.3d 1242 (11th Cir. 1999)

GALEHEAD, INC., an Oregon Corporation, Plaintiff-Appellant, Cross-Appellee, v. M/V ANGLIA, in rem, Defendant-Appellee, Cross-Appellant.

No. 98-4922

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

August 9, 1999

Rehearing Denied Sept. 15, 1999

Appeals from the United States District Court for the Southern District of Florida D. C. Docket No. 97-CV-1229-JLK

Before EDMONDSON and MARCUS, Circuit Judges, and ALARCON^*, Senior Circuit Judge.

PER CURIAM:

This case is about maritime liens. The district court said, on cross motions for summary judgment, that the plaintiff Galehead, Inc. ("Galehead") was entitled to only one of the three maritime liens it was seeking. We affirm that determination but conclude the value of that lien should be $24,376.00 and not--as the district court said--$20,349.29.

Background

This case is an in rem admiralty action about the efforts of the M/V Anglia ("Anglia") to procure fuel by means of its charterer Genesis Container Line ("Genesis"). Anglia was fueled on three separate occasions.

On 25 August 1995, Genesis contacted Polygon Energy Services, Inc. ("Polygon") to obtain fuel bunkers for Anglia at Port Everglades, Florida. Polygon then contacted Establissment Asamar, Ltd. ("Asamar"), to supply the fuel. Asamar engaged Coastal Refining and Marketing, Inc. ("Coastal"), who physically fueled Anglia on 26 August 1995. The bunker confirmation prepared by Polygon listed Coastal as the physical supplier and Asamar as the seller. The cost of the bunkers was paid by Asamar to Coastal. Genesis failed to pay Asamar for the bunkers, however.

The second fueling occurred on 8 September 1995, when Genesis again engaged Polygon to obtain bunkers for Anglia in Houston, Texas. Polygon then contacted Asamar who contacted ChemOil Corp. ("ChemOil") and Marsh Distributing Company ("Marsh") with instructions to fuel Anglia. ChemOil and Marsh supplied the fuel on 11 September 1995. Asamar paid ChemOil and Marsh for the bunkers but was not reimbursed by Genesis. In November, Asamar assigned its rights to the money from both of these fuelings to the collection agency, Galehead.

The third fueling incident was different. On 27 October 1995, Genesis contacted Polygon to procure bunkers for Anglia in Houston, Texas. Polygon then engaged ChemOil and Tesoro Petroleum Distributing Company ("Tesoro") to fuel Anglia. The bunker confirmation prepared by Polygon listed ChemOil and Tesoro as the "physical suppliers" and Polygon as the "seller." Polygon paid ChemOil and Tesoro $20,349.29 for supplying the fuel, but Genesis failed to pay Polygon the $24,376.00 it owed under the contract with Polygon. In December 1995, Polygon assigned its rights under the contract with Genesis to Galehead.

On 24 April 1997, Galehead filed a complaint to enforce the full amount of the three liens against Anglia. Both parties moved for summary judgment. The district court granted each motion in part. Applying a seven-part test of its own creation, the district court determined that Polygon had a maritime lien against Anglia but that Asamar did not have one. The court therefore ordered judgment for Galehead in the amount of Polygon's lien: the contract price of $24,376.00. The court later reduced the amount, though, to what Polygon had paid ChemOil for the fuel in question: $20,349.20. Galehead appealed and Anglia cross-appealed.¹

Discussion

I

The test for determining who is entitled to a maritime lien must come from a plain reading of the statute itself:

(a) Except as provided in subsection (b) of this section, a person providing necessaries to a vessel on the order of the owner or a person authorized by the owner--

(1) has a maritime lien on the vessel;

(2) may bring a civil action in rem to enforce the lien; and

(3) is not required to allege or prove in the action that credit was given to the vessel.

46 U.S.C. 31342. Therefore, to obtain a maritime lien, a person must: (1) provide necessaries; (2) to a vessel; (3) on the order of the owner or agent. While Polygon satisfies all three of the elements Asamar fails on element number three and does not qualify for its two liens. So, Galehead is entitled to only one lien.

A. Polygon

About the first element, although Polygon did not physically supply the bunkers, a party need not be the physical supplier or deliverer to have "provided" necessaries under the statute. See The Golden Gate Knutsen v. Associated Oil Co., 52 F.2d 397, 400 (9th Cir. 1931); A/S Dan-Bunkering LTD. v. M/V Zamet, 945 F. Supp. 1576, 1578-79 (S.D. Ga. 1996). The bunkers were supplied pursuant to an agreement made between Genesis and Polygon. That agreement caused, or provided for, the delivery of the fuel to the vessel. Therefore, Polygon "provided" necessaries to the vessel under the contract irrespective of how, or by whom, the delivery was carried out. See generally Restatement (Second) of Contracts 318 cmt. a, illus. 2 (1979) ("A contracts to deliver to B coal of specified kind and quality. A delegates the performance of this duty to C, who tenders to B coal of the specified kind and quality. The tender has the effect of a tender by A.").

The second and third elements of the statute are also satisfied. On element number two, no one disputes that the bunkers were supplied to the vessel. About element number three, the contract was performed on the order of the charterer Genesis. A charterer is authorized under the statute to bind a vessel for necessaries. See 46 U.S.C. 31341(a)(4)(B); see also Trico Marine Operators, Inc. v. Falcon Drilling Co., 116 F.3d 159, 161-62 (5th Cir. 1997).

B. Asamar

The work done by Asamar was not "on the order of the owner or a person authorized by the owner." Therefore, Galehead is entitled to neither of the two potential liens arising from the August and September 1995 fuelings. Summary judgment was proper for Anglia here.

That Asamar has met the first two elements of the statutory test is not much disputed. But the third element is a problem for Asamar. Asamar did not provide the bunkers on order of the owner or an authorized agent. Asamar provided the bunkers at Polygon's request, and Polygon is not a "person[] . . . presumed to have authority to procure necessaries[.]" 46 U.S.C. 31341(a); see also Port of Portland v. M/V Paralla, 892 F.2d 825, 828 (9th Cir. 1989) (stating the general rule that general contractors have no authority to bind a vessel).² In the circumstances of this case, therefore, the only way Asamar could have performed work on the order of the owner is if the work was somehow authorized by Genesis: that is, if Genesis was sufficiently aware of, and involved in, Asamar's work that it might be said that Asamar was working for Genesis.

The courts have considered the issue of the third-party provider a number of times. Where the level of involvement between the owner and the third-party provider was significant and ongoing during the pertinent transaction, the courts have found a triable issue of fact about whether the third-party deserved a lien. In Marine Coatings, Inc., of Alabama v. United States, 932 F.2d 1370 (11th Cir. 1991), the plaintiff--a subcontractor who made repairs on a couple of vessels at the request of the contractor--survived a summary judgment motion; these facts were material: (1) the owner of the vessel was aware of the subcontractor's performance before and during the performance; (2) the subcontractor performed between 35% and 50% of the work performed on the vessels; (3) the owner inspected the subcontractor's work; (4) the owner gave provisional and final acceptance to the subcontractor's work; and (5) the repairs were fully accepted and compensated for. Id. at 1376 & n.9.³

Stevens Technical Services, Inc. v. United States, 913 F.2d 1521 (11th Cir. 1990), involved facts similar to Marine Coatings and a similar result. In Stevens, the owner was aware beforehand of the repairer's role: the repairer was listed in the contract with the owner as a party performing 15% or more of the work, and the owner also knew the principal contractor was incapable of doing the work itself. Id. at 1534. Moreover, the owner dealt with the repairer in terms of "discussing, testing and inspecting work done by [the repairer.]" Id. at 1535.

But other cases illustrate that a third-party provider is not entitled to a lien where the degree of involvement with the owner is minimal or nonexistent. In Bonanni Ship Supply, Inc. v. United States, 959 F.2d 1558,1559 (11th Cir. 1992), the third-party provider (a subcontractor) was not listed on bids submitted to the owner. The undisputed facts showed no agreement (written or oral) between the subcontractor and the owner. Id. Moreover, the record showed no evidence that the owner was aware of the subcontractor's performance. Id. In those circumstances, summary judgment for the owner was granted....