Garcia v. M/V Kubbar

• Citation: 4 F.Supp.2d 99
• Decision Date: 20 January 1998
• Docket Number: No. 95-CV-1150 (LEK/DRH).,95-CV-1150 (LEK/DRH).
• Parties: Sairo GARCIA, Eloisa Gomez Garcia, individually and as Administrator for the Estate of Jose David Milian Mendoza and Empresa Portuaria Quetzal, Plaintiffs, v. M/V KUBBAR, her engines, tackle, apparel, appurtenances, etc., in rem, Defendant. M/V KUBBAR, her engines, tackle, apparel, appurtenances, etc., in rem, Defendant and Third-Party Plaintiff, v. FLOTA MERCANTE GRANCOLOMBIANA, S.A., Third-Party Defendant.
• Court: U.S. District Court — Northern District of New York

4 F.Supp.2d 99

Sairo GARCIA, Eloisa Gomez Garcia, individually and as Administrator for the Estate of Jose David Milian Mendoza and Empresa Portuaria Quetzal, Plaintiffs, v. M/V KUBBAR, her engines, tackle, apparel, appurtenances, etc., in rem, Defendant.

M/V KUBBAR, her engines, tackle, apparel, appurtenances, etc., in rem, Defendant and Third-Party Plaintiff, v. FLOTA MERCANTE GRANCOLOMBIANA, S.A., Third-Party Defendant.

No. 95-CV-1150 (LEK/DRH).

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

January 20, 1998.

COPYRIGHT MATERIAL OMITTED

Office of Peter A. Tulin, Saratoga Springs, NY, Peter A. Tulin, of counsel, Ballen, Gertel & Dicintio, Cherry Hill, NY, Jane M. Fearn-Zimmer, of counsel, Feldman & Troup, New York City, Steven Troup, of counsel, for Plaintiffs.

Clark, Atcheson & Reisert, New York City, Frank A. Atcheson, of counsel, for Defendant and Third-Party Plaintiff.

Walker & Corsa, New York City, R. Brett Kelly, of counsel, for Third-Party Defendant.

MEMORANDUM-DECISION AND ORDER

KAHN, District Judge.

This admiralty in rem action commenced with the arrest of defendant M/V KUBBAR, a merchant cargo vessel registered under the laws of Kuwait. The defendant now moves for summary judgment on the grounds that plaintiffs have failed to establish the existence of a maritime lien that is a prerequisite for in rem jurisdiction. For the reasons discussed below, defendant's motion is granted.

I. Background

A. Facts

The core event of this action is an accident in the Port of Quetzal, Guatemala, involving two stevedores, the plaintiff Sairo Garcia ("Garcia") and Jose David Milian Mendoza ("Mendoza"), both Guatemalan citizens. On July 10, 1995, the two men were loading boxes from the dock onto the vessel M/V KUBBAR ("vessel" or "defendant") using a crane, under the supervision of the crew of the vessel. Loading cargo required the stevedores to ride with the boxes as they were lifted onto the ship, and the men would thus periodically be elevated to a substantial height over the dock. At some point during the day, while they were so elevated, a wire in the crane snapped and the men fell approximately thirty feet. Mendoza, whose leg was severed by the crane's hook assembly during the fall, was killed and Garcia suffered serious injuries. In addition, plaintiff Empressa Portuaria Quetzal ("EPQ"), the owner of the dock, suffered property damage to its dock and equipment. Plaintiffs allege that the crane failed because of the negligence of the vessel and its crew in maintaining the "seaworthiness" of the equipment.

At the time of the accident, the vessel had been subchartered by third-party defendant Flota Mercante Grancolombiana, S.A. ("FMG") from a company called Industrial Maritime Carriers (Bahamas) Inc., who themselves had chartered the vessel from its owner, Kuwait Maritime Transport Company ("KMT" or "owner") on or around November 9, 1994.

After the accident, the ship was detained pursuant to local court order, and the matter forwarded for hearing before the Second Court of the First Instance in the City of Escuintla, Guatemala ("Second Court"). On July 13, 1995, the Second Court issued an order releasing the ship from detention, and on the same day, after obtaining a Sailing Order from the Captain of the port, the vessel departed Puerto Quetzal. Plaintiffs allege that defendant obtained the release order unlawfully by making pay-offs to the local Justice. They also allege that they made numerous attempts to arrest the vessel in its subsequent travels, but only caught up with it when it reached Albany, New York around August 16, 1995.

B. Procedural History

Plaintiffs filed a complaint in this Court on August 18, 1995 and obtained a warrant for arrest in rem of the M/V KUBBAR on the same day. On August 19, 1995, the vessel was released by order of Judge Cholakis after the posting of a letter of undertaking promising to secure the plaintiffs' claims up to $1,500,000.

Defendant first submitted an answer on September 11, 1995, which also stated counter-claims against EPQ, the dock owner. EPQ then answered on October 6, 1995. Defendant filed a third-party complaint against FMG, the sub-charterer, on February 13, 1996, which FMG answered on April 15, 1996. FMG also made counter-claims against both the defendant and EPQ, which defendant answered on April 25, 1996 and EPQ answered on June 12, 1996.

Defendant filed an amended answer to the complaint on June 10, 1996. This amended answer added several affirmative defenses, including an objection to in rem jurisdiction.

On November 15, 1996, plaintiffs submitted a legal brief, apparently intended as a motion, arguing for the application of American law and the continuance of the action in rem in this Court. On February 24, 1997, defendant cross-moved for summary judgment. The issues of both motions (taking plaintiffs' November 15 brief to be an adequate motion) are identical — whether foreign law must be applied to this action, and what the legal consequences are.

II. Discussion

On a motion for summary judgment, the movant bears the burden of persuading the court that the record demonstrates "the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Genuine issues exist if "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Once a movant has carried her initial burden, the respondent "must do something more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). In evaluating a summary judgment motion, the court must view the facts in the light most sympathetic to the nonmovant. Id. at 587, 106 S.Ct. 1348 (quotation omitted). The district judge's inquiry is whether a triable issue exists with respect to the claim being moved upon — that is, whether there is enough of a material dispute over key facts that the finder of fact could reasonably decide either way. See Anderson, 477 U.S. at 250, 106 S.Ct. 2505.

Defendant M/V KUBBAR has moved for summary judgment, arguing that the case is governed by Guatemalan law, and that, under that law, there is no maritime lien for harm done to stevedores through the negligence of the ship owners, and thus no basis for an in rem action. Plaintiffs argue that United States general maritime law should govern the determination of whether the lien exists. They further argue that defendants have consented to jurisdiction.

A. In Rem Jurisdiction and the Necessity of A Maritime Lien

Rule C(1)(a) of the Supplemental Admiralty and Maritime Claims Rules sets forth the conditions upon which one may file an in rem action: "[a]n action in rem may be brought (a) [t]o enforce any maritime lien [or] (b) [w]henever a statute of the United States provides for a maritime action in rem or a proceeding analogous thereto." Rule C, Supplemental Rules For Certain Admiralty and Maritime Claims. Plaintiffs do not argue that their in rem claim is provided for by a federal statute. Thus, they must establish the existence of a maritime lien to support in rem jurisdiction. See Sembawang Shipyard, Ltd. v. Charger, Inc. and M/V Charger, 955 F.2d 983, 987 (5th Cir.), reh. denied, 963 F.2d 372 (1992); Hunley v. Ace Maritime Corp., 927 F.2d 493, 496 (9th Cir.1991) (a maritime action in rem will be available "only in connection with a maritime lien"); Amstar Corp. v. S/S Alexandros T., 664 F.2d 904, 908 (4th Cir.1981)("A maritime lien is an essential predicate for the arrest of a vessel in a private in rem action.") In the absence of such a lien, the in rem action may not continue.

Whether such a lien exists is a question of substantive law. See Amstar Corp, 664 F.2d at 908 (maritime liens are "an integral aspect of substantive, rather than procedural maritime law"); Trinidad Foundry & Fabricating, Ltd. v. M/V K.A.S. Camilla, 966 F.2d 613, 615 (11th Cir.1992) (same). Substantive law, unlike procedural law, must be applied according to choice-of-law principles. See Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 778 n. 10, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984). These principles require a court to apply the substantive law of a foreign forum where that foreign jurisdiction has the greatest interests in the litigation. Carbotrade S.p.A. v. Bureau Veritas, 99 F.3d 86, 89 (2d Cir.1996), cert. denied, Veritas v. Carbotrade S.P.A., ___ U.S. ____, 117 S.Ct. 2454, 138 L.Ed.2d 212 (1997).

Thus, courts which find that foreign law applies in a maritime action must apply that law to determine if a valid maritime lien exists and an in rem proceeding may thereby continue. See Ocean Ship Supply, Ltd. v. M/V Leah, 729 F.2d 971, 972-73 (4th Cir. 1984) (to determine whether [plaintiff] held such a maritime lien as would warrant an in rem seizure of vessel, court first applied choice-of-law analysis); Metron Communications, Inc. v. M/V Tropicana, 1992 WL 532637, *4, No. 89-2460-CIV (S.D.Fla. March 6, 1992) (disposition of in rem claim depended on whether Greek or American law applied to determine whether maritime lien existed); Castelan v. M/V MERCANTIL PARATI, 1991 WL 83129, *4, Civ. A. No. 91-1351 (D.N.J. May 8, 1991) (plaintiff had no maritime lien under English law, and therefore no right to proceed in rem).

Federal maritime choice-of-law questions are decided under the test established by the Supreme Court in Lauritzen v. Larsen, 345 U.S. 571, 73 S.Ct. 921, 97 L.Ed. 1254 (1953) as amended in Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368, reh. denied, 359 U.S. 962, 79 S.Ct. 795, 3 L.Ed.2d 769 (1959) and Hellenic Lines Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252, reh. denied, 400 U.S. 856, 91 S.Ct. 23, 27 L.Ed.2d 94 (1970)("Rhoditis"). Although Lauritzen...