Glander Int'l Bunkering v. M/V Dvina Gulf
| Decision Date | 29 March 2022 |
| Docket Number | Civil Action 19-5206 (ES) (MAH) |
| Parties | GLANDER INTERNATIONAL BUNKERING INC., Plaintiff, v. M/V DVINA GULF, IMO NO 9336464, et al., Defendants. |
| Court | U.S. District Court — District of New Jersey |
NOT FOR PUBLICATION
Before the Court are cross-motions for summary judgment filed by Plaintiff Glander International Bunkering Inc. and Claimant Viterlef Management Co., Inc., as the claimant for in rem Defendant M/V Dvina Gulf (also referred to as the “Vessel”). (D.E. Nos. 49 & 50). Having considered the parties' submissions, the Court decides the matter without oral argument. Fed.R.Civ.P. 78(b); L. Civ R. 78.1(b). For the reasons set forth below, the Court GRANTS in part and DENIES in part Plaintiff's motion for summary judgment, DENIES Defendant's motion for summary judgment and enters judgment in Plaintiff's favor.
Unless noted otherwise, the following facts are not in dispute.[1] In this maritime action, Plaintiff Glander International Bunkering Inc. alleges that it supplied the Vessel, M/V Dvina Gulf, with marine fuel oil (commonly called fuel bunkers) in foreign ports. (Compl. ¶¶ 5-29). Plaintiff alleges it was not paid in full and accordingly seeks to enforce a maritime lien against the Vessel under the Federal Maritime Lien Act, 46 U.S.C. § 31342(a) (“FMLA”). (Id. ¶¶ 12, 20, 33).
Plaintiff is a United States company in the business of providing maritime “necessaries” to ships, specifically fuel bunkers. (Pl. SMF ¶ 2). The Vessel is registered in Belize. (Id. ¶ 1; D.E. No. 17, Verified Answer ¶ 4). Viterlef Management Co., Inc., is the owner of the Vessel and is based in Russia. (Def. Mov. Br. at 10). On March 22, 2018, Claimant entered into an agreement, known as the “Charter, ” with Sea Oil Shipping Ltd. to charter the Vessel. (Pl. SMF ¶ 3). Among other terms, the Charter required Sea Oil to purchase and furnish fuel bunkers to the Vessel. (Def. SMF ¶ 4).
Accordingly, Sea Oil entered a contract with Plaintiff for fuel bunkers at the port of Rotterdam in the Netherlands. (Pl. SMF ¶ 4).[2] On May 30, 2018, Plaintiff issued a confirmation order memorializing the contract. (Id. ¶ 5). On June 3, 2018, Plaintiff delivered fuel bunkers in accordance with the contract and submitted an invoice in the amount of $368, 786.73, which became due on July 18, 2018. (Id. ¶¶ 11-12; First Conf. Order; First Invoice).
Similarly, Sea Oil entered a second contract with Plaintiff for fuel bunkers at the port of Rio Grande in Brazil. (Id. ¶ 6). On July 20, 2018, Plaintiff issued a second confirmation order memorializing the second contract. (Id. ¶ 7; Second Conf. Order). On July 25, 2018, Plaintiff delivered fuel bunkers in accordance with the second contract and submitted an invoice in the amount of $584, 041.09, which became due on September 8, 2018. (Pl. SMF ¶¶ 14-15; Second Conf. Order; Second Invoice).
Each confirmation order contains the following language: (Pl. SMF ¶ 8; First Conf. Order; Second Conf. Order). The referenced Terms provide that United States law governs the existence of a maritime lien:
These General Terms and Conditions and each Contract to which they apply shall be governed by the general maritime law of the United States of America and disputes shall be determined by Arbitration in London by a sole arbitrator according to the LMAA Rules 2017. The laws of the United States, including but not limited to the Commercial Instruments and Maritime Lien Act, shall always apply with respect to the existence of a maritime lien, regardless of the country in which the Seller takes legal action. In case of breach of contract by the Buyer, the Seller shall moreover be entitled to take such legal action in any court of law in any state or country which the Seller may choose and which the Seller finds relevant in order to safeguard or exercise the Seller's rights in pursuance of this present Agreement. Seller shall be entitled to assert its rights of lien or attachment of other rights, whether in law, in equity, or otherwise, in any jurisdiction where the Vessel may be found.
(Pl. SMF ¶ 10 (emphasis added)).
In July 2018, Sea Oil de-registered as a corporation. (Def. Mov. Br. at 7). In August 2018, Sea Oil made partial payment toward the balance due on the first contract; however, a balance of $134, 669.51 on the first contract remains outstanding. .[3] The entire balance of the second contract remains outstanding. (Pl. SMF ¶ 16).[4] Sea Oil returned the Vessel to Claimant on October 1, 2018. (Def. Mov. Br. at 7).
Sometime in November 2018, the Vessel docked in Ravenna, Italy. (Def. SMF ¶ 20). On November 30, 2018, while docked in Ravenna, Plaintiff filed a Petition for the Vessel's arrest in the Court of Ravenna to obtain security for potential claims against Claimant. (Id. ¶¶ 20-23; Pl. Resp. to Def. SMF ¶¶ 20-23). Upon the filing of the Petition, Claimant learned for the first time that Sea Oil had failed to pay Plaintiff for the fuel bunkers. (Def. Reply at 8).
On December 5, 2018, the Court of Ravenna issued an arrest order authorizing the Vessel's arrest. (D.E. No. 49-15). The order does not reference a maritime lien. (Id.). To obtain the Vessel's release from arrest, Claimant made a cash deposit as substitute security for the Vessel in the amount of EUR 950, 000.00 at a bank in Ravenna. (Def. SMF ¶ 25). After the cash deposit was made, the Vessel was released on December 7, 2018. (Id. ¶ 26; Pl. Resp. to Def. SMF ¶ 26).
On February 11, 2019, while the parties were still litigating the merits of the Italian arrest proceeding, Plaintiff had the Vessel re-arrested while it was docked in New Jersey. (Compl. ¶ 2; Def. SMF ¶¶ 27-28; Pl. Resp. to Def. SMF ¶¶ 27-28; Ridolfi Dec. ¶¶ 5-15). To obtain the Vessel's release from arrest in New Jersey, Plaintiff and Claimant entered into an escrow agreement (the “Escrow Agreement”) dated February 13, 2019, which required Claimant to transfer $1, 078, 065.90 to the trust account of Claimant's attorney in a New York bank as substitute cash security for Plaintiff's potential claims. (Escrow Agreement ¶ D; Def. SMF ¶ 28; Pl. Resp. SMF ¶ 28). After this transfer, Plaintiff was to release the original cash deposit made in the bank in Ravenna. (Def. SMF ¶ 29; Pl. Resp. SMF ¶ 29). Claimant transferred the substitute cash security in accordance with the Escrow Agreement. (Def. SMF ¶¶ 28 & 29; Pl. Resp. SMF ¶ 28). On February 26, 2019, at the parties' request, the Court of Ravenna discontinued the arrest proceeding before it. (Def. SMF ¶ 30; Pl. Resp. SMF ¶ 30). On March 1, 2019, Plaintiff released the original cash deposit made in the Ravenna bank to Claimant in accordance with the Escrow Agreement. (Id.).
On February 11, 2019, Plaintiff filed the Complaint and ex parte motion for issuance of a warrant to arrest the Vessel in New Jersey. (See generally Compl.; D.E. No. 3). That day, the Undersigned held a conference with the parties and granted the motion for issuance of an arrest warrant. (D.E. Nos. 8, 11 & 12). On February 27, 2019, Claimant, as the Vessel's owner, entered a restricted appearance and verified claim of owner in this matter for the sole purpose of defending the Vessel pursuant to Rules C(6) and E(8) of the Supplemental Rules for Certain Admiralty and Maritime Claims of the Federal Rules of Civil Procedure. (D.E. No. 16). See Fed. R. Civ. P., Supp. Admiralty R. C(6) and E(8). On March 20, 2019, Claimant filed a verified answer. (D.E. No. 17). The parties engaged in discovery, and on November 10, 2020, the Honorable Michael A. Hammer, U.S.M.J., held a settlement conference and granted the parties leave to file motions for summary judgment. (D.E. No. 43). On February 5, 2021, the parties filed their respective cross-motions for summary judgment (see generally Def. Mov. Br. & D.E. No. 50 ( ), which were fully briefed in due course. (D.E. No. 51 (“Def. Opp.”); D.E. No. 52 (“Pl. Opp.”); D.E. No. 55 (“Pl. Reply”); D.E. No. 56 (“Def. Reply”)).
Plaintiff seeks $718, 710.60, plus interest and costs, due and owing under the fuel bunker contracts, as well as $9, 915.65 for fees and charges incurred to arrest the Vessel. (Pl. SMF ¶¶ 17 & 19; D.E. No. 50-9, National Maritime Service Invoice). After careful consideration of the record, the Court is ready to rule.
Summary judgment is appropriate where “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). The moving party bears the initial burden of showing that no genuine issue of material fact exists. Celotex, 477 U.S. at 323. Once the moving party has met this burden, “the nonmoving party must come forward with ‘specific facts showing that there is a genuine issue for trial.'” Cosm. Gallery, Inc. v. Schoeneman Corp., 495 F.3d 46, 51 (3d Cir. 2007) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)).
A dispute is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The mere existence of an alleged disputed fact is not enough. See Id. at 247-248. A fact is “material” if under the governing substantive law, a dispute about the fact might affect the outcome of the lawsuit. Id. at 248. Factual disputes that are irrelevant or unnecessary will...
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