Howse v. S/V ""Canada Goose I"", 79-2969

Citation641 F.2d 317
Decision Date02 April 1981
Docket NumberNo. 79-2969,79-2969
PartiesPage 317 641 F.2d 317 Gene HOWSE, Suzanne Norris and Samantha Stevens, Plaintiffs, v. S/V "CANADA GOOSE I", et al., Defendants. WINDWARD TERMINALS, INC., Intervening Cross-Plaintiff-Appellee, v. TRACOR MARINE, Intervening Plaintiff/Cross-Defendant/Third-Party Plaintiff-Appellant, v. LAUDANIA OCEAN TERMINAL, INC., Third-Party Defendant. United States Court of Appeals, Fifth Circuit. Unit B
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Smathers & Thompson, Linwood Anderson, Maria E. Arista, Keith E. Hope, Miami, Fla., for Tracor Marine.

J. James Donnellan, III, Miami, Fla., for Windward Terminals, Inc.

Appeal from the United States District Court for the Southern District of Florida.

Before HILL and FRANK M. JOHNSON, Jr., Circuit Judges and SCOTT *, District Judge.


This appeal is taken from a final judgment on a cross-claim brought by one would-be intervenor against another in the original suit in admiralty. The case turns upon the propriety of the district court's decision to allow the cross-claimant Windward Terminals, Inc. (Windward) 1 to intervene to assert a cross-claim against Tracor Marine (Tracor). Guided by International Tank Terminals, Ltd. v. M/V Acadia Forest, 579 F.2d 964 (5th Cir.1978) and Stallworth v. Monsanto Co., 558 F.2d 257 (5th Cir.1977), we conclude that intervention was inappropriate in the circumstances of this case and, accordingly, reverse.

Three former crew members brought the original action in rem to recover unpaid wages against the S/V CANADA GOOSE I, which at time of filing was docked at Tracor's facilities for repair. The vessel was attached on February 12, 1975, and the district court appointed Tracor substitute custodian of the vessel in place of the United States Marshal. On June 6, 1975, during the course of the litigation, Tracor allowed the vessel to be removed from its docks by agents of the owner without court approval. Shortly after leaving the Tracor premises, however, the vessel went aground adjacent to the Windward facility. Upon request, Windward hauled the leaking vessel to its dock facilities where she stayed until sold by the marshal more than four months later. Windward thus became de facto substitute custodian of the vessel on June 6, 1975, supplying substantial custodial services at Tracor's request. 2

Subsequently, a dispute developed between Tracor and Windward over who should be caring for the vessel and who should be paying for it. On September 24, 1975, Tracor intervened in the main action, filing an intervening complaint against the vessel in an attempt to assert a lien for the balance due on repair work ordered by the owner and for the costs of preserving the vessel prior to June 6, 1975. Although both Tracor and Windward moved the district court for an order clarifying custody of the vessel, no order was entered. At a subsequent hearing, however, the court confirmed Tracor's official custodianship, but recognized the custodial expenses of both Windward and Tracor. Accordingly, the district court ordered that $20,740.00 be taxed against the vessel in favor of Tracor and that $20,117.81 be taxed against the vessel in favor of Windward. Meanwhile, the trial of the main action was concluded, and the district court entered final judgment for the plaintiff seamen. The vessel was sold on October 20, 1975, and the sale confirmed on October 30, 1975. Unfortunately, the high bid was only $700.00. Neither custodian received any of the proceeds of sale.

On October 29, 1975, Windward, still a non-party to the main action, 3 filed a motion for leave to file a cross-claim against Tracor, alleging a claim in admiralty for breach of contract. Tracor opposed the motion. The district court, however, construed the motion as a motion to intervene, granted the motion, and ordered Windward's cross-claim to be filed on November 13, 1975. The cross-claim was twice amended, the final version asserting claims based on breach of contract, indemnification, and constructive trust. Tracor defended inter alia on grounds of lack of jurisdiction, improper intervention, and failure to state a claim for which relief could be granted.

After a non-jury trial, the district court concluded that Tracor had breached its duty of custodianship and, therefore, was liable to Windward for its costs and charges which arose as a result of that breach. The propriety of Windward's intervention was neither argued at trial nor addressed in the district court's findings and conclusions. On July 20, 1979, the district court entered a final judgment awarding Windward $27,664.20 together with prejudgment interest against Tracor.

On appeal Tracor raises four issues. One is directed to the propriety of Windward's intervention and three attack the district court's jurisdiction, rationale concerning liability, and damage award, respectively. Because we conclude that the district court erred in allowing Windward to intervene, we find it unnecessary to address the latter three issues. Rule 24 of the Federal Rules of Civil Procedure provides for intervention as a matter of right and for permissive intervention. 4 Rule 24(a) and (b). The district court's order of November 13, 1975, allowing Windward to intervene offers no clue as to the basis for that decision. 5 We conclude that Windward failed to satisfy the requirements of Rule 24 with respect to both intervention of right and permissive intervention.


In order to intervene as a matter of right under Rule 24(a)(2), all four of the requirements set forth in the rule must be met. First, the application for intervention must be timely. Next, the applicant must have an interest relating to the property or transaction which is the subject of the action, and the applicant must be so situated that the disposition of the action may, as a practical matter, impair or impede his ability to protect that interest. Finally, it must appear that the applicant's interest is inadequately represented by the existing parties to the suit. International Tank Terminals, Ltd. v. M/A Acadia Forest, 579 F.2d 964, 967 (5th Cir.1978).

Tracor urges us to hold that Windward delayed too long in seeking intervention after final judgment had been entered and the vessel sold. Timely application is a requirement for both intervention of right and permissive intervention. Rule 24(a) and (b). The question of timeliness is largely within the district court's discretion. Stallworth v. Monsanto Co., 558 F.2d 257, 263 (5th Cir.1977). We assume that the district court concluded that the application, such as it was, was timely. 6 That determination can only be reversed for abuse of discretion. Id. Although this Court has been reluctant to approve intervention after final judgment, there are circumstances in which post-judgment intervention may be justified. See McDonald v. E. J. Lavino Co., 430 F.2d 1065, 1072 (5th Cir.1970). Applying the guidelines set forth in Stallworth, we find no basis for concluding that the district court abused its discretion on the issue of timeliness. 558 F.2d at 263-66.

While the significance of the precise nature of an intervenor's interest has declined since the 1966 amendments to Rule 24, see Atlantis Development Corp. v. United States, 379 F.2d 818, 823-25 (5th Cir.1967), intervention of right still requires "a direct, substantial, legally protectable interest in the proceedings." Diaz v. Southern Drilling Corp., 427 F.2d 1118, 1124 (5th Cir.1970) quoting Hobson v. Hansen, 44 F.R.D. 18, 24 (D.C.D.C.1968). At the stage of litigation at which intervention was granted here, Windward's only remaining interest was confined to its cross-claim against Tracor. The interest in recovering damages in the amount of its custodial expenses from Tracor was insufficiently related to the main action to justify intervention as a matter of right under Rule 24(a)(2).

We distinguish two completely different interests which Windward sought to assert and protect at different times in this action. Windward cared for the vessel from June 6, 1975, until approximately October 30, 1975, as de facto substitute custodian. Notwithstanding any agreement or contract with Tracor to provide this custodial care, Windward clearly had an interest in obtaining an award of administrative expenses for this service. That interest was shared by Tracor, which had cared for the vessel from February 12, 1975, until June 6, 1975. Despite the fact that Tracor remained the official substitute custodian, the district court clearly recognized, accepted, and adjudicated the interests of both Windward and Tracor in awarding administrative expenses against the vessel in favor of Tracor for $20,740.00 and in favor of Windward for $20,117.81. Neither of these interests was satisfied, however, by the sale of the vessel.

Subsequently, Windward, though still not a party to the main action, attempted to file its cross-claim against Tracor. As amended and ultimately tried before the court, the cross-claim asserted rights arising from a contract or agreement between Windward and Tracor. Windward's interest was thus confined to recovery of its custodial expenses from Tracor. This cross-claim interest was unrelated to the "property or transaction" which was the subject of the main action. Windward's cross-claim asserted no interest in the property, i. e. the vessel. It is correctly characterized as a claim in personam against Tracor. Indeed, as previously noted, Windward's interest in the vessel had already been adjudicated. Moreover, the counterclaim had no connection whatever to the wage claims which formed the basis of the main action. The district court's disposition of those claims neither impeded nor impaired Windward's interest. At all times Windward was free to pursue that interest in a separate action against Tracor.

Windward urges us to eschew a "myopic fixation upon 'interest' " and be guided instead by considerations of efficiency and due process in determining...

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