Mobil Sales and Supply Corp. v. Panamax Venus, 85-6499
| Decision Date | 12 November 1986 |
| Docket Number | No. 85-6499,85-6499 |
| Citation | 804 F.2d 541 |
| Parties | MOBIL SALES AND SUPPLY CORPORATION and Mobil Oil Corporation, Plaintiffs- Appellants, v. The Vessel PANAMAX VENUS, and her engines, tackle, apparel, equipment and appurtenances, in rem; Alexandra Navigation Corp., Ltd.; Eddie's Steamship Company, Ltd.; and Eddies Shipping Agency, Inc., in personam, Defendants- Appellees. The CHASE MANHATTAN BANK (NATIONAL ASSOCIATION) as Mortgagee, Plaintiff-in- Intervention-Appellee, v. PANAMAX VENUS, her engines, tackle, furniture, apparel, appurtenances, etc., in rem; and Alexandra Navigation Corporation, Ltd., in personam, Defendants- Appellees. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Alfred E. Yudes, Jr., Burlingham Underwood & Lord, New York City, Erich Wise, Graham & James, Long Beach, Cal., for plaintiffs-appellants.
Alan Nakazawa, Lillick, McHose & Charles, Los Angeles, Cal., for defendants-appellees.
Appeal from the United States District Court for the Central District of California.
Before GOODWIN, WALLACE and ANDERSON, Circuit Judges.
Mobil Oil Corporation (Mobil Oil) and Mobil Sales and Supply Corporation (Mobil Sales) appeal from a judgment and order for disbursement of funds entered by the district court. They challenge subordination of their maritime liens to the preferred ship mortgage of Chase Manhattan Bank (Chase). We have jurisdiction pursuant to 28 U.S.C. Sec. 1291, and we affirm.
The M/V Panamax Venus was a Liberian flag vessel owned by Alexandra Navigation Corporation, Ltd. In March 1984, the vessel's shipping agent contracted to have Mobil Oil deliver lubrication oil to the Panamax Venus. Mobil Oil delivered the oil to the ship at Kaohsiung, Republic of China but never received payment. In July 1984, the shipping agent contracted to have Mobil Sales deliver bunker fuel oil to the Panamax Venus, then in Yokohama, Japan. Mobil Sales delivered the oil to the ship in Yokohama, but never received payment.
In October 1984, the Mobil companies began an in rem action against the Panamax Venus in the Central District of California, asserting maritime liens for the price of the oil delivered pursuant to the two contracts. The ship was arrested in Los Angeles harbor and held pending resolution of the action. In November 1984, Chase intervened as a plaintiff in the case, alleging that it held a $69 million foreign preferred ship mortgage on the Panamax Venus that it acquired in 1981 and that was duly registered under Liberian law. The Mobil companies do not contest the validity of Chase's mortgage.
Because neither the owner nor the agent of the Panamax Venus came forward to pay the claims or deny liability, the court entered an order of default against them, and ordered the ship sold and its proceeds paid into the court registry pending final judgment on the three parties' claims. The sale netted 3.3 million dollars. The court found that the Mobil companies held valid maritime liens against the ship. It ruled, however, that these liens were subordinate to the mortgage held by Chase, and, since the fund was not larger than Chase's mortgage, entered a final judgment awarding Chase the entire proceeds of the sale.
In general, a preferred ship mortgage enjoys priority over all other claims against a vessel except certain maritime liens not relevant in this case and fees and costs imposed by the court. 46 U.S.C. Sec. 953. A preferred mortgage on a foreign vessel, however, is also subordinate to "maritime liens for repairs, supplies, towage, use of drydock or marine railway, or other necessaries performed or supplied in the United States." 46 U.S.C. Sec. 951 (emphasis added). The Mobil companies argue that, under this statute, their liens should enjoy priority over Chase's foreign preferred ship mortgage because they are American suppliers and, alternatively, because their liens arose from contracts substantially performed in the United States. We review such questions of statutory interpretation de novo. Trinity County Public Utilities District v. Harrington, 781 F.2d 163, 165 (9th Cir.1986).
The Mobil companies first contend that their maritime liens should enjoy priority...
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