Nimbus Boat Rental, Corp. v. Garcel

• Decision Date: 07 October 2022
• Docket Number: 1:22-cv-22645-KMM
• Parties: NIMBUS BOAT RENTAL, CORP., et al., Plaintiffs, v. ANGEL GARCEL, et al., Defendants.
• Court: U.S. District Court — Southern District of Florida

NIMBUS BOAT RENTAL, CORP., et al., Plaintiffs,
v.
ANGEL GARCEL, et al., Defendants.

No. 1:22-cv-22645-KMM

United States District Court, S.D. Florida

October 7, 2022

REPORT AND RECOMMENDATIONS

LAUREN F. LOUIS UNITED STATES MAGISTRATE JUDGE

THIS CAUSE is before the Court upon Defendants' request to vacate the arrest of the F/V Nirvana, a 105-foot^[1] Rodman bearing Hull No. DLZ13852I512 (the “Vessel”). The matter was referred to the undersigned by the Honorable K. Michael Moore, United States District Judge, pursuant to 28 U.S.C. § 636 and the Magistrate Judge Rules of the Local Rules of the Southern District of Florida, to take all necessary and proper action as required by law with respect to any post-arrest hearing under Supplemental Rules C(3) and E(4)(f).^[2] (ECF No. 14). The Court entered an Order requiring Plaintiffs to show cause in writing why, among other topics, the arrest of the Vessel should not be vacated. (ECF No. 27). Plaintiffs filed a Response (“Response”) (ECF No. 28). The Court also set an evidentiary hearing to show cause on September 19, 2022, which continued on September 20, 2022, and September 27, 2022 (ECF Nos. 47, 50, 63). Having reviewed the Response, the record as a whole, and with the benefit of the evidence and argument

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presented at the Show Cause Hearings, the undersigned respectfully RECOMMENDS that Defendants' request to vacate the arrest of the F/V Nirvana be GRANTED.

I. BACKGROUND

This is an action involving title to the F/V Nirvana, arising under the Court's admiralty and maritime jurisdiction, pursuant to 28 U.S.C. § 1333 and Rule 9(h) of the Federal Rules of Civil Procedure, with state law claims arising under the Court's supplemental jurisdiction, pursuant to 28 U.S.C. § 1367.

A. The Verified Complaint

Plaintiffs Nimbus Boat Rental Corp. (“Nimbus”), Cristian Valdes (“Valdes”), and Elaine Leyva (“Leyva”) (collectively, “Plaintiffs”) allege that Defendants Angel Garcel (“Garcel”) and his company Jet Skis in Miami, Corp. (“Jet Skis”) (collectively, “Defendants”) have unlawfully deprived Plaintiffs of possession and title to the Vessel without consent and have failed to return the Vessel upon demand. According to Plaintiffs' Verified Complaint (“Complaint”) (ECF No.1), the individual Parties in this action (Valdes, Leyva, and Garcel) became friends through mutual familial relationships. Plaintiffs contend that Garcel sought out this friendship with Valdes's reputation as a successful entrepreneur in the music and entertainment industry in mind, all with the targeted goal of gaining Valdes's trust and confidence.

The Complaint describes Garcel as the sole principal of Jet Skis, which sells and rents personal marine watercraft and other marine vessels. Plaintiffs allege that, after gaining Valdes and Leyva's trust, Garcel approached them with a business opportunity: Garcel proposed that Valdes and Leyva purchase the Vessel, with Valdes, Leyva, Garcel, and Jet Skis to manage the Vessel, provide necessary repairs and maintenance, and make it seaworthy, so that they could

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charter the Vessel. Garcel further offered that he and Jet Skis would manage the Vessel in exchange for a fee.

When Valdes, Leyva, and a prospective business partner attended a preliminary inspection of the Vessel, they did not believe that it was worth the requested purchase price. Their bid of $450,000.00 to purchase the Vessel was rejected. According to Plaintiffs, Garcel became frustrated with the low value of their bid and attempted to cause a rift between Valdes and Leyva and their prospective business partner. To persuade Valdes and Leyva to purchase the Vessel, Garcel told them that he and Jet Skis would invest half the funds necessary to purchase the Vessel, becoming Valdes and Leyva's business partner. Under the proposed arrangement, Garcel would be responsible for equipping the Vessel, ensuring it was seaworthy and compliant, and managing aspects of the charter business. Based on Garcel's representations, Valdes and Leyva agreed.

However, Plaintiffs allege that Garcel never had the economic means to purchase his half of the Vessel. Rather, Plaintiffs contend that Garcel's promise to pay half the purchase price for the Vessel was false and was made to induce Valdes and Leyva to proceed with the purchase. Leading up to the close of the sale of the Vessel, Garcel informed Valdes and Leyva that he and Jet Skis did not have the funds to purchase their share of the Vessel, and instead suggested that Valdes and Leyva advance all the funds for the purchase. According to the Complaint, Valdes and Leyva did, advancing $635,000.00 for the purchase, furnishing, and equipping of the Vessel. In return, Garcel, Valdes, and Leyva agreed that Leyva would become an officer and shareholder of Jet Skis, conditioned upon Garcel and Jet Skis investing half of the funds for the acquisition and restoration of the Vessel. Jet Skis would conduct the charter business for the Vessel.

At closing, Garcel advised Valdes and Leyva that he would coordinate the registration paperwork for the Vessel. Valdes and Leyva agreed due to their lack of experience with maritime

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transactions. According to the Complaint, Garcel registered the Vessel in the name of Jet Skis.

Because the Vessel was in poor condition, Leyva and Valdes invested additional funds for its repair and upkeep. They asked Garcel to become the project manager for the refurbishment of the Vessel, with Garcel and Jet Skis earning a percentage of the charter business's net profits in exchange for Garcel's work. According to the Complaint, Garcel performed poorly in this role, ultimately destroying Plaintiffs' trust in Garcel. Determined to sell the Vessel, Leyva and Valdes requested that Garcel deliver the title and ownership papers to them. Garcel and Jet Skis refused, and instead lobbied for half of the net proceeds from the sale of the Vessel. Garcel and Jet Skis's request was rejected. Plaintiffs contend that Garcel held the Vessel's ownership papers hostage. Ultimately, Garcel capitulated, signing a Certificate of Title transferring ownership of the Vessel; Valdes and Leyva subsequently registered the Vessel in the name of Nimbus on May 2, 2022.

According to the Complaint, Garcel became frustrated and disgruntled. Plaintiffs allege that he falsely reported to law enforcement that Valdes had broken into Garcel and Jet Skis's offices and had stolen the Vessel's ownership documents, forged a signature to effectuate the transfer of the Vessel, and unlawfully registered the Vessel in the name of Nimbus. In reliance on Garcel's allegedly false report, law enforcement determined there was probable cause to arrest and prosecute Valdes. On June 22, 2022, Valdes was arrested. Ultimately, state prosecutors declined to prosecute, dismissing the charges on July 22, 2022, because the information Garcel provided to them had proved too inconsistent, inaccurate, and unreliable.

Plaintiffs contended that Garcel remained in possession of the Vessel and continued to charter it without Valdes and Leyva's consent, and in violation of various U.S. Coast Guard regulations. Plaintiffs asserted that Garcel has not accounted for any of the funds generated from chartering the Vessel, and that he surreptitiously uses third parties to seek out charters.

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Accordingly, Plaintiffs commenced this action against Defendants in this Court on August 19, 2022. Plaintiffs assert eight causes of action against Defendants: (1) an in rem claim for the arrest of the Vessel; and in personam claims for (2) conversion; (3) imposition of a constructive trust; (4) unjust enrichment; (5) an accounting; (6) malicious prosecution; (7) intentional infliction of emotional distress; and (8) abuse of process. In their in rem claim for the arrest of the Vessel, Plaintiffs request that “Plaintiff Nimbus be decreed the rightfully titled owner of the vessel.” (Complaint at 15).

Upon filing the Complaint, Plaintiffs also filed a Verified Motion for Issuance of a Warrant of Arrest and/or Summons (ECF No. 8) and an Emergency Hearing Request (ECF No. 9) as to that motion, with a certificate of emergency based on exigent circumstances, pursuant to Local Admiralty Rule C(2)(b). As a result, on August 22, 2022, the district court entered an Order directing the Clerk of Court to issue a warrant of arrest in rem against the Vessel (ECF No. 11), pursuant to Supplemental Rule C and Local Admiralty Rule C(2)(b), which issued and was executed on August 23, 2022 (ECF No. 17, 26).

On September 1, 2022, Defendants timely filed their Verified Statement of Right or Interest in a 2005 105' Rodman, Hull Identification Number DLZ138521512 and incorporated Motion for Order to Show Cause (ECF No. 25) (the “Claim”), pursuant to Supplemental Rule C(6)(a)(i) and Local Admiralty Rule C(6)(a). (ECF No. 25). Defendants' Claim asserts that Plaintiffs (1)...