S.E.L. Maduro (Florida), Inc. v. M/V Antonio De Gastaneta

• Decision Date: 14 December 1987
• Docket Number: No. 86-5839,86-5839
• Citation: 833 F.2d 1477
• Parties: , 56 USLW 2359 S.E.L. MADURO (FLORIDA), INC., Plaintiff-Appellant, v. M/V ANTONIO DE GASTANETA, f/k/a M/V MARIA ANTONIA, her engines, tackle, apparel, furniture, etc., et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1477

833 F.2d 1477

1988 A.M.C. 1217, 56 USLW 2359

S.E.L. MADURO (FLORIDA), INC., Plaintiff-Appellant, v. M/V ANTONIO DE GASTANETA, f/k/a M/V MARIA ANTONIA, her engines, tackle, apparel, furniture, etc., et al Defendants-Appellees.

No. 86-5839.

United States Court of Appeals Eleventh Circuit.

Dec. 14, 1987.

Timothy J. Armstrong, Armstrong & Mejer, P.A., Coral Gables, Fla., for plaintiff-appellant.

Philip V. Moyles, New York City, John Campbell, Michael T. Moore, Mark J. Buhler, Miami, Fla., for defendants-appellees.

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

Before RONEY, Chief Judge, HATCHETT, Circuit Judge, and HODGES ^*, District Judge.

HATCHETT, Circuit Judge:

This appeal requires that we apply principles of res judicata and collateral estoppel to determine whether this in rem action for services rendered and goods provided to a vessel is barred by a previous action between the same parties arising out of the delivery of the same services and provisions.

Finding that this lawsuit is not barred, we vacate, reverse, and remand.

FACTS

S.E.L. Maduro (Florida), Inc. (Maduro) provided services and goods to the M/V Antonio de Gastaneta, a cargo vessel. Maduro, the appellant, is a Florida corporation with its principal place of business in Dade County, Florida. The appellees, Banco de Credito Industrial, S.A. (BCI) and Sociedad de Gestion de Buques, S.A. (SGB), are Spanish business entities owned and operated by the government of Spain, with their principal places of business in Spain. SGB is the current operator of the M/V Antonio de Gastaneta, the appellee vessel in this action. BCI claims to be the current owner. ¹ All parties agree that Naviera Gorbea, a business entity organized under the laws of Spain, with its principal place of business in Spain, was the owner of the vessel from 1981 through 1985, the time period during which Maduro rendered services and provided necessaries to the vessel.

Naviera Gorbea chartered three vessels, the M/V Blas de Lezo, the M/V Bernardo de Zamcola, and the M/V Antonio de Gastaneta, to Compania Maritima Span-Chile, S.A. (Span-Chile), a Chilean entity engaged in transporting cargo by sea between North and South America. From August 4, 1981, through October, 1982, Maduro furnished stevedoring and other labor, materials, and supplies, constituting marine necessaries for all three vessels. In October, 1982, Span-Chile ceased doing business and Naviera Gorbea reclaimed the vessels.

On December 10, 1982, Jose L. Gervas, principal of Naviera Gorbea, and Leo McKay, the president of Maduro, met in Miami, Florida, to discuss the vessels' indebtedness to Maduro. All parties admit that this meeting took place; they disagree, however, as to what transpired during the meeting. According to Maduro, McKay informed Gervas that Naviera Gorbea's vessels which were chartered to Span-Chile, owed Maduro $595,016 for services rendered and necessaries provided to the vessels. According to Maduro, Gervas signed an agreement with Maduro, dated December 10, 1982, agreeing to pay the $595,016 debt. Maduro now alleges that the $595,016 charges give rise to a maritime lien against each of the vessels, because the charges were incurred not only by the charterer, but also by the owner. ²

BCI and SGB, the current parties-in-interest, have a different view of what transpired at the December 10, 1982, meeting. They claim that McKay informed Gervas that Maduro had a claim for $595,000 for services rendered to the three Naviera Gorbea vessels. According to BCI and SGB, McKay asserted Maduro's maritime lien in the three Naviera Gorbea vessels based upon the services rendered to the charterer, Span-Chile. They insist that at this meeting McKay told Gervas that Maduro intended to arrest the Naviera Gorbea vessels in rem to seek enforcement of its maritime lien. Because the vessels were at that time under charter, and operating out of United States ports, Naviera Gorbea had an interest in preventing the arrest and detainment of the vessels. Thus, Gervas signed a contract with Maduro, on behalf of Naviera Gorbea, agreeing to the $595,000 debt, and Maduro agreed not to foreclose its maritime lien on the three vessels.

Maduro denies that McKay ever claimed a maritime lien in the three Naviera Gorbea vessels based upon the services rendered at the request of the charterer, Span-Chile. Maduro further denies that McKay told Gervas that Maduro intended to arrest the Naviera Gorbea vessels in rem to seek enforcement of a maritime lien for services On July 6, 1983, three months before filing its complaint in Maduro I, Maduro telexed Naviera Gorbea to inform Naviera Gorbea that it was not Maduro's intention to attach the vessels because such action would place Naviera Gorbea in a difficult position regarding its existing charter agreements.

rendered. Naviera Gorbea subsequently refused to make payments, claiming that the document is merely an agreement to agree, rather than an enforceable contract.

PROCEDURAL HISTORY

On October 12, 1983, Maduro filed a lawsuit in the United States District Court for the Southern District of Florida against Naviera Gorbea, S.A. and Jose L. Gervas, alleging breach of the December 10, 1982, contract. In S.E.L. Maduro (Florida), Inc. v. Naviera Gorbea, S.A., & Jose L. Gervas, 83-2562-CIV-Davis (hereinafter referred to as Maduro I ), Maduro sought damages for breach of the contract resulting from the promise to pay for services rendered to the three Naviera Gorbea vessels.

Maduro's complaint in Maduro I alleged that Naviera Gorbea chartered the vessels to Span-Chile during 1981 and 1982, and that Maduro furnished stevedoring and other labor, materials, and supplies constituting marine necessaries for the vessels. Maduro also alleged that during December, 1982, Maduro representatives met with Gervas, and in consideration of Maduro's agreement to refrain from foreclosing its maritime lien on one or more of the vessels, Gervas executed a written agreement, or promissory note, on behalf of Naviera Gorbea. In Count I, Maduro alleged that it had sustained damage as a result of Naviera Gorbea's breach; in Count II, Maduro alleged that it sustained damage as a result of misrepresentations made by Naviera Gorbea and Jose L. Gervas.

Maduro I came on for trial, and the jury returned its verdict finding "no breach of contract by defendant." ³ On March 31, 1986, the district court entered judgment on the jury's verdict.

On August 28, 1985, Maduro filed this lawsuit (hereinafter referred to as Maduro II ) seeking to recover $148,000 plus interest against the M/V Antonio de Gastaneta in rem. Maduro's complaint in this action alleges that it furnished stevedoring and other marine necessaries and supplies to the M/V Antonio de Gastaneta, creating a maritime lien in its favor. Maduro alleges

                that the vessel defaulted in its obligation to pay amounts due Maduro and that the vessel refused to remedy these defaults upon demand.  Maduro seeks to foreclose on its maritime lien.  BCI and SGB filed a Motion for Summary Judgment.  The district court granted summary judgment in favor of BCI and SGB, finding that the judgment in the in personam action in Maduro I operates as an absolute bar to the in rem action in this case, Maduro II.    Maduro appeals
                

ISSUES

Maduro raises two issues in this appeal: (1) whether the doctrines of res judicata or collateral estoppel bar an action in rem against a vessel where a prior action was brought in personam against the vessel's owner; and (2) whether the district court abused its discretion in ordering Maduro to pay to the M/V Antonio de Gastaneta certain expenses associated with this lawsuit.

DISCUSSION

1. Res Judicata

Res judicata is claim preclusion; it refers to the preclusive effect of a judgment in foreclosing relitigation of matters that were litigated or could have been litigated in an earlier lawsuit. I.A. Durbin, Inc. v. Jefferson National Bank, 793 F.2d 1541, 1549 (11th Cir.1986); Interstate Pipe Maintenance, Inc. v. FMC Corp., 775 F.2d 1495, 1497 (11th Cir.1985). The purpose of claim preclusion is to avoid multiple suits on identical claims between the same parties. Brown v. Felsen, 442 U.S. 127, 131, 99 S.Ct. 2205, 2209, 60 L.Ed.2d 767, 771 (1979); Ray v. Tennessee Valley Authority, 677 F.2d 818, 821 (11th Cir.1982).

For the doctrine of res judicata to be properly applied, four essential elements must be present: (1) the first action must result in a final judgment on the merits, (2) the decision must be rendered by a court of competent jurisdiction, (3) the parties to both actions, or those in privity with the parties, must be identical, and (4) the causes of action in both suits must be identical. I.A. Durbin, Inc. v. Jefferson National Bank, 793 F.2d 1541, 1549 (11th Cir.1986). In Durbin, this court stated that "[t]he principal test for determining whether the causes of action are the same is whether the primary right and duty are the same in each case. [Citation omitted; footnote omitted.] In determining whether the causes of action are the same, a court must compare the substance of the two actions, not their form." I.A. Durbin, 793 F.2d at 1549. In order to invoke res judicata as a shield to the instant action, BCI and SGB, representing the interests of the M/V Antonio de Gastaneta, must show that all four of the prerequisites enumerated above have been satisfied.

BCI and SGB contend that the judgment in Maduro I constitutes a final judgment on the merits, rendered by a court of competent jurisdiction, that the parties, involved in Maduro I and Maduro II, are identical and that the cause of action in Maduro II is "a slice of Maduro I, " which has already been tried and resolved. They further contend that all the prerequisites have been satisfied and that Maduro II is barred by the judgment in Maduro I.

Applying the "primary right" test, however, we find with regard to the fourth...