Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-99-07018/USCOURTS-caDC-99-07018-0/pdf.json

Nature of Suit Code: 120
Nature of Suit: Marine Contract Actions
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 2, 1999 Decided February 11, 2000

No. 99-7017

Marina Management Services, Inc.,

and Lisa Petti Ellis,

Appellants/Cross-Appellees

v.

Vessel My Girls, and

John N. Singleton,

Appellees/Cross-Appellants

Consolidated with

No. 99-7018

Appeals from the United States District Court

for the District of Columbia

(No. 97cv00423)

Lisa P. Ellis argued the cause and filed the briefs for

appellants/cross-appellees.

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Thomas J. Whalen argued the cause and was on the briefs

for appellees/cross-appellants.

Before: Edwards, Chief Judge, Rogers and Tatel, Circuit

Judges.

Opinion for the Court filed by Circuit Judge Rogers.

Rogers, Circuit Judge: In this appeal and cross appeal

from the grant of summary judgment to Marina Management

Services, Inc., and the dismissal of John N. Singleton's counterclaims, we confront a long-pending dispute arising from

efforts to collect money due by Singleton for the lease of a

boat slip in the James Creek Marina in the Southwest

quadrant of the District of Columbia. Regrettably, various

settlement efforts did not succeed, and our review results in a

remand of the case to the district court. The district court

previously addressed Singleton's contention that the original

plaintiff, James Creek Marina, was not the real party in

interest under Fed. R. Civ. P. 17(a). James Creek Marina v.

Vessel My Girls, 964 F. Supp. 20, 21 (D.D.C. 1997). Notwithstanding the filing of an amended complaint with a new

plaintiff, Rule 17(a) concerns remain because the record does

not indicate that the new plaintiff--"Marina Management

Services, Inc., as agent for MIF Realty, LP"--is the real

party in interest or authorized to sue on behalf of the real

party in interest; hence the district court erred in dismissing

Singleton's motion to dismiss the amended complaint under

Rule 17(a). In addition, the district court's finding of a bad

faith misrepresentation by Marina Management is unsupported by evidence sufficient for imposition of a sanction of a

$20,000.00 reduction in the attorneys' fee award. Accordingly, although the district court did not err in finding that

Singleton's contract extended beyond June 1996, or abuse its

discretion in dismissing Singleton's counterclaims, we affirm

in part and reverse in part.

I.

John N. Singleton entered into an Annual Boat Storage

License Agreement ("License Agreement") to lease a slip for

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his boat at the James Creek Marina. The License Agreement, which was signed by Singleton and the manager of the

James Creek Marina, was for the period April 1, 1994 to

March 31, 1995, and was extended by the parties. Under the

License Agreement, Singleton, the Licensee, agreed to make

monthly payments of $181.50 for the boat slip, and by the

terms of s 19, upon 15 days' delinquency of a monthly

installment, he would become, at the Licensor's option, "subject to a day-to-day license at the Transient (Daily) Rate

posted in the Marina's offices, with such changes to take

effect automatically and without further notice to Licensee."

The transient rate charges were substantially higher than the

monthly payment.1 It is undisputed that Singleton became

delinquent in paying his slip fees as early as 1995.2

On March 3, 1997, the James Creek Marina filed a verified

complaint under 46 U.S.C. s 31342(a)3 for a lien against

Singleton's boat and a money judgment of $26,015.67, plus

future daily lease charges, marina fees, legal fees, and costs.

Exhibit C to the complaint reflected as of February 28, 1997,

__________

1 The transient rate is $0.75 per foot per day; because Singleton's boat is 34 feet long, his transient rate was $25.50 per day.

2 Marina Management received payments from Singleton of

$181.50 on April 16, 1994, and $800.00 on August 22, 1995. However, Marina Management asserts that when the latter payment was

made, Singleton was already in arrears of $3,989.17, and because his

one-year prepayment was put on an invalid MasterCard account, he

was "effectively in default from the first day of the [License]

Agreement," thus making transient rates applicable as of April 1,

1994.

3 Section 31342(a) provides, in relevant part:

(a) ... a person providing necessaries to a vessel on the order

of the owner or a person authorized by the owner--

(1) has a maritime lien on the vessel;

(2) may bring a civil action in rem to enforce the lien; and

(3) is not required to allege or prove in the action that credit

was given to the vessel.

46 U.S.C. s 31342(a) (1999).

both past due monthly slip fees and transient rate charges.

By ex parte order, the district court directed the arrest of

Singleton's boat. After a hearing, the court set the bond at

$20,542.67 (plus 12% for interest and court costs), "based only

upon the unpaid monthly fees and subsequent unpaid transient fees." When the district court became aware that

Exhibit C did not reflect the invoices that the marina had

actually sent to Singleton before the lawsuit was filed, the

court reduced the bond to $6,728.17 (plus 12% for interest and

court costs) and reduced the attorneys' fee award under the

License Agreement by $20,000.00 as a sanction against Marina Management for having mislead the court. In the meantime, Singleton filed five counterclaims, which the district

court dismissed as harassing and designed to delay resolution

of the litigation.

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We address in Part II, the real party in interest claim and

the contract issues, in Part III, the sanction for misleading

the court, and in Part IV, the dismissal of Singleton's counterclaims.

II.

Following the district court's ruling that the James Creek

Marina was not the real party in interest under Fed. R. Civ.

P. 17(a),4 see James Creek Marina, 964 F. Supp. at 22, an

__________

4 Rule 17(a) provides that:

Every action shall be prosecuted in the name of the real

party in interest. An executor, administrator, guardian, bailee,

trustee of an express trust, a party with whom or in whose

name a contract has been made for the benefit of another, or a

party authorized by statute may sue in that person's own name

without joining the party for whose benefit the action is

brought; and when a statute of the United States so provides,

an action for the use or benefit of another shall be brought in

the name of the United States. No action shall be dismissed

on the ground that it is not prosecuted in the name of the real

party in interest until a reasonable time has been allowed after

objection for ratification of commencement of the action by, or

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amended verified complaint was filed in which the plaintiff

was identified as "Marina Management Services, Inc., as

agent for MIF Realty, L.P., d/b/a James Creek Marina."

Singleton renewed his motion to dismiss the complaint on

several grounds. The district court denied the motion by

summary order. On cross appeal, Singleton contends that

the district court erred in denying his motion and in granting

summary judgment to Marina Management on the debt because an agent cannot sue for a disclosed principal, and there

is no evidence that MIF Realty, LP had acquired the contract

rights between Singleton and the James Creek Marina for

any preexisting debt, or that there was an outstanding contract after June 1996.

A.

Rule 17(a) protects a defendant against a subsequent claim

for the same debt underlying a previously entered judgment.

See, e.g., United Fed'n of Postal Clerks, AFL-CIO v. Watson,

409 F.2d 462, 470-71 (D.C. Cir. 1969). That understanding

was reflected in the district court's opinion addressing Singleton's motion to dismiss the original complaint under Rule

17(a). See James Creek Marina, 964 F. Supp. at 22. Although there is a lack of consensus in the case law regarding

whether an "agent" authorized to sue based solely on a power

of attorney is a real party in interest under Rule 17(a),5 the

__________

joinder or substitution of, the real party in interest; and such

ratification, joinder, or substitution shall have the same effect

as if the action had been commenced in the name of the real

party in interest.

Fed. R. Civ. P. 17(a).

5 Compare Advanced Magnetics, Inc. v. Bayfront Partners,

Inc., 106 F.3d 11, 17-18 (2d Cir. 1997); Airlines Reporting Corp. v.

S and N Travel, Inc., 857 F. Supp. 1043, 1046-47 (E.D.N.Y. 1994)

(Weinstein, J.) (citing Titus v. Wallick, 306 U.S. 282 (1939)); Corporation of the President of the Church of Jesus Christ of Latter Day

Saints v. Envtl. Protection Comm'n of Hillsborough County, 837

F. Supp. 413, 415 (M.D. Fla. 1993); Mitsui & Co. (USA), Inc. v.

Puerto Rico Water Resources Auth., 528 F. Supp. 768, 776 (D.P.R.

1981).

operative question is whether the plaintiff "possesses the

right to be enforced." Best v. Kelly, 39 F.3d 328, 329 (D.C.

Cir. 1994) (quoting Charles A. Wright, Law of Federal Courts

490 (1954)); see also Joyner v. F & B Enterprises, Inc., 448

F.2d 1185, 1186 (D.C. Cir. 1971); 6A Wright, Miller, and

Kane, Fed. Prac. and Proc. Civ.2d ss 1545, 1553.

As the caption of the amended complaint and the record

appears to show, the stakeholder vis-a-vis Singleton's boat

slip debt is MIF Realty, LP.6 Marina Management purports

only to be acting as an agent for MIF Realty, LP, which as

principal allegedly "possesses the right to be enforced."

Best, 39 F.3d at 329. Assuming MIF Realty, LP is the

stakeholder for Singleton's debt, there is nothing in the

record to show that Marina Management is authorized to

prosecute the instant lawsuit. Under the terms of a 1997

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operating agreement, MIF Realty, LP authorized Marina

Management to enforce license obligations of James Creek

Marina tenants and "at the direction of Owner take such

actions as may be necessary to effectuate Owner's rights

under any such license agreement." The operating agreement further provides that "[o]perator acknowledges that,

except as otherwise expressly provided for herein, the initiation and prosecution of lawsuits shall require the prior

__________

6 Exhibit D to Marina Management's opposition to the motion

to dismiss states the following: in 1988, the National Park Service,

which owns the James Creek Marina, and Marine Management,

Inc., entered into a concession agreement that was later assigned to

Washington, D.C. Associates ("WDCA"). Following a number of

assignments of interest in the concession agreement, and due to the

later bankruptcy of WDCA, MIF Realty, LP acquired the concession rights to the James Creek Marina in September 1996. See

infra n.7. MIF Realty, LP engaged Westrec Marina Management

to operate the marina. In February 1997, MIF Realty, LP terminated Westrec and hired Marina Management Services, Inc. to

operate the marina.

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written consent of Owner...." Id. p 2.5. The record provides no evidence of written consent by MIF Realty, LP for

Marina Management to sue Singleton for his boat slip debts.

Neither is there an affidavit from MIF Realty, LP indicating

consent or ratification of this lawsuit. See, e.g., Associated

Ins. Mgmt. Corp. v. Arkansas Gen. Agency, Inc., 149 F.3d

794, 797 (8th Cir. 1998) (citing Fed. R. Civ. P. 17(a)). Nor is

there a statement in the judgment of the district court that

would protect Singleton against a subsequent claim by MIF

Realty, LP for the debt that Marina Management seeks to

recover. Cf. Watson, 409 F.2d at 470-71.

Accordingly, we reverse the denial of Singleton's motion to

dismiss the amended complaint for noncompliance with Rule

17(a), and remand the case to allow Marina Management to

supplement the record or file a second amended complaint.

B.

Singleton also contends that the district court erred in

granting summary judgment to Marina Management on the

debt because there is no evidence that MIF Realty, LP had

acquired the contract rights for any preexisting indebtedness

for the boat slip and no evidence of an outstanding contract

between Singleton and the real party in interest after the

License Agreement expired in June 1996. Marina Management, in turn, contends that the district court erred in

denying its claim for transient rate charges. Our review of

the grant of summary judgment is de novo, viewing the

record in the light most favorable to the nonmoving party to

determine whether there is a genuine issue of material fact as

would make summary judgment inappropriate. See Aka v.

Washington Hosp. Ctr., 156 F.3d 1284, 1288 (D.C. Cir. 1998)

(en banc).

As to the past due slip fees, Singleton maintains that there

is no evidence that either Marina Management or MIF

Realty, LP was the party to whom he is indebted for the slip

fees, or that MIF Realty, LP had acquired the past debts of

the James Creek Marina. In his motion to dismiss the

amended complaint, Singleton argued that there was no evidence that MIF Realty purchased debts owed Washington,

D.C. Associates or that Washington D.C. Associates assigned

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MIF Realty, LP the rights in its contracts with Singleton. In

opposing the motion, Marina Management submitted Exhibit

D purporting to list the owners and managers of James

Creek Marina since September 1988.7 Further, Marina Management recited its efforts to provide Singleton's attorney

with direct access to documents and persons who could

review the chain of ownership. Singleton, in his response,

demanded proof that MIF Realty, LP "has the legal right to

any past obligations and current obligations" of Singleton.

The district court made no express finding that MIF

Realty, LP had acquired the marina's outstanding debts and

there are no documents in the record to substantiate the

assertions in Exhibit D. While mere allegations may be

sufficient to defeat a motion to dismiss, see Hanson v. Hoffmann, 628 F.2d 42, 43 (D.C. Cir. 1980); see also Maljack

Prods., Inc., 52 F.3d 373, 375 (D.C. Cir. 1995), summary

judgment was inappropriate in the absence of proof that MIF

Realty, LP has the right to recover debts incurred by Singleton prior to September 1996 when MIF Realty, LP obtained

the concession contract. See Crawford v. Signet Bank, 179

F.3d 926, 928 (D.C. Cir. 1999).

Singleton's contention that a second material issue of disputed fact involves whether the License Agreement was

extended beyond June 1996 fails, however. In the district

__________

7 Exhibit D states the following: Home Savings Association of

Kansas City, F.A. ("HSA"), which formerly held an interest in

WDCA's concession contract with the National Park Service as

security for a note it held on WDCA, was taken into receivership by

the Resolution Trust Corporation ("RTC"). On April 16, 1993, all of

HSA's "rights in the James Creek Marina interest" in the concession contract were assigned by the RTC to MIF Realty, LP. When

WDCA filed for bankruptcy in June 1996, MIF Realty filed a Proof

of Claim, and "[p]ursuant to a Joint Plan of Reorganization proposed by [WDCA] and MIF Realty, LP, MIF Realty [was] given

ownership ... of inter alia, the James Creek Marina interest" in

the concession contract on September 2, 1996.

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court, Singleton's attorney advised the court that the parties

had extended their agreement in June 1996. In granting

summary judgment of $7,663.21 for Marina Management, the

district court apparently relied on Singleton's attorney's oral

representation regarding the continuing viability of the Licensing Agreement after June 1996, using Singleton's statement of February 26, 1997, listing the amount of his debt.

Singleton's attorney informed this court at oral argument that

he was mistaken in representing to the district court that the

parties' agreement had been extended in June 1996. His

change of position comes too late: having conceded the fact of

extension in the district court, he cannot alter the record now.

See, e.g., United States ex rel. Yesudian v. Howard University, 153 F.3d 731, 748 (D.C. Cir. 1998) (citing Keller v. United

States, 58 F.3d 1194, 1198 n.8 (7th Cir. 1995)); United States

v. Ins. Co. of North America, 83 F.3d 1507, 1510 n.6 (D.C.

Cir. 1996); McNamara v. Miller, 269 F.2d 511, 515 (D.C. Cir.

1959).

Nevertheless, because the record does not reflect a basis on

which to conclude that MIF Realty, LP is entitled to recover

past-due amounts from Singleton for use of the James Marina

Creek boat slip, we are constrained to reverse the grant of

summary judgment. In addition, in response to Marina

Management's contention that it was entitled to recover

transient rate charges, the district court shall consider on

remand whether the plain language of the License Agreement

entitles recovery for the transient rate charges reflected in

Exhibit C. Although the district court ruled that Marina

Management had failed to exercise its option under s 19 of

the License Agreement because it had not previously billed

Singleton at the transient rate, our disposition of the sanction

based on Exhibit C to the complaint in Part III warrants that

the district court consider anew the claim for transient rate

charges based on the plain language of s 19 and the unrefuted evidence that Singleton received oral notice.

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III.

At the heart of Marina Management's appeal is its contention that the district court clearly erred in viewing Exhibit C

to the complaint--the February 28, 1997, invoice--as a misrepresentation, and thus abused its discretion by imposing a

sanction of $20,000.8 Although our review under an abuse of

discretion standard is highly deferential, see In re Holloway,

995 F.2d 1080, 1086 (D.C. Cir. 1993); Founding Church of

Scientology of Washington, D.C., Inc. v. Webster, 802 F.2d

1448, 1457 (D.C. Cir. 1986), if the district court's action is

based on a clearly erroneous finding of fact, that action is an

abuse of discretion. See Cooter & Gell v. Hartmarx Corp.,

496 U.S. 384, 405 (1990); F.J. Vollmer Co., Inc. v. Magaw,

102 F.3d 591, 596 (D.C. Cir. 1996).

The verified complaint stated that under 46 U.S.C.

s 31342(a) and the License Agreement, there was a valid

maritime lien against Singleton's boat and an in personam

contractual claim against Singleton for the unpaid costs of

"necessaries," totaling $26,015.67, as of February 28, 1997,

plus $25.50 per day for each day thereafter, plus fees, attorneys fees, and costs. Attached to the complaint was Exhibit

C, a copy of a February 28, 1997, invoice from the marina for

$22,065.67 that was sent to Singleton. The invoice reflected

eighteen monthly lump-sum charges for slip fees at the daily

transient rate from October 1995 through March 1997. The

district court issued an ex parte order for the arrest of

Singleton's boat on March 5, 1997, and, thereafter, pursuant

to Admiralty Rule E(5)(a), determined that the amount of

__________

8 In light of our disposition of the sanction, we need not address

Singleton's contention that Marina Management's counsel, Lisa

Petti Ellis, who also appeals the sanction, lacks standing to appeal

because the sanction was imposed against the client and not its

attorney. Cf. Ass'n of Am. Physicians and Surgeons v. Clinton,

187 F.3d 655, 660 n.4 (D.C. Cir. 1999).

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security that Singleton would be required to post in order to

regain possession of his boat was $20,542.67.9

Singleton moved for reconsideration of the bond amount,

arguing that, contrary to the district court's finding, Singleton

had not been billed in 1995 and thereafter for transient rate

charges, that Exhibit C was prepared for purposes of the

litigation, and that his "account history was altered to reflect

transient rates never charged to the defendant." Because the

monthly invoices sent to Singleton did not reflect transient

fees, Singleton's counsel maintained that Marina Management

"clearly intended and did in fact mislead the Court," and,

consequently, the bond calculated on the transient fees was

not in an amount of Marina Management's claim " 'fairly

stated' " under Rule E(5)(a). In response to the district

court's inquiry whether the inclusion of the transient rate

charges shown in Exhibit C represented double billing, Marina Management's attorney advised that there was no double

billing because under the Licensing Agreement, transient

charges, as reflected in Exhibit C, are over and above the

monthly rate. When Singleton's attorney objected that imposition of the transient rate charge was not in the contract and

was not a "necessary" but "a big penalty," Marina Management's attorney interjected that the transient rate was in the

License Agreement.

Agreeing with Singleton's assertions, the district court

reduced the bond to $6,728.17, based largely on a February

26, 1997, statement provided by Singleton showing the outstanding balance through March 1997 to be $5,936.17, and

__________

9 The district court initially set the bond amount based on the

monthly charge and transient rate charges over and above the

monthly fees dating back to September 1995, and other miscellaneous fees. The monthly charge consisted of the $181.50 rate in the

Licensing Agreement, which included a $16.50 credit contingent

upon Singleton's prepaying the entire amount in advance; because

he did not prepay, the monthly charge was $198.

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$792.00 in monthly slip fees of $198.00 incurred thereafter.

After issuing an order to show cause "as to why sanctions

should not be levied against plaintiff and its counsel for

having misled the Court," the district court reduced the

amount of attorney's fees to be recovered by Marina Management by $20,000. The district court found that:

The Court was misled by [Exhibit C] into believing that

transient fees actually were levied and billed to [Singleton] on the dates listed in ... [E]xhibit [C]. In addition,

this was suggested, if not argued, in papers filed with the

Court and during oral argument, and therefore was

relied upon by the Court in calculating the amount of

security.... [Marina Management] now admits that

transient fees were never charged before the start of this

litigation.... The Court was misled by the statement

[that Marina Management] provided with its Verified

Complaint and the arguments presented to it.

On appeal, Marina Management contends that there is no

evidence of intentional misrepresentation or violation of Fed.

R. Civ. P. 11,10 or any rule of professional conduct, inasmuch

as Exhibit C was a good faith interpretation of the parties'

agreement. Maintaining that it read the Licensing Agree-

__________

10 Rule 11(b) provides in pertinent part:

By presenting to the court ... a pleading ... or other paper,

an attorney ... is certifying that to the best of the person's

knowledge, information, and belief, formed after an inquiry

reasonable under the circumstances,--

...

(2) the claims ... are warranted by existing law....;

(3) the allegations and other factual contentions have evidentiary support....

Rule 11(c) provides for the imposition of sanctions for violation of

subsection (b).

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ment to allow retroactive assessment of transient rate

charges, and that, even if it erred in its reading, there was

abundant evidence of its good faith, Marina Management

relies on three facts in particular. First, Singleton was

notified by letter terminating his license effective January 31,

1997, that under District of Columbia law he was at a

minimum a hold-over tenant and the marina could charge the

transient rate for continued use and occupancy of the boat

slip. Second, the affidavit of the marina dock master, Steve

Wiltamuth, stated that Singleton was given "constant verbal

and oral notice that transient fees were going to be assessed

against him if he failed to pay his marina bill." Third, there

was other evidence that the marina had notified Singleton

prior to assessing transient fees that it was going to do so,

and that it notified Singleton's attorney of previous invoices

that did not include transient rate charges. In other words,

Marina Management maintains, the language of the Licensing

Agreement, specifically s 19, authorized retroactive transient

charges; Marina Management had exercised its option to

impose such charges, giving Singleton notice beyond that

required by s 19 itself; and Singleton's attorney could not

reasonably argue that Exhibit C represented anything other

than Marina Management's computation of its full claim in

admiralty under the parties' agreement.

Rule E for admiralty and maritime claims contemplates ex

parte proceedings for the arrest of property based on the

filing of a complaint. See Supp. R. Adm. E(2).11 Rule E(5)(a)

__________

Fed. R. Civ. P. 11 (1999).

11 Rule E(2)(a) provides:

In actions in which this rule is applicable the complaint shall

state the circumstances from which the claim arises with such

particularity that the defendant or claimant will be able, without moving for a more definite statement, to commence an

investigation of the facts and to frame a responsive pleading.

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provides that unless a bond amount is agreed to by the

parties, "the court shall fix the principal sum of the bond or

stipulation at an amount sufficient to cover the amount of the

plaintiff's claim fairly stated with accrued interest and costs;

but the principal sum shall in no event exceed (i) twice the

amount of the plaintiff's claim or (ii) the value of the property

on due appraisement, whichever is smaller."12 A person

claiming interest in arrested property is entitled to "a prompt

hearing at which the plaintiff shall be required to show why

the arrest ... should not be vacated or other relief granted...." Supp. R. Adm. E(4)(f).

The record indicates that the district court's conclusion that

it was misled was distinct from its concern about whether

__________

12 Rule E(5)(a) on specific bonds provides that arrested property may be released upon

the giving of security, to be approved by the court ... or by

stipulation of the parties, conditioned to answer the judgment

of the court or of any appellate court.... In the event of the

inability or refusal of the parties so to stipulate the court shall

fix the principal sum of the bond ... at an amount sufficient to

cover the amount of the plaintiff's claim fairly stated with

accrued interests and costs; but the principal sum shall in no

event exceed (i) twice the amount of the plaintiff's claim or (ii)

the value of the property on due appraisement, whichever is

smaller.

Rule E(5)(b) on general bonds provides that the owner:

may file a general bond or stipulation, with sufficient surety, to

be approved by the court, conditioned to answer the judgment

of such court in all or any actions that may be brought....

The rule further provides that "the execution of all such

process against such vessel shall be stayed so long as the

amount secured by such bond ... is at least double the

aggregate amount claimed by plaintiffs in all actions ... in

which such vessel has been ... arrested."

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there was double charging. Rather, that conclusion reflected

the district court's view that it was led to understand that

Exhibit C was a summary of the invoices that had actually

been sent to Singleton while he had used a boat slip at the

James Creek Marina, or as Singleton's attorney asserted,

Exhibit C purported to be the marina's "account history" with

Singleton. Upon determining that Singleton had not been

billed for transient rate charges prior to February 28, 1997

(the date of the Exhibit C invoice), the district court concluded that Exhibit C not only misstated the amount that Singleton owed but was, in effect, intentionally designed to mislead

the court. Even assuming no error in the district court's

ruling that Marina Management misinterpreted its rights

under the License Agreement, it does not necessarily follow

that Marina Management acted in bad faith with respect to

what Exhibit C represented. See Lipsig v. Nat'l Student

Mktg. Corp., 663 F.2d 178, 181 (D.C. Cir. 1980).

Viewed in the context of an admiralty proceeding, it was

incumbent on Marina Management under Rule E to state the

amount of its claim with particularity, indicating the basis for

arriving at that amount, inasmuch as Singleton and the

marina could not agree on the amount of the bond to be

posted to secure release of his boat. See Supp. R. Adm.

E(2)(a), supra n.11. Our own experience during oral argument suggests that neither counsel may have been particularly helpful in assisting the district court in understanding

Exhibit C's limited purpose in support of the claimed lien.

Be that as it may, we still do not find evidence of bad faith,

much less an intentional misrepresentation, see United States

v. Wallace, 964 F.2d 1214, 1218 (D.C. Cir. 1992) (citing

Roadway Express Inc. v. Piper, 447 U.S. 752, 767 (1980)),

about what Exhibit C purported to show.

Exhibit C is clearly labeled and dated, and referenced in

the complaint solely in connection with Marina Management's

statement of its claim under 46 U.S.C. s 31342(a) and the

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Licensing Agreement. Exhibit A to the complaint referenced

Singleton's ownership of the boat using the boat slip at the

James Creek Marina, and Exhibit B to the complaint was the

Licensing Agreement dated March 1, 1994. The four page

"Statement" in Exhibit C was addressed to Singleton from

the marina and listed the charges, payments, and balance due

as of each monthly payment date and the end of the month

from March 1994 through February 1997.

Marina Management explained in its opposition to Singleton's motion to reconsider the bond amount that although, in

the interests of trying to resolve this matter informally it had

not previously charged Singleton the transient rate, it had not

waived its right to the full amount negotiated in the Licensing

Agreement, which provided, in s 19, that such rates may be

applied "at the Licensor's option" and "without further notice

to Licensee." In Marina Management's view, the transient

rates in the License Agreement became part of the maritime

lien for "necessaries," citing Hudson Harbor 79th Street Boat

Basin, Inc. v. Sea Casa, 469 F. Supp. 987, 1979 AMC 2401

(S.D.N.Y. 1979), inasmuch as s 20 of the License Agreement

provided that the lien for necessaries shall include "all unpaid

charges."

Furthermore, Marina Management's conduct belies an intention to mislead. First, the transcript13 reveals no affirmative misstatement by Marina Management that Exhibit C was

Singleton's account history. The district court was concerned

__________

13 The only transcript in the record on appeal is for May 22,

1997, where the district court first sought to determine whether the

case could be settled. The court, having previously dismissed the

case on April 30, 1997, and having learned that settlement efforts

were unproductive, then responded to Singleton's request for release of his boat pursuant to Rule E(5)(a) & (b) and to Singleton's

motion to dismiss for failure to comply with Rule 17(a).

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about whether the Exhibit C invoice reflected double

charges--the transient rate charge in addition to the monthly

fee--for the same services. Marina Management's attorney

explained that "if the transient rate is a dollar per foot per

day and the monthly fee is $198, then obviously you subtract

that [$]198 from whatever the dollar per foot per day is."

Thereafter, the district court acknowledged that the amount

of the bond is tied to the amount of Marina Management's

claim and determined "an appropriate bond ... [based on]

what a 'necessary' is." The record on appeal reflects that

Marina Management's attorney was not asked if, and did not

volunteer that, Exhibit C was an account history.

Second, the record does not show that Marina Management

or its attorney implied that Singleton had been billed for

transient rate charges prior to February 1997. The undisputed facts that Marina Management provided Singleton's attorney with copies of the invoices sent to Singleton prior to

February 1997 and the commencement of the instant litigation, and that those invoices do not reflect transient rate

charges, are inconsistent with an intent to create the impression that such charges had been part of the regular prelitigation billing history.

Third, to the extent that Exhibit C on its face could be

mistaken for an account history, the mere appearance of

Exhibit C did not amount to an affirmative misrepresentation

in view of Marina Management's independent reason for

itemizing the amount it claimed was due and owing under

Supp. R. Adm. E(2)(a), supra n.11. Cf. Wallace, 964 F.2d at

1219-20 (quoting Restatement (Second) Torts s 500 cmt. g

(1964)). While, as a matter of prudent legal practice, Marina

Management might have better clarified precisely what Exhibit C represented, the record does not support a finding of

a bad faith misrepresentation by Marina Management or its

attorney that Singleton had been presented with invoices for

transient rate charges prior to February 28, 1997.

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Accordingly, in the absence of a factural basis for the

sanction we remand the case so that the district court may

enter an order vacating the sanction.14

IV.

On cross appeal, Singleton contends that the district court

erred in sua sponte dismissing his counterclaims as mostly

frivolous and designed primarily to harass and delay. Our

review is for abuse of discretion, see Rafferty v. NYNEX

Corp., 60 F.3d 844, 851 (D.C. Cir. 1995) (citing Cooter & Gell

v. Hartmax Corp., 496 U.S. 384, 405 (1990)), and we find

none.

In his amended answer, Singleton counterclaimed for property damage to the vessel and missing property (Counterclaim I), defamation (Counterclaim II), intentional interference with prospective contractual relations (Counterclaim

III), wrongful seizure of the vessel (Counterclaim IV), and

abuse of process (Counterclaim V). Singleton sought

$200,000.00 in damages, costs, and attorney's fees. The district court observed in dismissing the counterclaims that:

[b]oth counsel have engaged in name-calling, personal

attacks and petty arguments and have burdened the

Court with repetitions of arguments already rejected.

Defense counsel has filed counterclaims that appear frivolous and designed primarily to harass and delay a final

resolution of this case.

The district court noted that Singleton had withdrawn the

counterclaim for wrongful seizure, and that the counterclaims

__________

14 In view of our remand of the case for a determination of who

is the proper plaintiff under Rule 17(a) and an order vacating the

sanction, we do not address the merits of either Marina Management's contention that the district court erred in denying recovery

of certain fees or Singleton's contention that the amount of attorneys' fees awarded "was" excessive because a substantial amount

pertained to work associated with the sanction issue. These are

matters to be resolved on remand.

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for defamation and abuse of process were "deficient because

of their integral relationship to the legitimate pursuit by

plaintiff of this lawsuit." Viewed in the context of the conduct of both counsel, the district court concluded that "all of

the counterclaims should be seen as designed primarily to

harass," and that "all five counterclaims therefore are properly dismissed under Rule 11 of the Federal Rules of Civil

Procedure."

"[T]he central purpose of Rule 11 is to deter baseless

filings in district court and thus ... streamline the administration and procedure of the federal courts." Cooter & Gell,

496 U.S. at 393 (quoting Advisory Committee Note on Rule

11, 28 U.S.C. App. p. 576). Dismissal is a legitimate sanction

under Rule 11, see Carman v. Treat, 7 F.3d 1379, 1382 (8th

Cir. 1993); Rhineheart v. Stauffer, 638 F.2d 1169, 1171 (9th

Cir. 1979), for serious misconduct when lesser sanctions

would be ineffective or are unavailable. See Dodson v. Runyon, 86 F.3d 37, 39-40 (2d Cir. 1996); Henry v. Gill Indus.,

Inc., 983 F.2d 943, 948 (9th Cir. 1993). The record supports

the district's court's finding that the counterclaim for abuse of

process was legally deficient because of its close connection

with a good faith action for recovery of a debt. See Scott v.

District of Columbia, 101 F.3d 748, 755 (D.C. Cir. 1996);

Croixland Properties Ltd. Partnership v. Corcoran, 174 F.3d

213, 215 (D.C. Cir. 1999). So too, the district court could

reasonably conclude that Singleton's defamation claim, which

included allegations not necessarily integrally linked to the

legitimacy of the debt recovery action, nonetheless was "designed primarily to harass" in view of "the petty ... conduct

of counsel for both parties....," as were his counterclaims for

property damage and for intentional interference with contractual relations. Marina Management presented multiple

affidavits calling into serious doubt Singleton's property damage claim. Without weighing the merits, this peek at the

evidence, cf., e.g., Massachusetts School of Law at Andover,

Inc. v. United States, 118 F.3d 776, 783 (D.C. Cir. 1997); Air

Line Pilots Ass'n, Int'l v. Eastern Air Lines, Inc., 869 F.2d

1518, 1521 (D.C. Cir. 1989), confirms that given the contenUSCA Case #99-7018 Document #495796 Filed: 02/11/2000 Page 19 of 20
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tious history of this unduly prolonged litigation, see

McLaughlin v. Bradlee, 803 F.2d 1197, 1205-06 (D.C. Cir.

1986), the district court did not abuse its discretion.

Accordingly, we reverse the grant of summary judgment,

remanding Marina Management's case to the district court,

and affirm the dismissal of the counterclaims.

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