Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-05117/USCOURTS-cand-3_05-cv-05117-3/pdf.json

Nature of Suit Code: 120
Nature of Suit: Marine Contract Actions
Cause of Action: 28:1333 Admiralty

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United States District Court

For the Northern District of California

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

GREGER LEASING CORP., a Nevada

corporation,

Plaintiff,

 v.

Barge PT. POTRERO, official number

523213, in rem, TED BUHL and JANE

DOE BUHL, individually, and the

marital community composed thereof;

BUHL DIVING & SALVAGE, a sole

proprietorship, in personam

Defendants. 

AND ALL RELATED ACTIONS

___________________________________

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No. 05-5117 SC

ORDER RE: CLAIMANTS'

MOTION TO QUASH

ARREST OR IN THE

ALTERNATIVE FOR COSTS

SECURITY 

I. INTRODUCTION

Claimants in this case, Riverview Equipment Company LLC and

Jerico Products, Inc. ("Claimants"), filed this motion on January

13, 2005, seeking an adversary hearing pursuant to Federal Rule of

Civil Procedure Supplemental Admiralty Rule E(4)(f) ("Supplemental

Rule E(4)(f)") and Local Admiralty and Maritime Rule 4-8 (Local

Maritime Rule 4-8"). According to Claimants' moving papers and

declarations attached thereto, the adversary hearing is necessary

to determine whether Plaintiff in this case, Greger Leasing

Corporation ("Plaintiff" or "Greger Leasing"), has a valid

maritime lien on the in rem Defendant in this case, the Barge Pt.

Potrero, which was arrested by the United States Marshal Service

on December 14, 2005. The arrest was conducted pursuant to an

Case 3:05-cv-05117-SC Document 41 Filed 01/23/06 Page 1 of 5
United States District Court

For the Northern District of California

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1

 Plaintiff has also objected to Claimants' filings because,

he asserts, the documents exceed the 25-page limit established by

the Civil Local Rules. However, the Court notes that the 25-page

limit applies to the memorandum of points and authorities filed in

support of or in opposition to a motion, and does not limit the

length of documentation filed in support of the memorandum, such as

declarations or affidavits. See Local Rules 7-2, 7-3, 7-4, & 7-5. 

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Order of this Court that was issued following the filing of a

verified complaint and appropriate motions on December 12, 2005. 

Claimants now assert that Plaintiff does not have and never

had a valid maritime lien on the Barge Pt. Potrero, and, on that

basis, have requested an adversary hearing to prove their claim

and have the arrest quashed. See Docket #25. In the alternative,

Claimants request that the Court order Plaintiff to post a bond in

an amount greater than or equal to $25,000.00, because, Claimants

assert, Plaintiff is a newly-formed, out-of-state corporation that

allegedly does not maintain a substantive presence in the state of

California, and is therefore a threat to avoid satisfying whatever

financial obligations it might incur in connection with the

instant dispute, including any damage caused to the Barge or the

Haystack Bridge in which the Barge became lodged during the arrest

and attempted transfer of the vessel to Pier 50 in San Francisco. 

Id. Claimants assert that they are entitled to a hearing upon

three days notice to Plaintiff pursuant to Supplemental Rule

E(4)(f) and Local Maritime Rule 4-8. 

Plaintiff has raised substantive and procedural objections to

Claimants' motion, asserting that Plaintiff does have a valid lien

on the Barge;1

 that he is not estopped from claiming such a lien;

that Claimants waived their opportunity to request an adversary

Case 3:05-cv-05117-SC Document 41 Filed 01/23/06 Page 2 of 5
United States District Court

For the Northern District of California

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hearing by failing to raise the issue at either of several postarrest proceedings before the Court; and that, in any event,

Supplemental Rule E(4)(f) does not contemplate an adversary

hearing one month after arrest of a vessel. See Docket # 32.

II. DISCUSSION

Supplemental Rule E(4)(f) provides that "[w]henever property

is arrested or attached, any person claiming an interest in it

shall be entitled to a prompt hearing at which the plaintiff shall

be required to show why the arrest or attachment should not be

vacated or other relief granted consistent with these rules." 

Local Maritime Rule 4-8 provides that the adversary hearing called

for in Supplemental Rule E(4)(f) "shall be conducted upon 3 days

written notice to plaintiff, unless otherwise ordered." 

Although neither rule nor the sparse case law applying the

rules indicates that a party waives its right to an adversary

hearing by failing to request one immediately after the arrest,

the Advisory Committee notes to the 1985 Amendment to Supplemental

Rule E(4)(f) indicate that the rule was implemented in order to

"satisfy the constitutional requirement of due process by

guaranteeing to the shipowner a prompt post-seizure hearing...."

(emphasis added). The wording of this explanatory sentence

indicates that the word "prompt" is meant to describe the temporal

interval between the arrest and the hearing, rather than the

interval between the motion for the hearing and the hearing

itself. Similarly, a review of the several reported cases that

have involved adversary hearings under Supplemental Rule (E)(4)(f)

indicates that such hearings generally take place within several

Case 3:05-cv-05117-SC Document 41 Filed 01/23/06 Page 3 of 5
United States District Court

For the Northern District of California

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days of the arrest. See Marubeni America Corp. v. M/V Unity, 802

F. Supp. 1353 (D. Md. 1992); see also Erne Shipping Inc. v. HBC

Hamburg Bulk Carriers GmbH & Co. KG, ___ F. Supp. 2d ___, 2006 WL

52713 (S.D.N.Y. 2006). 

Although Local Maritime Rule 4-8 provides for an adversary

hearing "upon 3 days written notice to plaintiff," the rule

specifically references the "adversary hearing following

arrest...that is called for in...Rule E(4)(f)." Thus, if the

adversary hearing contemplated by Rule E(4)(f) is to be held

promptly after arrest, the three-day notice period described by

Local Maritime Rule 4-8 merely quantifies what "prompt" means in

this District. But where E(4)(f) is rendered inapplicable by the

passage of over a month's time, so too is Local Maritime Rule 4-8

and its notice provisions.

In any event, and as an alternative basis for sustaining the

Court's ruling, Local Maritime Rule 4-8 provides that the Court

may order an alternative notice period to the three days set forth

in the Rule. Because the Court finds that Claimants have raised

several different arguments that may be dispositive of the rights

and obligations of both Plaintiff and Claimants, the Court finds

that it would be unwise to rule on such issues absent a full

briefing schedule. 

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Case 3:05-cv-05117-SC Document 41 Filed 01/23/06 Page 4 of 5
United States District Court

For the Northern District of California

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III. CONCLUSION

Accordingly, Claimants' motion is DENIED. The Court will

grant the parties leave to renotice and refile their motion in

compliance with the Local Rules governing noticing and filing of

motions. 

 

IT IS SO ORDERED.

Dated: January 23, 2006

 

UNITED STATES DISTRICT JUDGE

Case 3:05-cv-05117-SC Document 41 Filed 01/23/06 Page 5 of 5