FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BUNKER HOLDINGS LTD.,

Plaintiff-Appellant,

v.

YANG MING LIBERIA CORP., Owner 

of Defendant M/V YM Success,

Claimant-Appellee,

M/V YM SUCCESS (IMO 9294800), 

her tackle, boilers, apparel, 

furniture, engines, appurtenances, 

etc., in rem,

Defendant-Appellee.

No. 16-35539

D.C. No.

3:14-cv-06002-

BHS

OPINION

Appeal from the United States District Court

for the Western District of Washington

Benjamin H. Settle, District Judge, Presiding

Argued and Submitted June 14, 2018

Seattle, Washington

Filed October 11, 2018
2 BUNKER HOLDINGS V. YANG MING LIBERIA

Before: Milan D. Smith, Jr. and Paul J. Watford, Circuit 

Judges, and Douglas L. Rayes,

* District Judge.

Opinion by Judge Watford

SUMMARY**

Maritime Law

The panel affirmed the district court’s summary 

judgment against a supplier of bunkers (marine fuel) in the 

supplier’s in rem action for a maritime lien against a 

containership, and the panel reversed the district court’s 

award of costs to the vessel owner.

Assuming that United States law applies, the panel held 

that, under 46 U.S.C. § 31342(a), the bunker supplier would 

be entitled to a maritime lien if it provided necessaries to a 

vessel on the order of the owner or a person authorized by 

the owner. Agreeing with other circuits, the panel held that 

the supplier did not provide the bunkers on the order of the 

owner or a person authorized by the owner because the 

owner ordered the bunkers from a fuel broker, which 

purchased the bunkers, pursuant to a separate contract, from 

the supplier and did not act as the owner’s agent or have 

authority to bind the vessel.

 * The Honorable Douglas L. Rayes, United States District Judge for 

the District of Arizona, sitting by designation.

** This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
BUNKER HOLDINGS V. YANG MING LIBERIA 3

The panel reversed the district court’s award of costs, 

under a local rule, to the vessel owner for the cost of keeping 

in place a letter of undertaking that enabled the owner to 

secure the release of the ship, which had been arrested at the 

outset of the action. The panel held that the local rule lacked 

statutory authority because premiums paid on undertakings 

or bonds are not authorized by 28 U.S.C. § 1920 or by any 

other statute. The panel wrote that this result was 

undesirable, but a return to an earlier practice awarding such 

costs would require action by Congress or by the Supreme 

Court pursuant to its delegated rulemaking authority under 

28 U.S.C. § 1925.

COUNSEL

Briton P. Sparkman (argued) and George M. Chalos, Chalos 

& Co. P.C., Houston, Texas, for Plaintiffs-Appellants.

Barbara L. Holland (argued) and Tyler W. Arnold, Garvey 

Schubert Barer, Seattle, Washington, for ClaimantAppellee.

Erich P. Wise and Alisa Manasantivongs, Flynn Delich & 

Wise LLP, Long Beach, California; Bruce G. Paulsen,

Jeffrey M. Dine, and Brian P. Maloney, Seward & Kissell 

LLP, New York, New York; for Amicus Curiae ING Bank 

N.V.
4 BUNKER HOLDINGS V. YANG MING LIBERIA

OPINION

WATFORD, Circuit Judge:

This is an in rem action for a maritime lien brought by 

Bunker Holdings Ltd. against the containership M/V YM 

Success. Bunker Holdings supplied bunkers (marine fuel) to 

the YM Success while the ship was docked in Nakhodka, 

Russia. Under United States law, which we will assume 

applies here, Bunker Holdings is entitled to a maritime lien 

if it “provid[ed] necessaries to a vessel on the order of the 

owner or a person authorized by the owner.” 46 U.S.C. 

§ 31342(a).

Bunker Holdings provided “necessaries” to a “vessel,” 

as the statute requires, because bunkers are considered 

necessaries and the YM Success qualifies as a vessel. The 

only issue is whether Bunker Holdings provided the bunkers 

“on the order of the owner or a person authorized by the 

owner.” On cross-motions for summary judgment, the 

district court held that Bunker Holdings could not satisfy this 

last requirement. We agree with that conclusion.

The relevant facts are not in dispute. The owner of the 

YM Success, Yang Ming Liberia Corp., ordered the bunkers 

from O.W. Bunker Far East (Singapore) Pte. Ltd., which we 

will refer to as OWB Far East for short. Under the terms of 

their contract (simplified somewhat), Yang Ming agreed to 

buy 3,500 metric tons of fuel oil from OWB Far East for 

delivery to the YM Success on specified dates at a price of 

$498.00 per metric ton. The contract designated OWB Far 

East as the “seller” and Yang Ming as the “buyer.” Yang 

Ming knew that in all likelihood OWB Far East, a fuel 

broker, would not supply the bunkers itself, but it did not 

direct OWB Far East to select any particular supplier. OWB 

Far East decided to purchase the bunkers from Bunker 
BUNKER HOLDINGS V. YANG MING LIBERIA 5

Holdings, and those two companies entered into their own 

separate contract. Under the terms of their contract, Bunker 

Holdings agreed to sell 3,500 metric tons of fuel oil to OWB 

Far East at a price of $480.33 per metric ton. Bunker 

Holdings then supplied the bunkers to the YM Success and 

billed OWB Far East for payment. Shortly thereafter, OWB 

Far East filed for bankruptcy, leading Bunker Holdings to 

pursue payment through this maritime lien action against the 

ship.

These facts make clear that Bunker Holdings did not 

provide bunkers to the YM Success “on the order of the 

owner” of the vessel. Yang Ming placed its order with OWB 

Far East, not Bunker Holdings.

Because it did not provide the bunkers on the order of the 

vessel’s owner, Bunker Holdings is entitled to a maritime 

lien only if it can show that it provided the bunkers “on the 

order of . . . a person authorized by the owner.” 46 U.S.C. 

§ 31342(a). Bunker Holdings supplied the bunkers “on the 

order of” OWB Far East, so it must show that OWB Far East 

was “a person authorized by the owner” to bind the vessel. 

A separate statutory provision, § 31341(a), provides a list of 

persons who are “presumed to have authority to procure 

necessaries for a vessel” on the ship’s credit. They include 

the owner, the master, and “a person entrusted with the 

management of the vessel at the port of supply.” 

§ 31341(a)(1)–(3). OWB Far East does not fall into any of 

those categories. The statute also includes, as relevant here, 

“an agent appointed by . . . the owner.” § 31341(a)(4)(A). 

But Bunker Holdings submitted no evidence that OWB Far 

East was acting as Yang Ming’s agent when OWB Far East 

contracted with Bunker Holdings to purchase bunkers for the 

YM Success.
6 BUNKER HOLDINGS V. YANG MING LIBERIA

Unable to rely on the statutory list of persons with 

presumed authority to bind the vessel, Bunker Holdings 

grounds its claim on our decision in Marine Fuel Supply & 

Towing, Inc. v. M/V Ken Lucky, 869 F.2d 473 (9th Cir. 

1988). There, we ruled that the plaintiff was entitled to a 

maritime lien in circumstances not unlike those present in 

this case. Bulkferts, the subcharterer of the Ken Lucky, 

placed an order for bunkers with Brook Oil, which in turn 

placed an order with the plaintiff, Marine Fuel. Id. at 475. 

Marine Fuel was the entity that actually supplied the bunkers 

to the vessel. Id. We held that Marine Fuel was entitled to 

a maritime lien, but we based our holding on a critical factual 

admission made by the defendant. The defendant admitted 

that Marine Fuel sold the bunkers to Bulkferts, pursuant to 

an order originating from Bulkferts. Id. at 476–77. Based 

on that admission, we treated the case as though Bulkferts 

had ordered the bunkers directly from Marine Fuel and 

hence assumed that Marine Fuel had supplied the bunkers 

“on the order of” Bulkferts. Since Bulkferts was one of the 

entities with presumed authority to bind the vessel, see id. at 

476 & n.3, each of the statutory requirements for a maritime 

lien was satisfied. In ruling for Marine Fuel, we explicitly 

refused to consider whether Brook Oil was authorized to 

bind the ship as Bulkferts’ agent. Id. at 477.

Bunker Holdings cannot rely on our decision in Ken 

Lucky because the critical factual admission present there is 

absent here. Yang Ming never admitted that it ordered the 

bunkers from Bunker Holdings; it has asserted throughout, 

and the undisputed facts confirm, that it ordered the bunkers 

from OWB Far East. In contrast to the single transaction we 

assumed was involved in Ken Lucky, two independent 

transactions are involved in this case: one between Yang 

Ming and OWB Far East, and a second transaction between 
BUNKER HOLDINGS V. YANG MING LIBERIA 7

OWB Far East and Bunker Holdings. That key factual 

difference renders this case distinguishable from Ken Lucky.

In our view, this case is controlled not by Ken Lucky, but 

instead by our decisions in Port of Portland v. M/V Paralla, 

892 F.2d 825 (9th Cir. 1989), and Farwest Steel Corp. v. 

Barge Sea-Span 241, 828 F.2d 522 (9th Cir. 1987). In both 

of those cases, ship owners entered into contracts with 

general contractors for repair of the vessels. The general 

contractors, in the course of performing their work, 

negotiated separate agreements with subcontractors for 

certain necessaries, which the subcontractors provided to the 

vessels. We held that the subcontractors were not entitled to 

a maritime lien because they had contractual relationships 

only with the general contractors, and in most cases “a 

general contractor does not have the authority to bind a 

vessel.” Port of Portland, 892 F.2d at 828; see Farwest 

Steel, 828 F.2d at 526. There is one exception to that general 

rule, which applies when the vessel owner directs the general 

contractor to use a particular subcontractor. In that scenario, 

the general contractor essentially acts as the owner’s agent 

and thus exercises authority to bind the vessel. Farwest 

Steel, 828 F.2d at 526.

The general rule stated in Port of Portland and Farwest 

Steel governs this case because OWB Far East occupied a 

position no different from that of a general contractor. 

Under its contract with Yang Ming, OWB Far East assumed 

the obligation to supply bunkers to the YM Success. OWB 

Far East entered into a separate contract with Bunker 

Holdings to assist OWB Far East in fulfilling its own 

contractual obligations to Yang Ming. OWB Far East was 

not acting as Yang Ming’s agent and lacked authority to bind 

the vessel, so its contract with Bunker Holdings could not 

give rise to a maritime lien in Bunker Holdings’ favor. The 
8 BUNKER HOLDINGS V. YANG MING LIBERIA

exception to the general rule does not apply because Yang 

Ming did not direct or require OWB Far East to purchase the

bunkers from Bunker Holdings.

In sum, we agree with the district court’s conclusion that 

Bunker Holdings is not entitled to a maritime lien against the 

YM Success. In so holding, we join three other circuits that 

have reached the same conclusion on nearly identical facts. 

See Valero Marketing & Supply Co. v. M/V Almi Sun, 

893 F.3d 290, 294–95 (5th Cir. 2018); ING Bank N.V. v. M/V 

Temara, 892 F.3d 511, 521–22 (2d Cir. 2018); Barcliff, LLC 

v. M/V Deep Blue, 876 F.3d 1063, 1071 (11th Cir. 2017).

The one remaining issue concerns the district court’s 

award of costs. After Bunker Holdings arrested the YM 

Success at the outset of this action, the parties agreed that 

Yang Ming could secure the ship’s release by posting 

substitute security in the form of a letter of undertaking for 

$2.4 million. See 28 U.S.C. § 2464(a); Supplemental 

Admiralty and Maritime Claims Rule E(5). Yang Ming paid 

approximately $54,000 to keep the letter of undertaking in 

place during the 17 months this action remained pending in 

the district court. The court awarded Yang Ming that 

amount as a taxable cost under Rule 54(d)(3)(B) of the Local 

Rules of Civil Procedure for the Western District of 

Washington, which provides that “[r]easonable premiums 

paid on undertakings or bonds or security stipulations shall 

be allowed where the same have been furnished by reason of 

express requirement of law, rule, or court order.” The court 

viewed the cost of obtaining the letter of undertaking as 

“tantamount to a premium on an undertaking, bond, or 

security.”

Bunker Holdings argues that the costs award is invalid 

because Local Rule 54(d)(3)(B) lacks statutory 

authorization, at least as applied in admiralty and maritime 
BUNKER HOLDINGS V. YANG MING LIBERIA 9

cases. We agree with Bunker Holdings on this point. 

Federal courts may not award costs beyond those mentioned 

in 28 U.S.C. § 1920 unless another federal statute authorizes 

them to do so. West Virginia University Hospitals, Inc. v. 

Casey, 499 U.S. 83, 86 (1991); see Taniguchi v. Kan Pacific 

Saipan, Ltd., 566 U.S. 560, 573 (2012). Premiums paid on 

undertakings or bonds are not included among the six 

categories of taxable costs mentioned in § 1920. A separate 

statute, 28 U.S.C. § 1925, does authorize the Supreme Court 

to promulgate rules specifying additional categories of costs 

that may be awarded in admiralty and maritime cases. But 

thus far the Supreme Court has not issued a rule allowing a 

party to recover as a taxable cost the expenses incurred in 

posting a bond or other security under 28 U.S.C. § 2464 and 

Supplemental Rule E(5). The district court therefore lacked 

authority to award Yang Ming the costs it incurred in posting 

the letter of undertaking in this case.

Although we are constrained by precedent to rule as we 

have, this strikes us as an undesirable result. When a ship is 

arrested and held in the marshal’s custody, the marshal’s 

expenses may be taxed as costs. 28 U.S.C. § 1921(a)(1)(E). 

Posting substitute security to allow for the vessel’s release 

avoids those expenses, often at a lower cost. If the plaintiff 

can be forced to bear the marshal’s expenses when the ship 

remains in custody, a district court should have the discretion 

to award a prevailing ship owner the expenses it incurs to 

post substitute security allowing for the ship’s release. 

Courts sitting in admiralty have historically awarded such 

costs to prevailing ship owners, see, e.g., The South 

Portland, 95 F. 295, 296 (D. Wash. 1899), but that was 

before the Supreme Court held that each item of a costs 

award must be grounded on an explicit grant of statutory 

authority. A return to that earlier tradition seems warranted, 

but it will require action either by Congress or by the 
10 BUNKER HOLDINGS V. YANG MING LIBERIA

Supreme Court pursuant to its delegated rulemaking 

authority under 28 U.S.C. § 1925. Until then, we do not 

think district courts may allow prevailing ship owners to 

recover as a taxable cost the expenses incurred in posting 

substitute security, even if a local court rule purports to 

authorize such an award. Accordingly, we reverse the 

district court’s award of costs to Yang Ming.

AFFIRMED in part; REVERSED in part.

The parties shall bear their own costs on appeal.