The HONORABLE MICHAEL J. DAVIS, United States District Judge for * the District of Minnesota, sitting by designation. -1- 

## United States Court of Appeals FOR THE EIGHTH CIRCUIT

____________ No. 97-2512

____________ American Home Assurance Company, * *

Plaintiff-Appellant * * v. * * L & L Marine Service, Inc., * Appeal from the United * States District Court for Defendant, * the Eastern District of * Missouri. Insurance Company of North America, * * Garnishee, * * American Steamship Owners Mutual * Protection and Indemnity Association, * Inc., * * Garnishee-Appellees. *

____________ Submitted: February 11, 1998 Filed: August 11, 1998

____________ Before McMILLIAN and HANSEN, Circuit Judges, and DAVIS, District Judge. *The Honorable George F. Gunn, Jr., late a United States District Judge for 1 the Eastern District of Missouri. -2- ____________ DAVIS, District Judge. American Home Assurance Company appeals the judgment of the district court 1 dismissing its writ of execution and summons of garnishment against America n Steamship Owners Mutual Protection. We affirm.
BACKGROUND This case arises from the grounding of the tug Maya and the barge Apex C hicago off the coast o f Massachusetts. The facts of this case can be found as stated in th e underlying action, American Home Assurance Co. v. L&L Marine Service , 875 F.2d 1351, 1352 (8th Cir. 1989). In October 1981, the tug was towing the barge fro m Car teret, New Jersey to Boston, Massachusetts, carrying a cargo of 1.76 millio n gallons of gasoline owned by Apex Oil. Both the tug and barge were ow ned by Central Barge & Boat Co., wh ich chartered them to Apex R.E. & T. Inc. (“Apex Towing”), a sub sidiary of Apex Oil. Pursuant to an agreement with Apex Towing, L&L Marin e provided the crew to operate the tug Maya. Despite war

nings of inclement weather, the crew of the Maya continued for its destination. Eventually, the tow cable broke but the crew of the Maya did not discover that the bar ge had come adrift until 30 minutes later because of the intensity of th e storm. When the Maya went back to retrieve the barge, it was aground and leakin g gasoline t hrough a gash in its hull. In attempting to pull the barge from the rocks, the Maya backed into its bow thus further damaging the barge. The Maya eventually lost control and was stranded with the barge. With the assistance of others, both the tu g andbarge were eventually freed and the cargo of gasoline was transferred to another barge for completion of the voyage. 875 F.2d at 1353.-3-

Both Ap ex Towing and Apex Oil were insured for this voyage b y Plaintiff/Appellant American Home Assurance Co. (“American Home”), whic h subse quently paid almost $200,000 in claims relating to the accident, including th e amount of gasoline lost in the accident, cleanup costs, the cost of repairing the barge, and costs incurred in transferring the o il for completion of the voyage. As subrogee of Apex Towi ng and Apex Oil, American Home filed suit against L&L Marine for th e allegedly neg ligent operation of the Maya by L&L Marine’s crew. In that underlying suit, the district court found and this Court affirmed that the accident was cause d equa llyby the negligent navigation of the Maya by L&L Marine’s crew and by th e unseaw orthy condition of the tug provided by Apex Towing. American Home wa s ultimately awarded judgment f or one-half of the sum of provable damages, which was calculated to be $103,463.61. However, at the commencement of the suit, L& L Marine was and remains insolvent.

To collect on its judgment awarded in the underlying action, American Hom e subseque ntly brought a writ of execution and summons of garnishment agains t Garnishees American Steamship Owners Mutual Protection and Indemnity Association (“Amer ican Steamship”) and Insurance Company of North American (“INA”) a s insurers of L&L Marine under maritime protection and indem nity policies of insurance. Fed. R. Civ. P. 69(a). In April 1997, the district court dismissed this action agains t Defendants. Pursuant to admiralty jurisdiction, the district court applied federal choice of law rules to determine which state’s substa ntive law governed the maritime contract at iss ue. The district court concluded that New York law governed and the actio n against American Steamship should be dismissed because New York law prohibits a dire ctaction against a marine insurer. Although the district court also dismissed th e action against INA, American Home appeals the dismissal of American Steamship only and does not challenge the dismissal of INA on appeal. DISCUSSION This Court reviews a district court’s choice of law determination de novo

. No rthwest Airlines v. Astraea Aviation Services, Inc. , 111 F.3d 1386, 1392 (8th Cir.-4-

1997); Horn v. B.A.S.S. , 92 F.3d 609, 611 (8th Cir. 1996). The parties do not dispute the district court’s determination that it had admiralty jurisdiction over the case and that federal choice of law rules determine which state’s substantive law should apply to the maritime contract. Aqua- Marine Constructors, Inc.
v. Banks , 110 F.3d 663, 670 (9th Cir. 1997), cert. denied, 118 S.Ct. 339 (1997)

. Unde r federal choice of law rules, courts determine which state’s law applies t o maritimecontracts by “ascertaining and valuing points of contact between th e transactio n

[giving rise to the cause of action] and the states or governments whos e competing laws are involved.” Advani Enterprises , Inc. v. Underwriters at Lloyds , 140 F.3d 157, 162 (2nd Cir. 1998) (quoting Lauritzen v. Larsen , 345 U.S. 571, 58 2 (1953)).
The p arties agree that the “most significant relationship” test established i n Restatem ent

(Second) of Conflict of Laws § 188 provides the modern analysis as t o whichcontacts should be taken into account. Advani Enterprises , Inc. , 140 F.3d at 162; Aqua-Marine Constructors, Inc. , 110 F.3d at 674. The sole dispute at issue in this
case is whether consideration of those factors mandates application of New York o r Missouri law. In relevant part, Restatement § 188 provides as follows:

In the absence of an effective choice of law by the parties, th e contacts to be taken into account in applying the principles of § 6 t o determine the law applicable to an issue include: (a) the place of contracting, (b) the place of negotiation of the contract, (c) the place of performance, (d) the location of the subject matter of the contract, and (e) the domicil, residence, nationality, place of incorporation and-5- place of business of the parties. These contacts are to be evaluated according to their relativ e importance with respect to the particular issue. Restatement (Second) of Conflict of Laws § 188(2) (1971). American Home, a New York corporation, seeks to recov er its judgment against L&L M arine, a Missouri corporation, from American Steamship, a New York cor poration and indemnity insurer of L&L Marine. Thus, the dispute in this action is between American Home, a New York corporation, and American Steamship, also a New York corporation.
Amer ican Home argues that consideration of the Restatement factors require s application of Missouri law in this case. American Home asserts that both L&L Marine and A pex Towing are Missouri residents for whose benefit the insurance contract a t issue was procured. However, because neither L & L Marine nor Apex Towing ar e parties to the present action, we conclude that thei r place of residence is not significant in our choice of law analysis. American Home further asserts that Missouri has the greater interest in applying its law bec ause of its significant interest in protecting its citizens, residents, an d
co rporations. American Home primarily relies on Aqua-Marine Constructors t o support its position. In that case, an Oregon resident and owner of a barge sued i n Oregon to recover under a performance bond and the court considered which state’s law s hould apply. The court found that California, Oregon, Washington, and Cost a Rica all had significant contacts with the performance bond: the bond was issued by
a C osta Rican resident, the bond was executed in California, the party for whos e benefit the bond was executed was an Oregon resident, and the vessel covered by the performance bond was to be redelivered in Washington. 110 F.3d at 674-75. The court concluded that Oregon had a considerably greater interest in the-6-

application of its law because of its strong interest in the protection of its citizen s against th e insolvency of a foreign insurer. In regards to the other locales, the court noted that no citizen of Washington was a party to or beneficiary of the contract a t issue , California’s citizen elected not to defend himself and default judgment wa s enter ed against him, and Costa Rica’s citizen never argued that the law of its stat e should apply. Id.
However, Aqua-Marine

is dist inguishable from this case on the basis that in this action, no Miss ouri resident is seeking to enforce its rights under the policy in thi s case. Thus, application of Missouri law would not further the interests of that state

. AmericanHome contends that the mere fact that L&L Marine is a party to the policy at issue is sufficient to consider its state of residence in this Court’s choice of la w analysis. In support of such conte ntion, American Home relies on Ahmed v. American Steam ship Owners Mutual Protection & Indemnity Association , 444 F.Supp. 56 9 (N.D.Cal. 1978). In Ahmed , injured seamen obtained default judgments against their emp loyers for personal injuries and subsequently sought recovery from the insuranc e carrier of the employers. In that case , the employers and the insurer all resided in New Yor k and the contract at issue was negotiated and performed in New York. Thus , co ntrary to American Home’s assertion, the residency of the insured was not a significant factor in Ahmed

. American Home argues t

hat as subrogee of Apex Oil, it is entitled to enforce all the rights of Apex Oil, including the protection of Missouri law. However, American Home has failed to show that Apex Oil is entitled to the application of Missouri law in this c ase. Even taking into account that Apex Oil is a Missouri resident, we conclude that consideration of the Restatement factors weighs in favor of a pplying New York law in this case. Under the remaining Restateme nt factors, American Home does not dispute that the placeof contracting, negotiation, and performance of the contract were all in New-7-

York. Furthermore, as the lower court noted, New York has a significant interest i n protecting its maritime insurance industry from third party contract claims. Although Missouri ha s a similar interest in protecting its corporations, that interest is no t compellin g in this case because there is no Missouri resident seeking to enforce th e terms of the policy.

Restatem ent

(Second) of Conflict of Laws § 188(3) (1971) provides furthe r sup port for the district court’s determination that New York law governs this case

. Un der that provision, if the contract at issue was negotiated in the same state as th e place of performance, the law of that state will usually appl y. American Home does not dispute that the contract was ne gotiated and to be performed in New York. Therefore, section 188(3) provides that New York law should apply.
Ame rican Home does not dispute that under New York law, it is barred fro m bringing a direct action against American S teamship. Therefore, we affirm the order of the district court dismi ssing the writ of execution and summons of garnishment against American Steamship. A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.