Opinion ID: 529988
Heading Depth: 2
Heading Rank: 2

Heading: The Stipulation as to Value Issue

Text: 30 Midland argues that claimant must stipulate that the $143,460.74 value placed on the ship and freight by Midland is correct and sets the ultimate limit of any monetary recovery. In support of this proposition, Midland cites to Ex parte Green, 286 U.S. 437, 52 S.Ct. 602, 76 L.Ed. 1212; Jefferson Barracks Marine Serv., Inc. v. Casey, 763 F.2d 1007 (8th Cir.1985); S & E Shipping, 678 F.2d 636; and In re Red Star Barge Line, Inc., 160 F.2d 436 (2d Cir.), cert. denied, 331 U.S. 850, 67 S.Ct. 1741, 91 L.Ed. 1859 (1947). When carefully read, however, these cases do not support Midland's contention. 31 In Ex parte Green there is a statement made that if the value of the vessel be not accepted as the limit of the owner's liability, the federal court is authorized to resume jurisdiction and dispose of the whole case. 286 U.S. at 440, 52 S.Ct. at 603. In Ex parte Green the parties stipulated in the limitation proceedings to the value of the vessel, and the quoted language refers to claimant's attempt in state court to put in issue the owner's right to limited liability. Thus, Ex parte Green presents neither the legal issue nor the factual setting with which we deal in the case at bar. 32 In S & E Shipping, we stated that a claimant must concede that the limitation fund is equal to the value of the vessel and freight.... 678 F.2d at 643 n. 13. Midland misreads this footnote to mean that a claimant must stipulate to the value of the vessel and its freight, rather than merely agreeing that whatever value may be ultimately determined sets the outer limitation of liability. 33 Jefferson Barracks is similarly unsupportive of Midland's argument. There is a quote in the case from G. Gilmore & C. Black, The Law of Admiralty (2d ed. 1975), which indicates that a claimant must concede the sufficiency of the amount stated in the stipulation of value filed by the shipowner. 7 However, this quote is part of a general review of the procedures that have historically evolved in this type of case and, not being central to the court's holding, is clearly dicta. Jefferson Barracks, 763 F.2d at 1010. More significantly, however, the stipulations filed by the claimant which the Jefferson Barracks court found to be adequate did not concede value. All the claimant conceded was the district court's right to ultimately determine the proper value of the limitation fund. 8 In In re Red Star Barge Line, the claimant did concede the value placed on the boat by the owner and this was not an issue in the case. 34 Claimant, on the other hand, has cited cases which directly support her contention that she must concede the right of the district court to determine value, but not the value itself. These cases include Anderson v. Nadon, 360 F.2d 53 (9th Cir.1956); Kattelman v. Otis Eng'g Corp., 701 F.Supp. 560 (E.D.La.1988); In re North Lubec Mfg. and Canning Co., 647 F.Supp. 1132 (D.Me.1986); and Baltimore Sports & Recreation, 1987 A.M.C. 1099, 1986 WL 15672. 9 We find it unnecessary to go into detail on the facts of the above cited cases since we are convinced that they support claimant's contentions. We are equally convinced, however, that this is an issue that has generated a good bit of needless controversy and therefore have decided to set forth a procedure which hopefully will avoid such controversies in the future. 35 Federal Rules of Civil Procedure Supplement F provides the detailed procedures for the filing of complaints and responses in connection with limitation of liability actions. The rule in F(7) provides a specific procedure for a claimant to challenge the value placed on the ship and its freight by the plaintiffs. The rule, in pertinent part, reads: 36 (7) Insufficiency of Fund or Security. Any claimant may by motion demand that the funds deposited in court or the security given by the plaintiff be increased on the ground that they are less than the value of the plaintiff's interest in the vessel and pending freight. Thereupon the court shall cause due appraisement to be made of the value of the plaintiff's interest in the vessel and pending freight; and if the court finds that the deposit or security is either insufficient or excessive it shall order its increase or reduction. 37 Although the claimant here has filed an answer pursuant to F(5), denying the value placed on the ship and its freight by the owner, the claimant has not followed the procedures outlined in F(7) and filed the type of motion that would compel the court to cause an appraisement to be made. We therefore direct that claimant is ordered to either file an F(7) motion forthwith challenging the value or concede the value placed on the vessel and its freight by Midland. If either one of these procedures is followed, the state court action may proceed. We want to make it clear, however, that if an F(7) motion is filed, we are not requiring that the state court action be stayed pending the resolution of the F(7) motion. Although we think it would be of value to both parties to know as soon as possible just what the monetary limit of liability will be, we leave the scheduling details to the good judgment of the district judge. 38 AFFIRMED AND REMANDED for further proceedings consistent with this opinion.