Court Opinion

ID: 2675941
Source: CourtListenerOpinion
Date Created: 2014-05-28 15:00:58.855018+00
Date Added: 2024-06-11T09:35:16.599902
License: Public Domain

Case: 13-13508    Date Filed: 05/28/2014    Page: 1 of 8

                                                             [DO NOT PUBLISH]

               IN THE UNITED STATES COURT OF APPEALS

                       FOR THE ELEVENTH CIRCUIT
                         ________________________

                                No. 13-13508
                          ________________________

                      D.C. Docket No. 1:13-cv-21588-JLK

DAVID MIDDLETON,
d.b.a. Foodservice Specialty Marketing,
a.k.a. Specialty Marketing,

                                              Plaintiff-Counter Defendant-
                                              Appellant,

                                     versus

M/V GLORY SKY I,
a 219.8’ cargo vessel, VIN 7523996 Call Sign 3EKX4,
flying the Panamanian flag, in rem,

                                              Defendant-Counter Claimant-
                                              Appellee,

FOFO TRANSPORT INC.,

                                              Defendant-Appellee.

                          ________________________

                  Appeal from the United States District Court
                      for the Southern District of Florida
                        ________________________
                                (May 28, 2014)
                 Case: 13-13508        Date Filed: 05/28/2014       Page: 2 of 8

Before HULL, BLACK and FARRIS, * Circuit Judges.

PER CURIAM:

       This admiralty case arises from the alleged maritime conversion of 3,800

fifty-pound bags of black beans owned by David Middleton. The district court,

adopting a magistrate judge’s report and recommendation, concluded that

Middleton’s allegations did not establish a tort on navigable water and that the

court therefore lacked subject-matter jurisdiction over Middleton’s claims. Upon

review and with the benefit of oral argument, we affirm the district court’s

dismissal.

                                     I. BACKGROUND 1

       The essential facts of the case are straightforward. In August 2011, Emile

Destin agreed to store 5,500 fifty-pound bags of black beans owned by Middleton

at a warehouse Destin operated through Fo Fo Import-Export Retail, Inc. (Fo Fo

Import) in Hialeah, Florida. After a series of authorized distributions from the

warehouse, 3,800 bags remained. Then, in either October or early November

2011, Middleton learned that Destin had removed the remaining 3,800 bags and

       *
         Honorable Jerome Farris, United States Circuit Judge for the Ninth Circuit, sitting by
designation.
       1
          Because the district court resolved Middleton’s claims under the assumption that his
allegations are true, we will likewise assume the truth of Middleton’s allegations in our recitation
of the facts and in our ensuing analysis.

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intended to transport them for sale in Haiti. 2 Destin had taken the beans from the

warehouse to the M/V GLORY SKY I, a ship Destin operated through Fo Fo

Transport, Inc. (Fo Fo Transport), where it was docked on the Miami River.

Middleton met Destin aboard the GLORY SKY on November 7, 2011, and

demanded he return the beans, but Destin refused. Ultimately, the beans were

shipped to Haiti and sold to an undisclosed third party without compensation to

Middleton.

       On June 26, 2012, Middleton sued Fo Fo Import and Destin in state court for

breach of contract and civil theft, obtaining a default judgment of $228,000. On

May 3, 2013, Middleton commenced the instant action in federal court against the

GLORY SKY in rem. Middleton sought and obtained arrest of the GLORY SKY

pursuant to Rule C(3)(a)(i) of the Supplemental Rules for Admiralty or Maritime

Claims and Asset Forfeiture. The GLORY SKY responded with an emergency

motion for a hearing requiring Middleton to show cause why the court should not

vacate the arrest of the GLORY SKY for lack of subject-matter jurisdiction. On

July 14, 2013, Middleton filed an amended complaint. The magistrate judge

scheduled a hearing for July 19, 2013, but, before the hearing commenced and

       2
         Middleton’s operative complaint alleged that a Fo Fo Import employee told him they
had been taken on or about October 20, 2011, while other evidence he submitted indicates that he
learned the beans had been taken through a series of e-mails on November 3-4, 2011. For our
purposes, it makes no difference whether he learned the beans had been removed on October 20
or November 3.

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without taking any evidence, determined that even assuming Middleton could

prove all of his allegations, no maritime tort occurred. As a result, no admiralty

jurisdiction existed. The district court eventually adopted the magistrate judge’s

reasoning, vacated the arrest of the GLORY SKY, and dismissed Middleton’s

claim for lack of subject matter-jurisdiction. Middleton filed a timely appeal. 3

                                II. STANDARD OF REVIEW

       The magistrate judge issued the report and recommendation that formed the

basis of the district court’s dismissal of Middleton’s claims following a show-cause

hearing. However, the magistrate judge received no evidence and performed an

analysis functionally equivalent to review of a motion to dismiss for lack of

subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1).

Accordingly, we will treat the district court’s order as a dismissal under Rule

12(b)(1) and review it de novo. See Aqua Log, Inc. v. Lost & Abandoned Pre-Cut

Logs & Rafts of Logs, 709 F.3d 1055, 1058 (11th Cir. 2013).

                                       III. DISCUSSION

       “‘[A] party seeking to invoke federal admiralty jurisdiction . . . over a tort

claim must satisfy conditions both of location and of connection with maritime

activity.’” Doe v. Celebrity Cruises, Inc., 394 F.3d 891, 900 (11th Cir. 2004)

       3
         On December 5, 2013, this Court entered an order denying Appellees’ motion to
dismiss for lack of appellate jurisdiction and holding that the district court’s order of dismissal is
immediately appealable under 28 U.S.C. §§ 1291 and 1292(a)(3).

                                                  4
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(quoting Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S.
527, 534, 115 S. Ct. 1043, 1048 (1995)). The condition of location, which asks

whether the alleged tort occurred “on navigable water,” is at issue in this appeal.

See Broughton v. Fla. Int’l Underwriters, Inc., 139 F.3d 861, 865 (11th Cir. 1998).

       In the instant case, Middleton alleged the tort of conversion. “In the

admiralty context, as elsewhere, conversion is simply an intentional and wrongful

exercise of dominion or control over a chattel, which seriously interferes with the

owner’s rights in the chattel.” 4 Evergreen Marine Corp. v. Six Consignments of

Frozen Scallops, 4 F.3d 90, 94 (1st Cir. 1993) (emphasis removed); see also

Restatement (Second) of Torts § 222A (1965). In this context, admiralty

jurisdiction “depends on whether the [converted] chattel was ‘on navigable waters’

at the time of the alleged wrongful exercise of dominion.” Evergreen, 4 F.3d at 94.

       Destin removed Middleton’s beans from the warehouse in Hialeah without

permission and with the intent to take them to Haiti and sell them. This act

constituted a conversion because it was an unauthorized, intentional, and

substantial interference with Middleton’s ownership of the beans. See id. Because

no other acts were necessary to satisfy the elements of a conversion, Destin’s

       4
         The question whether admiralty jurisdiction applies to Middleton’s claim implicates
choice-of-law questions. See Aqua Log, 709 F.3d at 1061 (“When admiralty jurisdiction is
invoked, a uniform body of federal maritime law applies.”). However, admiralty law
occasionally analogizes and refers to principles of state law, see In re Dearborn Marine Serv.,
Inc., 499 F.2d 263, 277 n.27 (5th Cir. 1974), and the parties have not indicated, nor are we aware
of, any differences between federal law and Florida law that bear on the outcome of this appeal.

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conversion of the beans was complete at the time he first removed the beans from

the warehouse. See Wallace v. Kato, 549 U.S. 384, 388, 127 S. Ct. 1091, 1095

(2007) (“[I]t is the standard rule that accrual occurs when the plaintiff has a

complete and present cause of action.” (internal brackets and quotation marks

omitted)). Consequently, Destin converted the beans in the warehouse, not on

navigable water, and Middleton must point to some other conversion that occurred

on navigable water to establish admiralty jurisdiction.

       In the operative complaint, Middleton alleged that it was Destin’s refusal to

return the beans during the November 7, 2011, meeting aboard the GLORY SKY

that “effectively brought the vessel into the conversion.” 5 Middleton argues that

the operative conversion “took place . . . when the [GLORY SKY], through Destin,

refused Middleton’s demand to return the beans.” However, demand is not an

element of conversion, and Destin therefore did not commit a new conversion

when he refused to return the beans. See Senfeld v. Bank of N.S. Trust Co.

(Cayman) Ltd., 450 So. 2d 1157, 1161 (Fla. 3d DCA 1984) (“[W]hile a demand

and refusal constitute evidence that a conversion has occurred, it is unnecessary to

prove a demand and refusal where the conversion can be otherwise shown.”); see

also 8A Am. Jur. 2d Bailments § 74 (“[T]he elements of demand and refusal are

not required if other evidence establishes an act of conversion.”). Destin had
       5
       Middleton did not allege in his complaint, nor did he argue in his brief on appeal, that
the GLORY SKY was liable for conversion committed by Fo Fo Transport.

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               Case: 13-13508     Date Filed: 05/28/2014   Page: 7 of 8

already converted the beans when he removed them from the warehouse, and any

subsequent refusal to return them was merely a reassertion of his already-

completed conversion.

      Because Destin’s refusal established no new liability in him, there was no

maritime liability arising from this act in which the GLORY SKY could share. See

Lamb v. Interstate S.S. Co., 149 F.2d 914, 916 (6th Cir. 1945) (“It is true that the

owner of a vessel is liable in personam and the vessel is liable in rem for injuries

done to persons by the negligence of the Master or crew, but the negligence must

be such as would make the owner of the vessel under the same circumstances,

liable in a suit at common law.” (emphasis added)).

      On appeal, Middleton asserts an additional theory that the GLORY SKY

committed a new, maritime conversion when Destin loaded the converted beans

onto it. Although we readily accept Middleton’s repeated assertion of the GLORY

SKY’s separate legal identity, see Cont’l Grain Co. v. The FBL-585, 364 U.S. 19,

22-23, 80 S. Ct. 1470, 1473 (1960); Canadian Aviator v. United States, 324 U.S.
215, 224, 65 S. Ct. 639, 644 (1945), this does not mean, nor does Middleton cite

any authority establishing, that the GLORY SKY can be liable for a tort even when

its operator has not committed one. “The general rule in respect of torts committed

by the master or crew of a vessel is that, apart from the personal liability of

tortfeasors, the vessel is liable in rem . . . .” 1 Benedict on Admiralty § 176

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(Joshua S. Force ed., 7th ed. rev. 2013) (footnotes omitted) (emphasis added). The

GLORY SKY, though a separate legal entity under maritime law, see Cont’l

Grain, 364 U.S. at 22-23, 80 S. Ct. at 1473, could only act through Destin. As a

consequence, it could not re-appropriate the beans for its own purposes and thereby

commit a new conversion separate from Destin’s. Instead, by loading the beans

onto the GLORY SKY, Destin only furthered his already-completed conversion

that had taken place on land. The only acquisition of the beans with intent to

acquire a proprietary interest in them occurred at the warehouse. Thus, a new,

maritime conversion did not occur when the beans were loaded onto the GLORY

SKY. 6

                                     IV. CONCLUSION

       In light of the foregoing, we conclude that the district court did not err in

dismissing Middleton’s claims for lack of subject-matter jurisdiction. 7

       AFFIRMED.

       6
         Under Middleton’s view, conversions invariably give rise to admiralty jurisdiction if the
tortfeasor ever loads the converted property onto a ship he controls, even if this occurs long after
and far removed from the actual conversion of the property. This result undermines the situs
prong of the test for admiralty jurisdiction and uses the fictional separateness of a ship in
admiralty to expand the reach of admiralty jurisdiction to torts that are otherwise entirely land
based.
       7
          Middleton also asserted a claim under the Declaratory Judgment Act, 28 U.S.C. § 2201.
However, the Declaratory Judgment Act does not provide an independent basis for federal
jurisdiction. Provident Life & Accident Ins. Co. v. Transamerica-Occidental Life Ins. Co., 850
F.2d 1489, 1491 (11th Cir. 1988). Accordingly, the lack of subject-matter jurisdiction over
Middleton’s conversion claim requires dismissal of his declaratory-judgment claim for the same
reason.

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