Court Opinion

ID: 1029849
Source: CourtListenerOpinion
Date Created: 2013-07-05 08:04:46.65672+00
Date Added: 2024-06-11T12:36:30.422835
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                              No. 07-1957

BUNKER HOLDINGS, LTD.,

                Intervenor/Plaintiff - Appellant,

          and

TRITON MARINE FUELS LTD., S.A.; BRIDGE OIL, LTD.,

                Plaintiffs,

          and

CRESCENT TOWING AND SALVAGE COMPANY, INC.; COOPER/T. SMITH
MOORING; CANTON PORT SERVICES LLC; ISS MARINE SERVICES,
INC., d/b/a Inchcape Shipping Services,

                Intervenors/Plaintiffs,

          v.

GREEN PACIFIC A/S,

                Defendant – Appellee,

          and

M/V PACIFIC CHUKOTKA, apparel, freights, etc., IMO No.
8800224; EMERALD REEFER LINES, LTD.; EMERALD REEFER LINES,
LLC; INTERTRANSPORT CO., LLC; INTERTRANSPORT, LTD.,

                Defendants,

          and

THE MASTER OF THE M/V PACIFIC CHUKOTKA,

                Garnishee.
Appeal from the United States District Court for the District of
Maryland, at Baltimore.     J. Frederick Motz, District Judge.
(1:06-cv-03346-JFM)

Argued:   May 12, 2009                  Decided:   August 28, 2009

Before SHEDD, Circuit Judge, Joseph F. ANDERSON, Jr., United
States District Judge for the District of South Carolina,
sitting by designation, and Martin K. REIDINGER, United States
District Judge for the Western District of North Carolina,
sitting by designation.

Affirmed by unpublished per curiam opinion.

John Stephen Simms, SIMMS & SHOWERS, LLP, Baltimore, Maryland,
for Appellant. David W. Skeen, WRIGHT, CONSTABLE & SKEEN, LLP,
Baltimore, Maryland, for Appellee.

Unpublished opinions are not binding precedent in this circuit.

                                2
PER CURIAM:

       In     this    maritime     action,       Bunker   Holdings,        Ltd.    (“Bunker

Holdings”) asserts in personam claims of conversion and unjust

enrichment against Green Pacific A/S (“Green Pacific”), arising

out of the consumption of fuel oil by Green Pacific’s vessel,

the M/V PACIFIC CHUKOTKA (“PACIFIC CHUKOTKA” or “Vessel”).                                The

district court granted Green Pacific summary judgment, holding

that    the    contracts        between    Bunker      Holdings      and   the     Vessel’s

charterer, pursuant to which Bunker Holdings supplied the fuel

bunkers to the Vessel, called for the application of Greek law,

and    that    Bunker        Holdings    had     failed   to    show    that      Greek   law

recognized such claims.

       Bunker Holdings appeals, arguing that the Greek choice-of-

law    provisions        in     the     supply      contracts     with     the     Vessel’s

charterer       do     not     control    Bunker      Holdings’        extra-contractual

claims      against      the    Vessel’s       owner,     Green      Pacific.        Bunker

Holdings further contends that had the district court applied

traditional          maritime    choice-of-law        rules     to     Bunker     Holdings’

claims, the district court would have found that Russian law

governs this action.            For the following reasons, we affirm.

                                               I.

       Bunker Holdings is a Cypriot corporation that sells marine

fuel (“bunkers”).             Green Pacific is a Norwegian corporation and,

                                               3
at all times relevant to this litigation, was the owner of the

Vessel.

      In December 2005, Green Pacific leased the Vessel under a

bareboat        charter 1      to          Intertransport      Company          LLC

(“Intertransport”), a Russian company with its principal place

of   business   in   Vladivostok,         Russia.   On   September     28,   2006,

Intertransport sent an e-mail to Bunker Holdings requesting a

quote for a purchase of bunkers.               On September 29, 2006, Bunker

Holdings replied by e-mail (“Bunker Confirmation”), confirming

Intertransport’s      order.        The    Bunker   Confirmation      contains   a

choice-of-law provision, which states as follows:

      BUYERS ACCEPT AND AGREE THAT THIS AGREEMENT, FOR ANY
      DISPUTES ARISING HEREIN IS SUBJECT TO GREEK LAW AND
      THE EXCLUSIVE JURISDICTION OF THE COURTS OF PIRAEUS.

(J.A. 193).      The bunker transaction was also subject to Bunker

Holdings’   “Standard       Terms   and     Conditions   for   Sale    of    Marine

Bunker Fuels, Lubricants and Other Products,” which provides, in

pertinent part, as follows:

      The Agreement is subject to the law and jurisdiction
      of the courts of Greece.  So whoever that nothing in
      this clause shall, in the event of a breach of the
      Agreement by the Customer, preclude the Company from
      taking any such actions as it shall in its absolute

      1
       Under a bareboat charter, also known as a demise charter,
“the shipowner surrenders possession and control of the vessel
to the charterer, who then succeeds to many of the shipowner’s
rights and obligations.”    Black’s Law Dictionary 250 (8th ed.
2004).

                                           4
      discretion consider it necessary to enforce, safeguard
      or secure its rights under the Agreement in any Court
      or tribunal or any state or country.

(J.A.   206).      On    October    5,    2006,   Bunker     Holdings     confirmed

delivery of the bunkers to the Vessel in St. Petersburg, Russia.

Thereafter, Bunker Holdings sent an invoice to Intertransport

requesting payment for the bunkers by December 4, 2006.

      On November 16, 2006, similar e-mail communications between

Bunker Holdings and Intertransport confirmed a second sale of

bunkers to be delivered to the Vessel in St. Petersburg, Russia.

The   confirmation       terms    were    identical     to   the    terms    of   the

October 5, 2006 transaction, including the Greek choice-of-law

clause.     This    second       transaction      was   also   governed      by   the

Standard Terms and Conditions, which included a Greek choice-of-

law provision.       On November 25, 2006 Bunker Holdings confirmed

delivery of this second set of bunkers to the Vessel in St.

Petersburg, Russia, and an invoice was sent to Intertransport

requesting payment for the fuel.              Intertransport never paid for

either bunker delivery.

      In December 2006, the PACIFIC CHUKOTKA was arrested in the

Port of Baltimore pursuant to a complaint filed by another fuel

supplier, Triton Marine Fuels Ltd.                Bunker Holdings intervened

in that action to assert claims against the charterer and sub-

charterer   of     the   Vessel     for   their    failure     to   pay     for   the

bunkers.    Bunker Holdings subsequently amended its complaint to

                                          5
assert in personam claims against Green Pacific as the Vessel’s

owner.       This     amended     complaint,       without     reference      to    the

applicable law, asserts in personam claims of conversion and

unjust    enrichment       against      Green    Pacific    arising     out   of    the

consumption of the fuel oil by the Vessel between October 5,

2006 and the date of the Vessel’s arrest.                     As part of its in

personam action, Bunker Holdings attached the Vessel as property

of Green Pacific, pursuant to Rule B of the Supplemental Rules

for Admiralty or Maritime Claims and Asset Forfeiture Actions.

      Green Pacific moved to vacate Bunker Holdings’ attachment

and to dismiss Bunker Holdings’ in personam claims under federal

maritime law. 2       In response to Green Pacific’s motion to vacate,

Bunker Holdings stated for the first time its position that its

claims were made under Russian maritime law, and it submitted

the   affidavits      of   three       Russian   lawyers     in     support   of    its

contention that Russian maritime law allows recovery on these

facts     under   a   theory      of    unjust    enrichment.         Following     an

expedited    hearing, 3     the    district      court     denied    the   motion    to

      2
       In its motion to vacate, Green Pacific noted in passing
that the Standard Terms and Conditions contained a Greek choice-
of-law provision, but denied the application of such provision
to the present claims, noting that this agreement was only
between Bunker Holdings and Intertransport, not Green Pacific.
      3
       In its brief, Green Pacific discusses several arguments
advanced by counsel as well as oral findings made by the
(Continued)
                                           6
vacate, and Green Pacific posted security to obtain the release

of the Vessel.

       Thereafter,        Green     Pacific       filed    a   motion      for    summary

judgment, arguing that Bunker Holdings was bound by its choice

of    Greek    law   and     that    in     the     absence    of    any   support       for

liability      under      Greek    law,    Bunker     Holdings’      claims      based    on

Russian      law   must    be     dismissed.         In   opposing    Green      Pacific’s

motion, Bunker Holdings again relied upon Russian maritime law

in support of its claims.

       The    district       court        entered     an    order     granting          Green

Pacific’s motion for summary judgment.                     In a letter to counsel 4 ,

the    district      court      explained      its    ruling,       holding      that    the

contractual choice of Greek law was enforceable and that Bunker

Holdings had failed to show the viability of its claims under

Greek law.

district   court  during these                    emergency  proceedings.                 No
transcript of this proceeding,                    however, is contained in               the
record on appeal.
       4
       The district court’s order does not set out the reasons
for its ruling. Those reasons are set out only in the informal
letter to counsel, which has been included in the record. (J.A.
401-05).

                                             7
                                         II.

         We review the district court’s grant of summary judgment

de novo, applying the same standards as those applied by the

district court.       Catawba Indian Tribe of S.C. v. City of Rock

Hill, 501 F.3d 368, 370-71 (4th Cir. 2007).                      Summary judgment is

proper “if the pleadings, the discovery and disclosure materials

on file, and any affidavits show that there is no genuine issue

as to any material fact and that the movant is entitled to

judgment as a matter of law.”            Fed. R. Civ. P. 56(c).

                                         III.

                                             A.

       We begin our analysis by determining whether the choice-of-

law    provisions     set       forth   in        the     contracts    between      Bunker

Holdings and Intertransport are enforceable.                     In determining the

enforceability      of      a     choice-of-law           provision,        we    look   to

principles of federal maritime law.                     See generally M/S Bremen v.

Zapata Off-Shore Co., 407 U.S. 1 (1972); Richards v. Lloyd’s of

London, 135 F.3d 1289, 1292-93 (9th Cir. 1998) (en banc); but

see Trans-Tec Asia v. M/V HARMONY CONTAINER, 518 F.3d 1120, 1124

(9th   Cir.)   (applying         traditional        choice-of-law       principles       to

determine which country’s law determines the validity of choice-

of-law    provision    in       contract),        cert.    denied,    129    S.   Ct.    628

(2008).

                                             8
       It is well-settled under United States law that absent a

compelling reason of public policy, a freely negotiated choice-

of-law clause in a maritime contract should be enforced.                            See

Bremen, 407 U.S. at 12-13 (“There are compelling reasons why a

freely negotiated private international agreement, unaffected by

fraud, undue influence, or overweening bargaining power, such as

that involved here, should be given full effect.”); Lauritzen v.

Larsen, 345 U.S. 571, 588-89 (1953) (“Except as forbidden by

some public policy, the tendency of the law is to apply in

contract matters the law which the parties intended to apply.”);

Bominflot, Inc. v. M/V HENRICH S, 465 F.3d 144, 148 (4th Cir.

2006) (“Because no ‘other law’ is specified on the face of the

contract, and public policy does not counsel against it, we will

respect    the    parties’        intentions       and    apply    English      law.”);

Hawkspere Shipping Co. v. Intamex, S.A., 330 F.3d 225, 233 (4th

Cir.   2003)     (“Where    the    parties       specify    in    their   contractual

agreement which law will apply, admiralty courts will generally

give    effect     to      that     choice.”)       (quoting       Chan    v.     Soc’y

Expeditions, Inc., 123 F.3d 1287, 1297 (9th Cir. 1997)).

       In the present case, Bunker Holdings drafted the terms and

conditions     which    governed      the       bunkers    transactions,     and    its

deliberate inclusion of a Greek choice-of-law provision both in

the Bunker Confirmation and the Standard Terms and Conditions

reflects Bunker Holdings’ intent that the parties’ transactions

                                            9
would   be   governed       by     Greek    law.         Bunker      Holdings         has   not

demonstrated any compelling public policy that would prevent the

enforceability       of    the   choice-of-law          provisions         in    the    supply

contracts, nor has Bunker Holdings shown that any fundamental

unfairness     would        result        from     enforcing             the     provisions.

Accordingly, we conclude that the district court was correct in

holding that the Greek choice-of-law provisions are enforceable

in this case.

                                            B.

     Having    determined          that    the    choice-of-law           provisions        are

enforceable,      questions         still       remain    as        to    whether        Bunker

Holdings’ in personam claims of conversion and unjust enrichment

against Green Pacific fall within the scope of these provisions,

and whether such claims are viable under Greek law.

     Bunker Holdings contends that because Green Pacific was not

a   party    to      the    agreements,          the     choice-of-law           provisions

contained therein are not applicable to its in personam claims

asserted     against       Green     Pacific.           The    Bunker          Confirmation,

however,     indicates       that    Bunker       Holdings      intended          for    Green

Pacific to be a party to the transaction, as Bunker Holdings

identified    the     “buyer”       of    the    bunkers       as    the       “M/V     PACIFIC

CHUKOTKA       AND         JOINTLY         AND      SEVERALLY             OWNERS/MANAGING

OWNERS/OPERATORS          MANAGERS/DISPONENT           OWNERS/CHARTERS           AND    VESSEL

                                            10
IN    REM   AND    INTERTRANSPORT           CO.,    LLC.”     (J.A.     197)     (emphasis

added).      The Bunker Confirmation further provides that “MERE

RECEIPT      OF      THIS        CONFIRMATION         SIGNIFIES        ACCEPTANCE           OF

RESPONSIBILITY FOR PAYMENT OF OUR BUNKER INVOICE BY EACH AND ALL

OF THEM.”         (Id.).       Having sought to bind Green Pacific to the

supply contract, Bunker Holdings cannot now be heard to claim

that the provisions of that contract should not be enforced as

to its claims against Green Pacific.                      Bunker Holdings’ argument,

therefore, must be rejected.

       Bunker Holdings further contends that even if these choice-

of-law provisions are enforceable with respect to Green Pacific,

the    provisions         do    not     encompass         Bunker     Holdings’        extra-

contractual claims.             The scope of the choice-of-law provisions,

however,     being    a    matter      of     contract      interpretation,          must   be

determined by the law of the state chosen by the parties in the

contract.         See Milanovich v. Costa Crociere, S.p.A., 954 F.2d

763, 767 (D.C. Cir. 1992) (“If the choice-of-law provision is

enforceable, we will use the law that it selects to evaluate the

enforceability        of       the    remainder      of     the     contract     terms.”);

Siegelman v. Cunard White Star, 221 F.2d 189, 193 (2d Cir. 1955)

(examining        United    States      law    to    determine       enforceability         of

English choice-of-law provision, then applying English law to

interpret     contract          provision      limiting       the    time      for    suit);

Jansson v. Swedish Am. Line Ltd., 185 F.2d 212, 218 (1st Cir.

                                              11
1950)        (“when      the     parties    contract    with     the   law     of   some

particular jurisdiction in view, the law of that jurisdiction

will        be    applicable       in    determining     the     interpretation      and

validity of the contract”); Odin Shipping Ltd. v. Drive Ocean V

MV, No. 98-56794, 2000 WL 576436, at *1 (9th Cir. May 11, 2000)

(applying law selected in choice-of-law provision to determine

whether          asserted   tort    claims    arise    within    the   scope   of   said

provision).             Accordingly, whether the choice-of-law provisions

encompass the non-contractual claims asserted by Bunker Holdings

against Green Pacific is an issue that must be determined under

Greek law.

        On       this   point,     however,   Bunker    Holdings’      argument     must

fail.        Bunker Holdings has presented nothing to establish what

the relevant Greek law is or whether it would serve to preclude

the    application          of   the    parties’   contractual     choice-of-law      to

Bunker Holdings’ extra-contractual claims.                      It was due to Bunker

Holdings’ lack of proof on this issue that the district court

granted summary judgment to Green Pacific.                        On appeal, Bunker

Holdings does not challenge the district court’s conclusion in

this regard. 5          Having failed to address this issue in its opening

        5
      In its opening appellate brief, Bunker Holdings maintains
that the district court erred in failing to conduct a Lauritzen
analysis to determine the appropriate law to apply to Bunker
Holdings’ claims against Green Pacific.   In a footnote, Bunker
Holdings contends that the district court “compounded its error
(Continued)
                                              12
appellate brief, we consider Bunker Holdings to have abandoned

this issue on appeal, and we therefore will not further consider

it.   See Edwards v. City of Goldsboro, 178 F.3d 231, 241 n.6

(4th Cir. 1999).

                              IV.

      For the foregoing reasons, we affirm the judgment of the

district court.

                                                        AFFIRMED

even further” by failing to determine “how, if at all, the
supposedly controlling Greek law would affect Bunker Holdings’
claims (or even, what the supposedly controlling Greek law,
was).”   (J.A. 13 n.5).   This passing reference in a footnote
hardly satisfies the appellant’s obligation to set forth its
“contentions and the reasons for them, with citations to the
authorities and parts of the record on which the appellant
relies.” Fed. R. App. P. 28(a)(9)(A).

                               13