Court Opinion

ID: 37905
Source: CourtListenerOpinion
Date Created: 2010-04-25 20:00:25+00
Date Added: 2024-06-11T12:04:13.209372
License: Public Domain

United States Court of Appeals
                                                                      Fifth Circuit
                                                                   F I L E D
                    UNITED STATES COURT OF APPEALS
                         FOR THE FIFTH CIRCUIT                     March 24, 2005

                        _______________________                Charles R. Fulbruge III
                                                                       Clerk
                              No. 03-31157
                        _______________________

                        PACORINI USA INC; ET AL,

                                                               Plaintiffs,

                           PACORINI USA INC;
                     CLEAR WATER SHIP AGENCY INC.,

                                                    Plaintiffs-Appellees,

                                  versus

                     ROSINA TOPIC MV, ETC; ET AL,

                                                               Defendants,

                     ROSINA TOPIC MV, HER ENGINES,
                    TACKLE, APPAREL, ETC., IN REM,

                                                  Defendants-Appellants.

            Appeal from the United States District Court
                for the Eastern District of Louisiana
                              03-CV-381

Before GARWOOD, JONES, and PRADO, Circuit Judges.

Edith H. Jones, Circuit Judge:*

           This case arises from an in rem action against a vessel

for payment for services provided to that vessel.              Despite the

vessel’s waiver of the issue below, we hold that Clear Water lacked

     *
            Pursuant to 5TH CIR. R. 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5TH CIR. R. 47.5.4.
standing, and the district court thus lacked jurisdiction, over

claims   belonging    to   the   stevedore    Lockwood.   The   vessel’s

complaints against the judgment for the stevedore Pacorini are

misplaced.    We AFFIRM IN PART, REVERSE IN PART, and RENDER.

                                 BACKGROUND

           The M/V ROSINA TOPIC (“ROSINA TOPIC”) is a Liberian flag

vessel chartered at all times relevant to this appeal to TorMar

Shipping, A.S. (“TorMar”), a Norwegian corporation. TorMar engaged

Clear Water Ship Agency, Inc. (“Clear Water”) to coordinate the

discharge of various lots of cargo carried by the vessel.        TorMar

authorized Clear Water to procure stevedoring services for the

vessel, as well as such barging services as might be needed.

           The ROSINA TOPIC began its journey in St. Petersburg,

Russia, carrying cargo that included zinc ingots, copper wire,

aluminum t-bars, and steel bars.             The vessel first called in

Newark, New Jersey.    Lockwood International (“Lockwood”), hired by

Clear Water, provided stevedoring services in Newark, and Lockwood,

in turn, hired two more companies to discharge the relevant cargo

in Newark.     The vessel then continued south, and on January 24,

2003, the ROSINA TOPIC docked in New Orleans, Louisiana, at a mid-

stream buoy system owned by Zito Anchorage, LLC (“Zito”). Pacorini

U.S.A., Inc. (“Pacorini”), a stevedoring company, had negotiated

with the relevant parties to unload part of the cargo in New

Orleans.     Specifically, Pacorini had an agreement from Glencore,

                                     2
the lead cargo interest for the cargo onboard the ROSINA TOPIC, to

discharge part of the cargo (a portion of the steel bars and zinc)

on a “liner out” basis.        When cargo is unloaded on a “liner out”

basis, the line, charterer, or vessel is responsible for all

stevedoring charges.1

            Around this time, Pacorini and the other parties became

aware that the charterer, TorMar, had become financially unstable.2

When TorMar’s insolvency became apparent, all named plaintiffs

demanded adequate assurance of payment from all interested parties,

including the vessel interest for the services that are the subject

of the instant suit.      As part of this demand, on January 29, 2003,

Pacorini threatened to halt work, after it had already discharged

approximately two-thirds of the “liner out” cargo.             At this point,

Pacorini also entered negotiations with Glencore, owner of the

“liner out” cargo, about guaranteeing payment for discharge of the

zinc portion of the “liner out” cargo if Pacorini was otherwise

unable to obtain payment or security from the vessel interests.

            The “through” bill of lading for the steel bars required

delivery to Chicago to Aurora USA, Inc. (“Aurora”), which owned

that particular cargo.       Although the ROSINA TOPIC was supposed to

continue to Chicago, the operators learned that it was too large to

        1
            Additionally, Glencore hired Pacorini separately to discharge part
of the aluminum t-bars on a “free out” basis.       This second aspect of the
transactions is not at issue here. When cargo is unloaded on a “free out” basis,
the cargo owner or receiver is responsible for all stevedoring charges.
        2
            TorMar ultimately filed for bankruptcy in Norway on February 19,
2003.

                                       3
navigate up the Mississippi River. Clear Water, as shipping agent,

then hired Lockwood to arrange barge transportation of the steel

bars from New Orleans to Chicago and for stevedoring services on

arrival.   On January 31, 2004, Lockwood issued an invoice to Clear

Water in the total amount of $17,350, representing $13,300 for

barging the steel from New Orleans to Chicago, and $4,050 for

stevedoring services in Chicago.     On February 4, 2003, the steel

bars were successfully unloaded from the ROSINA TOPIC to the

appointed barge in New Orleans. On February 8, Clear Water advised

Aurora that Lockwood was holding the barge in New Orleans pending

payment for its services.   In spite of this threat, however, the

barge eventually made its trip and the steel bars were unloaded in

Chicago.   Although neither Lockwood nor its hired stevedore Ceres

was ever paid, at no time did either company assign its claims to

Clear Water.

           On February 7, 2003, Clear Water, Zito, and Pacorini

filed a complaint against the vessel, in rem, seeking to have the

vessel arrested.   That same day, Topal Navigation Company, Inc.,

the owner of the vessel, deposited $205,178.08 in the registry of

the court in lieu of arrest.

           Following a bench trial, the district court delivered

oral reasons and entered a written judgment in favor of the three

plaintiffs. The district court found that all three plaintiffs had

provided necessaries to the vessel and were entitled to maritime

liens to secure payment.    Additionally, the court found that all

                                 4
plaintiffs maintained their liens on the vessel, and that none of

the named plaintiffs waived their rights to assert maritime liens

against the vessel.       The district court awarded Clear Water $5,000

for the services provided to the vessel as the ship’s agent.                    This

award is not disputed in the appeal.             The district court also ruled

in Clear Water’s favor for the expenses paid to Lockwood for

stevedoring     and    barge    transportation      services    in    Newark,   New

Orleans, and Chicago.          Specifically, the district court held “that

Clear   Water    is    obligated     to       collect   and   pay    Lockwood   for

stevedoring services in Newark which amount to $2,177.85, and

Chicago in the amount of $4,050, as well as the charges associated

with barge movement of cargos from New Orleans to Chicago in the

amount of $13,300.”       District Court Op. at 10.           The district court

awarded docking and line handling fees to Zito.               This award has not

been appealed.        The district court also awarded Pacorini $42,950

for the discharge of a cargo of zinc while the vessel was moored in

New Orleans, rejecting the contention that Glencore entered into a

valid agreement to guarantee these payments.

           The vessel timely filed a notice of appeal. On motion of

the vessel, the district court ordered payment of the parts of the

judgment which were not subject to appeal and stayed execution on

the remainder of the judgment.

                                    DISCUSSION

                                          5
          Appellant-Defendant ROSINA TOPIC raises several claims of

error.   First, the ROSINA TOPIC contends that Clear Water lacked

standing to assert claims for charges owed to Lockwood, and thus

the district court’s award to Clear Water should be reversed

because that court lacked jurisdiction.    In the alternative, the

vessel claims the district court erred as a matter of fact in

finding that Clear Water had a valid maritime lien against the

ROSINA TOPIC.   Second, the vessel contends the award to Pacorini

should be reversed because Pacorini waived its maritime lien.

Finally, the vessel asserts that the district court erroneously

awarded Pacorini excessive damages.

          Upon appeal of a judgment rendered through a bench trial,

we review the factual findings for clear error and conclusions of

law de novo. See Maritrend, Inc. v. Serac & Co., 348 F.3d 469, 470

(5th Cir. 2003).    Factual determinations made under an erroneous

view of legal principles are reviewed de novo.   Id.    Additionally,

mixed questions of law and fact are reviewed de novo.    See Davis v.

Odeco, Inc., 18 F.3d 1237, 1244 n.30 (5th Cir. 1994).

          The requirement that a party have legal standing to

assert a violation of legal rights is a constitutional requirement

of jurisdiction that must exist throughout the litigation and

cannot be waived.   See Valley Forge Christian College v. Americans

United for Separation of Church and State, Inc., 454 U.S. 464, 475-

76, 102 S. Ct. 752, 760 (1982); Warth v. Seldin, 422 U.S. 490, 498-

99, 95 S. Ct. 2197, 2205 (1975); Asbestos Information Assoc./North

                                 6
America v. Reich, 117 F.3d 891, 893 (5th Cir. 1997).            To have

standing, (1) a plaintiff must have suffered an actual injury of a

legally   protected   interest   which   is   both   (a)   concrete   and

particularized and (b) actual or imminent; (2) a causal connection

must exist between the injury and the complained of conduct; and

(3) a likelihood must exist that a favorable decision will redress

the injury.   Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61,

112 S. Ct. 2130, 2136 (1992).

           As Clear Water never paid Lockwood any of the costs

Lockwood was due for services rendered to the vessel, it lacks a

cognizable “injury” from the dispute unless it somehow inherited

the claims Lockwood had against Defendants-Appellants. Cf. Florida

Dep’t of Ins. v. Chase Bank of Tex. Nat. Ass’n, 274 F.3d 924, 931

(5th Cir. 2001).      Under general maritime law, a maritime agent

acting on behalf of a disclosed principal is not liable for

contract claims stemming from contracts the agent executes on the

principal’s behalf.      See Atlantic & Gulf Stevedores, Inc. v.

Revelle Shipping Agency, Inc., 750 F.2d 457, 459 (5th Cir. 1985).

Clear Water, as the agent of disclosed principals ROSINA TOPIC

and/or TorMar, could not have been held liable to Lockwood for

claims arising out of contracts Clear Water executed on these

principals’ behalf.     Thus the opposite is also true: where Clear

Water risked no liability, it can win no recovery as agent to

disclosed principals. Moreover, Clear Water offered no evidence in

the district court that Lockwood had assigned its claims against

                                   7
Defendants-Appellants to Clear Water.            Clear Water lacks standing

to sue and recover from the Defendants-Appellants — and in fact has

lacked standing from the outset of the lawsuit.3                Thus we must

reverse the district court           on its decision awarding damages to

Clear Water; the judgment in Clear Water’s favor for $19,527.85 is

REVERSED.4

             For two reasons, the vessel contends the district court

erred in awarding damages to Pacorini because Pacorini waived its

maritime     lien.    A     supplier    of   necessaries   enjoys    a   strong

presumption that it has not waived its maritime lien.                 Gulf Oil

Trading Co. v. M/V CARIBE MAR, 757 F.2d 743, 750 (5th Cir. 1985).

To overcome this presumption, a defendant bears the burden of

showing that the plaintiff took affirmative actions that manifested

plaintiff’s clear, purposeful, and deliberate intention to forego

the maritime lien.        Id.

             First,   the   vessel     asserts   that   Pacorini    waived   its

maritime lien by filing a premature in rem suit.            But this case is

      3
            At oral argument, counsel for the vessel conceded that he had never
raised this argument in the district court — and in fact intentionally chose not
to raise such an argument. The fact that this jurisdictional defect can be
raised and addressed in the first instance in this court is an irreducible truth
of constitutional law. However, that legal point does not mean that a party
serves his client, the interests of justice, or his ethical obligations
sufficiently by failing to raise the argument in the first instance in the
district court. This “strategic decision” wasted judicial resources. Although
we will not impose sanctions for this infraction, we trust that counsel will
refrain from this course of action in the future.
      4
            Because the district court lacked jurisdiction to adjudicate Clear
Water’s claims arising from Lockwood’s charges, we need not address the vessel’s
alternative argument as to whether Clear Water had a valid maritime lien against
the ROSINA TOPIC.

                                        8
unlike Veverica v. Drill Barge Buccaneer No. 7, 488 F.2d 880 (5th

Cir. 1974), where premature arrest of a vessel constituted an

independent breach of the contract giving rise to the lien, and

where the court determined that the vessel did not have to be

seized to protect the lien.       Here, Pacorini did not immediately

seize the vessel but instead notified all vessel representatives

prior to the suit, prompting them to post security and avoid arrest

and the interruption of trading.          Finding waiver or repudiation of

a   maritime   lien   under   these   circumstances    would     vitiate   an

important aspect of maritime law — providing a maritime lien to

stevedores servicing vessels. See Atlantic & Gulf Stevedores, Inc.

v. M/V GRAND LOYALTY, 608 F.2d 197, 201 (5th Cir. 1979) (“[I]t was

the intent of the Congress to make it easier and more certain for

stevedores and others to protect their interests by making maritime

liens   available     where    traditional      services   are    routinely

rendered.”).

           Second, the vessel points to the arrangement Pacorini

made with Glencore for payment as evidence of waiver.             At trial,

however, the court found that Glencore’s willingness to guarantee

payment for the discharging of the zinc portion of the liner out

cargo was contingent upon Pacorini’s inability to secure payment or

security from an alternative source. This arrangement between

Pacorini and Glencore did not amount to a sufficiently “clear and

unequivocal” intent to rely exclusively on the credit or security

of a cargo receiver to constitute waiver of a maritime lien.               The

                                      9
district court’s determination comports with our relevant caselaw,

which establishes that “[i]f the evidence shows that the claimant

relied on the credit of the vessel to some extent, we will not find

a waiver of the maritime lien.”        Maritrend, Inc. v. Serac & Co.,

348 F.3d 469, 473 (5th Cir. 2003).      We will not disturb this aspect

of the district court’s decision.

          Finally, the vessel challenges Pacorini’s damage award as

excessive.   We review this factual determination for clear error.

See Sosa v. M/V LAGO IZABAL, 736 F.2d 1028, 1035 (5th Cir. 1984).

A verdict is excessive if it is greater than the maximum amount a

trier of fact could properly have awarded.        Caldarera v. Eastern

Airlines, Inc., 705 F.2d 778, 784 (5th Cir. 1983).

          The trial court awarded Pacorini the invoiced amount of

$42,950, which that court considered “reasonable and justified”

based on the evidence.      The vessel contends that this award is

$7,000 higher than the original amount Pacorini agreed to charge.

However, the district court considered this amount the appropriate

market rate; the lower price quote reflected a “volume discount.”

As TorMar became insolvent, its inability to produce additional

volume for Pacorini justified Pacorini’s unwillingness to extend

the concomitant discount.    The district court did not clearly err

in awarding this level of damages; we thus affirm all aspects of

the award to Pacorini.

                                  10
          AFFIRMED   IN   PART,   REVERSED   IN   PART,   and   RENDERED.

JUDGMENT RENDERED IN REVISED AMOUNT.     Each party shall bear their

own costs on appeal.

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