445 F.Supp.3d 983
S.D. Cal.2020Background
- Plaintiff Bartell Hotels (dba Half Moon Marina) operates a 180-slip marina in San Diego and provided wharfage to S/V Talus (1981 40-ft Islander), believed owned by Ronald Lee.
- Lee executed a wharfage contract in April 2016; the contract was terminated by plaintiff with notice effective December 16, 2018, but the vessel remained at the marina.
- Wharfage arrears accrued: $24,724.70 as of August 31, 2019, with continued accrual at the transient rate ($2.50/ft/day = $100/day for the 40-ft vessel).
- The vessel was arrested October 18, 2019; plaintiff was appointed substitute custodian; defendant defaulted and no party filed opposition or posted security.
- Plaintiff moved (Feb. 12, 2020) for interlocutory sale under Supplemental Admiralty Rule E(9)(a) and for authorization to credit bid; the court granted the motion (Order dated Apr. 13, 2020).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether interlocutory sale is warranted under Supplemental Admiralty Rule E(9)(a)(i) | Vessel will deteriorate if left idle; custody costs are excessive; unreasonable delay in securing release | No opposition filed; potential defense: generalized deterioration evidence insufficient | Granted — court found all three Rule E(9)(a)(i) criteria satisfied (deterioration, disproportionate custody expense, unreasonable delay) |
| Whether plaintiff may credit bid at auction | Plaintiff is sole maritime lien claimant and senior lienholder; may credit bid up to lien ($24,724.70) plus custodia expenses (not attorneys' fees) | No opposition filed | Granted — credit bid authorized up to lien amount plus custodia expenses; attorneys' fees excluded |
| Sale procedure and confirmation requirements | Request sale by U.S. Marshal with published notice, deposit rules, and automatic confirmation if no objection within three days | No opposition filed | Ordered — Marshall to publish 7 days; bidder deposit/ payment rules set; sale confirmed as of course if unopposed within 3 days; hearing vacated |
Key Cases Cited
- Ex Parte Easton, 95 U.S. 68 (1877) (holds a contract for wharfage is a maritime contract)
- Royal Ins. Co. of America v. Pier 39 Ltd. P'ship, 738 F.2d 1035 (9th Cir. 1984) (admiralty jurisdiction applies when wharfage provided to a specific vessel)
- Ferrous Fin. Servs. Co. v. O/S Arctic Producer, 567 F. Supp. 400 (W.D. Wash. 1983) (interlocutory sale substitutes proceeds for property and supports sale for unreasonable delay)
- Merchants Nat'l Bank of Mobile v. Dredge Gen. G.L. Gillespie, 663 F.2d 1338 (5th Cir. 1981) (plaintiff need only show one of Rule E(9)(a)(i)'s criteria; delay can justify sale)