962 F.3d 827
5th Cir.2020Background
- CGG conducted seismic surveys using three Seismic Vessels and used three Support Vessels (Bourbon Petrel, OMS Resolution, Miss Lilly) to carry fuel from Port Fourchon to refuel the Seismic Vessels.
- Martin Energy delivered fuel, at O.W. Bunker's direction, into the Support Vessels' cargo tanks; the fuel was transported onward and consumed by the Seismic Vessels.
- O.W. Bunker later filed bankruptcy and did not pay Martin; Martin sued CGG in rem against the Support Vessels under CIMLA alleging a maritime lien for "necessaries."
- The district court found Martin had a maritime lien, concluding the delivered fuel was a "necessary" to the Support Vessels because they functioned as floating gas stations/offshore supply vessels.
- On appeal the Fifth Circuit reviewed the lien issue de novo and examined whether cargo fuel intended for other vessels can be a "necessary" to the carrier vessel.
- The Fifth Circuit reversed: fuel carried as cargo for other vessels is not a "necessary" to the carrier Support Vessels and therefore did not create a CIMLA maritime lien against them.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fuel loaded into Support Vessels' cargo tanks for delivery to other vessels qualifies as "necessaries" to the Support Vessels | Fuel was "necessary" because Support Vessels operated as floating gas stations/offshore supply vessels and needed fuel to perform that role | Fuel was mere cargo destined for Seismic Vessels, not used to operate Support Vessels; cargo is not a "necessary" to carrier vessel | Reversed: such cargo fuel is not a "necessary" to the carrier Support Vessels and thus creates no maritime lien under CIMLA |
| Whether the vendor's (Martin's) lack of knowledge about end use affects the "necessaries" analysis | Vendor perspective matters; Martin could not know the fuel was for other vessels, so a lien should attach | Necessaries are judged by the vessel's need; vendor's subjective perspective is irrelevant | Rejected: necessity depends on the vessel's need, not the vendor's perspective |
Key Cases Cited
- Equilease Corp. v. M/V Sampson, 793 F.2d 598 (5th Cir. 1986) (en banc) (defines "necessaries" and describes maritime lien as special property right in vessel)
- Valero Mktg. & Supply Co. v. M/V Almi Sun, 893 F.3d 290 (5th Cir. 2018) (recognizes bunkered fuel as a "necessary" when supplied to refuel that vessel)
- Silver Star Enters., Inc. v. Saramacca M/V, 82 F.3d 666 (5th Cir. 1996) (necessaries are items that keep the ship going and enable its functions)
- Trico Marine Operators, Inc. v. Falcon Drilling Co., 116 F.3d 159 (5th Cir. 1997) (services ferrying provisions to a rig were "necessaries" to the rig)
- Foss Launch & Tug Co. v. Char Ching Shipping U.S.A., Ltd., 808 F.2d 697 (9th Cir. 1986) (physical equipment/containers enabling carriage of cargo can be "necessaries" for cargo ships)
- Dampskibsselskabet Dannebrog v. Signal Oil & Gas Co., 310 U.S. 268 (1940) (Supreme Court formulation that necessaries are items to keep the ship going)