Inbesa America, Inc. v. M/V Anglia

United States Court of Appeals,
Eleventh Circuit.
No. 96-5278.
INBESA AMERICA, INC., a Texas Corporation, Plaintiff-Appellee,
v.
M/V ANGLIA, a 1977 313-foot general cargo ship, Lloyds Reg. No. 7601724, her engines,
tackle, cargo, appurtenances, etc., in rem, Defendant-Appellant.
Feb. 2, 1998.
Appeal from the United States District Court for the Southern District of Florida. (No. 95-7147-CV-
WJZ), William J. Zloch, Judge.
Before ANDERSON and BIRCH, Circuit Judges, and WOODS*, Senior District Judge.
BIRCH, Circuit Judge:
In this appeal, we determine whether a contract for various shipping-related services comes
within the federal admiralty jurisdiction. In granting summary judgment for appellee Inbesa
America, Inc. ("Inbesa"), the district court held that a contract between Inbesa and the charterer of
in rem appellant M/V Anglia was wholly maritime, thereby bringing all disputes arising under the
contract within the federal admiralty jurisdiction. The Anglia, however, contends that the contract
is not subject to admiralty jurisdiction because the contract covers a variety of non-maritime
services. We REVERSE and REMAND for further proceedings.
I. BACKGROUND
Inbesa operates a terminal shipping facility in the Port of Houston, Texas. As part of its
business, Inbesa provides shippers with both docking and cargo-handling services. Although
*
Honorable Henry Woods, Senior U.S. District Judge for the Eastern District of Arkansas,
sitting by designation.
Inbesa's own employees perform most of Inbesa's shoreside services, Inbesa subcontracts all
stevedoring to outside companies.
In April 1994, Inbesa entered a "Stevedoring and Terminal Services Contract" ("the
contract") with Genesis Container Line ("Genesis"). Under the contract, Inbesa agreed to perform
a variety of services for Genesis's liner service, including cargo handling, dockage, and stevedoring.
Inbesa then subcontracted its stevedoring responsibilities to Gulf Stream Maritime, Inc. ("Gulf
Stream").
In November 1994, the claimant/owner of the Anglia, Reederei MS Anglia GmBH & Co.
KG ("Reederei"), and Genesis entered into a time charter allowing Genesis to use the Anglia for its
liner service. Thereafter, the Anglia received terminal services from Inbesa from July through
November 1995 under the existing Inbesa-Genesis contract. Under the contract, Inbesa billed
Genesis for six itemized categories of services with regard to the Anglia: $ 6,708.56 for dockage;
$ 115,688 for stevedoring; $ 6,708.56 for unloading of break bulk (i.e., un-containerized) cargo
from trucks; $ 14,807.50 for stuffing and stripping of break bulk cargo into and out of containers;
$ 5,265.68 for securing cargo within containers; and $ 28,062.36 for moving cargo through Inbesa's
wharf.
When Genesis failed to pay its bills, Inbesa filed a verified complaint in rem against the
Anglia to foreclose on purported maritime liens for its services. The Anglia, however, argued that
the district court lacked admiralty jurisdiction because the contract involved significant
non-maritime services.1 On the parties' cross-motions for summary judgment, the district court
awarded final judgment to Inbesa against the Anglia for $ 177,389.62 plus prejudgment interest.
1
To avoid arrest of the Anglia, Reederei stipulated with Inbesa to substitute security for
Inbesa's asserted lien.
The Anglia now appeals.
II. DISCUSSION
Before assessing the validity of Inbesa's asserted lien, we must first establish whether we
have admiralty jurisdiction over the contract from which the lien is purported to arise. See, e.g.,
Ambassador Factors v. RMS, 105 F.3d 1397, 1398-99 (11th Cir.1997). In order for a contract to fall
within the federal admiralty jurisdiction, it must be wholly maritime in nature, or its non-maritime
elements must be either insignificant or separable without prejudice to either party. See E.S.
Binnings, Inc. v. M/V Saudi Riyadh, 815 F.2d 660, 665 (11th Cir.1987); 14 Charles Alan Wright,
Arthur R. Miller, Federal Practice and Procedure § 3675 (Suppl.1997) (collecting cases). To
qualify as maritime, moreover, the elements of a contract must "pertain directly to and be necessary
for commerce or navigation upon navigable waters.... The test we apply in deciding whether the
subject matter of a contract is necessary to the operation, navigation, or management of a ship is a
test of reasonableness, not of absolute necessity." Ambassador Factors, 105 F.3d at 1399 (quoting
Nehring v. Steamship M/V Point Vail, 901 F.2d 1044, 1048 (11th Cir.1990) (internal quotation
omitted)).2 Applying this standard, the Anglia argues that a significant portion of the services
provided by Inbesa under the contract were non-"necessary," while Inbesa maintains that its contract
services were wholly maritime. We review the district court's jurisdictional analysis de novo. See
2
In this sense, the federal admiralty jurisdiction is coterminous with the right of providers of
maritime services to maritime liens. See Bradford Marine, Inc. v. M/V Sea Falcon, 64 F.3d 585,
589 (11th Cir.1995) ("The lien and the proceeding in rem are ... correlative—where one exists,
the other can be taken, and not otherwise." (quoting The Rock Island Bridge, 73 U.S. (6 Wall.)
213, 215, 18 L.Ed. 753 (1867))). Under the Maritime and Commercial Instruments and Liens
Act, "a person providing necessaries to a vessel on the order of the owner or a person authorized
by the owner ... (1) has a maritime lien on the vessel; [and] (2) may bring a civil action in rem to
enforce the lien...." 46 U.S.C. § 31342(a)(1) & (2) (emphasis added). The statutory definition of
"necessaries," however, is non-exclusive and, therefore, not helpful in this particular case. See
46 U.S.C. § 31301(4) (" "necessaries' includes repairs, supplies, towage, and the use of a dry
dock or marine railway"); Bradford Marine, 64 F.3d at 589 (statutory definition non-exclusive).
Sea Vessel, Inc. v. Reyes, 23 F.3d 345, 347 (11th Cir.1994).
As stated previously, Inbesa asserts a maritime lien on the Anglia for six itemized categories
of services: (1) dockage, (2) stevedoring, (3) unloading, (4) stuffing and stripping, (5) securing, and
(6) wharfage. Of these claimed services, two, dockage and stevedoring, are clearly maritime. See
Steven F. Friedell, 1 Benedict on Admiralty § 213, at 14-21 (7th ed. 1997) ("During the furnishing,
supplying, loading, unloading and repairing of a vessel, it is necessary that she should lie at wharf,
dock or pier.... The pecuniary charge to which vessels are liable for such use of a dock or wharf is
called ... dockage and is a subject of admiralty jurisdiction ...." (footnotes omitted)) (collecting
cases); id. § 215, at 14-25 ("To enable the vessel safely to transport her cargo, it is of the first
importance that the cargo be well stowed.... The business of stowing ships and of breaking out cargo
at the port of delivery has fallen into the hands of ... stevedores. Their services are maritime."
(internal footnote omitted)) (collecting cases).
The remaining categories of services provided by Inbesa under the contract, however, are
non-maritime cargo-handling. Despite Inbesa's protestations, "it has long been the rule that contracts
involving cargo are maritime only to the extent the cargo is on a ship or being loaded on or off a
ship." Luvi Trucking, Inc. v. Sea-Land Serv., Inc., 650 F.2d 371, 373 (1st Cir.1981) (citing The
Moses Taylor, 71 U.S. (4 Wall.) 411, 18 L.Ed. 397 (1866)).3 Inbesa's stripping, stuffing, securing,
3
Inbesa's citations to Pittston Stevedoring Corp. v. Dellaventura, 544 F.2d 35, 53 (2d
Cir.1976), aff'd Northeast Marine Terminal Co., Inc. v. Caputo, 432 U.S. 249, 97 S.Ct. 2348, 53
L.Ed.2d 320 (1977), are inapposite. In Pittston, the Second Circuit "liberally" interpreted the
"remedial" Longshoreman and Harbor Workers' Compensation Act, 33 U.S.C. §§ 901 et seq., to
cover longshoremen handling cargo along a pier, thereby providing parity between
longshoremen off-loading cargo containers and longshoremen stripping such containers. See id.
at 51-53. In contrast, Inbesa seeks in the instant case to assert a lien under the Maritime and
Commercial Instruments and Liens Act, 46 U.S.C. § 31342. Maritime liens are "governed by the
principle "stricti juris and will not be extended by construction, analogy or inference.' "
Bradford Marine, 64 F.3d at 589 (quoting Piedmont & George's Creek Coal Co. v. Seaboard
Fisheries Co., 254 U.S. 1, 12, 41 S.Ct. 1, 4, 65 L.Ed. 97 (1920)).
and unloading of cargo into and out of containers and trucks was not directly related to the loading
or unloading of a maritime vessel. Cf. Bermuda Express, N.V. v. M/V Litsa, 872 F.2d 554, 563-64
(3rd Cir.1989) (movement of cargo chassis along pier "not directly related to loading or unloading
the vessel"); South Carolina State Ports Auth. v. M/V Tyson Lykes, 837 F.Supp. 1357, 1365
(D.S.C.1993), aff'd, 67 F.3d 59 (4th Cir.1995) (cargo container services not maritime); Green Light
Transp., Inc. v. Ocean Express Lines, Inc., No. 93-1686-CIV, (S.D.Fla.1994) (positioning truck
under stevedore's crane not maritime). But see Ceres Marine Terminals, Inc. v. M/V Harmen
Oldendorff, 913 F.Supp. 919, 927 (D.Md.1995) (holding container stuffing and stripping to be
maritime).4 Although such services by Inbesa were no doubt important for Genesis's business, they
were not "necessary" for the Anglia 's operation. Indeed, all of Inbesa's cargo-handling services took
place on land without regard to whether the Anglia was in port; Inbesa could have unloaded, stuffed,
and secured cargo from trucks into containers before the Anglia arrived, and then stripped cargo
from containers into warehouses or onto trucks after the Anglia departed. Although we recognize
that circumstances may sometimes arise in which movement of cargo a short distance away from
a ship may be necessary to make room for additional off-loading, Inbesa has made no such claim
of stevedoring necessity in this case. The fact that it was convenient, as a logistical matter, for
Genesis to have Inbesa fill and empty its cargo containers at Inbesa's port facilities is not enough to
make Inbesa's shoreside, cargo-handling services maritime. Cf. Luvi Trucking, 650 F.2d at 373
("Whether a contract action falls within admiralty jurisdiction depends upon the subject matter of
4
In addition to finding Ceres unpersuasive, we are uncertain whether the case remains good
law within the Fourth Circuit. After the district court in Ceres issued its opinion, the Fourth
Circuit affirmed Tyson Lykes, which had found shoreside, cargo container services to be
non-maritime. See Tyson Lykes, 837 F.Supp. at 1365, aff'd, 67 F.3d 59. The Fourth Circuit,
however, did not discuss the Tyson Lykes district court's conclusion that such services were not
maritime.
the contract rather than the place where the contract ... is to be performed"). We see no reason to
blur the line between stevedoring and shoreside cargo-handling that has long been a useful guide
for the district courts in determining the scope of their admiralty jurisdiction.
For similar reasons, Inbesa's "wharfage" services, as idiosyncratically defined by the
contract, are also non-maritime. Normally, the term "wharfage" is used synonymously with
"dockage." See 1 Benedict § 213, at 14-21. As such, "wharfage" is a maritime service. See id.
Inbesa's "wharfage" fees, however, reflect charges for the movement of Genesis's cargo through
Inbesa's wharf, not dockage. See R2-33 at 16 (Geiger Depo.) ("Wharfage is a charge assessed on
every ton of cargo that goes through a wharf."). In fact, Inbesa not only charged Genesis separately
for "dockage," as the district court noted below, see R3-96 at 5-6, but also listed "wharfage" under
the contract's heading for terminal cargo-handling services, see R2-33 Exh. 1 at 2. Inbesa cannot
bring shoreside cargo-handling services within the admiralty jurisdiction simply by re-labelling them
as "wharfage."
In sum, we conclude that a significant portion of Inbesa's obligations under the contract are
non-maritime. Even so, it may be possible for a federal court to exercise admiralty jurisdiction over
the maritime dockage and stevedoring parts of the contract if they are separable without prejudice
to either party. See Binnings, 815 F.2d at 665. Unfortunately, neither Inbesa nor the Anglia has
addressed the separability or prejudice issues in their briefs before this court, and the district court
did not have reason, given its ruling that the contract was wholly maritime, to examine such issues
in its order granting summary judgment. Although the itemized nature of Inbesa's invoices and
claims suggests to us that the maritime and non-maritime elements of the contract may be separable,
we believe that the prudent course is to remand the case to the district court so that it may examine
the separability and prejudice issues as a court of the first instance.5 On remand, the district court
should determine, first, whether Inbesa's maritime claims under the contract are capable of separate
adjudication and, second, whether separate adjudication of Inbesa's claims concerning dockage and
stevedoring would be prejudicial to Inbesa's or the Anglia 's claims or defenses regarding the
non-maritime contract services.
III. CONCLUSION
A significant portion of the contract at issue concerns non-maritime shoreside services.
Therefore, we conclude that the district court erred in exercising admiralty jurisdiction over Inbesa's
claim for a lien against the Anglia to cover all of Inbesa's contract services to the vessel.
Accordingly, we REVERSE and REMAND the case to the district court for a determination of
whether the remaining contract services are separable without prejudice as required for the district
court to exercise admiralty jurisdiction. Should the district court conclude that admiralty jurisdiction
does lie with regard to Inbesa's claims for maritime dockage and stevedoring services, it may
proceed to determine whether summary judgment is again appropriate.
5
As we are remanding the case to the district court, we decline to reach at this time the
additional issues raised by the parties.