United States District Court, D. Maine
ORDER ON MOTION TO APPORTION CUSTODIAL COSTS
Brock Hornby United States District Judge.
dispute is over the allocation of custodial expenses while a
vessel was under arrest in Portland harbor before it was
released in exchange for a bond from the owner. The owner
settled all but two claims against the vessel. After a bench
trial, I awarded judgment against one claimant and awarded
the other claimant a small portion of what it claimed, a
decision affirmed on appeal. Portland Pilots, Inc. v.
NOVA STAR M/V, 875 F.3d 38 (1st Cir. 2017). The owner
now seeks to have these two claimants pay a “fair
share” of the custodial expenses accrued by the vessel
during its arrest. Both claimants argue that they should pay
nothing, largely on arguments of waiver. None of the
parties has requested a hearing. I conclude that the two
claimants should share in some of the custodial expenses and
announce applicable principles, but I do not have the
necessary evidence to order specific dollar amounts.
October 30, 2015 Portland Pilots, Inc. (Portland Pilots)
filed a verified complaint in rem against the M/V
Nova Star (the vessel) seeking, among other things, to have
it arrested. Pilot's Compl. (ECF No. 1). The M/V Nova
Star had been operated as a ferry service between Portland
Maine and Yarmouth Nova Scotia. The United States Marshal
arrested the vessel that same day and, on Portland
Pilots' motion, it was placed under the care of
substitute custodian National Maritime Services (NMS).
Warrant in Rem (ECF No. 12); Order Appointing Substitute
Custodian (ECF No. 10). The vessel remained in the custody of
NMS until it was released on November 30, 2015. Oral Order
Releasing Vessel (ECF No. 148).
appearing on November 13, 2015, see Verified
Statement of Right (ECF No. 52), the vessel's Owner paid
the custodial expenses. Ultimately the Owner settled with
Portland Pilots and others claiming against the vessel, as a
result of which it no longer has a claim against those
parties for their pro rata share of custodial expenses.
Owners' Renewed Mot. 2 (ECF No. 349). The Owner was
unable to settle with two parties: Portland Development Corp.
(PDC) and Maine Uniform, Inc. (MUR).
for PDC first entered their appearance in the action on
November 6, 2015. Notices (ECF Nos. 28-29). PDC filed its
Verified Claim on November 9 (ECF No. 36), claiming a lien
for $151, 398.68 and interest, attorney fees, and costs, but
did not move to intervene until November 23. Emergency Mot.
(ECF No. 88). MUR first appeared in the lawsuit on November
17, when it filed a Motion to Intervene (ECF No. 64) claiming
a lien of $262, 001.50 and interest, attorney fees, and
claimants' motions to intervene were granted on November
24. Orders (ECF Nos. 90, 101). They filed intervenor
complaints the same day, reflecting the amounts I have
already listed (for MUR, see Compl. ¶¶ 18,
24, 29 (ECF No. 99); for PDC, see Compl. ¶ 19
(ECF No. 103)). PDC also moved to arrest the vessel,
Emergency Mot. (ECF No. 96); Order for Arrest (ECF No. 110),
but ultimately did not execute the arrest. Both parties
supported the release of the vessel on a substitute bond on
November 25. Responses (ECF Nos. 112, 116).
reject both claimants' arguments that the Owner waived
any claim for allocation of custodial expenses against them.
The Owner made clear at the November 30, 2015 hearing
(principally on the bond substitution) that it was not
waiving the allocation of costs as against PDC and MUR. Tr.
of Proceedings (11/30/15) at 17-18, 23-24 (ECF No. 337). The
December 14 hearing focused on other parties, but Magistrate
Judge Rich clearly stated then that the allocation issue
remained. Tr. of Proceedings (12/14/15) at 31 (ECF No. 336).
It is true that MUR stated that its consent to release of the
vessel on November 25 (ECF No. 116) was contingent on its
having no liability for arrest costs. But the record does not
reflect that the Owner (or any other party) accepted that
condition, and arguably it was directed only at World Fuel
Services (WFS). See MUR's Status Update (ECF No.
135) (stating the condition as a requirement for WFS's
dismissal from the case); Tr. (11/30) at 30-31 (ECF No. 337)
(MUR's lawyer stating that his concern was WFS and it was
resolved). MUR made no reference to the issue in its
“Issues Update” filed December 10 (ECF No. 160).
The Owner's “Issues Update” filed December 11
(ECF No. 162), says that it will seek to allocate custodial
charges to Century Resorts International LTD (Century) after
November 25; it also says that the PDC's and MUR's
claims present “similar issues, ” albeit without
further specificity. On that record, there is no basis to
conclude that the Owner waived its argument that these
claimants should participate in the custodial expenses.
custodial costs is based upon general principles of fairness,
and is clearly committed to the discretion of the trial
court. See Mullane v. Chambers, 438 F.3d 132, 138
(1st Cir. 2006) (admiralty courts have “flexible and
equitable” authority to award custodial expenses
(citing The Poznan, 274 U.S. 117, 120-23 (1927));
accord Beauregard, Inc. v. Sword Servs. LLC, 107
F.3d 351, 354 (5th Cir. 1997) (“T]he district court
enjoys broad equitable authority over the administration of
maritime seizures.”); Donald D. Forsht Assocs.,
Inc. v. Transamerica ICS, Inc., 821 F.2d 1556, 1559-60
(11th Cir. 1987) (lienholders and claimants in in
rem action potentially liable for “proportionate
share” of custodial costs).
case, the Owner has proposed no standard for allocation other
than a “fair share, ” Reply to PDC 7 (ECF No.
353); Reply to MUR 6 (ECF No. 355); the claimants have
proposed no standard at all, arguing only that they should
pay nothing. Nevertheless, certain principles have been
established by Judge Rich's earlier rulings in this
Judge Rich ruled that all custodial charges for the arrest
period after November 25, 2015, until the vessel's
release on November 30, 2015, were the sole responsibility of
Century. Century, unlike all other claimants, refused to let
the vessel be released in exchange for the Owner's bond
on November 25. Order on Costs to Century (ECF No. 296).
(Century had casino equipment on board the vessel that it
first wanted unloaded in accordance with specified
procedures, delaying the release.) I conclude therefore that
these two claimants have no responsibility for custodial
costs during that period. (After Judge ...