Liaw Su Teng v. Skaarup Shipping Corp.

743 F.2d 1140, 1986 A.M.C. 1201
CourtCourt of Appeals for the Fifth Circuit
DecidedOctober 15, 1984
DocketNo. 83-3452
StatusPublished
Cited by34 cases

This text of 743 F.2d 1140 (Liaw Su Teng v. Skaarup Shipping Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Liaw Su Teng v. Skaarup Shipping Corp., 743 F.2d 1140, 1986 A.M.C. 1201 (5th Cir. 1984).

Opinion

ALVIN B. RUBIN, Circuit Judge:

Foreign nationals injured by the collision on the high seas of two vessels flying the flags of different nations seek redress from the owners of both vessels in a United States district court. Absent compelling reasons, such a suit obviously ought not to be divided into separate suits against the owner of each vessel with each case then to be tried separately in the forums of different nations, for that sort of bifurcation creates not only the necessity of two separate trials to determine responsibility for a single event, but also the possibility of inconsistent results.

This litigation arises from the collision of two vessels in the Mediterranean Sea. Seven separate suits were filed in a Louisiana district court for the deaths of seven of the seamen, who were members of the crew of one of the vessels, seeking joint and several recovery against the owners of both the vessel on which they had been working and the other vessel involved in the collision. On motion of the owner of the employer vessel, the district court transferred the claims against it to the Southern District of New York but, concluding that personal jurisdiction over the owner of the other (non-employer) vessel was wanting, dismissed the claim against it on the basis of forum non conveniens, conditioned on the owner’s submission to the jurisdiction of some appropriate court. Because the United States District Court for the Eastern District of Louisiana had jurisdiction over the owner of the non-employer vessel, and because American law, interpreting the communis juris, is applicable to the claims against it, we reverse the judgment dismissing the claims against the owner of that vessel.

Because no issue has been raised concerning the transfer of the claims against the seamen’s employer, we do not consider the correctness of that order. However, those claims having been transferred to the Southern District of New York, we remand for transfer of the claims against the non-employer defendant to the same court.

I.

Thirty-two members of the crew of the M/V FEDDY, each of whom had been a resident either of Taiwan or Hong Kong, died as a result of a collision between the FEDDY and the M/V SOUNION in the Mediterranean Sea off the coast of Algeria in 1981. Seven suits were filed in the Eastern District of Louisiana by the personal representatives of Taiwanese crew members who had signed contracts of employment in Taiwan, Republic of China. These were consolidated and all are included in this appeal.

The FEDDY, which was registered in Liberia, was owned by Solvang Shipping Company and operated by Skaarup Shipping Company; the SOUNION was owned by Summit Investment, Inc. Skaarup is a New York corporation with offices in Greenwich, Connecticut. It contends that [1143]*1143it had surrendered management of the FEDDY to its owner, Solvang, a Liberian corporation, 95% of whose stock is beneficially owned by United States citizens or residents. The FEDDY had made three calls to the port of New Orleans some time before suit was filed, and this was the basis for the plaintiffs assertion that venue lay in the Eastern District of Louisiana. Coincident with this litigation, Solvang had filed a limitation action in the Southern District of New York.

Skaarup and Solvang sought transfer of the action to the Southern District of New York as a more convenient forum, invoking 28 U.S.C. §§ 1404(a) and 1406(a). The district court ordered the transfer, and no objection to that order is urged on appeal. This appeal, therefore, concerns only the dismissal of the action against Summit, the owner of the SOUNION, the vessel that was not the seamen’s employer.

Summit is a Panamanian corporation whose stock is owned by Greek nationals. The M/V SOUNION is registered in Greece and has never entered Louisiana waters. Save for Summit’s statements to the court, the record contains no evidence that Summit has an American base of operations. Discovery of facts concerning Summit’s operations and ownership has never been completed, but its sole American connection established to date is that it owes a mortgage on the SOUNION to a New York bank. The record shows no connections between the SOUNION and the Eastern District of Louisiana.

Summit filed a motion to dismiss the claim against it either for want of jurisdiction over its person, or, alternatively, because the forum was inconvenient. Thereafter, when the SOUNION called at the Port of Chicago, the plaintiffs filed an in-rem complaint against the vessel in the Northern District of Chicago. To avoid arrest of the vessel, Summit agreed to provide a letter of undertaking and to “enter appearance in EDLA ... waiving personal jurisdiction defense of U.S. courts but with full reservation of all other rights or to pursue forum non conveniens, transfer, etc.” (Emphasis added.)

Summit then filed a motion for transfer of the suits against all defendants, including Summit, to the Southern District of New York. The plaintiff resisted that motion. Summit’s brief asserted that the motion was based on the thesis that the Eastern District of Louisiana was not a proper venue for the suit. Summit relied on 28 U.S.C. § 1406(a), which deals with transfer of a case laying venue in the wrong district, and took “the position that transfer to the Southern District of New York [was] proper as to it and that therefore transfer to that forum is transfer to a forum in which the case might have been brought.” Summit’s brief also stated: “Summit is not yet asking for the Sec. 1406(a) dismissal, but preliminarily seeks transfer to the Southern District of New York where Summit contends venue is proper.” Summit stated that it had sufficient contact with the State of New York to support personal jurisdiction and venue there. That district, it contended, was not excluded by the provision in § 1404(a) permitting transfer only to a court in which the action “might have been brought,” because that section is “remedial in nature. [Its] purpose is served by consideration of each case individually in light of convenience and fairness and ... by a broad and unrestrictive reading of the term ‘where it might have been brought.’ ”

The trial court ordered the claims against Solvang and Skaarup dismissed for lack of personal jurisdiction. The court said that transfer of the case under §§ 1404(a) and 1406 would not be “in the interest of justice.” The plaintiffs knew or should have known, the court said, that service of process could not be effected in the Eastern District; the court would not allow these transfer sections “to be used to aid non-diligent plaintiffs who knowingly file a case in the wrong district.” It therefore referred to Summit’s original motion, which alternatively sought dismissal of the suit because the forum was not convenient, and dismissed the claims against Summit. At this juncture, the entire suit was dismissed.

[1144]*1144The plaintiffs then moved to set aside that ruling and sought transfer of the entire case to the Southern District of New York. After Solvang and Skaarup represented that they were prepared to defend the matter there, the trial court transferred the claims against these defendants to the Southern District of New York. It then returned to Summit’s alternative forum-non-conveniens motion.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
743 F.2d 1140, 1986 A.M.C. 1201, Counsel Stack Legal Research, https://law.counselstack.com/opinion/liaw-su-teng-v-skaarup-shipping-corp-ca5-1984.