Maxum Services, Inc. v. Island Boats, Inc.

• Court: Louisiana Court of Appeal
• Decided: October 5, 2011
• Docket: CA-0011-0222
• Status: Unknown

Opinion

STATE OF LOUISIANA COURT OF APPEAL, THIRD CIRCUIT

11-222 consolidated with 11-223, 11-224

MAXUM SERVICES, INC.

VERSUS

ISLAND BOATS, INC., ET AL.

**********

APPEAL FROM THE SIXTEENTH JUDICIAL DISTRICT COURT PARISH OF IBERIA, NO. 114114 C/W 114303 C/W HONORABLE EDWARD LEONARD, JR., DISTRICT JUDGE

ELIZABETH A. PICKETT JUDGE

Court composed of Elizabeth A. Pickett, Billy Howard Ezell, and Shannon J. Gremillion, Judges.

REVERSED.

Michael W. Campbell Caffery, Oube, Campbell & Garrison, LLP P.O. Drawer 12410 New Iberia, LA 70560 (337) 232-6581 Counsel for Defendant/Appellee: Gulfmark Americas, Inc. N. Jerae Carlson Strasburger & Price, LLP 1401 McKinney St., Suite 2200 Houston, TX 77010 (713) 951-5600 Counsel for Defendant/Appellee: Gulfmark Americas, Inc.

Thomas R. Juneua, Sr. Tonya R. Smith Juneau Law Firm P. O. Box 51268 Lafayette, LA 70505-1268 (337)269-0052 Counsel for Plaintiff/Appellant: Maxum Services, Inc.

Joseph A. Tabb Aloise, Baudry, & Baudy, LLC P.O. Box 766 Franklin, LA 70538 (337) 828-0454 Counsel for Plaintiff/Appellant: Estes Refractory & Insulation of Louisiana, Inc. PICKETT, Judge.

In these consolidated cases, two companies that provided materials and/or

labor for the construction of a vessel appeal the trial court’s grant of summary

judgment dismissing claims they asserted against the vessel. Finding the

defendants failed to prove they were entitled to summary judgment, we reverse the

judgment.

FACTS

Gulfmark Americas, Inc. (Gulfmark) 1 entered into a construction contract

with Island Boats, Inc. (Island) for the construction of two 170-foot water jet

crew/supply vessels. Estes Refractory & Insulation of Louisiana, Inc. (Estes)

provided labor and materials, and Maxum Services, Inc. (Maxum) provided labor

to Island for the construction of one of the vessels, the M/V Swordfish. Gulfmark

took possession of the vessels on February 22, 2009. Island did not pay Estes or

Maxum for their services and filed for bankruptcy. On April 22, 2009, Maxum

filed suit against Gulfmark and Island, seeking in part to have the privilege

La.Civ.Code art. 3237(8) provides material men and workmen employed in the

construction of a vessel recognized on the M/V Swordfish. Estes thereafter filed

suit on May 22, 2009, seeking recognition of the same privilege in its favor on the

M/V Swordfish.

Gulfmark filed peremptory exceptions of prescription and no cause of action

which were dismissed. Gulfmark then had the suits consolidated, after which it

filed a motion for summary judgment seeking to have Estes’ and Maxum’s claims

dismissed. The trial court denied the motion for summary judgment. Gulfmark

1 The contract was actually between Rigdon Marine Holdings, LLC and Island; however, Rigdon is now known as Gulfmark. re-urged the motion, however, and the trial court granted it. Estes and Maxum

appealed the trial court’s judgment.

ASSIGNMENTS OF ERROR

On appeal, Estes and Maxum assign six errors with the trial court’s judgments

granting summary judgment in Gulfmark’s favor:

1. The trial court erred in determining that prior jurisprudence interpreting Civil Code Articles 3237-3245 does not apply.

2. The trial court erred in distinguishing between steamships and motor vessels.

3. The trial court erred in determining that there was no genuine issue of material fact preventing summary judgment.

4. The trial court erred in determining that the M/V Swordfish made a voyage as contemplated by Civil Code Article 3237(8).

5. The trial court erred in determining that Appellants do not have a privilege on the price of the vessel.

6. The trial court erred in dismissing Appellants’ claims against Gulfmark.

SUMMARY JUDGMENT

Appellate courts review summary judgments de novo, using the same

criteria applied by the trial courts to determine whether summary judgment is

appropriate. La. Safety Ass’n of Timbermen-Self Insurers Fund v. La. Ins. Guar.

Ass’n, 09-23 (La. 6/26/09), 17 So.3d 350. A motion for summary judgment will

be granted “if the pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if any, show that there is no

genuine issue as to material fact, and that mover is entitled to judgment as a matter

of law.” La.Code Civ.P. art. 966(B). Summary judgment is favored and shall be

construed “to secure the just, speedy, and inexpensive determination of every

action.” La.Code Civ.P. art. 966(A)(2).

2 The initial burden of proof is on the movant to show that no genuine issue of

material fact exists. La.Code Civ.P. art. 966(C)(2). However, if the movant will

not bear the burden of proof at trial, he need not negate all essential elements of the

adverse party’s claim, but he must point out that there is an absence of factual

support for one or more elements essential to the claim. Id. Once the movant has

met his initial burden of proof, the burden shifts to the adverse party “to produce

factual support sufficient to establish that he will be able to satisfy his evidentiary

burden at trial.” Id.

DISCUSSION

Estes and Maxum each seek to enforce a privilege provided by La.Civ.Code

art. 3237(8) to material men and workmen who provide materials and labor for the

construction of ships and vessels. A privilege is “stricti juris” and “can be claimed

only for those debts to which it is expressly granted.” La.Civ.Code art. 3185.

Article 3237, previously Article 3204, provides in pertinent part:

The following debts are privileged on the price of ships and other vessels, in the order in which they are placed:

....

8. Sums due to sellers, to those who have furnished materials and to workmen employed in the construction, if the vessel has never made a voyage; and those due to creditors for supplies, labor, repairing, victuals, armament and equipment, previous to the departure of the ship, if she has already made a voyage. .... The term of prescription of privileges against ships, steamboats and other vessels shall be six months.

A material man or workman can enforce the privilege provided by Article

3237 against a vessel after it has been sold to a voluntary purchaser if the vessel is

in port and it has not made a voyage “in the name and at the risk of the purchaser.”

La.Civ.Code art. 3242. If the vessel has made a voyage before the privilege is

3 asserted, the privilege is “lost and extinct.” La.Civ.Code art. 3243. “Voyage” is

defined in Article 3245 as when a “ship” has departed from one port and arrived at

another or been out more than sixty days without returning to the same port, or as

when a ship has been out more than sixty days without any claim for a privilege

being asserted.

Gulfmark urges that the privileges provided to Estes and Maxum by Article

3237 were extinguished when they filed suit because the M/V Swordfish made

numerous voyages before that time. Estes and Maxum contend Gulfmark is not

entitled to summary judgment because the evidence submitted by Gulfmark in

support of the motion is insufficient to warrant summary judgment in light of

jurisprudence applying Article 3237. They argue the M/V Swordfish did not make

a voyage before they filed suit and they filed suit within six months of providing

material or labor to it; therefore, summary judgment is inappropriate.

Jurisprudence

The plaintiffs assert that a long line of jurisprudence which held, pursuant to

former Article 3204, now Article 3237, that prior to 1858, vessels trading on the

inland waters of Louisiana and the Mississippi River were not making voyages

within the “sense of the statute.” Learned v. Brown, 94 F. 876, 881 (5th Cir. 1899)

(rev’d on other grounds). In those cases, material men and laborers had sixty days

to file liens against a vessel. Id.; Shirley v. Fabrique, 15 La. 140 (1840). In 1858,

Article 3204, now Article 3237, was amended to provide: “The term of

prescription of privileges against ships, steamboats and other vessels shall be six

months.” After passage of this amendment, state and federal courts held that

material men and laborers had six months to assert the privilege provided in

Article 3237 on vessels that sailed on inland waters, e.g., steamboats. In Re Red

River Line, 115 La. 867, 40 So. 250 (1905); Learned, 94 F. 876. 4 Citing Millaudon v. Martin, 6 Rob. 534 (La.1844), Estes and Maxum

contend that a vessel must sail on the sea to make a voyage. This argument has no

merit, though, as counsel for the plaintiff in Millaudon, not the court, stated the

definition of voyage was “the passage of a ship upon the sea and from one port to

another.” Indeed, the court did not consider whether a voyage had been made.

We find the jurisprudence does not require a vessel to sail “on the sea” to

have made a voyage; nevertheless, we do find that when a vessel sails only within

the inland waters of Louisiana, material men and laborers have six months to assert

the privilege provided by Article 3237. Shirley, 15 La. 140; Learned, 94 F. 876.

Maxum and Estes argue on one hand that jurisprudence governs this matter but

argue on the other hand that the plain language of the 1858 amendment to

Article 3204, now Article 3237, governs our determination, i.e., the applicable

term of prescription here is six months. They cannot have it both ways. The pre-

1858 jurisprudence relied upon by Estes and Maxum led to the amendment, and

post-amendment jurisprudence continued to hold that the privilege ceased once a

vessel made a voyage. See Graeme Spring & Brake Serv., Inc. v. De Felice 98

So.2d 314 (La.App. Orl. 1957); Learned, 94 F. 876. Therefore, we will consider

whether Gulfmark proved it made a voyage beyond the inland waters of Louisiana

as contemplated by La.Civ.Code arts. 3237 and 3245.

Did the M/V Swordfish Make a Voyage Before Plaintiffs Filed Suit?

Under the facts of this case, the applicable definition of voyage hinges on

the term “port,” and we must decide whether the M/V Swordfish departed one port

and arrived at another port outside the inland waters of Louisiana. Inland waters

have been determined to extend three miles from the Louisiana coastline. U.S. v.

La., 394 U.S. 11, 89 S.Ct. 773 (1969). “Port” is not defined in the Civil Code.

Therefore, we look to other sources to determine its definition. 5 Black’s Law Dictionary 5th & 6th Editions 1979, 1990, defines “port” as:

A place for the loading and unloading of the cargoes of vessels, and the collection of duties or customs upon imports and exports. A place, either on the seacoast[, great lakes,]2 or on a river, where ships stop for the purpose of loading and unloading cargo, or for purpose of taking on or letting off passengers, from when they depart, and where they finish their voyage. A port is a place intended for loading or unloading goods; hence includes the natural shelter surrounding water, as also shelter water produce by artificial jetties.

The Merriam-Webster Online Dictionary defines “port” as “a place where

ships may ride secure from storms” and “a harbor town or city where ships may

take on or discharge cargo.” Similarly, Dictionary.com defines “port” as “a city,

town, or other place where ships load or unload”; “a place along a coast in which

ships may take refuge from storms; harbor”; “any place where persons and

merchandise are allowed to pass, by water or land, into and out of a country and

where customs officers are stationed to inspect or appraise imported goods”; or “a

geographical area that forms a harbor.”

Gulfmark supported its motion for summary judgment with an affidavit by

its Director of Technical Service, James R. Whitley. Mr. Whitley averred in his

affidavit that the Swordfish “made its maiden voyage . . . traveling from Amelia,

Louisiana to Port Fourchon, Louisiana” and, after being chartered, “made the first

of many voyages from Port Fourchon, Louisiana to the EW-998 field in the Gulf of

Mexico and back.” Mr. Whitley’s affidavit further states the M/V Swordfish

carried cargo and/or crew to specific points throughout the Louisiana Gulf Coast

region. Logs for the M/V Swordfish attached to Mr. Whitley’s affidavit show

departure and arrival times as well as destinations. The logs also contain remarks

which are apparently intended to show the M/V Swordfish’s activities during those

2 The bracketed term does not appear in the 1979 Edition’s definition of “port.” 6 times; however, unexplained abbreviations are used in some cases, e.g., O/L and

B/L.

As argued by Estes and Maxum, neither Mr. Whitley’s affidavit nor the logs

attached thereto show that the waters in which the EW-998 field is located are not

inland waters such that the M/V Swordfish was not engaged in inland navigation

during the time in question. Moreover, Mr. Whitley’s affidavit and the

attachments thereto do not show what the EW-998 field is or that it satisfies the

definition of port. The same is true of Amelia and Port Fourchon. In other words,

the documents do not establish that the M/V Swordfish made a voyage prior to

Estes and Maxum filing suit. Accordingly, we find the trial court erred in granting

summary judgment dismissing Estes’ and Maxum’s claims.

DISPOSITION

The judgment of the trial court granting summary judgment in favor of

Gulfmark Americas, Inc. is reversed. All costs are assessed to Gulfmark

Americas, Inc.