SNP Boat Service S.A. v. Hotel Le St. James

483 B.R. 776, 2012 U.S. Dist. LEXIS 54615, 2012 WL 1355550
CourtDistrict Court, S.D. Florida
DecidedApril 18, 2012
DocketNo. 11-cv-62671-KMM
StatusPublished
Cited by14 cases

This text of 483 B.R. 776 (SNP Boat Service S.A. v. Hotel Le St. James) is published on Counsel Stack Legal Research, covering District Court, S.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
SNP Boat Service S.A. v. Hotel Le St. James, 483 B.R. 776, 2012 U.S. Dist. LEXIS 54615, 2012 WL 1355550 (S.D. Fla. 2012).

Opinion

ORDER

K MICHAEL MOORE, District Judge.

THIS CAUSE is before the Court on an appeal from the Bankruptcy Court’s October 19, 2011 Final Judgment on Order Denying with Prejudice Motion for Entry of Order Entrusting M/Y Sixty Five to Foreign Representative for Administration in French Bankruptcy (Sauvegarde) Proceeding. This Court has jurisdiction over the appeal pursuant to 28 U.S.C. § 158(a)(1) and Fed. R. Bankr.P. 8001. For the reasons stated herein, the Bankruptcy Court’s Judgment is affirmed-in-part, reversed-in-part, and remanded for further proceedings not inconsistent with this Opinion.

FACTUAL BACKGROUND

A, The French (and Canadian) Connection

Debtor-Appellant SNP Boat Service S.A. (“SNP”) is a corporation organized under the laws of France. In addition to designing luxury boats, SNP provides brokerage, charter, and boat management services associated with its principal line of business. Appellee Hotel Le St. James (“St.James”) is a corporation organized under the laws of Canada. In May 2008, SNP executed a contract for the sale of a vessel to a third party. The terms of the contract required SNP to accept the trade-in of the M/Y Saint James — a separate vessel owned by St. James — and credit 2,500,000 to St. James’ account upon delivery.

The M/Y Saint James was ultimately delivered to SNP; however, SNP took issue with the condition of the vessel. SNP claimed the vessel “had not been delivered in good maintenance and operating condition.” Appellant’s Br., at 8 (ECF No. 12). SNP also claimed that it had not received proper documentation upon the delivery of [778]*778the vessel. Consequently, on October 22, 2008, SNP informed St. James that the terms of the contract had not been fulfilled and SNP would not be crediting St. James’ account pursuant to the terms of the contract. St. James disputed SNP’s conclusion that St. James had breached the contract in a letter it sent to SNP approximately two days later.

The emerging contract dispute between SNP and St. James then took on a decisively international flavor. On October 27, 2008, SNP initiated an action against St. James in the Commercial Court of Cannes, France (the “French proceeding”). On November 6, 2008, St. James initiated a separate action against SNP in the Court of Montreal in Canada (the “Canadian proceeding”). At the Canadian proceeding, SNP argued that the Court of Montreal lacked both personal jurisdiction over SNP and subject matter jurisdiction to consider St. James’ breach of contract claim. The Canadian courts denied SNP’s jurisdictional arguments at both the trial and appellate level.

On April 7, 2009, the French Commercial Court approved a French sauvegarde proceeding for SNP. The goals of a sauve-garde proceeding are to “facilitate the reorganization of the debtor in order to pursue its commercial activity, to maintain its employments and to repay its debts.” Appellant’s Br., at 2-3. Often compared to reorganization under Chapter 11 of the U.S. Bankruptcy Code, a sauvegarde proceeding imposes an automatic stay on any legal proceeding initiated by creditors of the debtor.1 The French Supreme Court has held that this automatic stay has an international effect.2 On August 25, 2009, St. James submitted an unsecured claim in the sauvegarde proceeding for the price of the M/Y Saint James, plus interest, damages, and other costs.

As the French sauvegarde proceeding was taking place, the Canadian proceeding was also progressing. After SNP’s jurisdictional arguments were rejected, SNP’s Canadian counsel withdrew. The Superior Court of Quebec served notice on SNP and SNP’s Foreign Representative that the Court would enter judgment against SNP should SNP not obtain replacement counsel and defend itself in the Canadian litigation. SNP failed to defend itself, and on October 16, 2009, the Superior Court of Quebec entered a default judgment in the amount of CAD $4,047,500 in favor of St. James and against SNP (the “Canadian judgment”).

B. Coming to America

At some point after obtaining the Canadian judgment St. James learned SNP had assets located in Florida, and on February 17, 2010, St. James domesticated the Canadian Judgment in Broward County, Florida. Shortly thereafter, the Broward County Sheriffs office seized two of SNP’s vessels — the M/Y Sixty Five and the M/Y [779]*779Foursome — pursuant to a writ of execution issued by the state court. Before the vessels could be sold to satisfy St. James’ judgment, however, the French Commercial Court designated Pierre-Louis Ezavin as administrator of SNP, and on April 6, 2010, Ezavin filed a Chapter 15 Petition in U.S. Bankruptcy Court seeking recognition of the French sauvegarde proceeding as a “foreign proceeding” pursuant to 11 U.S.C. § 1515.

On April 28, 2010, the bankruptcy court formally recognized the French sauve-garde proceeding as a foreign main proceeding and Ezavin as SNP’s foreign representative. Pursuant to 11 U.S.C. § 362, the bankruptcy court also ordered a stay with respect to the sale of any SNP property located within the United States. Finally, the court released the M/Y Sixty Five to Ezavin’s custody, but prohibited the vessel from leaving the Southern District of Florida and ordered that any transfer or sale of the vessel was subject to court approval.

One week later, SNP motioned the bankruptcy court to enter an order finding the M/Y Sixty Five subject to the jurisdiction of the French Commercial Court sau-vegarde proceeding, and entrusting the M/Y Sixty Five to Ezavin (the “Entrustment Motion”). St. James opposed the motion on several grounds. A hearing was scheduled for June 8, 2010, but was ultimately continued to August 9, 2010 due to concerns the bankruptcy court had regarding international comity. Complicating matters, on June 17, 2010, the French Commercial Court entered a declaratory judgment finding SNP not liable for the 2,500,000 price of the M/Y Saint James.

On August 9, 2010, the bankruptcy court granted SNP’s Motion to Continue the En-trustment Motion Hearing. The court also ordered the parties to attend a second settlement conference,3 which was to take place on September 7, 2010. The bankruptcy court ordered that Ezavin and a senior SNP representative with authority to bind SNP appear in person at the September 7, 2010 settlement conference. A status conference was then scheduled for the day after the settlement conference, at which time matters of discovery and scheduling were to be discussed.

St. James then served a request for production on SNP, seeking, inter alia, all documents filed in the sauvegarde proceeding; and translations of all pleadings in the sauvegarde proceeding. At the same time St. James served the request upon SNP, St. James motioned the bankruptcy court to shorten SNP’s deadline to respond to the production request. The court granted St.

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Bluebook (online)
483 B.R. 776, 2012 U.S. Dist. LEXIS 54615, 2012 WL 1355550, Counsel Stack Legal Research, https://law.counselstack.com/opinion/snp-boat-service-sa-v-hotel-le-st-james-flsd-2012.