WIENER, Circuit Judge.
Defendant-Appellant Oceanografia, S.A. ("OSA") appeals (1) the district court's denial of its motion to vacate attachment under Supplemental Admiralty Rule B and (2) that court's grant of Plaintiff-Appellant Malin International Ship Repair & Drydock, Inc.'s ("Malin") motion for summary judgment. Concluding that both the attachment and the summary judgment were proper, we affirm.
Malin operates a shipyard in Galveston, Texas. In 2008 and 2009, Malin performed work for OSA, a Mexican corporation, and Con-Dive, LLC ("Con-Dive"), a now-defunct Texas company. Not having received payment for its work, Malin sued OSA for the balance of its unpaid invoices for work, services, materials, and supplies that it had provided to OSA at the request of Con-Dive. Malin sought recovery on the alternative theories of breach of contract and quantum meruit.
OSA operated a vessel, the M/V KESTREL, under a bareboat charter agreement. The registered owner of the M/V KESTREL, Cal Dive Offshore Contractors, Inc. ("Cal Dive"), had entered into a charter agreement with Gulf Offshore Construction, Inc. ("GOC"), which in turn bareboat chartered the vessel to OSA. OSA had taken delivery of the vessel on October 15, 2012. The charter agreement stated that "[a]t the time of delivery[, OSA] shall purchase the bunkers . . . in the said Vessel at the then current market price at the port of delivery." To obtain jurisdiction over OSA pursuant to Supplemental Admiralty Rule B, Malin attached the fuel bunkers
OSA and Cal Dive sought to vacate the attachment, contending that OSA did not hold an attachable interest in the bunkers at the time of Malin's attachment because title to them had not yet passed to OSA. According to OSA and Cal Dive, OSA had neither paid for the bunkers nor received an invoice for them and therefore did not own them.
The district court denied their motions, holding that OSA's possessory interest in the bunkers constituted an attachable interest under Rule B. Cal Dive then posted a vessel release bond to substitute for the seized bunkers of the M/V KESTREL and to secure the liability of OSA to Malin.
Malin then sought summary judgment on its breach of contract and quantum meruit claims against OSA. Malin contended that Con-Dive was OSA's agent and had authority to bind OSA to the invoices, or, in the alternative, that OSA had ratified the invoices or is liable to Malin on its
The magistrate judge recommended granting summary judgment in favor of Malin based on its ratification and quantum meruit theories. The magistrate judge also recommended that Malin be awarded attorneys fees on its ratification claim. The district court accepted and adopted the magistrate judge's Report and Recommendation, then rendered judgment to Malin for the amount of the invoices, plus accrued interest and attorneys fees. This appeal followed.
On appeal, OSA contends that the district court erred in denying its motion to vacate the attachment. It argues that the attachment of the bunkers was improper under Supplemental Rule B because the bunkers were not its property. OSA further asserts that the district court erred in granting Malin's motion for summary judgment on its ratification theory.
The propriety of the attachment of the bunkers aboard the M/V KESTREL goes to the district court's jurisdiction over OSA, so we begin there. We review an order denying a motion to vacate an attachment under Rule B for abuse of discretion, and we review issues of law de novo.
Supplemental Rule B provides:
"Rule B allows a district court to take jurisdiction over a defendant in an admiralty or maritime action by attaching property of the defendant."
The only issue before us is whether the fuel bunkers constituted OSA's "tangible or intangible personal property" at the time of attachment.
The Supreme Court approved of maritime attachment in Manro v. Almeida.
Later, the Third Circuit in McGahern v. Koppers Coal Co. distinguished Kingston when considering whether a bareboat charterer possessed an attachable interested in the chartered vessel.
Although these cases recognized the principle that a conditional right to title may support attachment under Rule B, a more recent unpublished Fourth Circuit opinion adopted a narrower approach. In Wave Maker Shipping Co., Ltd. v. Hawksphere
The Second Circuit recently emphasized the importance of ownership in determining whether an interest is attachable under Rule B. In deciding whether electronic fund transfers ("EFTs") are an attachable interest under Rule B, the Second Circuit, relying on New York state law, held that they are not: "Because EFTs in the temporary possession of an intermediary bank are not property of either the originator or the beneficiary under New York law, they cannot be subject to attachment under Rule B."
Several district courts have found an attachable property interest under Rule B when the defendant's interest does not rise to ownership. For example, in World Fuel Services, Inc. v. SE Shipping Lines Pte., Ltd.,
The body of federal maritime jurisprudence presents ambiguity as to whether, as the district court held here, a possessory interest is attachable under Rule B. Neither does federal maritime law categorize the type of interest that OSA held in the fuel bunkers at the time of the attachment. Confronted with such a void, other courts "generally look to state law to
At the district court, Cal Dive contended that Texas law governs this issue. The bareboat charter agreement specifies that Texas law applies when federal maritime law is silent. An amendment to the agreement, effective shortly before the instant attachment, specifies that Mexican law applies. Neither party directed us to this amendment or urged us or the district court to apply Mexican law. Under Federal Rule of Civil Procedure 44.1, "[a] party who intends to raise an issue about a foreign country's law must give notice by a pleading or other writing."
OSA and GOC executed the bareboat charter agreement on September 12, 2012. The agreement provides that OSA "shall purchase the bunkers" at the time of delivery: "At the time of delivery the Charterers shall purchase the bunkers . . . in the said Vessel at the then current market price at the port of delivery." OSA took delivery of the M/V KESTREL (and consequently its bunkers) on October 15, 2012. Malin attached the fuel bunkers aboard the M/V KESTREL on October 29, 2012. As of October 31, 2012, OSA had neither paid for nor received an invoice for the bunkers. Our task is to determine the nature of the property interest OSA held in the fuel bunkers at the time of attachment.
Texas has adopted Article 2 of the Uniform Commercial Code, which governs the sale of goods. Relevant here, Article 2 specifies that "title passes to the buyer at the time and place at which the seller completes his performance with reference to the physical delivery of the goods. . . ."
Under Texas common law, the instant at which title to personal property passes from seller to buyer depends on the parties' intent.
The instant agreement specifies that OSA "shall purchase the bunkers" at the time of delivery. Although Cal Dive asserted in the district court that this language indicates that the parties contemplated a cash sale under which OSA would not obtain title until payment, this interpretation goes too far. "Purchase" means "[t]he acquisition of an interest in real or personal property by sale. . . ."
In addition, OSA's and Cal Dive's representations throughout this litigation show that Cal Dive did not expect OSA to remit payment for the bunkers at the time of delivery. Both parties have consistently represented that, as of the time of attachment on October 29, 2012, OSA had neither received an invoice for the fuel bunkers nor been asked to pay for them. OSA maintains that this confirms that it never obtained title to the bunkers. We disagree: It shows that OSA was not expected to pay for the bunkers at the time of delivery. Thus, under Texas law, the parties contemplated a credit transaction. Further, there is no evidence in the record indicating that OSA and Cal Dive intended
Under this analysis, OSA received title to the bunkers on October 15, 2012, the day that it took possession of the M/V KESTREL. Malin attached those bunkers on October 29, 2012. Because OSA held title to the bunkers at the time of Malin's attachment—and title to property unquestionably suffices as an attachable interest under Rule B—we affirm the district court's denial of OSA's motion to vacate the attachment.
Having confirmed that the district court had personal jurisdiction over OSA by virtue of the attachment of the bunkers on the vessel that it had chartered, we turn to OSA's challenges to the district court's summary judgment in favor of Malin. We review the district court's summary judgment de novo, applying the same standards as the district court.
In his Report and Recommendation on Malin's motion for summary judgment, the magistrate judge found the following facts to be undisputed: (1) Con-Dive represented to Malin that it was acting for and with the permission of OSA when it arranged for the work and services; (2) Malin performed the work and provided the services; (3) through Con-Dive, an OSA employee furnished instructions and directions for Malin's work; (4) Malin periodically invoiced OSA for the work; (5) these invoices contained the terms and conditions of the contracts, including provisions for the collection of service charges and attorney's fees; (6) OSA, through an employee, promised to pay the overdue invoices; (7) OSA did nothing within any reasonably relevant time to disaffirm Con-Dive's authority or Malin's work; and (8) OSA retained all of the benefits of Malin's work. On that record, the magistrate judge recommended finding that OSA ratified Malin's work and invoices and is liable to Malin for payment. The magistrate judge recommended finding in the alternative that OSA is liable for the payment of Malin's invoices on the basis of quantum meruit. The magistrate judge also recommended that Malin be awarded attorneys fees on the basis of its ratification theory, but not on its quantum meruit theory. The district court adopted these findings and entered judgment in favor of Malin.
OSA contends that the district court erred in holding that OSA ratified
OSA initially contends that Malin failed to show that its services benefited OSA. Whether Malin's services benefited OSA, however, has no bearing on Malin's ratification theory. Demonstrating that a party accepted benefits under a contract is one way to show ratification, but it is not the only way.
OSA next contends that the presence of an issue of fact as to whether Con-Dive acted as Malin's agent should have precluded summary judgment on Malin's ratification theory. But an agency relationship is not required to uphold the district court's ruling that OSA ratified Con-Dive's acts.
OSA finally contends that Malin failed to show that OSA ratified the invoices' provisions on interest and attorneys fees. On an undisputed record, the magistrate judge found that Malin invoiced OSA for its services and that "the invoices contained the terms and conditions of the contracts, including the provisions for the collection of service charges and attorney's fees. . . ." Malin supplied an affidavit from Gabe Socias, a superintendent at Malin, who testified that "Malin and Oceanografia/Con-Dive agreed to the provision of certain work and services . . . pursuant to the terms of Malin's invoices." Socias further testified that "[t]he invoices attached are true and correct copies of the originals and accurately reflect the work and services provided by Malin to Oceanografia and Con-Dive." Each invoice includes two parts: (1) a basic invoice, dated at various times in 2008, which reflected the invoice number, date, services rendered, and amount due; and (2) a formal invoice, reflecting, inter alia, the original invoice date, the total amount invoiced, the interest due as of February 10, 2009, and the interest and attorneys fees provisions.
On appeal, OSA tries to inject ambiguity into the summary judgment record by asserting that there is no evidence that OSA received the formal invoices containing the interest and attorneys fees provisions. It follows, argues OSA, that the evidence does not prove that it ratified the interest and attorneys fees provisions of the invoices.
We note that OSA proffered no summary judgment evidence to show that it did not receive the relevant invoices. By contrast, the unrefuted summary judgment evidence, as established by Socias's affidavit, proves that (1) OSA agreed to Malin's provision of services and work pursuant to Malin's invoices, and (2) the attached invoices are the "true and correct copies of the originals. . . ." In addition, the June 9, 2009, e-mail from OSA's representative confirms OSA's receipt of the "overdue" invoice statements and OSA's agreement to pay the invoices. We must assume that, if OSA had evidence to create an issue of fact to preclude summary judgment, it would have supplied it.
We affirm the district court's denial of OSA's and Cal Dive's motions to vacate the attachment, and we affirm the district court's summary judgment in favor of Malin.
AFFIRMED.