Marriott International, Inc. v. M/Y Under the Radar, a 2001 37.8-Foot Sea Ray Sundancer Motor Yacht, U.S. Coast Guard Official No. 1120637

Summary

The United States District Court for the Southern District of California granted Marriott International, Inc.’s motion for interlocutory sale of the vessel M/Y Under the Radar and authorization to credit bid. The court found that Marriott had maritime liens based on necessaries provided through wharfage services and damages arising from maritime trespass. The court authorized a public auction and permitted Marriott to credit bid its secured indebtedness and qualifying custodial costs, excluding attorneys’ fees, subject to applicable local-rule requirements.

Holdings

1. Wharfage or storage services reasonably needed for the vessel's operations are necessaries under 46 U.S.C. § 31342(a), and Marriott therefore held a maritime lien against the vessel.
2. The continued presence of the vessel in Marriott's marina after termination of the wharfage contract, notice, and an opportunity to remove the vessel supported a finding of maritime trespass and a preferred maritime lien under 46 U.S.C. § 31301(5)(B).
3. An interlocutory sale was warranted because the expense of keeping the arrested vessel was excessive or disproportionate to its value and because there was an unreasonable delay in securing its release.
4. Marriott was authorized to credit bid at the auction up to the amount of its secured indebtedness established by affidavit, including its maritime lien claim and actual demonstrable custodia legis expenses, but excluding attorneys' fees.

Questions Presented

1. Whether Marriott established a maritime lien under 46 U.S.C. § 31342(a) for providing wharfage or storage services constituting necessaries to the vessel.
2. Whether the vessel's continued presence in the marina after termination of the wharfage contract and notice to remove it supported a preferred maritime lien for damages arising from maritime trespass under 46 U.S.C. § 31301(5)(B).
3. Whether an interlocutory sale was warranted because the expense of keeping the vessel was excessive or disproportionate and because there was an unreasonable delay in securing its release.
4. Whether Marriott could credit bid the amount of its secured maritime lien claims and authorized custodia legis expenses at the vessel auction, excluding attorneys' fees.

Disposition

other