Justia U.S. 1st Circuit Court of Appeals Opinion SummariesArticles Posted in Admiralty & Maritime Law
Catlin (Syndicate 2003) at Lloyd’s v. San Juan Towing & Marine Servs., Inc.
In 2011, Catlin (Syndicate 2003) at Lloyd’s (“Catlin”) issued to San Juan Towing and Marine Services (SJT), a ship repair company based on San Jan, Puerto Rico, a marine insurance policy to cover SJT’s floating drydock. After the drydock was damaged and sold for scrap, the SJT filed a claim with Catlin, alleging the total loss of the drydock in the amount of $1,750,000. Catlin denied this claim. Catlin then filed a declaratory judgment complaint against SJT, alleging eight admiralty or maritime claims and seeking to void the policy. SJT filed a separate diversity suit against Catlin seeking recovery for the full insured value under the policy for the loss of the drydock. At trial, the district court concluded that the insurance policy was void ab initio pursuant to the doctrine of uberrimae fidei. The First Circuit affirmed as modified, holding (1) the contract was voidable, not void ab initio; and (2) SJT violated the doctrine of uberrimae fidei in its procurement of the policy, and thus, Catlin was entitled to void the policy. View "Catlin (Syndicate 2003) at Lloyd’s v. San Juan Towing & Marine Servs., Inc." on Justia Law
Town of Johnston v. Fed. Housing Fin. Agency
The states of Massachusetts and Rhode Island each tax the transfer of real estate. In separate actions, the Town of Johnston, Rhode Island and the Commissioners of Bristol County, Massachusetts (the municipalities) brought actions against Fannie Mae, Freddie Mac, and the Federal Housing Finance Agency (collectively, the entities), seeking declaratory judgments that the entities owed transfer taxes as well as money damages and equitable relief to recover the unpaid taxes. Federal district courts granted the entities’ motions to dismiss based on statutory exemptions from taxation. The municipalities appealed, arguing that a real property exception in the entities’ tax exemptions applies to the transfer taxes and that the exemptions themselves are unconstitutional. The First Circuit affirmed the dismissal of all claims, holding (1) the transfer taxes are not included in the real property exception to the entities’ tax exemptions; and (2) the tax exemptions are a constitutional exercise of Congress’ power under the Commerce Clause and do not violate the Tenth Amendment.View "Town of Johnston v. Fed. Housing Fin. Agency" on Justia Law
Ramirez v. Carolina Dream, Inc.
Appellant, a seaman, was diagnosed with aplastic anemia, a blood condition that preventing him from continuing to work. Appellant brought a personal injury action against his employer, alleging negligence under the Jones Act and maritime claims of unseaworthiness and maintenance and cure. The district court granted summary judgment for the employer. On appeal, Appellant challenged only the dismissal of his cause of action for maintenance and cure, arguing that he was entitled to that remedy until he “reaches maximum medical recovery.” The First Circuit vacated the district court’s ruling, holding that Appellant adduced sufficient evidence to support a finding that his aplastic anemia arose or became aggravated during his service on the ship and, hence, triggered the duty of maintenance and cure. Remanded.View "Ramirez v. Carolina Dream, Inc." on Justia Law
United States v. Nueci-Pena
A drug interdiction in Caribbean waters by the United States Coast Guard ended with the arrest and indictment of multiple defendants, including Appellant. The Coast Guard determined that the vessel was "without nationality" and subject to the jurisdiction of the United States under the Maritime Drug Law Enforcement Act (MDLEA). Appellant was convicted of possession with the intent to distribute more than 1140 pounds of cocaine and heroin while on board a vessel in violation of the MDLEA. On appeal, Appellant argued that Congress lacked the authority under the Piracies and Felonies Clause to criminalize drug trafficking on board a vessel in international waters under the MDLEA without requiring a nexus between the conduct and the United States. The First Circuit Court of Appeals affirmed, holding that any jurisdictional error under the MDLEA related to Appellant's conviction did not constitute plain error in this case. View "United States v. Nueci-Pena" on Justia Law
Barclays Bank PLC v. Poynter
Defendant bought a custom-made yacht with the help of a loan from Barclays Bank. When Defendant stopped making payments on the loan, Barclays repossessed the yacht and sold it pursuant to the Florida UCC. Barclays got less than what Defendant owed on the yacht, and therefore, Barclays sued Defendant for the deficiency. Defendant moved for summary judgment, arguing that Barclays was barred from recovering the deficiency because, in violation of the mortgage's terms, it did not provide Defendant with proper notice of the sale. The district court denied Defendant's motion and sua sponte granted summary judgment in favor of Barclays. The First Circuit Court of Appeals affirmed, holding that the notice Barclays provided to Defendant was sufficient. View "Barclays Bank PLC v. Poynter" on Justia Law
Markel Am. Ins. Co. v. Diaz-Santiago
In 2008, MDS purchased a vessel and executed a note in favor of FirstBank, secured by a preferred ship mortgage, under an agreement that required that they maintain insurance. In 2009, Customs and Border Protection seized the vessel as part of a drug enforcement action. The search and seizure damaged the vessel, significantly decreasing its value. Customs notified FirstBank, which initiated an administrative forfeiture proceeding, intervened in the criminal case, obtained voluntary dismissal of the indictment against the vessel, then submitted an insurance claim for "loss of the vessel including, without limitation, the value of the Bank's collateral, legal fees incurred in attempting to secure its release, as well as any applicable costs and interests." The insurer denied the claim. The district court granted FirstBank partial summary judgment and awarded $74,512.50 in attorneys' fees for costs and expenses incurred in securing release of the vessel and defending the validity of the policy. The First Circuit affirmed, finding no genuine issues of material fact. View "Markel Am. Ins. Co. v. Diaz-Santiago" on Justia Law
Fairest-Knight v. Marine World Distrib., Inc
In 2004, defendant had the used boat inspected. Although he could not test the engine, a certified marine surveyor concluded that the boat was good for cruising around Puerto Rico and coastal waters. Plaintiff, a first-time boat owner, purchased the boat "as is" for $38,000. During the next few years there were a number of problems; all repairs were done by defendant. Plaintiff paid $16,139.34 for repairs, $3,195.20 for towage and $2,990.00 for wharfage and insurance. During a period of 32 months, the boat was undergoing service or was otherwise unuseable for about nine months. Plaintiff filed claims under admiralty law and Article 1802 of the Puerto Rico Civil Code. The district court found that defendant breached its duty to a workmanlike performance upon which plaintiffs had a right to rely. The First Circuit reversed. Defendant was not liable; there was no evidence that its acts or omissions were the cause of the chronic problems. The court also vacated the award of damages for negligent infliction of emotional distress and pain and suffering under state law.