Virginia Lawyers Weekly VA Lawyers Weekly
Where a subcontractor that was not paid for its services asserted a maritime lien on vessels owned by the United States, its complaint was dismissed. The majority of courts, including district courts in the Fourth Circuit, have held that the Maritime and Commercial Instruments Lien Act, or MCILA, prohibits fixing maritime liens on public vessels.
Background
The United States contracted with Great Eastern Group Inc., or GEG, to provide certain services to four training vessels. GEG entered into a subcontracting agreement with Seaward Services Inc. to provide certain crew and services to the vessels.
Seaward provided the services due under the subcontracting agreement; however, GEG failed to provide payment to Seaward. On Nov. 18, 2019, Seaward notified defendant that Seaward had not been paid for past services and was continuing to provide services for which it was not being paid. Because Seaward received no payments or assurances of future payment, it issued a notice of intent to stop work due to nonpayment to defendant.
Seaward alleges that as a result of nonpayment, it has a maritime lien against the vessels for the outstanding balance. Defendant has filed a motion to dismiss.
Analysis
Defendant contends that the MCILA prohibits fixing maritime liens on public vessels. Plaintiff argues that the MCILA only prohibits in rem actions on public vessels, while the Suits in Admiralty Act and Public Vessels Act permit in personam actions on public vessels. Plaintiff claims that this action is an in personam claim, so it is not barred by the MCILA.
Only one circuit court, the 11th Circuit, has opined on the issue, finding that the MCILA does not prohibit in personam actions against public vessels. However, the Bonanni ruling hardly renders the issue settled in the 11th Circuit. The Bonanni court expressed reservations about its own ruling, noting “[g]iven the clear desire of Congress to exempt public vessels from coverage under the maritime lien provisions of the MCILA . . . en banc
Review Overview
District courts around the country, with the exception of those in the 11th Circuit, have been uniform in their plain text interpretation of the MCILA and have found that it prohibits liens on public vessels. District courts within the Fourth Circuit have also been uniform in their interpretation of the MCILA as prohibiting maritime lien actions against public vessels. The court agrees with these cases.
The language of the MCILA and the intent of Congress clearly prohibits maritime lien actions, whether in rem or in personam, against public vessels. When “the words of a statute are unambiguous, the judicial inquiry is complete.” The plain meaning of the MCILA could not be clearer: “[the] section does not apply to a public vessel.” Even if the court were to find ambiguity where none exists, the legislative history illustrates the clear intent of Congress to prohibit such actions.
Defendant’s motion to dismiss granted.
Seaward Services Inc. v. United States, Case No. 2:21-cv-131, Feb. 7, 2022. EDVA at Norfolk (Young). VLW 022-3-063. 9 pp.
