Cruise Ship Law

TERRY J. WILLIAMS, Plaintiff-Appellant-Cross-Appellee, -v.-WILMINGTON TRUST COMPANY, Defendant-Appellee-Cross-Appellant, AMERICAN SHIP MANAGEMENT LLC, APL LIMITED, JIM LONDAGAN, Capt., NEPTUNE ORIENT LINES, LTD. And M/V APL KOREA, her engines, boilers, generators, tackle, equipment, apparel, appurtenances, etc. in rem, Defendant-Appellees

Docket Nos. 02-9452(L), 02-9455(XAP)
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
345 F.3d 128; 2003 U.S. App. LEXIS 19931; 8 Wage & Hour Cas.2d (BNA) 1882
August 25, 2003, Argued
September 25, 2003, Decided

PRIOR HISTORY: Plaintiff appeals from a judgment of the United States District Court for the Southern District of New York (Martin, J.) granting summary judgment on plaintiff's claim for penalties under the seaman's wage statutes, 46 U.S.C. §§ 10313, 10504 (2000). We affirm on the alternative ground that the defendant, the nominal owner of the vessel, had given over control and operation of the vessel to another entity, such that the defendant was not an "owner" as that term is used in the wage penalty statute.

DISPOSITION: Decision of magistrate judge in appeal number 02-9455 (XAP) reversed. Judgment of District Court in appeal number 02-9452(L) affirmed.

PROCEDURAL POSTURE: Plaintiff sailor alleged that he demanded and did not receive timely payment for his work aboard defendant vessel, and that defendant nominal owner was liable for the wage penalty under 46 U.S.C.S. §§ 10313, 10504. The owner moved to dismiss arguing that it was not an owner. The magistrate judge denied the motion. The United States District Court for the Southern District of New York granted the owner summary judgment. The parties appealed.

OVERVIEW: The district court accepted the owner's argument its clerical errors fell within a statutory safe harbor for late payments having substantial cause. The instant court did not decide whether the owner's argument, which was accepted by the district court, was correct. If the owner was not the master or owner, it was not liable for a wage penalty. The instant court found that where a putative owner of a vessel entered into a demise or bareboat charter sufficient to render another entity the owner pro hac vice of the vessel, it was the owner pro hac vice that was liable for a wage penalty. There was no real dispute that defendant management company was in complete and exclusive possession, command, and navigation of the vessel. There was no evidence that anyone other than the company took any action in response to notices, and the owner did not pay the mortgage bills it received. Therefore, any reasonable finder of fact would have had to conclude that the owner was not the owner of the vessel. The magistrate judge erred in determining that the owner was an owner subject to penalties under the seaman's wage statutes. The owner was entitled to summary judgment on that basis.

OUTCOME: The decision of the magistrate judge was reversed. The judgment of the district court was affirmed.