Robert E. Derecktor, Inc. v. Bruderman et, al

Background

The court considered Derecktor’s claim for “expenses of justice,” meaning expenses incurred to preserve and maintain a vessel while it was under court custody. Derecktor had obtained a maritime arrest warrant for M/Y Independence on October 22, 2015. The court later appointed National Maritime Services as substitute custodian and authorized normal and routine maintenance, repairs, and cleaning needed to keep the yacht seaworthy and marketable. Derecktor paid National Maritime’s charges and provided services to the yacht while it remained arrested.

The yacht was released on September 12, 2017, after Ducky-Momo provided substitute security. An arbitration panel had previously awarded Derecktor $56,106.75 for services, but the court had found that the partial award did not clearly resolve which dockage, custodial, and other post-arrest expenses were included. The arbitration panel later issued a final award giving Ducky-Momo a net recovery of $1,628,754, which the court confirmed on January 19, 2021. The court deferred final judgment while it considered Derecktor’s expenses claim.

Expenses of Justice

Derecktor sought $248,969 for costs incurred in maintaining the yacht in a safe environment and seaworthy condition during its arrest. The court granted the claim. It concluded that the work was performed at National Maritime’s direction, that National Maritime had been authorized to conduct routine maintenance, and that the work preserved the yacht and benefited Ducky-Momo. The court also found that the work was not shown to involve major or unexpected repairs requiring separate advance approval.

The court rejected Ducky-Momo’s arguments that Derecktor could not recover because it lacked advance court approval or had arrested the yacht in bad faith based on an illegitimate lien. The court found persuasive the statement by a representative of National Maritime, an impartial court-appointed substitute custodian, that the claimed fees and services—including payments to National Maritime, winterization, daily checks, and dockage—were reasonable and necessary. The court also noted that the arbitration award had addressed Ducky-Momo’s claim for loss in value from damage to the yacht, including unfinished or defective work.

The court ruled that Derecktor was entitled to reimbursement of $248,969. It ordered that amount set off against Ducky-Momo’s $1,628,754 arbitration award.

Payment Under the Bond and Judgment

The court had previously denied as premature Ducky-Momo’s request for payment under Derecktor’s $331,000 bond because judgment had not yet been entered. After resolving Derecktor’s expenses claim, the court ordered Aspen American Insurance Company to pay $331,000 under the bond, with interest calculated from the date the bond was posted.

Judge Vincent L. Briccetti instructed the Clerk to enter judgment in favor of Ducky-Momo against Robert E. Derecktor, Inc. for $1,379,785. The court stated that the bond payment would partially satisfy that judgment. It also directed counsel to submit a joint letter about the status of the remaining parties and claims.