Barnet Marine Inc. v. Laurel D Shipping LLC

Background

Barnet Marine Inc. owns the commercial motor tanker CE-NIRIIS. Laurel D Shipping LLC, now known as Laurel Shipping LLC, chartered the vessel for a voyage that included discharging cargo in Hong Kong. The charter party allowed 96 hours of laytime and set demurrage at $15,000 per day. It also required demurrage claims, with all supporting documents, to be submitted within 90 days after discharge was completed.

The vessel arrived in Hong Kong and first tendered a Notice of Readiness on August 6, 2020. After crew members tested positive for COVID-19, Hong Kong authorities ordered the vessel into quarantine. The vessel received free pratique on September 7, 2020, and completed discharge on September 15, 2020.

Barnet Marine submitted a $97,500 demurrage claim on October 20, 2020, 35 days after discharge. It later submitted a $573,437.55 claim on January 29, 2021, 136 days after discharge. The later claim relied on the August 6 Notice of Readiness rather than the September 7 Notice of Readiness used for the first claim and included supporting documents that had not been sent with the original claim.

Motion to Vacate the Attachment

The court had previously issued an attachment order under Rule B of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions. Laurel asked the court to vacate that order, arguing that it could be found in Connecticut, described in the motion as a convenient adjacent jurisdiction.

The court explained that a defendant is “found” in a district for this purpose only if it is subject to personal jurisdiction there and can be served there with reasonable diligence. Laurel had the burden of establishing the grounds for vacatur.

The court concluded that Laurel was not subject to personal jurisdiction in Connecticut. Laurel had not shown that it targeted Connecticut residents in a way that would satisfy Connecticut’s long-arm statutes. The court also found that Laurel had not provided enough evidence to establish that its Connecticut office was its principal place of business for constitutional due-process purposes. Its answer, business certificate, and declaration from an assistant secretary did not provide facts showing where the company’s important decisions were made or who controlled its operations.

Because Laurel was not present in Connecticut for purposes of the attachment rules, the court denied Laurel’s motion to vacate the attachment.

Partial Judgment on the Pleadings

Laurel also sought partial judgment on the pleadings under Rule 12(c) concerning Barnet Marine’s $573,437.55 claim. Judgment on the pleadings is appropriate when the material facts are undisputed and the pleadings show that judgment is possible. In a contract case, the court may decide the issue at this stage when the contract is unambiguous.

The court held that the charter party clearly released Laurel from liability for a demurrage claim unless the claim and all supporting documents were submitted within 90 days after discharge. Barnet Marine’s January 29 claim was submitted 136 days after discharge. The court rejected Barnet Marine’s argument that the January 29 submission was merely an amendment to its timely October claim. The later submission relied on a different Notice of Readiness and included documents that had not accompanied the original claim.

The court therefore held that the January 29 claim was barred by the charter party’s time-limit provision and granted Laurel’s motion for partial judgment on the pleadings as to that claim.

The court did not decide whether the August 6 Notice of Readiness was invalid because the vessel had not yet received free pratique. It noted that the charter party’s COVID-19 provision could reasonably be read to excuse the lack of free pratique, but found it unnecessary to resolve that issue because the claim was untimely.

Disposition

The court denied the motion to vacate the attachment and granted the motion for partial judgment on the pleadings. Because the $573,437.55 claim was time-barred, the court stated that the remaining contested demurrage claim was the original $97,500 claim. It directed Barnet Marine to submit a proposed amended attachment order replacing the earlier order with an attachment up to $97,500. The court also required the parties to provide a joint update about settlement discussions and the discovery stay.