United States District Court, D. South Carolina, Charleston Division
REPORT AND RECOMMENDATION
Bristow Marchant United States Magistrate Judge
action has been filed by the Plaintiff seeking storage fees
and collection costs (including legal fees and costs)
relating to the storage of a boat, the Sailing Vessel Frolic
(“Frolic”), at Plaintiff's place of
businesses. Plaintiff contends that the Defendants Owens and
Closson, along with certain entities, are responsible for payment
of these fees and costs pursuant to a contract signed with
the Plaintiff to haul the Frolic out of the water and to
provide storage. Plaintiff's claims are for enforcement
of a maritime lien (First Cause of Action), breach of
contract (Second Cause of Action), for quantum
meruit (Third Cause of Action), for unjust enrichment
(Fourth Cause of Action), and for fraudulent conveyance
(Fifth Cause of Action). See Plaintiff's Third
4, 2017, Defendant Owens filed a second renewed motion for
summary judgment pursuant to Rule 56,
Fed.R.Civ.P. Although Closson is also a Defendant,
since he is proceeding pro se, a Roseboro
Order was entered by Court on May 5, 2017,
advising Closson of the importance of a dispositive motion
and of the need for him to file an adequate response. Closson
was specifically advised that if he failed to respond
adequately, Owens' motion (which only seeks the dismissal
of Owens as a party Defendant) may be granted.
did not thereafter file a response; however, Plaintiff filed
a response in opposition to Owens' motion on May 18,
2017, following which Owens filed a reply memorandum on May
25, 2017. The Defendant Owens' motion for summary
judgment (as to her) is now before the Court for
and Owens are husband and wife, having been married in 2007.
In November 2010, they purchased the Frolic with both marital
funds and joint insurance proceeds from the sinking of their
previous boat. Owens Deposition, pp. 24-25;
Closson Deposition, p. 32. The Frolic was moored in
Charleston, and the plan was to fix her up and put the Frolic
into service as a commercial passenger vessel in Rhode
Island. Closson Deposition, p. 10. Owens testified
that she and Closson traveled to South Carolina to see the
Frolic prior to purchasing the vessel. Owens
Deposition, pp. 39-40; see also Closson
Deposition, p. 33. The Frolic was thereafter registered
with the United States Coast Guard in November 2010 in both
parties' names as owners, with Closson listed as the
“managing” Owner. Owens Deposition, p.
55; Court Docket No. 208-2, pp. 3-12.
November 2010, Closson signed a charter agreement between the
Frolic and Aquidneck Ferry & Charter, Inc.
(“Aquidneck”), a company created by
Closson. Closson Deposition, Exhibit 5.
Aquidneck ran a ferry service in Rhode Island. Closson
Deposition, pp. 13-14. Closson signed the agreement as
the Owner of the Frolic and as the President of Aquidneck.
See Court Docket No. 208-32, p. 2. The charter
agreement stated that while Aquidneck was chartering the
Frolic from its owners, the Frolic Owners remained liable and
responsible for vessel storage, insurance, the crew, and
other items. See Court Docket No. 208-32.
August 2011, Captain O. Bryan Harris was hired by Closson for
a “hurricane haul”, removing the Frolic, which
was still in South Carolina, from the water to protect it
from a hurricane. See Court Docket No. 208-34
(Harris Affidavit). The Hurricane Haul Agreement with the
Plaintiff was executed by Harris as agent for the owners. The
Frolic was then navigated to Pierside by Harris, and the
parties do not dispute that the Frolic has been and continues
to be located at Pierside since August 2011. See
Court Docket No. 108-3, pp. 31-34; No. 198-1, p. 2. In
October 2011, Closson apparently signed a work order for
Pierside to perform some repairs and maintenance work on the
Frolic. See Court Docket No. 208-3. For her part,
Owens testified that she has never been to Pierside Boatworks
and does not believe that she ever signed any documents at
Pierside. Owens Deposition, p. 68. However,
John Brophy, the Plaintiff's President, testified that
Owens did come to Pierside, his boatyard, in early 2012.
Brophy Deposition, pp. 11, 25, 28-30.
emailed Brophy in October 2011 that he wanted the Frolic
placed in the water, following which he planned to take the
Frolic to the Ashley Marina in Charleston and then to Rhode
Island to be placed in commercial service. See Court
Docket No. 208-3, pp. 2-3. Closson also sent an email to a
local attorney regarding plans to commercially operate the
Frolic in Rhode Island. See Court Docket No. 208-3,
pp. 3-5. Plaintiff contends that also around this time,
Closson created flyers advertising the Frolic for charter
under the name Frolic Yacht Charters with a specific website
and contact information, although Aquidneck is not mentioned
as the charter company on the flyers. See Court
Docket No. 208-49. While Owens asserts that she knew nothing
of these plans, the evidence submitted shows that she was
copied on various of these emails both with the Plaintiff and
the lawyer concerning Pierside's work and the plans for
the boat. See Court Docket No. 208-3, pp. 3, 5, 7-8.
February 9, 2012, Closson signed a storage agreement with the
Plaintiff. Closson Deposition, p. 47 &
Exhibit 27; Brophy Deposition, Exhibit 4. Closson
wanted to do some work on the Frolic himself at that time,
and Brophy testified this agreement has to be signed before
someone can come onto the premises to themselves do work on a
boat stored there (i.e. “Do it yourself”
storage). Brophy Deposition, pp. 23-26. At that
point, the Frolic had already been stored at Plaintiff's
facility for approximately six (6) months with no payments
for the boat's storage ever having been made. Brophy
Deposition, pp. 24-26. Brophy testified that based upon
Closson's representation of himself as the Owner and
based on the 2011 Hurricane Haul Agreement signed by Captain
Harris, Brophy believed Closson to be the owner and that all
bills had been submitted to Closson's email with invoices
addressed to Addison Closson. Brophy Deposition, pp
28, 31, 63-65; Exhibits 4-6 (Attached to Defendant Owens'
Motion for Summary Judgment).
Closson visited the facility over the course of a few days
when executing this agreement, Brophy testified that Owens
was also present on at least one occasion, although Brophy
did not speak to her. Brophy Deposition, pp. 24-25,
28-30. Further, when Closson did make a payment
to the Plaintiff on February 10, 2012 for the repair work
that had been done on the boat, he used the debit card from
Closson and Owens' joint bank account. See
Exhibit 1 (Attached to Defendant Owens' Reply
Memorandum); see also Court Docket No. 208-40, p. 3.
That payment did not include any amount for Plaintiff's
continued storage of the Frolic. Brophy Deposition,
p. 24. However, in June 2012, Closson emailed Plaintiff
stating that he and Owens had received their income tax
refund check and would be able to make a payment on a
settlement offer for the storage fees with this refund.
See Court Docket No. 208-42. This offer was not for
the full amount owed, and Brophy responded by demanding that
the outstanding balance be paid immediately or he would
“hand the account over to an attorney”. It is
uncontested that thereafter no payment was ever made. On May
14, 2015, Closson sent Plaintiff another email regarding the
outstanding balance, with Owens copied on the email. The
email stated that Closson and Owens had discussed the debt
owed and that they were willing to transfer title of the boat
to a “qualified new owner who has the ability to
restore her to her original condition”, but did not
offer to pay the outstanding bill owed for storage of the
boat. It was signed “Addison Closson and Judith
Owens.” See Court Docket No. 208-43. On May
21, 2015 another email was sent to the Plaintiff stating that
although Closson and Owens wanted to resolve the debt issue,
they were also prepared to litigate the matter, which would
be “quite time consuming and expensive”. The
email was again signed as being from both Closson and Owens,
and Owens was copied on the email. See Court Docket
2015, Plaintiff filed a lawsuit in state Magistrate Court to
sell the Frolic. However, Closson and Owens then transferred
ownership of the Frolic to a company called Mickle, LLC, on
July 2, 2015. Addison Closson was listed on the incorporation
documents as the “agent” for Mickle, LLC.
See Court Docket No. 44, p. 2, ¶ 2 of the Fact
Section; Court Docket No. 44-1, p. 1. Both Owens and Closson
signed the Bill of Sale transferring ownership of the boat to
Mickle, LLC. See Court Docket No. 208-4;
see Court Docket No. 44, p. 2, ¶ 3 of the Fact
Section; Court Docket No. 44-1, p. 4. Plaintiff contends that
Closson and Owens also filed a Schedule C on their 2016 tax
return for this company. On July 31, 2015, Closson and Owens
hired an attorney to file a special Motion to Dismiss the
Magistrate Court's action. See Court Docket No.
208-48. Plaintiff thereafter voluntarily dismissed that
action, and noticed Defendants' counsel that a case would
be filed in federal court. This case was then filed on
September 15, 2015.
November 2015, the M/V Frolic, LLC was formed. Closson and
Owens are listed as the managing members of this company on
the incorporation document. See Court Docket No.
208-9. Thereafter, on December 8, 2015,
ownership of the Frolic was transferred to M/V Frolic, LLC.
See Court Docket No. 208-12. Again, both Closson and
Owens signed the Bill of Sale. See Court Docket No.
208-13. On December 10, 2015, Closson and Owens filed
paperwork with the U.S. Coast Guard requesting that the
Frolic's ownership be transferred to M/V Frolic, LLC.
See Court Docket No. 208-14. That same month,
Closson and Owens' counsel filed two Answers and Amended
Answers on behalf of Closson and Owens, asserting ownership
of the Frolic by M/V Frolic, LLC. See Court Docket
Nos. 208-16 & 208-17.
April 1, 2016, Owens and Closson sent a letter to the Coast
Guard asking the Coast Guard to disregard the application of
Mickle, LLC to list the Frolic as its property, and to
instead list it as the property of M/V Frolic, LLC.
See Court Docket No. 208-18, p. 1. On April 12,
2016, Closson sent the vessel documentation service an email
asking that they place the transfer to M/V Frolic, LLC on
hold until some issues can be sorted out. See Court
Docket No. 208-19, p. 1. In May 2016, Closson and Owens
stated in federal court documents that a “clerical
error” occurred when the sale to M/V Frolic, LLC listed
Owens and Closson as the Frolic's owners and their
counsel was wrong when he filed the Answers and Amended
Answers. See Court Docket No. 44, p. 3, ¶ 11.
judgment shall be rendered forthwith if the pleadings,
depositions, documentary evidence, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to
judgment as a matter of law. Rule 56,
Fed.R.Civ.P. The moving party has the burden of
proving that judgment on the pleadings is appropriate.
Temkin v. Frederick County Comm'rs, 945 F.2d
716, 718 (4th Cir. 1991). Once the moving party makes this
showing, however, the opposing party must respond to the
motion with specific facts showing there is a genuine issue
for trial. Baber v. Hosp. Corp. of Am., 977 F.2d
872, 874-75 (4th Cir. 1992).
after careful review and consideration of the arguments and
evidence presented, the undersigned finds and concludes that
the Defendant Owens' motion should be granted, in part,
and denied, in part, as is set forth below.
First Cause of Action is for a maritime lien to be placed on
the Frolic, which remains at the Plaintiff's shipyard. A
maritime lien is “a special property right in the
vessel, arising in favor of the creditor by operation of law
as security for a debt or claim.” State Bank &
Tr. Co. v. LIL AL M/V, No. 16-5053, 2017 WL 3265870, at
*2 (E.D. La. Aug. 1, 2017). Plaintiff asserts that it is
entitled to enforce a maritime lien in order to have the
Frolic “arrested” and sold.
has not moved for summary judgment on Plaintiff's first
cause of action, nor has she moved on behalf of any other
Defendant. Rather, she has only moved for summary judgment on
the remaining causes of action as to her individually.