PSARA ENERGY LTD v. ST (2019)

SUMMARY ORDER

In October 2017 Psara Energy Ltd. (Psara) commenced this maritime case as an action in the District Court under Rule B of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions, seeking to obtain security for claims of over $ 19.6 million against Space Shipping Ltd. (Space) by garnishing an award (the Debt) owed to Space by ST Shipping & Transport Pte. Ltd. (ST Shipping). The District Court issued an order of attachment over the Debt but then vacated the order (the Vacatur Order) when it concluded that the Debt was not located within the District of Connecticut. Psara's subsequent motions to stay the Vacatur Order were denied, and it appealed. After the District Court issued its Vacatur Order, ST Shipping initiated a stakeholder proceeding before the English High Court of Justice to resolve Psara's and Space's competing claims to the Debt. The English High Court ruled that $ 911,894.40 and £204,620—sums that Space conceded it owed Psara—should be paid from the Debt to Psara, with the balance of the Debt going to Space. ST Shipping then moved to dismiss the present appeal as moot on the ground that the Debt had been liquidated. We assume the parties’ familiarity with the underlying facts and the record of prior proceedings, to which we refer only as necessary to explain our decision to dismiss the appeal as moot.

Because the thing Psara seeks to attach – the Debt – has been distributed from ST Shipping to Space and to Psara pursuant to the English High Court's order, it no longer exists as a discrete res in ST Shipping's possession. This Court cannot order the attachment of a res that no longer exists within the ownership of the garnishee, ST Shipping. See Republic Nat'l Bank of Miami v. United States, 506 U.S. 80, 87, 113 S.Ct. 554, 121 L.Ed.2d 474 (1992); Fid. Partners, Inc. v. First Tr. Co. of N.Y., 142 F.3d 560, 564–66 (2d Cir. 1998). The appeal is therefore moot. See In re Flanagan, 503 F.3d 171, 178 (2d Cir. 2007); cf. In re McLean Indus., Inc., 857 F.2d 88, 89 (2d Cir. 1988).

Psara acknowledges that the Debt has been distributed to Psara and Space pursuant to the English High Court's decision. But Psara suggests that we or the District Court may order Space to restore the res to ST Shipping, rendering the res once again attachable notwithstanding that decision. We decline to do so both because we extend comity to the decision of the English High Court, which had proper jurisdiction, and because the enforcement of its decision does not prejudice the rights of United States citizens or violate domestic public policy. Victrix S.S. Co., S.A. v. Salen Dry Cargo A.B., 825 F.2d 709, 713 (2d Cir. 1987). Psara insists that we should not extend comity to the English High Court because the English High Court did not extend comity to our Circuit. But there was no attachment order at the time the English High Court issued its decision. That Court, as it determined, therefore was not “acting in conflict either with an existing order of the Connecticut court or with the wishes of the US Court of Appeals.” ST Shipping v. Space Shipping [2018] EWHC (Comm) 156 [37] (Eng.).

We have considered Psara's remaining arguments as to mootness and conclude that they are without merit. For the foregoing reasons, ST Shipping's motion to dismiss the appeal is GRANTED and the appeal is DISMISSED as moot. ST Shipping's motion for sanctions and costs under Rule 38 is denied.