Exxon Corporation v. Central Gulf Lines, Inc.

500 U.S. 603 (1991)

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Nature of the Case

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Facts

The Hooper is owned by D and was chartered by the Waterman Steamship Corporation (Waterman) for use in maritime commerce. P was Waterman's exclusive worldwide supplier of gas and bunker fuel oil for some 40 years. In 1983, Waterman and Exxon negotiated a marine fuel requirements contract. P would supply Waterman's vessels with marine fuels when the vessels called at ports where P could supply the fuels directly. In ports where P had to rely on local suppliers, P would arrange for the local supplier to provide Waterman vessels with fuel. P would pay the local supplier for the fuel and then invoice Waterman. (Arabian Marine) of Jeddah, Saudi Arabia. P acting as an agent paid for the fuel and invoiced Waterman, in turn, for $763,644. Waterman sought reorganization under Chapter 11 of the Bankruptcy Code and never paid the full amount of the bill. During the reorganization proceedings, D agreed to assume personal liability for the unpaid bill if a court were to hold the Hooper liable in rem for that cost. P sued D in personam and against the Hooper in rem. P claimed to have a maritime lien on the Hooper under the Federal Maritime Lien Act, 46 U. S. C. § 971 (1982 ed.). 'A prerequisite to the existence of a maritime lien based on a breach of contract is that the subject matter of the contract must fall within the admiralty jurisdiction.' The District Court concluded that it did not have admiralty jurisdiction over the claim because it was constrained by Minturn v. Maynard which created a per se rule excluding agency contracts from admiralty jurisdiction. The Court of Appeals affirmed.