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Attorney From page 6
may file an opposition to the sale if they have a legitimate defense to the claim, which may delay the sale until a judge has an opportunity to sort things out. Assuming the sale is authorized and all the notices are sent and no opposi- tion is filed, the sale will go forward as advertised and the lien claimant may recover the amount of the claim from the sale proceeds. Any remaining funds from the sale are sent to the DMV, where a lender or other parties with an interest in the sale proceeds may submit a claim for reimburse- ment.
Lien sale procedures for CF regis-
tered boats are fairly straightforward, but the Boaters Lien Law specifically excludes “any vessel which has a valid marine document issued by the United States.” A lien claim against a Coast Guard documented vessel is enforced under federal maritime law, and the procedure usually requires the claimant to file a lawsuit in federal court which calls for the vessel to be seized by U.S. Marshals and transferred to a commercial custodian for the duration of the lawsuit. A federal lien foreclosure is a very expensive procedure but it is very effi- cient. The boat is taken into custody by armed federal law enforcement offi- cers, it is ultimately sold through a marshal’s auction, and the entire pro- cedure is overseen by a federal judge. The procedure differs substantially from the DMV procedure described above, but there is one particular dif- ference that brings us back to our read- er’s case. Only a federal judge, in the exercise of the court’s federal admiralty jurisdiction, may sell a documented vessel free and clear of all liens. Our reader indicated that he bought the boat at a lien sale conducted by a lien sale company, but that the Coast Guard would not transfer title to him with an unsatisfied mortgage recorded against the vessel’s title. A properly recorded mortgage will remain as a claim against the vessel until a satisfac- tion of mortgage is recorded by the lender or a federal judge enters an order to clear it from the title. Our reader therefore purchased a boat with a big problem. His legal options at this point will start with a demand to the lien sale company and the marina to unwind the sale because the sale was not properly conducted. The DMV will not issue a lien sale authorization for a boat with a current Coast Guard document. They will authorize a sale for a boat with expired documentation, but in those cases the lien claimant must first obtain written confirmation from the Coast Guard that the boat has been “removed from documentation,” and the Coast Guard will not provide that confirmation for a boat with an unsatisfied mortgage recorded against the title, even of the boat’s documentation has expired. Lien sales may be attractive for
prospective buyers because of the potential for a bargain purchase. But
sometimes you get what you pay for. Consult a maritime attorney experi- enced in lien foreclosure before sub- mitting a purchase offer if you are con- cerned about a particular lien sale.
David Weil is licensed to practice law in the state of California and, as such, some of the information provided in this column may not be applicable in a jurisdiction outside of California. Please note also that no two legal situations are alike, and it is impossible to provide accurate legal advice without know- ing all the facts of a particular situation. Therefore, the information provided in this column should not be regarded as individual legal advice, and readers should not act upon this information without seeking the
opinion of an attorney in their home state. David Weil is the managing attorney at
Weil & Associates (
weilmaritime.com) in Long Beach. He is an adjunct professor of Admiralty Law at Loyola University Law School, is a member of the Maritime Law Association of the United States and is for- mer legal counsel to the California Yacht Brokers Association. He is also one of a small group of attorneys to be certified as an Admiralty and Maritime Law Specialist by the State Bar of California. If you have a maritime law question for Weil, he can be contacted at (562) 438-8149 or at
dweil@weilmaritime.com.
Ask your question online at
thelog.com.
The Log • April 25 - May 8, 2014 • 11
Editorial From page 6
The project converted two huge
parking lots located south of the County Administration Building into a 14-acre park that will feature an 830-foot-long fountain with jets that will shoot water 14 feet up in the air, a promenade, splash pad, public art, theme gardens and a large play area. The space measures 96,000 square feet, hosts 250 parking spaces and 178 public spaces Additional space for kids and fami-
lies to recreate and more access to San Diego’s bayfront is just what the city needs.
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