This appeal is taken from a final judgment on a cross-claim brought by one would-be intervenor against another in the original suit in admiralty. The case turns upon the propriety of the district court's decision to allow the cross-claimant Windward Terminals, Inc. (Windward)
Subsequently, a dispute developed between Tracor and Windward over who should be caring for the vessel and who should be paying for it. On September 24, 1975, Tracor intervened in the main action, filing an intervening complaint against the vessel in an attempt to assert a lien for the balance due on repair work ordered by the owner and for the costs of preserving the vessel prior to June 6, 1975. Although both Tracor and Windward moved the district court for an order clarifying custody of the vessel, no order was entered. At a subsequent hearing, however, the court confirmed Tracor's official custodianship, but recognized the custodial expenses of both Windward and Tracor. Accordingly, the district court ordered that $20,740.00 be taxed against the vessel in favor of Tracor and that $20,117.81 be taxed against the vessel in favor of Windward. Meanwhile, the trial of the main action was concluded, and the district court entered final judgment for the plaintiff seamen. The vessel was sold on October 20, 1975, and the sale confirmed on October 30, 1975. Unfortunately, the high bid was only $700.00. Neither custodian received any of the proceeds of sale.
On October 29, 1975, Windward, still a non-party to the main action,
After a non-jury trial, the district court concluded that Tracor had breached its duty of custodianship and, therefore, was liable to Windward for its costs and charges which arose as a result of that breach. The propriety of Windward's intervention was neither argued at trial nor addressed in the district court's findings and conclusions. On July 20, 1979, the district court entered a final judgment awarding Windward $27,664.20 together with prejudgment interest against Tracor.
On appeal Tracor raises four issues. One is directed to the propriety of Windward's intervention and three attack the district
INTERVENTION OF RIGHT UNDER RULE 24(a)(2)
In order to intervene as a matter of right under Rule 24(a)(2), all four of the requirements set forth in the rule must be met. First, the application for intervention must be timely. Next, the applicant must have an interest relating to the property or transaction which is the subject of the action, and the applicant must be so situated that the disposition of the action may, as a practical matter, impair or impede his ability to protect that interest. Finally, it must appear that the applicant's interest is inadequately represented by the existing parties to the suit. International Tank Terminals, Ltd. v. M/A Acadia Forest, 579 F.2d 964, 967 (5th Cir.1978).
Tracor urges us to hold that Windward delayed too long in seeking intervention after final judgment had been entered and the vessel sold. Timely application is a requirement for both intervention of right and permissive intervention. Rule 24(a) and (b). The question of timeliness is largely within the district court's discretion. Stallworth v. Monsanto Co., 558 F.2d 257, 263 (5th Cir.1977). We assume that the district court concluded that the application, such as it was, was timely.
While the significance of the precise nature of an intervenor's interest has declined since the 1966 amendments to Rule 24, see Atlantis Development Corp. v. United States, 379 F.2d 818, 823-25 (5th Cir.1967), intervention of right still requires "a direct, substantial, legally protectable interest
We distinguish two completely different interests which Windward sought to assert and protect at different times in this action. Windward cared for the vessel from June 6, 1975, until approximately October 30, 1975, as de facto substitute custodian. Notwithstanding any agreement or contract with Tracor to provide this custodial care, Windward clearly had an interest in obtaining an award of administrative expenses for this service. That interest was shared by Tracor, which had cared for the vessel from February 12, 1975, until June 6, 1975. Despite the fact that Tracor remained the official substitute custodian, the district court clearly recognized, accepted, and adjudicated the interests of both Windward and Tracor in awarding administrative expenses against the vessel in favor of Tracor for $20,740.00 and in favor of Windward for $20,117.81. Neither of these interests was satisfied, however, by the sale of the vessel.
Subsequently, Windward, though still not a party to the main action, attempted to file its cross-claim against Tracor. As amended and ultimately tried before the court, the cross-claim asserted rights arising from a contract or agreement between Windward and Tracor. Windward's interest was thus confined to recovery of its custodial expenses from Tracor. This cross-claim interest was unrelated to the "property or transaction" which was the subject of the main action. Windward's cross-claim asserted no interest in the property, i. e. the vessel. It is correctly characterized as a claim in personam against Tracor. Indeed, as previously noted, Windward's interest in the vessel had already been adjudicated. Moreover, the counterclaim had no connection whatever to the wage claims which formed the basis of the main action. The district court's disposition of those claims neither impeded nor impaired Windward's interest. At all times Windward was free to pursue that interest in a separate action against Tracor.
Windward urges us to eschew a "myopic fixation upon `interest'" and be guided instead by considerations of efficiency and due process in determining whether intervention should be allowed as a matter of right. The authority for this proposition, though not cited in Windward's brief, is found in Smuck v. Hobson, 408 F.2d 175, 178-80 (D.C.Cir.1969) (en banc) citing Nuesse v. Camp, 385 F.2d 694, 700 (D.C.Cir.1967). It is contended that efficiency and due process are served by allowing the duly appointed substitute custodian and the de facto substitute custodian of a vessel which was the subject of the main action to dispose of their obligations between each other in the same action.
We have previously adopted a flexible approach to the interest issue. United States v. Perry County Board of Education, 567 F.2d 277 (5th Cir.1978). What Windward asks, in effect, is that we now adopt a standard much broader than that espoused by the District of Columbia Circuit in Smuck v. Hobson, supra. In both Smuck v. Hobson and Neusse v. Camp, the court of appeals was presented with a situation in which the applicant for intervention had
Windward also urges us to consider that the United States Supreme Court has allowed intervention of right beyond the confines of Rule 24(a). Windward's reliance upon Missouri-Kansas Pipeline Co. v. United States, 312 U.S. 502, 61 S.Ct. 666, 85 L.Ed. 975 (1941) and Cascade Natural Gas Corp. v. El Paso Natural Gas Co., 386 U.S. 129, 87 S.Ct. 932, 17 L.Ed.2d 814 (1967) for that proposition, while correct, fails to note the distinguishing features of those cases. First, of the two cases only Cascade deals with the same amended version of Rule 24(a) that concerns us in the instant case.
PERMISSIVE INTERVENTION UNDER RULE 24(b)(2)
On this issue we will be brief. It is true that Rule 24(b)(2) "dispenses with any requirement that the intervenor shall have a direct or pecuniary interest in the subject of the litigation." SEC v. United States Realty and Improvement Co., 310 U.S. 434, 459, 60 S.Ct. 1044, 84 L.Ed. 1306 (1940); In re Estelle, 516 F.2d 480, 485 (5th Cir.1975). The decision to permit intervention under Rule 24(b)(2), however, requires a threshold determination that "the applicant's claim or defense and the main action have a question of law or fact in common." Fed.R.Civ.P. 24(b)(2). The determination is not discretionary; it is a question of law. Stallworth v. Monsanto Co., 558 F.2d 257, 269 (5th Cir.1977). If this requirement is met, then the district court must exercise
In conclusion, whether based upon Rule 24(a) or 24(b), the district court's order of November 13, 1975, allowing Windward to intervene to assert a cross-claim against Tracor, constituted reversible error. Accordingly, we REVERSE that order, VACATE the judgment of July 18, 1979, against Tracor Marine, and REMAND this case to the district court for dismissal of Windward's cross-claim and for such further proceedings as may be necessary.
REVERSED, VACATED, AND REMANDED.
Rule 24(b)(2) provides, in pertinent part:
Cascade Natural Gas Corp. v. El Paso Natural Gas Co., 386 U.S. 129, 136, 87 S.Ct. 932, 937, 17 L.Ed.2d 814, 819 (1967).