United States District Court, D. Maryland
Frederick Motz United States District Judge
Zimmerman Marine, Inc. ("ZMI") filed this action
in rem to foreclose two maritime liens against a
defendant vessel, M/V "Rotten Kids, " owned by
Defendant John Verde, Sr. ("Verde, Sr."). [ECF No.
1]. ZMI also asserts contractual and quasi-contractual claims
against Verde, Sr. and his son, John Verde, Jr. (collectively
"Defendants" with M/V "Rotten Kids").
Id. Verde, Sr. filed a counterclaim against ZMI,
alleging breach of contract, breach of warranty of
workmanlike performance, negligence/bailment, and wrongful
arrest. [ECF No. 19]. Presently pending before the Court are
Defendants' Motion for Summary Judgment [ECF No. 39] and
ZMI's Cross-Motion for Partial Summary Judgment [ECF No.
41]. The motions are fully briefed, and no hearing is
necessary. See Loc. R. 105.6 (D. Md. 2016). For the
reasons set forth below, both motions will be DENIED.
Sr. owns M/V Rotten Kids, a 2005 52' Ocean Yachts Super
Sport ("the vessel"). See Verde, Sr. Aff.,
[ECF No. 39-4 at ¶1]. In late 2012, the vessel sustained
damage while in dry storage at a marina. Id. In
March, 2013, Eric Greene, a naval architect, provided a
report outlining the damage and the scope of needed repairs.
Verde, Sr. Dep., [ECF No. 39-5 at 15, 31]. After obtaining
estimates from multiple facilities, Verde Sr. chose ZMI to
repair the vessel. Id. at 29-31.
prepared a proposal ("Proposal") containing an
itemized list of the work to be performed and the price per
line item. Verde, Sr. Dep., [ECF No. 39-5 at 38-41, 74];
Zimmerman Dep., [ECF No. 39-6 at 23, 37]. The parties
negotiated some changes to the Proposal, and also exchanged
and negotiated a two page "Agreement for Repairs to
Vessel" ("the Agreement"). Verde, Sr. Dep.,
[ECF No. 39-5 at 38-41]; Zimmerman Dep., [ECF No. 39-6 at
23]; [ECF No. 39-7, 2-3]. On April 11, 2014, Steve Zimmerman,
the president of ZMI, (''Zimmerman"), and Verde,
Sr. accepted and signed the Proposal and the Agreement. [ECF
No. 39-7]. The parties agree that those two documents
constituted the contract for repairs of the vessel ("the
provisions of the Contract are especially relevant to the
instant dispute. First, the parties agreed on a quote of
$136, 450.00 for the itemized work in the Proposal. [ECF No.
39-7, 1]. Second, the parties agreed that:
Invoices for respective repairs completed will be sent and
payments required only at 50% repair completion and at 100%
(repair completed). . . . Zimmerman Marine shall provide a
lien release and waiver at each progressive and final
payment. At no point may Zimmerman Marine or Zimmerman
Marine's agents confiscate, hold, not allow launching of
Customer's vessel, or not allow access within reasonable
business hours to Customer's vessel.
Id. at 2-3. However, the contract also provides
that, "All invoices must be paid in full prior to
departure of vessel." Id. at 1. The parties
further acknowledged that, when ZMI began work on the vessel,
it would likely discover additional damage requiring repair.
The parties agreed on a procedure to handle such findings.
"Given the extent of the damage and the limitations of
nondestructive testing, it is assumed that there will be
additional findings not included in the scope of this
estimate. Where such findings are discovered, ZMI will notify
the [sic] Mr. Verde before proceeding. Such work, when
approved, will be identified as 'supplemental' and
will be invoicd (sic) separately." Id. at 1.
Sr. paid the agreed deposit, and ZMI commenced the itemized
repairs to the vessel. On September 30, 2014, Zimmerman
emailed Verde, Sr. and asserted that the project was over 50%
complete, since the estimate was for 650 man hours of labor
and ZMI had expended 401 man hours. [ECF No. 39-9]. In an
email on October 3, 2014, Verde contested ZMI's method of
calculating completion, and instead asserted that "the
totaling of the line item completions (reasonable percentage
completed times the total cost of that line item) divided by
the complete project total cost will be used to determine the
percentage of repair completion. Using this method it's
been determined that the project is at 36% repair
completion." [ECF No. 39-6, 22]. To resolve the dispute,
Verde, Sr. agreed to modify the terms of the Contract to add
progress payments at 36% and 75% completion. Id.
Zimmerman responded in an email stating,
We are in agreement with the revised payment schedule of
36%/50%/75%/100%. . . For the record, I do not agree that we
are only 36% complete, but did not see that as a reason to
withhold the release. By my calculations we are more than 50%
complete, and I agreed to your calculation in exchange for
your offer to add a payment at 75%.
Id. at 21.
October 3, 2014, Zimmerman signed a document entitled,
"Partial Release of lien - Material and Labor"
("Partial Release of Lien") providing:
As described in this partial release of lien Zimmerman Marine
has for the consideration of the payment of $52, 709.00
completed all the requirements up to the 36% stage of
completion . . . The undersigned hereby releases, waives,
indemnifies and discharges Owner from all claims, demands,
all present and/or future liens, rights of lien and lien
and/or payment or performance bond claims of any kind
whatsoever undersigned has, or might have, under any present
or future law, for any work done or labor or materials
furnished in connection with the Owner or Owner's
Id. at 24. In exchange for the Partial Release of
Lien, Verde, Sr. paid ZMI 36% of the Contract price, minus
the amount of the deposit already paid. [ECF No. 39-6, 22].
the October modification to the Contract and the partial
payment, ZMI provided Verde, Sr. with a proposal for the
supplemental work that would be required to complete the
repairs to the vessel ("the Supplemental
Proposal"). [ECF No. 39-10, 12-18]. Verde, Sr. did not
approve the Supplemental Proposal because he did not agree
with the new proposed payment terms, but he did approve a few
line items of supplemental work. Verde, Sr. Dep., [ECF Nos.
39-5 at 75; 41-9 at 72-73; 41-14 at 68-69]; Zimmerman Dep.,
[ECF No. 39-6 at 58, 82]. While the parties negotiated the
Supplemental Proposal, ZMI continued to repair the vessel
under the original Contract. The project manager at ZMI, Kip
Koolage, sent Verde, Sr. a spreadsheet on or about December
3, 2014, with what Koolage determined to be the status of
completed Contract work. [ECF No. 39-6, 33-37]. On that