Yard placing a Lien on your boat

[Talonewo]

Does the Coast Guard get both sides of the story before placing a lien on a boat, can/will they place a lien on a boat without discussing it with the boat owner?

A few of you have follow my now two year paint job at a yard in Slidell LA. I have now left the yard but the yard owner is threatening to place a lien on my boat over a dispute about sales tax. I paid cash for the boat and it is registered with the Coast Guard. I assume the yard would start the process by filling paperwork with the Coast Guard, my question is will the Coast Guard come to me for my side of the story before they place a lien on it? When is my "day in court" if you will?

I want this thread to stay focused on the lien process but I'm sure some will ask about the sales tax issue, long story short I told him I will pay the state of Louisiana but not the yard, I requested the state mediate the situation, I told them I would gladly take my emails, invoices, and canceled checks to the state and if they think I need to pay sales tax I would cut them a check and be done with it. All the invoices in question are from 2013.

 

[CPseudonym]

I'm less than useless on your real question.

How was the job billed? Was it a fixed bid job or time and material?

It may make a difference in Louisiana. Several years ago in California I collected sales tax from customers on T & M jobs but not fixed bid.

Sorry for your troubles.

 

[pilothouse king]

Does the Coast Guard get both sides of the story before placing a lien on a boat, can/will they place a lien on a boat without discussing it with the boat owner? When is my "day in court" if you will?

.

No, and it's a rather quick simple process to do if the vessel is federally documented. No court required for them, but you will have to spend money (and maybe end up in Court) to try to get the lien released. At least you have possession of the vessel. It will effect you trying to sell it though, and if they get possession (as in snatching it up in the middle of the night) of it-ouch. That's one of the negatives in having a documented vessel.

 

[ksanders]

About the lien.

It is my understanding that all the yard has to do is follow these instructions:

http://www.uscg.mil/nvdc/instr/inst%20NCL.pdf

 

[pilothouse king]

And speaking of snatching up in the middle of the night. The guys that do it are really good at their jobs. A friend of mine who was a major yacht dealer was losing his line of boats to the bank back in 09. He had one new 54' they hadn't
yet taken, and he was going to make it as difficult as possible so he chained the props together and then attached the shafts with "theft proof" cable to the pilings 4' underwater behind his house, literally 30' from his living room and bedroom. He said he looked out the window and the boat was there, looked out again 15 minutes later it was gone. 30 minutes later it was in National Liquidators yard. He was impressed. And they did it in the daytime. Sooooo if I was you I would be over in Slidell making friends with my hat literally in my hands. They get your boat it's gone. I see it all the time. They have Federal Marshals on their side, and you can't even go on the boat for anything. Any and everything on and in it is now theirs. Right before Christmas is a particular favorite time for them, as they obtain already wrapped gifts, sometimes complete with trees. All that personal stuff ends up in the repo peoples garage(s).

 

[THD]

Talon-despite the dire warnings already posted, there is a bit more to the process than meets the eye. First, to your original question, the CG has nothing to do with liens other than recording them. That is their only involvement. The only point to the recording is to give any interested party information about the vessel. They do not examine it or make any determinations as to the validity. What is filed with the CG, is a "Claim of Lien", not an actual lien. A lien is a legal finding by a court that you owe money. There is not enough room here for a full discussion of marine liens, but here is some general information. Since your boat is documented, the yard guy can seek a maritime lien or a state law lien, He gets the maritime lien from a Federal court and it is against to boat, not against you. Upon his application and a showing of an amount due, the Federal Court issues an arrest warrant for the boat and US Marshalls chain it to the dock. You get notice and a hearing date at which you can contest the lien. The yard guy will have to post a bond to cover the cost of maintaining the boat during the process. In my Federal District, the standard bond amount is $10,000.


If he seeks a state law lien, that lien is against you personally. Again, he has to go to state court, giving you notice before going to court to give you a chance to show up and contest. The state court will generally set a hearing date at which you can contest the lien. In most states, (LA maybe a bit different due to its Napoleonic Code legal structure), if the lien and judgment are granted by the court, the guy has to take measures to collect from you personally before asking the court to seize and sell assets to satisfy the judgment lien.


As an aside, the situation described by Pilothouse King is distinctly different from your situation. The bank had a collateral interest in the boats it financed for the dealer. In such a case, they can di just what they did, just come and take the collateral.


I suspect that the yard owner has been hit for the sales tax by the State wither through an audit or he reported it as a sale in his monthly sales tax filings, so he is trying to make himself whole by collecting from you.

 

[pilothouse king]

THD is correct, but my point is that nothing will meet your eye, everything is out of sight but If they can grab your boat it changes the dynamics which is why people will take them first, whether right or wrong.
I too, suspect the State has pinged your yard for the Sales Tax as they are supposed to collect it, and the State throws big penalties to those who were supposed to collect it-and don't.

 

[Moonstruck]

The CG must keep a watch list. If they know there is a lien on the boat, they will notify the federal marshall. He will come down, impound the boat, wrap it in yellow tape, and you will not even be allowed to remove personal gear from the boat. I have watched this process with a boat that left Ft. Lauderdale, and they caught up with it in NC.

 

[psneeld]

If the issue is JUST sales tax....

Why not resolve that?

I was under the impression in NJ that the vendor had to collect the sales tax otherwise they were responsible for it. Maybe LA has some sort of agency that deals with business disputes that can intervene.

 

[psneeld]

Good point. If one is to believe the Feds (which I don't!) Nagin sold out for just some slabs of granite. That's it-put the black mayor in prison, but the Corp of Engineers and contractors gets a pass for their well documented short cuts ($$$ kick backs) building the levy which failed (as everybody who watched them build it knew it would) which destroyed an entire city, then 10 years later people are still waiting for FEMA checks? Probably cheaper just to pay the yard the sales tax you owe. They could had just fed him to the crabs. Such civilized gentlemen over there in Slidell. Lol

Still think it's important to find out whether the yard IS the only one that is responsible for it.

If so...a lawyer for $200 or less would probably take care of the situation and ensure the paperwork is in order.

 

[capt jerry]

Still think it's important to find out whether the yard IS the only one that is responsible for it.

If so...a lawyer for $200 or less would probably take care of the situation and ensure the paperwork is in order.

wher are you going to get a lawyer today for 200$

 

[psneeld]

Mine would do it...
He went to a hearing for me for free so I gave him $200 to take his office to lunch.

Plus ....no matter the price.....it would be cheaper for a fixed price one time shot rather than if the lien happens and you need him (her) in court.

 

[eseyoung]

i am at a loss...why would someone not have to pay sales tax?

OP said in his original thread the yard collected (and he voluntarily paid) but then the manager refunded. Yard fires said manager and admits he made a mistake and tries to correct and collect. under what rule was this situation exempt from sales tax? maybe if it is i will have a refit in LA

But then again the yard let the boat go...so maybe more to the story???

Either way the yard will get the $$$ or place a lien and possibly pick up the boat. the real question is is this a battle you are willing to fight? Or maybe its a gamble that the yard won't actually send an agent to pick up the boat.

when faced with the Possible loss of the boat for a (proportionally) small bill i think i'd just bite the bullet and pay or offer compromise with the yard.

 

[Tony B]

The short of it is, the yard probably already paid the sales tax to the state when they file their monthly or quarterly reports. The state will not get involved in this. They will only take your money for the sales tax if the yard hasn't already paid it because the state will take money from anyone to settle someone else's debt. But if the yard didn't pay the tax, the state would be on their ass and they would be paying a penalty.
Also the state would not be interested in your receipts or anything else. If you want to pay someone elses bill, that's OK. But they wont care why and will not get involved in any way at all.
I think what is happening here is that you bought a used boat from an individual and in La. and Ms. you don't have to pay sales tax for the boat. You are now bundling the yard work with the boat cost to avoid sales tax. maybe you even bought the boat from the yard.
I don't know, I'm just guessing since I don't know the whole story. You possibly could have bought the boat from the very same yard and agreed on the repairs.
Either way, if they did the work, they are required to pay tax and so are you.The best solution is to settle up with the yard and pay them the tax.


Best of luck to you.

 

[Art]

Let's see:

1. Pay the bill - or - probably lose the boat

2. Get lawyer involved to get the hounds off your back as well as have reduced bill amount agreed upon by both parties... and then pay the bill - or - probably lose the boat

3. Don't pay the bill at all - and - probably lose the boat

Numbers 1 and 2 seem the best ways to go. Number 3 is simply crazy!

Pay The Bill! And, Keep The Boat!!

That's the answer... what's the question???

Perchance, is/are there something(s) regarding this boat, this bill, the marina, you, and maybe even the PO we are not being made aware of... just wondering!

 

[Talonewo]

Thanks for all the opinions and information. I really don't think it will get to the point of him placing a lien I just wanted to understand the process if it did and and think THD summed it up very well.

As with all issues there are two sides to the story and this tax issue is only a portion of the overall dynamics involved in this situation. All I want to do is move on and start enjoying my boat.

 

[windmill29130]

The ultimate question is: how much money are we talking about? You have to weigh the cost vs the hassle of all the hoops you may have to jump through in the future or money out of your pocket to fix it. If it's just the principle of it, I suggest you swallow your pride and pay. You you wish you had if all this plays out. GOOD LUCK,!

 

[bligh]

The ultimate question is: how much money are we talking about? You have to weigh the cost vs the hassle of all the hoops you may have to jump through in the future or money out of your pocket to fix it. If it's just the principle of it, I suggest you swallow your pride and pay. You you wish you had if all this plays out. GOOD LUCK,!

X2.
how much money are we talking about? have you thought about asking him if he will go away for25-50% of the amount he is asking?
either way , you have a headache on your hands and if you have to hire a lawyer, how much is that going to cost?
I'm not saying dont hire a lawyer, but look for the cheapest route out, Unless you want to stick it to the guy, then just hire a lawyer first. A good lawyer may be able to prevent the lien from being placed in the first place.

(I have experience with property liens in California. They are very easy to file, but very difficult to enforce (ie file a claim to sell the property and get money for it).

I will say that from my experience with any vendor trying to collect money that is not due them (IMO), I immediately hire a lawyer to start writing letters to any and all parties involved. This has always worked in my favor (with qualified lawyers) and I feel the money spent on them was a wise investment.

The first letter sent to a vendor usually starts something like " Hi my name is lawyer 123 . I have been hired by so and so who says that you are trying to collect money that is not owed to you. My client says he paid you in full yada yada yada and does not owe you any money. Any further correspondence regarding this issue should be sent to me (lawyer 123). Any action against him will result in xyz."

 

[Art]

With lawyer letter include this pict as your enforcer

 

[BandB]

Thanks for all the opinions and information. I really don't think it will get to the point of him placing a lien I just wanted to understand the process if it did and and think THD summed it up very well.

As with all issues there are two sides to the story and this tax issue is only a portion of the overall dynamics involved in this situation. All I want to do is move on and start enjoying my boat.

At some point I'd look for the most expeditious exit from the situation. I would be very hesitant to proceed without a lawyer just to make sure you do things right and don't increase your exposure. However, ultimately, a prolonged battle over this is probably not worth the costs involved. The worst thing financially one can do is make a stand based on "principle". That can lead to a standoff that only ends up costing both parties more than if they'd just agreed to some compromise.

Lawyers can give you some initial advice generally quite reasonably. I think within the $200 mentioned. Perhaps write some form letters for a little more. Where lawyers become expensive is the moment litigation or potential litigation comes into play. There's a bit difference in cost between the lawyer who advises clients to avoid court and the lawyer who makes his living in court.

 

[Moonstruck]

Whatever happens be sure to get a signed release of the obligation. Preferably with a notorized signature.

 

[C lectric]

Different country , Canada, but liens can be a big PIA. Don't ignore it and the consequences. On our house we had some liens from individual contractors form a bankruptcy of the G.C. which we thought were properly cleared through our lawyer at the time.

Jump nearly 30 years later to when we went to sell our house. There were still two liens registered????? NO they did not foul up the house sale, we owned the house outright, but it still caused a delay while the proper research was done and the liens cleared.

I'm not suggesting you just knuckle under either, just be carefull and weigh the consequences AND maybe before you get in too deep get some real legal help.
There are lawyers and other knowledgeable folk here, I'm sure, but it's still a forum and you could get bitten by jurisdictional differences/opinions.

 

[Tony B]

I don't know how much you paid for the boat or the amount of sales tax in question, but if it's an older boat, the lawyer's fee can easily exceed the sales tax due by a very large amount. once you lawyer up or even hint that you will, all communications can come to an abrupt halt. Now the lawyers talk it over at at least $100/hour.
If someone threatened me with an atty. I would tell them to never contact me again and just have their lawyer call me, then hang up.
.

 

[Art]

I repeat! LOL

With lawyer letter include this pict as your enforcer

 

[BandB]

I don't know how much you paid for the boat or the amount of sales tax in question, but if it's an older boat, the lawyer's fee can easily exceed the sales tax due by a very large amount. once you lawyer up or even hint that you will, all communications can come to an abrupt halt. Now the lawyers talk it over at at least $100/hour.
If someone threatened me with an atty. I would tell them to never contact me again and just have their lawyer call me, then hang up.
.

You can get advice from a lawyer without their knowledge and without threatening them, but advice that will at least let you know where you stand legally. And I agree if it's a very small amount just find a way to settle, even if it's giving in.

 

[C lectric]

I was not suggesting having a lawyer even contact the yard, just simply getting some advice about options so you do not dig yourself into a hole.

Maybe some accountants would be of help.

 

[Talonewo]

Calmer heads prevailed and we were able to work things out, I don't have a signed release as Moonstruck suggested(excellent suggestion by the way) but we do have very clear emails back and fourth saying we are good. The tax in question was tax due for work done on the boat NOT for the purchase of the boat, they were aprox $5000. Like I said before the tax was only a portion of the issues in question. The resolution was we are even, no money exchange hands. I know I feel like I walked away from services and dollars owed and I'm sure the yard feels the same way, neither one of us wanted to turn this into a lengthy legal battle and just agreed to disagree. I'm not going to air our dirty laundry in a public forum but if anyone is considering using a yard in Slidell La they can PM me and I will give them the facts to my situation as I see them. Now I just want to enjoy my boat, what a relief it is to finally be in total control of my boat... having the boat on the hard for almost two years I was at the whim of the yard... they have you by the "shorties" as they say.

 

[windmill29130]

Congrats!

 

[bligh]

 

[THD]

Talon-congrats on an agreeable resolution. Now get on the water, and have a cold one (after mooring of course!).