Crofton Diesel Engine Co., Inc. v. Puget Sound Nat. Bank of Tacoma

This is an appeal from a final decree in admiralty which determined the relative priorities of certain valid maritime liens on the one hand and two mortgages on the other. The mortgages and liens were upon a fishing vessel, The Flying Cloud. Decree was in favor of the appellee Puget Sound-National Bank of Tacoma, hereafter called the Bank, and against the appellants, herein called Crofton and Larson, holders of the maritime liens who, after the Bank had filed a libel for foreclosure of its two mortgages, filed libels in intervention.

The Bank took from the owners of The Flying Cloud as security for a note, a mortgage on the vessel which was entitled “Preferred Mortgage of Vessel”. A ship building corporation took a similar mortgage to-secure a note representing a part of the purchase price of the vessel. The latter-mortgage was duly assigned to the Bank. Both mortgages were recorded and endorsed upon the vessel’s documents, in accordance with the provisions of § 922 of Title 46 U.S.C.A.

About a year later, at San Pedro, California, the owners had some work done on the vessel by Larson and approximately six months thereafter Crofton did some engine work and furnished some…