Chugach Timber Corp. v. Northern Stevedoring & Handling Corp. (In re Chugach Forest Products, Inc.)

Opinion by Judge Hall.

Chapter 11 debtors Chugach Timber Corporation and Chugach Forest Products, Inc. appeal a district court order affirming the bankruptcy court’s determination that Northern Stevedoring & Handling Corporation did not violate the Bankruptcy Code’s automatic stay by foreclosing a maritime lien on a vessel containing property of the debtors. We affirm.

*243 I.

In February 1991, Chugach Timber Corporation hired Northern Stevedoring & Handling Corporation to load logs and lumber onto the M/V Hermes Island, a vessel under charter to Alaska Pacific Trading Company (“Alpac”). Upon completion of the job, Northern Stevedoring billed Chugach $101,-488.94 and, pursuant to the Maritime Lien Act, acquired a lien on the Hermes Island for that amount. See 46 U.S.C. § 31342 . In March 1991, before paying the bill, Chugach and its parent entities (Chugach Alaska Corporation and Chugach Forest Products, Inc.) filed petitions under chapter 11 of the Bankruptcy Code.

Shortly thereafter, Chugach procured a bankruptcy court order allowing it to sell to Alpac a shipment of logs and lumber free and clear of liens. See 11 U.S.C. § 363 (f). Chu-gach again hired Northern Stevedoring…