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UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 93-3631
THE FIRST NATIONAL BANK OF BOSTON,
Plaintiff-Appellee,
VERSUS
BECKWITH MACHINERY COMPANY,
Intervenor-Appellant,
VERSUS
VIKING MARITEC, INC.,
Defendant.
Appeal from the United States District Court
for the Eastern District of Louisiana
(June 13, 1995)
Before JOHNSON, BARKSDALE and DeMOSS, Circuit Judges.
PER CURIAM:
This case revolves around the construction and financing of a
towboat. In 1992, Viking Maritec, Inc. ("Viking") and Avondale
Industries, Inc. ("Avondale") entered into a contract for Avondale
to build a towboat for Viking in exchange for a purchase price of
$2.8 million. Viking entered into a credit agreement with First
National Bank of Boston ("FNBB") to finance the purchase price due
Avondale and to pay for other equipment for the vessel. FNBB

agreed to lend Viking up to $4.8 million, and Viking executed a
construction note in favor of FNBB. Viking also executed a
"Louisiana Ship Mortgage and Security Agreement," granting the bank
a security interest in the towboat and its materials and components
under the provisions of the LA. REV. STAT. ANN. 10:9-101 - 10:9-604
(West 1993). FNBB perfected the security interest by filing a UCC-
1 financing statement in the proper office on August 6, 1992. The
documents stated that the Ship Mortgage Law and the Louisiana UCC
would govern the security agreement. In early 1993, Viking
purchased from Beckwith Machinery Company ("Beckwith") engines and
related machinery, which were incorporated into the tugboat.
Viking did not pay either Beckwith or FNBB. After its demand
for payment was not answered, FNBB filed an action in federal
district court to have the unfinished and undocumented towboat
seized and sold. Beckwith intervened, seeking priority through the
Louisiana Civil Code, which gives privileges to certain classes of
creditors, including suppliers of shipbuilding materials and
equipment. LA. CIV. CODE ANN. art. 3237 (West 1952). FNBB filed a
motion asking the court to give priority instead to its perfected
UCC security interest.
On July 26, 1993, the district court rendered a decision
formally ranking FNBB's security interest in the vessel ahead of
Beckwith's materialman's privilege. First Nat. Bank of Boston v.
Viking Maritec, Inc., No. CIV.A 93-1336, 1993 WL 292996 (E.D. La.
1993). A final judgment was entered on September 3, 1993, giving
priority to the bank's security interest. The towboat was sold at
2

a judicial sale on August 20, 1993, and FNBB was paid its debt on
September 23, 1993. Beckwith brought the instant appeal.
Noting that the determinative issue in this case is clearly a
matter of Louisiana law, and finding no ruling by a Louisiana court
on such issue, we certified the following question to the Louisiana
Supreme Court:
Which interest should have priority under Louisiana law:
(1) a civil law "privilege" for suppliers of shipbuilding
materials, thus giving Beckwith creditor priority rights,
or (2) an earlier perfected UCC security interest, thus
giving FNBB creditor priority rights?
See First Nat. Bank of Boston v. Beckwith Machinery Co., 26 F.3d
580 (5th Cir. 1994) (certifying question). The Louisiana Supreme
Court granted certification, 648 So.2d 379, and responded with a
well-reasoned opinion explaining the proper priority of Louisiana
Civil Code privileges in relation to the Louisiana Uniform
Commercial Code. See First Nat. Bank v. Beckwith Machinery, 650
So.2d 1148 (La. 1995). In its opinion, which we adopt and
incorporate herein, the Louisiana court reached the following
conclusion:
A prior perfected Chapter 9 security interest created
pursuant to [LA. REV. STAT. ANN.] 10:9-101 et seq. has
priority over a nonpossessory materialman's privilege
granted to a supplier of shipbuilding materials under
LA. CIV. CODE ANN. art. 3237(8).
Id. at 1157. We now apply that ruling in our disposition of this
appeal. Under Louisiana law, the prior perfected security interest
held by plaintiff-appellee First National Bank of Boston has
3

priority over the civil code materialman's privilege held by
intervenor-appellant Beckwith Machinery. We therefore AFFIRM the
decision of the district court to rank the bank's interest first.
AFFIRMED.
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