## Facts

- The schooner *William Leishear* was arrested in rem in the U.S. District Court for the District of Maryland after multiple admiralty libels were filed against the vessel.
- The court ordered the schooner sold under admiralty process, and the net proceeds paid into the court’s registry totaled $1,011.17.
- The proceeds were far less than the aggregate demands, requiring the court to decide which claimants held maritime liens and the order in which valid liens would be paid.
- The asserted claims were: (1) $850 for salvage under a written contract dated July 22, 1926; (2) $4,132.90 for labor and materials furnished between September 1 and November 20, 1926; (3) $45 for transporting the vessel’s sails on or about October 1, 1926; (4) $640 for crew wages during October and November 1926; (5) $126 for wharfage from November 20, 1926, to March 26, 1927; and (6) $198 for watchman services from January 19, 1927, to March 26, 1927.
- The distribution dispute focused on classic admiralty ranking rules (including the favored status of seamen and salvors) and whether particular services—especially the watchman’s work—created maritime liens.

## Issues

1. Which of the asserted demands constituted enforceable maritime liens against the vessel (and thus could share in the proceeds of the judicial sale)?
2. What priority rules governed distribution of an inadequate fund among competing maritime liens, including the treatment of seamen’s wages and salvage versus other contract-based claims?
3. Did the watchman’s services to the vessel during the relevant period give rise to a maritime lien payable from the proceeds?

## Decision

- The court held the sale proceeds were “grossly insufficient” to satisfy all demands, so distribution had to follow maritime lien validity and priority rather than equal sharing.
- Seamen’s wages were treated as among the most favored liens in admiralty and were entitled to first-class payment from the limited fund.
- The salvage claim was recognized as a highly favored maritime lien and ranked at the top with wage claims, reflecting admiralty’s strong protection of salvors and seamen.
- Claims for necessaries such as repairs and supplies, and claims such as wharfage, were treated as maritime in character but ranked behind wage and salvage claims under established priority doctrines (including the general inverse-order rule among comparable contract liens).
- The watchman’s claim was denied maritime-lien status and therefore could not participate in the fund as a lienholder.
- Any claimants not paid from the registry fund were left to seek payment elsewhere.

## Legal Principles

- When a vessel is sold in an in rem admiralty case and the proceeds are insufficient, the court distributes the fund by determining (a) whether each demand is a maritime lien and (b) the relative priority of valid liens.
- Maritime liens are not all equal; priority turns on established admiralty categories and policies, including the special protection afforded to seamen’s wage claims and the strong preference for salvage claims.
- Tort liens generally outrank contract liens, but wage and salvage liens occupy an exceptional position at the top of the hierarchy.
- Among maritime contract liens of the same general class, admiralty often applies the rule that liens rank in inverse order of accrual, reflecting that later services may be preferred when they keep the vessel in service or preserve its value for prior creditors.
- All maritime claims outrank nonmaritime claims in competing for the proceeds of the res.
- A watchman or caretaker’s services to a vessel (particularly when the vessel is laid up or in custody) do not, without more, create a maritime lien payable from sale proceeds.

## Conclusion

*The William Leishear* addressed distribution of a deficiency fund after the judicial sale of a schooner, applying maritime lien validity and priority rules to decide which claims could share in $1,011.17 of proceeds; the court favored seamen’s wages and salvage at the top, treated repairs/supplies and wharfage as lower-ranking maritime liens, and rejected the watchman’s demand as non-lienable in admiralty, leaving unpaid claimants to pursue other remedies.


Unable to verify; if the case exists as titled, the Bluebook form would be *The William Leishear*, 21 F.2d 862 (D. Md. 1927).

Unable to verify; if the case exists as titled, the Bluebook form would be The William Leishear, 21 F.2d 862 (D. Md. 1927).