David Vann - A Mile Down - The True Story of a Disastrous Career at Sea

I sent the crew home, buying their tickets and paying the marina bill with the last money I had. I could leave the boat cleared of expenses, but that was it. I didn’t have enough money left over even for my own plane ticket home. I had poured everything into the business.

I arranged with Nick to bring the boat back to Sotogrande, where the insurance might be willing to pay for repair of the engine and hauling of the boat to modify the rudder. Or they might not. In any case, the marina there would cost less per day than Gibraltar, and the boat would be more likely to sell, and the repairs might get done. It was the best I could do for the lenders. If they wanted me to return in January to work on the boat, to fix it up for sale, I would do that too.

Rand paid for my flight home, and Nancy’s parents paid for hers. On the morning of the day we were to fly out, we moved the boat from Gibraltar to Sotogrande with two crew Nick had lined up for us. We paid them with the food from our refrigerators and freezers.

It was a sad last trip on the boat. It had been such a grueling, pointless struggle: getting through construction and financing and launch in Turkey; then the charters with the various problems, including water in the engines and paint falling off and the emergency haul-out; then the quick trip across the Med, the rudder falling off, and ten hours at the helm for the towing attempts, followed by six frustrating weeks in the yard, trying to get the Spaniards to do the work, afraid all the time of the bills I couldn’t pay; and now these new problems with one of the engines and the new rudder, with bankruptcy as the whipped cream and cherry. I’d had enough.

AFTER PAYING FOR my flight home, Rand set up an appointment with a bankruptcy attorney, and he gave me cash to get through the next few weeks. If he hadn’t done this, I don’t know how I would have gotten by. I didn’t have even $10, cash or credit.

This bankruptcy attorney gave us some helpful information, but he was not up to the task of a complicated bankruptcy. I soon met with another attorney, recommended by another of my lenders, and he seemed capable. After a lot of discussion, I decided to file a personal bankruptcy under Chapter seven, with the three corporations (California, Gibraltar, and Mexico) listed as personal assets. I didn’t have the option of reorganization, because my debts, both secured and unsecured, were too large.

Bankruptcy law is very generous to the debtor. I might be allowed to keep Grendel , for instance, my forty-eight-foot boat that still hadn’t sold. I could claim a $50,000 homeowner’s exemption even though it was a boat, and this, combined with the $34,000 bank mortgage and $10,000 in private loans secured against it, meant that the bankruptcy trustee could not make any money from selling, so he most likely would consider it not worth the effort.

In the end, I hoped that most of my lenders would be repaid from the sale of the boat in Spain, and I would keep Grendel (with its mortgages still intact) and $4,000 in IRAs. I would still have other private debts, however, which the court would discharge but which I would have to repay anyway. I owed my mother $60,000, for instance, and my sister $11,000. I would also need to repay money that I was borrowing from Rand to get through the bankruptcy and to get my life back together. I would end up at far less than zero net worth.

And then I ran into new problems. I called the attorney general of California’s office because I was not able to refund passenger deposits for the winter charters. I had collected only $14,371 in deposits, from six passengers, but I had no cash to repay even this amount. I had a California Seller of Travel license, however, and I had contributed yearly to the Travel Consumer Restitution Fund as a part of this ongoing licensing process. I thought my passengers might be able to make claims against this fund to get their money back, and I wanted to make sure they received their money, so I was calling on their behalf to find out how and where they should make their claims.

After several voicemail messages back and forth, I spoke over the phone with a deputy attorney general who told me very directly that he was going to come after me. He said that every time I had used passenger deposits to pay for diesel, crew, slip fees, food, or any other operating expense, I had committed embezzlement, a felony offense.

He claimed this on the basis that I had two corporations, one in California and one in Gibraltar. The California corporation had a Seller of Travel license, had collected the monies, and, in his opinion, was a Seller of Travel and not a “carrier.” The Gibraltar corporation owned the boat and was therefore the carrier. A carrier can legally use deposits to pay for a boat’s operating expenses, whereas a Seller of Travel cannot.

I realized at this point that I had made a mistake. I should not have called, and my passengers had no right to make claims against the fund. I had the Seller of Travel license only for when I leased boats, but in this case I had not leased a boat. I had used my own boat and was a “carrier,” like a cruise line, rather than a Seller of Travel, which is basically a travel agent.

I tried to explain this to the deputy, calmly. The Gibraltar corporation was owned by the California corporation and had been set up only to allow flagging of the vessel. It had no bank account, no employees, no income or expenses, and no office. The California corporation could not have used the passenger deposits to buy the trips from the Gibraltar corporation, because there was no one to pay, and the Gibraltar corporation could not have paid for operating expenses because it had no bank account or employees. In summary, the California company was the “carrier,” I had not broken any laws, and my passengers had no right to make claims against the fund. I apologized for making this mistake.

The deputy attorney general said no. Just said no, flying in the face of common sense and reason. It was hard to know how to respond. He understood what I was saying, but he still claimed that the company with no bank account and no employees was the company I had to pay for obtaining the charters, and that if I had ever paid operating expenses with money from the California company, it was a felony charge of embezzlement and I was going to jail.

It was just before Christmas, sunny and bright outside. I was trying to think of some other simpler way of explaining this to him. Surely a deputy attorney general of California was capable of basic reason. I was getting scared. Then he told me the only thing I could do that would keep him from pressing charges would be to repay in full the $14,371 I owed to passengers. I explained that I had no money at all, that everything had gone into the business, because I had in fact not embezzled anything, not even my own savings and wages from teaching, and this was why I had to file for bankruptcy. But he said I had to pay or he would press charges.

I made my mistake with him then. I didn’t raise my voice, and I didn’t get angry. I just asked, in a very humble tone, what happened if I contested this, because it didn’t make sense. I felt I was allowed at least the question, to find out what my options were, but this was a mistake.

I began calling attorneys immediately. I also called one of my lenders, who happened to be a deputy attorney general of California in a different office. He thought the charges were nuts, but it was clear he wasn’t going to step into the case and interfere, either. Apparently it was bad etiquette for one deputy to step in and question another deputy’s case. So I found an attorney, a guy named Jack, who specialized in this area and had in fact written part of the current Seller of Travel Law. He represented cruise lines and travel agents. And he knew this deputy personally.