               IN THE UNITED STATES COURT OF APPEALS

                       FOR THE FIFTH CIRCUIT

                       _____________________

                            No. 95-40348
                          Summary Calendar
                       _____________________


IN THE MATTER OF:   A & M Operating Co., Inc.
                    d/b/a Custum Vessel Co.,

                                               Debtor.

THE RALPH M. PARSONS CO.

                                               Appellant,

                              versus

SOUTH COAST SUPPLY COMPANY, INC.

                                            Appellee.
_________________________________________________________________

      Appeal from the United States District Court for the
                    Eastern District of Texas
                           (6:93-CV-627)
_________________________________________________________________
                          April 10, 1996

Before JOLLY, JONES, and STEWART, Circuit Judges.

PER CURIAM:*

     The plaintiff, The Ralph M. Parsons Co. ("Parsons"), appeals

partially the March 29, 1995 order of the district court affirming

the award by the bankruptcy court to South Coast Supply Company,

Inc. ("South Coast") of a materialmen's lien in the amount of

$309,464.32 on several high pressure vessels constructed by the

bankrupt A & M Operating Company, Inc. d/b/a Custom Vessel Company,


     *
      Pursuant to Local Rule 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in Local Rule 47.5.4.
Inc. ("CVC"), for Parsons and other CVC clients.1             The amount of

the materialman's lien impressed against the single high pressure

vessel constructed for Parsons is $207,980.00.          Parsons challenges

this lien, arguing that the bankruptcy court's findings, affirmed

by   the   district   court,   are    not   supported    by   the   record.

Specifically, it disputes whether (a) CVC owned the Parsons's

vessel at the time the materialman's lien arose, and (b) South

Coast, the materialman, was in privity with CVC.

                                      I

     In reviewing the affirmance by the district court of findings

of fact by the bankruptcy court, we credit the factual findings

unless clearly erroneous.      Matter of Reed, 700 F.2d 986, 992 (5th

Cir. 1983).   A finding of fact is clearly erroneous "when although

there is evidence to support it, the reviewing court on the entire

evidence is left with a firm and definite conviction that a mistake

has been committed."     United States v. United States Gypsum Co.,

333 U.S. 364, 395 (1948).      The parties agree that in the instant

case the ownership of personal property in possession of the debtor

at the time of bankruptcy is a question of fact, as is whether

privity existed between the debtor and the putative owner.


     1
     The district court's order also reversed the bankruptcy court
and awarded an additional materialman's lien against CVC in favor
of South Coast in the amount of $24,544.72 for sale of material to
CVC from South Coast's general inventory. This lien is not the
subject of this appeal as only the materialman's lien that South
Coast was found to have against the Parsons's vessel has been
appealed.




                                     -2-
       The   bankruptcy     court    found    the     following       facts.      CVC

specialized in building high pressure vessels, such as the one

constructed for Parsons in this case.            South Coast was a supplier

of subcomponents for these high pressure vessels.                      South Coast

supplied its customers with these components both from its own

stock and on a special order basis.             South Coast did not itself

manufacture any parts.       To fill special orders for its customers,

such    as   CVC,   South   Coast     maintained      a    relationship        with   a

manufacturer of parts, Forged Vessel Connections, Inc. ("FVC").

Under   this   relationship,        South   Coast's       customers    requiring      a

special order item could order from a FVC catalog maintained by

South Coast or they could order directly from FVC.                     All orders,

whether placed directly with FVC or with South Coast, were billed

directly to customers, including CVC, solely through South Coast.

CVC was never directly invoiced for special order components by FVC

and CVC never disputed its liability for payment to South Coast for

special orders filled by FVC but billed by South Coast.

       The bankruptcy court found that CVC experienced financial

difficulty in 1992 and was unable to pay South Coast for purchases

of components valued at approximately $656,462.27.                     South Coast

became concerned that CVC was about to transfer ownership of

certain uncompleted vessels to CVC's respective customers that had

ordered them.       South Coast therefore filed state court actions

asserting its rights as a materialman to a mechanic's lien on the

vessels built by CVC with South Coast components, including the




                                       -3-
Parsons's vessel.     In conjunction with these state court suits,

South   Coast    obtained   a    prejudgment   order   of   sequestration

effectively impounding numerous vessels under construction at CVC's

facilities.     The orders of sequestration required the payment of

$323,218.06 as a condition of replevy of the seized vessels.          The

replevy of each individual vessel is dependent upon the dollar

amount of the material supplied by South Coast toward construction

of the vessel.

     In January 1993, CVC filed for relief under Chapter 11 of the

Bankruptcy Code. South Coast then removed the state court lawsuits

to the United States District Court for the Eastern District of

Texas, Tyler Division.          Three additional adversary proceedings

concerning the same basic issues were filed by two of CVC's

customers, Parsons and M.W. Kellogg Company.       Because CVC, Parsons

and the M.W. Kellogg Company announced a resolution of their

disputes in open court, the only issue addressed by the bankruptcy

court concerned whether South Coast is entitled to a materialman's

lien as a supplier to CVC in the construction of various vessels,

including the Parsons's vessel.

     The bankruptcy court found that the various vessels subject to

the sequestration order, including the Parsons's vessel, actually

were owned by CVC at the time of the sequestration order, and thus

able to be attached by CVC's creditors under Texas law.2              The

        2
        Parsons does not dispute whether the bankruptcy court
correctly sets forth the test for the lien under Texas law.




                                     -4-
bankruptcy court further found that the value of the components

used    in     the     Parsons's       vessel,      and    therefore      the        Texas

constitutional lien against the Parsons's vessel alone, amounted to

$207,980.00.          In     finding    that      the   vessels    subject      to    the

sequestration        order    could    be     attached,    the    bankruptcy     court

rejected the claim of CVC's customers that the customers owned the

various vessels at the time of sequestration. Parsons premised its

ownership of the vessel constructed for it by CVC on (a) the

vesting title provision in its contract with CVC, and (b) Parsons's

payments of several hundred thousand dollars to CVC in the months

preceding CVC's bankruptcy filing.                  The court reasoned that the

vesting title provision conflicted with a December 16, 1992 letter

of Parsons's stating that title to the vessel did not transfer

until that date.             It further found that the several hundred

thousand dollars paid by Parsons to CVC compensated CVC not for

components supplied by South Coast and incorporated into the

vessels, but for drawings of the vessel and the provision of

certain "head and plate" material.

       The bankruptcy court also turned aside Parsons's argument that

because of a lack of privity, South Coast could not qualify as a

materialman.         In so doing, the court found first that CVC was in

privity      with    South    Coast,    not    FVC,     even   though   South    Coast

permitted its customers, including CVC, to order directly from FVC.

The    court   reasoned       that    because     all   invoices    for   components

furnished CVC were submitted to CVC by South Coast, CVC dealt with




                                            -5-
South Coast instead of FVC, as Parsons's had asserted, entitling

South Coast to claim the lien.

                                 II

     The issue on appeal is whether the district court committed

clear error in affirming the bankruptcy court's factual findings

that (a) CVC owned the vessels at the time that the lien in favor

of South Coast arose, and (b) South Coast was in privity with CVC.

Having reviewed the record, the briefs of the parties, the opinion

of the bankruptcy court, and the memorandum opinion and order of

the district court, we find that because the bankruptcy court's

factual findings have solid support in the record, the district

court's affirmance of the bankruptcy court's recognition of a

materialman's lien in the Parsons's vessel in favor of South Coast

for $207,980.00 is not clearly erroneous.   For the reasons set out

by the district court in its order of March 29, 1995, the judgment

in favor of the defendant, South Coast Supply Company, Inc., is

hereby

                                                  A F F I R M E D.




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