Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel, 76-2151

Citation569 F.2d 330
Decision Date13 March 1978
Docket NumberNo. 76-2151,76-2151
PartiesTREASURE SALVORS, INC., a corporation and Armada Research Corp., a corporation, Plaintiffs-Appellees, v. The UNIDENTIFIED WRECKED AND ABANDONED SAILING VESSEL, her tackle, armament, apparel and cargo located within 2500 yards of a point at coordinates 24.31.5' north latitude and 82.50 west longitude, said sailing vessel is believed to be the NUESTRA SENORA de ATOCHA, Defendant, United States of America, Intervenor-Appellant.
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

Michael W. Reed, U. S. Dept. of Justice, Washington, D. C., Marine Resources Section, Peter R. Taft, Asst. Atty. Gen., Land & Natural Res. Section, Bruce C. Rashkow, Atty., Dept. of Justice, Washington, D. C., for intervenor-appellant.

David Paul Horan and Joshua M. Morse, III, Key West, Fla., for plaintiffs-appellees.

Appeal from the United States District Court for the Southern District of Florida.

Before BROWN, Chief Judge, GEWIN and TJOFLAT, Circuit Judges.

GEWIN, Circuit Judge:

Treasure Salvors, Inc., and Armada Research Corp., Florida corporations, sued for possession of and confirmation of title to an unidentified wrecked and abandoned vessel thought to be the Nuestra Senora de Atocha. The Atocha sank in the sea off the Marquesas Keys in 1622 while en route to Spain. The United States intervened, answered, and counterclaimed, asserting title to the vessel. Summary judgment was entered for the plaintiffs, 408 F.Supp. 907 (S.D.Fla.1976), and the government appealed. We modify the district court's judgment, and affirm.

This action evokes all the romance and danger of the buccaneering days in the West Indies. It is rooted in an ancient tragedy of imperial Spain, and embraces a modern tragedy as well. The case also presents the story of a triumph, a story in which the daring and determination of the colonial settlers are mirrored by contemporary treasure seekers.

In late summer of 1622 a fleet of Spanish galleons, heavily laden with bullion exploited from the mines of the New World, set sail for Spain. Spain, at this period in her history, was embroiled in the vicious religious conflicts of the Thirty Years' War and desperately needed American bullion to finance her costly military adventures. As the fleet entered the Straits of Florida, seeking the strongest current of the Gulf Stream, it was met by a hurricane which drove it into the reef-laced waters off the Florida Keys. A number of vessels went down, including the richest galleon in the fleet, Nuestra Senora de Atocha. Five hundred fifty persons perished, and cargo with a contemporary value of perhaps $250 million was lost. A later hurricane shattered the Atocha and buried her beneath the sands.

For well over three centuries the wreck of the Atocha lay undisturbed beneath the wide shoal west of the Marquesas Keys, islets named after the reef where the Marquis of Cadereita camped while supervising unsuccessful salvage operations. Then, in 1971, after an arduous search aided by survivors' accounts of the 1622 wrecks, and an expenditure of more than $2 million, plaintiffs located the Atocha. 1 Plaintiffs have retrieved gold, silver, artifacts, and armament valued at $6 million. Their costs have included four lives, among them the son and daughter-in-law of Melvin Fisher, plaintiffs' president and leader of the expedition. 2


The district court did not specify its basis of jurisdiction. With respect to the controversy presented by the parties, it was clearly within the court's power to declare title to those objects within its territorial jurisdiction. The government, however, contends that the court lacked in rem jurisdiction to determine the rights of the parties to that portion of the res situated beyond the territorial jurisdiction of the court.

In rem actions in admiralty generally require, as a prerequisite to a court's jurisdiction, the presence of the vessel or other res within the territorial confines of the court. American Bank of Wage Claims v. Registry of District Court of Guam, 431 F.2d 1215, 1218 (9th Cir. 1970); 7A Moore's Federal Practice P E.05, at E-202 (1977). This rule is predicated upon admiralty's fiction of convenience that a ship is a person against whom suits can be filed and judgments entered. Continental Grain Co. v. Barge FBL-585, 364 U.S. 19, 22-23, 80 S.Ct. 1470, 1472-1473, 4 L.Ed.2d 1540, 1543 (1960). Personification of the ship allows actions to be brought against the vessel when her owner can not be reached. Id. In these circumstances the fiction may perform a useful and salutary function. But when a legal fiction which exists solely to effectuate the adjudication of disputes is invoked for the opposite purpose, we have no hesitation in declining to employ it. 3

Other courts faced with similar challenges to their jurisdiction have refused to myopically apply this fiction where its application was inappropriate to the situation before them. In Booth Steamship Co. v. Tug Dalzell No. 2, 1966 A.M.C. 2615 (S.D.N.Y.1966), the claimant to the res contested the court's in rem jurisdiction on the grounds that the res was not within the territorial jurisdiction of the court. In its pleadings the plaintiff had alleged, as in the case before us, that the res was within or during the pendency of the proceedings would be within the court's jurisdiction. The claimant's answer admitted this allegation. After reviewing the decisions on this question the court held:

(T)he mandate of Admiralty Rule 22 requiring that in an in rem action, the libel allege the presence of the res in the district, does not relate to subject matter jurisdiction, and therefore actual local seizure or a tangible substitute thereof, such as the posting of a bond, is not a prerequisite to the maintenance of an in rem action. The claimants-petitioners, by admitting the presence of the res within the district, by filing a claim to the tug Dalzell # 2 and by filing and serving a general appearance, have submitted that vessel to the jurisdiction of this court.

Id. at 2618.

The Third Circuit reached a similar conclusion in Reed v. Steamship Yaka, 307 F.2d 203 (3d Cir. 1962), rev'd on other gds., 373 U.S. 410, 83 S.Ct. 1349, 10 L.Ed.2d 448 (1963). There, the res was also outside the court's territorial jurisdiction, but the claimant voluntarily appeared and answered the complaint "to avoid attachment and delay of the vessel if it should subsequently be present" within the court's jurisdiction. The court held that by this act the claimant had waived the requirement that the res be arrested by the court and had consented to the court's jurisdiction over its interest in the vessel. Id. at 204-05.

Finally, the Supreme Court, in Continental Grain Co. v. Barge FBL-585, 364 U.S. 19, 80 S.Ct. 1470, 4 L.Ed.2d 1540 (1960), aff'g, 268 F.2d 240 (5th Cir. 1959), permitted the transfer under 28 U.S.C. § 1404(a), with the claimant's consent, of an in rem action in admiralty to a district in which the res was not present. The Court based its decision upon the fact that this transfer would prevent "unnecessary inconvenience and expense to parties, witnesses, and the public." Id. at 21, 80 S.Ct. at 1472, 4 L.Ed.2d at 1542. It is true, as Justice Whittaker stated in his dissent in Continental Grain, that the Court did not decide the question of whether the owner's consent can confer in rem jurisdiction in an action where the res is not within the territorial jurisdiction of the court. However, as commentators have noted, the Supreme Court appears to favor the position that the presence of the res within the district is not an absolute prerequisite to the court's jurisdiction. 4

These decisions evidence the common concern of the courts with finding the most practical and efficacious means of resolving the disputes before them. An interest in rendering justice rather than an automatistic reliance upon rigid legalisms characterizes each of them. It is with these examples before us that we turn to an examination of the merits of the government's jurisdictional challenge.

Initially we note that for all practical purposes it was impossible to bring the entire remains of the vessel and her cargo within the territorial jurisdiction of the court. Thousands of items retrieved from the wreck site were brought into the district, but the bulk of the wreck lies buried under tons of sand in international waters. The district court did everything within its power to have the marshal arrest the vessel and bring it within the custody of the court. 5 Thus, there is little danger that the res, against which any claims might be satisfied, will escape an in rem decree against it.

In this case, as in the three cases we have discussed, the court had in personam jurisdiction over the claimants, 6 thus rendering the vessel's arrest nonessential to the resolution of the action. The United States intervened in plaintiffs' in rem action as a party defendant and filed a counterclaim asserting a property right in the res. The government, by intervening in this action and by stipulating to the court's admiralty jurisdiction (A. 67), waived the usual requirement that the res be present within the territorial jurisdiction of the court and consented to the court's jurisdiction to determine its interest in the extraterritorial portion of the vessel.

Alternatively, we note that assuming a lack of in rem jurisdiction of that part of the wreck lying outside the territorial waters of the United States, the district court is not deprived of jurisdiction over the government's counterclaim if that claim rests upon an independent basis of jurisdiction. Sachs v. Sachs, 265 F.2d 31 (3d Cir. 1959); Haberman v. Equitable Life Assurance Soc'y of United States, 224 F.2d 401, 409 (5th Cir. 1955); Isenberg v. Biddle, 75 U.S.App.D.C. 100, 102, 125 F.2d 741, 743 (1944). In its counterclaim the government requested that "a declaratory judgment be issued affirming the property right of the...

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