Treasure Salvors, Inc. v. Unidentified Wrecked & Abandoned Sailing Vessel

• Decision Date: 09 March 1981
• Docket Number: No. 80-5067,80-5067
• Parties: TREASURE SALVORS, INC., a corporation and Armada Research Corp., a corporation, Plaintiffs-Appellees, v. The UNIDENTIFIED WRECKED AND ABANDONED SAILING VESSEL, etc., Defendant, Olin Frick, John Gasque, William Riley and The Masters of the Motor Vessels"Juniper" & "Seaker", Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 560

640 F.2d 560

TREASURE SALVORS, INC., a corporation and Armada Research Corp., a corporation, Plaintiffs-Appellees, v. The UNIDENTIFIED WRECKED AND ABANDONED SAILING VESSEL, etc., Defendant Olin Frick, John Gasque, William Riley and The Masters of the Motor Vessels"Juniper" & "Seaker" Defendants-Appellants.

No. 80-5067.

United States Court of Appeals Fifth Circuit.

March 9, 1981.

Reginald M. Hayden, Jr., Miami, Fla., for defendants-appellants.

Horan & Sireci, David Paul Horan, J. M. Morse, III, Key West, Fla., for plaintiffs-appellees.

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

Before GEE, FAY and RANDALL, Circuit Judges.

RANDALL, Circuit Judge:

This appeal marks the third time that Treasure Salvors and its efforts to retrieve treasure from the remains of the Spanish sailing vessel, Nuestra Senora de Atocha, have been before this court. The Nuestra Senora de Atocha sank off the coast of Florida in 1622 while carrying gold and silver bullion from Havana to Cadiz. ¹ In 1971 Treasure Salvors located an anchor from the Atocha; since then, Treasure Salvors has continued to conduct salvage operations in the wreck area and has retrieved gold and silver bullion, artifacts and armaments.

The first legal battle over Treasure Salvors' rights to the remains of the Atocha began when Treasure Salvors filed an in rem action in the United States District Court for the Southern District of Florida seeking possession of and confirmation of title to the remains of the vessel and its cargo. The United States intervened and counterclaimed for title to the vessel. The district court entered an order granting judgment for Treasure Salvors as against the United States and also decreed that Treasure Salvors had sole title to, and right to immediate and sole possession of, the vessel and its cargo "wherever the same may be found."

On appeal, we affirmed the district court's judgment insofar as it resolved the competing title claims of Treasure Salvors and the United States; however, we modified the district court's order by refusing to approve that portion of the order which purported to hold that Treasure Salvors had exclusive title to, and the right to immediate and sole possession of, the vessel and cargo as to other claimants, who were not parties or privies to the action. Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel, 569 F.2d 330, 336 (5th Cir. 1978) (Treasure Salvors I ). ²

The second legal battle over rights to the wreckage of the Atocha involved Treasure Salvors and the State of Florida. In 1971 Treasure Salvors and the State entered into the first of a series of contracts which granted Treasure Salvors the right to conduct underwater salvage operations on the Atocha and gave the State a right to receive 25% of the property recovered as a result of such operations. Both parties entered into these agreements in the belief that the Atocha rested on a submerged reef owned by the State of Florida. Both parties were mistaken in that belief. In 1975, the Supreme Court rejected Florida's claim to ownership of that portion of the continental shelf where the remains of the Atocha rest, United States v. Florida, 420 U.S. 531, 95 S.Ct. 1162, 43 L.Ed.2d 375 (1975). Thereafter, Treasure Salvors instituted an action to recover from the State the artifacts which had been transferred to it pursuant to the terms of the contracts. The district court again entered judgment for Treasure Salvors reasoning, first, that the State of Florida was bound by the earlier judgment in Treasure Salvors I, and alternatively, that the suit to establish title to the artifacts was not barred by the Eleventh Amendment and that, under the law of contracts, the State had no meritorious claim to ownership of the artifacts in its possession. While specifically declining to affirm or reverse the district court's ruling that the State was bound by the holding in Treasure Salvors I, we agreed with the district court's conclusion that the suit was not barred by the Eleventh Amendment and affirmed the judgment of the district court on the alternative contract law theory of mutual mistake. State of Florida, Department of State v. Treasure Salvors, Inc., 621 F.2d 1340 (5th Cir. 1980) (Treasure Salvors II ).

This appeal (certain to be christened Treasure Salvors III) arose not out of Treasure Salvors' difficulties with a sovereign but from a controversy between Treasure Salvors and another salvor. In its original action seeking a declaration of possessory and ownership rights to the Atocha, Treasure Salvors had defined the location of the wreck in terms of a circle having a radius extending 2500 yards from a point at coordinates 24o 31' 5 North Latitude and 82o 50' West Longitude. On May 10, 1979, Treasure Salvors filed an amended description of the wreck site claiming that the remains of the Atocha were scattered throughout a corridor 3,000 yards wide which extended from 24o 27' North Latitude and 82o 18' West Longitude, to 24o 33' 42 North Latitude and 82o 27' 42 West Longitude. Treasure Salvors again amended its description of the vessel's location on December 11, 1979, when it declared that it had found another anchor belonging to the Atocha at 24o 30' North Latitude and 82o 15' West Longitude and announced that it was continuing to conduct salvage operations in the area between this point and the site of the first anchor at 24o 31' 5o North Latitude and 82.50' West Longitude. Treasure Salvors continues to claim title to all remains of the vessel and the exclusive right to conduct salvage operations in the area between these points.

On December 11, 1979, Treasure Salvors also filed a motion for a temporary restraining order claiming that Olin Frick, John Gasque, William Riley and the Masters of the Motor Vessels "Juniper" and "Seaker" were wrongfully interfering with Treasure Salvors' right to possession and salvage of the Atocha by conducting salvage operations within 1500 yards of the point where the second anchor had been recovered. Treasure Salvors also claimed that threatening shots had been fired by someone aboard one of the defendants' vessels. The district court granted Treasure Salvors' request for a temporary restraining order and later issued a preliminary injunction prohibiting the defendants from interfering with Treasure Salvors' search and salvage operations within an area extending 2500 yards from either side of a line drawn between the two points contained in Treasure Salvors' latest description of the wreck site. Frick and his co-defendants have brought this appeal from that injunction.

On appeal two jurisdictional issues, one concerning our ability to review the order entered by the district court at this time and the other involving the district court's power to resolve this dispute, require our consideration. We conclude, however, that neither of these jurisdictional questions bars our consideration of the merits of the injunction. For the reasons set forth herein, we affirm the district court's injunctive order but modify it to provide that it shall expire no later than 90 days following the issuance of our mandate in order to speed resolution of the merits of this unusual dispute.

I. THE APPEALABILITY OF THE INJUNCTION

Under 28 U.S.C. § 1292(a)(1) appeals are permitted from interlocutory orders "... granting, continuing, modifying, refusing or dissolving injunctions ...." There can be no doubt therefore that the district court order granting preliminary injunctive relief to Treasure Salvors would be an appealable order if it had been entered in the course of an ordinary civil case. Treasure Salvors contends, however, that since this interlocutory order was entered in the context of an admiralty proceeding, interlocutory review under § 1292(a)(1) is unavailable and that since the order does not meet the requirements of 28 U.S.C. § 1292(a)(3), which authorizes interlocutory appeals in admiralty from orders "determining the rights and liabilities of the parties to admiralty cases ...," we have no jurisdiction to entertain this appeal. We agree that this order does not fall within the compass of § 1292(a)(3). That section was designed to apply in circumstances distinctive to admiralty where it is not uncommon for a court to enter an order finally determining the issues of liability between the parties and then to refer the case to a master for a determination of damages. Courts have tended to construe this provision rather narrowly and it has not been read to permit interlocutory appeals in admiralty except where the order, regardless of the label affixed to it, had the effect of ultimately determining the rights and obligations of the parties. An order granting one party preliminary injunctive relief clearly fails to meet that criterion.

We do not, however, believe that § 1292(a)(3) provides the exclusive authorization for interlocutory appeals in admiralty. In admiralty cases where injunctive orders are entered which would be appealable under § 1292(a)(1) if entered in the course of an ordinary civil proceeding, interlocutory appeals will properly lie under that statutory provision. Prior to the unification of the admiralty rules with the federal civil rules it was generally presumed that the admiralty judge lacked the chancellor's power to order injunctive relief; therefore, the question whether appeals could be taken from such orders in admiralty cases under § 1292(a)(1) was seldom posed. The question did, however, arise in the context of injunctions entered in limitation of liability proceedings which barred prosecution of other actions while the limitation action proceeded. We held that such injunctions, and orders modifying them, were appealable under § 1292(a)(1). Complaint of Muchok, Inc., 578 F.2d 1156 (5th Cir. 1978); Beal v. Walz, 309 F.2d 721 (5th Cir. 1962); Pershing Auto Rentals, Inc. v. Gaffney, 279 F.2d 546 (5th Cir. 1960).

For...