Opinion ID: 764166
Heading Depth: 2
Heading Rank: 3

Heading: Determining The Owner of the Captain Lawrence

Text: 31 Under the ASA, if a State proves that a shipwreck is embedded in the submerged lands of the State and abandoned by its owner, title to the shipwreck vests in the State. See 43 U.S.C. § 2105(a). The Captain Lawrence is embedded in the submerged lands of Michigan. The district court in Fairport I reasoned that, if Behrens had abandoned the shipwreck, Michigan owned the Captain Lawrence, and the Eleventh Amendment prevented the court from refereeing an ASA dispute about ownership. Thus, the district court conducted a preliminary inquiry into abandonment to see whether the case implicated the ASA. See Fairport I, 913 F.Supp. at 555 (If the State bears its burden of showing ... that the Captain Lawrence has been abandoned ... the Court would be divested of jurisdiction to adjudicate the merits of the State's claim.). The court did not seek conclusively to determine whether Behrens abandoned the ship; rather, it ended the inquiry after finding that the State proved that it had a colorable claim to the shipwreck (i.e., that a preponderance of the evidence showed that Behrens abandoned the ship). Under this logic, once Michigan established its colorable claim, the Eleventh Amendment prevented the court from adjudicating any dispute under the ASA. 32 The Supreme Court's recent decision in Deep Sea Research rejects this approach. That opinion definitively instructs us that, if a State does not possess a shipwreck, the Eleventh Amendment does not prevent a federal court from entertaining claims under the ASA to the shipwreck. See Deep Sea Research, 118 S.Ct. at 1473. The Court explicitly distinguished past cases on this ground. See, e.g., id. at 1471 (In this case, unlike in Treasure Salvors, DSR asserts rights to a res that is not in the possession of the State.). 33 In the Brother Jonathan dispute, as in Fairport I, the district court believed that the Eleventh Amendment barred federal jurisdiction over shipwrecks claimed by States through the ASA's transfer of title. The Supreme Court vacated the Brother Jonathan opinion and remanded because the Court found that this evaluation of abandonment was necessarily influenced by the [mistaken] assumption that the Eleventh Amendment was relevant to the courts' inquiry. Deep Sea Research, 118 S.Ct. at 1473. It continued: In light of our ruling that the Eleventh Amendment does not bar complete adjudication of the competing claims to the Brother Jonathan in federal court, the application of the ASA must be reevaluated. Ibid. This implies that, because no jurisdictional barrier exists, the district court should conduct only one abandonment inquiry, and that that inquiry does not ask a preliminary jurisdictional question, but rather resolves whether Behrens abandoned the ship, and thus whether the ASA transfers title to Michigan. 34 The Court's reasoning in Deep Sea Research applies to Fairport's claims. The Fairport Idistrict court believed that the Eleventh Amendment foreclosed jurisdiction if Michigan indeed owned the Captain Lawrence. Thus, the district court dismissed the case after it found that Michigan proved, by a preponderance of the evidence, that Behrens abandoned his ship. Michigan did not possess the boat, however: the Captain Lawrence remained embedded in the lake bed during trial, and the State did not claim any of the artifacts recovered from the vessel. 3 Believing a jurisdictional bar existed if Michigan had title to the boat, the district court conducted only a preliminary inquiry to assess whether Michigan owned the vessel. Once the court decided that Michigan proved by a preponderance of the evidence that Behrens abandoned the boat, it dismissed the case without resolving the competing claims for title. It held that Michigan had a colorable claim to the Captain Lawrence under the ASA; it did not hold that Michigan certainly owned the shipwreck. 35 The Supreme Court has clarified that, because Michigan did not possess the res, the district court should not have undertaken a preliminary Eleventh Amendment inquiry. Rather, Michigan's claim under the ASA should receive an evaluation consistent with the requirements of the ASA and maritime law. The Supreme Court remanded the Brother Jonathan case [i]n light of [the Court's] ruling that the Eleventh Amendment does not bar complete adjudication of the competing claims to the Brother Jonathan in federal court.... Ibid. (emphasis added). Thus, we remand this case to the district court for complete adjudication of the competing claims to the Captain Lawrence. We write to guide the district court in its consideration of two issues: the means of proving abandonment, and the burden of proof placed upon Michigan.
36 Under maritime law, those who wish to raise sunken ships are governed by either the law of salvage or the law of finds. The law of salvage applies when the original owner retains an ownership interest in the ship; a salvor receives a salvage award, but not title to the ship. See, e.g., Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel, 640 F.2d 560, 567 (5th Cir.1981). Where the owner has abandoned the ship, however, recent doctrine applies the law of finds, vesting title in the finder of the ship. See Columbus-America, 974 F.2d at 464; Martha's Vineyard Scuba Headquarters, Inc. v. Unidentified, Wrecked and Abandoned Steam Vessel, 833 F.2d 1059, 1064-65 (1st Cir.1987); Treasure Salvors, 640 F.2d at 567. Whether the owner abandoned the ship thus determines which law applies, and, subsequently, who owns the ship. Intent on protecting the property rights of owners, admiralty courts recognize a presumption against finding abandonment. See, e.g., Hener v. United States, 525 F.Supp. 350, 356-57 (S.D.N.Y.1981). 37 The 1987 passage of the ASA altered this approach. The ASA transfers to a State the title to all abandoned shipwrecks embedded in the submerged lands of the State. See 43 U.S.C. § 2105. The ASA expressly rejects the application of the maritime laws of salvage and finds. See 43 U.S.C. § 2106(a) (The law of salvage and the law of finds shall not apply to abandoned shipwrecks to which section 2105 of this title applies.). If a diver now discovers a long-lost ship embedded in the submerged lands of a State, a finding of abandonment leaves the diver with neither title nor a salvage award (unless state law provides otherwise). 38 Deep Sea Research teaches that--at least where a State does not possess the contested res--a court should not engage in an Eleventh Amendment inquiry. A separate threshold question persists: is the shipwreck abandoned? If the owner abandoned the ship, the ASA automatically, perhaps instantaneously, takes title for the United States and transfers title to a State, resolving the legal issue and ending the court's inquiry. If the owner did not abandon the ship, the claim to the ship does not implicate the ASA, because the statute applies only to abandoned shipwrecks. The ownership of the wreck turns on the meaning of abandoned. 39 The Supreme Court remanded the Brother Jonathan with a one-sentence clarification that the meaning of 'abandoned' under the ASA conforms with its meaning under admiralty law. Deep Sea Research, 118 S.Ct. at 1473. Until the 1987 passage of the ASA, admiralty courts interpreted abandoned primarily when deciding whether to apply the law of salvage or of finds. The ASA departs from maritime law by insulating abandoned shipwrecks from the law of salvage and finds, see 43 U.S.C. § 2106(a), although the Act did not affect the meaning of abandoned, which serves as a precondition for the invocation of the ASA's provisions. 40 In this court's opinion in Fairport II, we adopted the inferential abandonment test, which allows parties to prove abandonment even if the original owner has not expressly renounced her claim to a vessel. The Fairport II court believed that the inferential abandonment test comported with the weight of maritime authority, see Fairport II, 105 F.3d at 1084 (favorably relating the Brother Jonathan court's discussion of the test, and contending that [t]his reasoning accords with the vast majority of decisions that have discussed the issue) and sound policy reasons, see id. at 1085 ([A]pplication of [the express abandonment test] would render the ASA a virtual nullity.). We recognize that the legislative history of the ASA also supports this view. See 1988 U.S.C.C.A.N. 365, 366 ([T]he term 'abandoned' does not require the original owner to actively disclaim title or ownership. The abandonment or relinquishment of ownership rights may be implied or otherwise inferred ....); id. at 373-74. 41 The appeals court decisions in Fairport II and the Brother Jonathanrejected the holding of Columbus-America Discovery Group v. Atlantic Mut. Ins. Co., 974 F.2d 450 (4th Cir.1992), which appears to adopt the express abandonment theory. See id. at 464. A court following the rule of Columbus-America may find abandonment only where it finds a strong actus element required to prove the necessary intent, id. at 461; the decision offers as an example an owner's express declaration abandoning title. Ibid. (quoting T. SCHOENBAUM, ADMIRALTY AND MARITIME LAW § 15-7, at 512 (1987)). Cases support this proposition, see, e.g., Hener, 525 F.Supp. at 357 ([A] finding that title to such property has been lost requires strong proof, such as the owner's express declaration abandoning title.); Wilkie v. Two Hundred and Five Boxes of Sugar, 29 F. Cas. 1247, 1247 (D.S.C.1796) (No. 17,662), although few explain their reasoning. 42 We think that the apparent divergence of authority masks a degree of underlying agreement. A close reading of the cases reveals a uniform concern that courts impose a high burden on those who argue that an owner abandoned property that sank against his will. To overcome this significant hurdle, the claimant may prove abandonment by inference as well as by express deed. This proposition finds support even from those cases cited as examples of the doctrine of express abandonment. See, e.g., Columbus-America, 974 F.2d at 464-65 (Such abandonment must be proved by clear and convincing evidence, though, such as an owner's express declaration abandoning title. Should the property encompass an ancient and long lost [sic] shipwreck, a court may infer an abandonment.); Wiggins v. 1100 Tons, More or Less, of Italian Marble, 186 F.Supp. 452, 456 (E.D.Va.1960) (While lapse of time and nonuser [sic] are not sufficient, in and of themselves, to constitute an abandonment, these factors may, under certain circumstances, give rise to an implication of intention to abandon.). Once these opinions recognize an exception to a rule of express abandonment, the question becomes after what length of years may a court infer abandonment; rather than draw arbitrary (time) lines separating express from implied tests, we choose to view length of time as one factor among several relevant to whether a court may infer abandonment. 43 We agree that lapse of time, alone, does not necessarily establish abandonment, see e.g., Wilkie, 29 F. Cas. at 1247, and an owner's failure to return to a shipwreck site does not necessarily prove abandonment, but we recognize that a combination of several facts, proved clearly and convincingly, see Part III.C infra, may support a finding that an owner has abandoned a shipwreck. Rigid adherence to a doctrine requiring express abandonment would require courts to stretch[ ] a fiction to absurd lengths, Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel, 569 F.2d 330, 337 (5th Cir.1978), where courts encounter claims to ancient shipwrecks with long-forgotten and undiscoverable owners. Permitting proof by inference reconciles maritime law's presumption against finding abandonment with the apparently-conflicting caselaw, and it explains the decisions upholding inferential abandonment. See, e.g., Brother Jonathan, 102 F.3d at 387-88; Fairport II, 105 F.3d at 1084-85; Moyer v. Wrecked and Abandoned Vessel, known as Andrea Doria, 836 F.Supp. 1099, 1105 (D.N.J.1993) (Abandonment may be inferred from circumstantial evidence. Factors such as lapse of time and nonuse by the owner may give rise to an inference of an intent to abandon. Other factors include the place of the shipwreck as well as the actions and conduct of the parties having ownership rights in the vessel.) (citation omitted). 44 Hence, we hold that a State may prove by inference that a shipwreck last owned by a private party is abandoned, for the purposes of admiralty law and the ASA. Proof by inference still requires proof, not conjecture--a requirement bolstered by the exacting burden of proof admiralty law imposes on those who allege abandonment. See Part III.C infra. We limit our holding to vessels formerly owned by private parties, and express no view as to the application of the express abandonment test to vessels initially owned by the United States. See, e.g., United States v. Steinmetz, 973 F.2d 212, 222-23 (3d Cir.1992), cert. denied, 507 U.S. 984, 113 S.Ct. 1578, 123 L.Ed.2d 146 (1993); cf. United States v. Pennsylvania & Lake Erie Dock Co., 272 F. 839, 843 (6th Cir.1921) (explaining that, once the government acquires title to land, it cannot abandon it without an express congressional declaration).
45 The district court in Fairport I required only that Michigan establish a colorable claim to the shipwreck. The court permitted Michigan to prove by a preponderance of the evidence that Behrens abandoned the Captain Lawrence. See Fairport I, 913 F.Supp. at 559. The Supreme Court disapproved of a similar threshold inquiry by the Brother Jonathan district court, holding that federal courts may engage in complete adjudication of the competing claims under the ASA. Deep Sea Research, 118 S.Ct. at 1473. 46 When the district court revisits this case on remand, it will not conduct a threshold inquiry to determine whether Michigan has a colorable claim under the ASA. Instead, it will decide whether Behrens abandoned the shipwreck; if he did, the ASA vests title in Michigan. If he did not, the ASA does not apply. Michigan may prove abandonment by circumstantial evidence, see supra, but Michigan must prove with clear and convincing evidence that Behrens abandoned the ship. 47 The district courts in Fairport I and the Brother Jonathanapplied the preponderance of the evidence standard not because admiralty law required it, but instead because they reasoned that parties asserting an affirmative jurisdictional defense must establish the defense by a preponderance of the evidence. See Deep Sea Research, Inc. v. Brother Jonathan, 883 F.Supp. 1343, 1349 (N.D.Cal.1995) ([A] party asserting sovereign immunity will have to at least prove, by a preponderance of the evidence, that the privilege applies.), aff'd, 102 F.3d 379 (9th Cir.1996), aff'd in part, vacated in part, California v. Deep Sea Research, 523 U.S. 491, 118 S.Ct. 1464 (1998); Fairport I, 913 F.Supp. at 554-54 (adopting the Brother Jonathan court's reasoning). 48 The uniform rule in admiralty law is that a finding of abandonment requires proof by clear and convincing evidence. See, e.g., Columbus-America Discovery Group, 974 F.2d at 467-68 ([W]hen a previous owner claims long lost property that was involuntarily taken from his control, the law is hesitant to find an abandonment and such must be proved with clear and convincing evidence.); Falgout Bros., Inc. v. S/V Pangaea, 966 F.Supp. 1143, 1145 (S.D.Ala.1997) (Abandonment must be proven by clear and convincing evidence....); Moyer, 836 F.Supp. at 1104-05 (requiring proof of abandonment by clear and convincing evidence); cf. Ries v. Thiesse, 61 F.3d 631, 631 (8th Cir.1995) (requiring creditors to prove by clear and convincing evidence a debtor's abandonment of a homestead). 49 The Fairport I and Brother Jonathan district courts also recognized that, if no jurisdictional defense applies, maritime law requires proof by clear and convincing evidence. See Brother Jonathan, 883 F.Supp. at 1351 (Finally, the finding of abandonment must be supported by strong and convincing evidence.); Fairport I, 913 F.Supp. at 558 (citing Columbus-America, 974 F.2d at 468). The district courts rejected the admiralty standard only because they applied a burden of proof appropriate for assertions of sovereign immunity. The Supreme Court has clarified, however, that where, as here, a State does not possess a shipwreck, the State cannot assert the Eleventh Amendment as a defense to the ASA action. See Deep Sea Research, 118 S.Ct. at 1473. On remand, the district court will decide whether the ASA applies, not whether the Eleventh Amendment bars the action. The court should consider whether Michigan can prove that it owns the shipwreck--that is, whether clear and convincing evidence shows that Behrens abandoned the Captain Lawrence. This burden of proof accords with maritime law and with the protection of private property rights against appropriation by the state. 50 Finally, we observe that the district court must reexamine, and supplement if necessary, the evidence adduced in the earlier proceedings. When the Supreme Court remanded the Brother Jonathan case, it remarked that the district and circuit courts' conclusion about whether the ship was abandoned was necessarily influenced by the assumption that the Eleventh Amendment was relevant to the courts' inquiry. Ibid. The Court concluded that the application of the ASA must be reevaluated, ibid., and we agree, urging the district court to conduct its inquiry under the exacting standard of clear and convincing evidence. In light of the conflicting evidence regarding whether Behrens had access to the technology necessary to salvage the ship, the lack of evidence concerning whether Behrens ever returned to Poverty Island, and the testimony regarding Behrens's intention to return, the district court must determine whether the evidence is fit to induce conviction in the minds of reasonable persons under this elevated, relatively stringent evidentiary standard. Miller's Bottled Gas, Inc. v. Borg-Warner Corp., 955 F.2d 1043, 1050 (6th Cir.1992). 4