Court Opinion

ID: 8915297
Source: CourtListenerOpinion
Date Created: 2022-11-27 04:46:21.412223+00
Date Added: 2024-06-11T17:08:55.428292
License: Public Domain

WM. MATTHEW BYRNE, Jr., District Judge
(dissenting):
Although I concur with the majority on the nonconstitutional issues, I must respectfully dissent from the conclusion that Supplemental Rule B, as written and applied, satisfies the due process clause of the Fifth Amendment.
Determining what process is due depends on a balancing of the interests of the parties. See, e.g., Mitchell v. W. T. Grant, 416 U.S. 600, 604,94 S.Ct. 1895,1898, 40 L.Ed.2d 406 (1974). Cf. id. at 610, 94 S.Ct. at 1908 (Powell, J. concurring). Plaintiff has a legitimate interest in securing collateral for the satisfaction of any judgment he might win against the defendant. Without collateral, the judgment, and the effort expended in obtaining the judgment, could be useless. Of course, this is a danger in any litigation, but in admiralty cases the danger of judgment without satisfaction is particularly serious because the only available assets of the defendant — possibly a ship or, as in this case, a bank account — are often easily removable from the jurisdiction. The interest of the defendant is to minimize the risk of a wrongful attachment. Attachment deprives defendant, without any warning, of the temporary use of his property. This denial can be especially costly if it prevents him from using his property to derive profits or meet obligations.
It is the duty of this court to evaluate the panoply of possible procedural safeguards to determine which combination strikes the proper compromise in serving these conflicting interests.
I agree with the majority’s conclusion that pre-attachment notice and hearing are not constitutionally required.1 The very purpose of attachment is to prevent the removal or concealment of assets after the defendant is notified of a pending suit. Pre-attachment notice would destroy the protection that attachment was created to provide. Once put on guard, the defendant may nullify the effectiveness of the judicial remedy by removing his assets from the jurisdiction of the court and possibly the United States as well. Therefore, requiring pre-attachment notice and hearing, while furthering the defendant’s interest, would leave the interest of the plaintiff unprotected.
In the absence of pre-attachment notice and hearing, prompt post-attachment notice and hearing are constitutionally required. North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601, 607, 95 S.Ct. 719, 723, 42 L.Ed.2d 751 (1975); Mitchell, 416 U.S. 600, 618, 94 S.Ct. 1895, 1905, 40 L.Ed.2d 406 (1974). Supplemental Rule B does not require prompt notice and hearing after attachment and, therefore, on its face, violates due process. Nonetheless, the constitutional notice and hearing requirement was met in this case because Sanko, in fact, received prompt notice of attachment and had the opportunity under the Local Rules of the District of Hawaii and Supplemental Rule B to obtain a timely hearing.
Even when post-attachment notice and hearing are provided, I would find that Supplemental Rule B, both as written and applied, violates due process because it fails to adequately protect against wrongful deprivation.2
Post-attachment notice and hearing provide a defendant no protection against the *643initial wrongful deprivation of property; they merely limit the time the deprivation can persist. When a defendant is not provided notice and hearing until after the attachment, the due process clause requires that certain procedural safeguards be observed in the ex parte issuance of a summons of attachment.
A plaintiff seeking a summons of attachment in an ex parte proceeding must make a particularized factual showing of entitlement to attachment.3 This showing must be evaluated by a judicial officer4 who has the discretion to grant or deny the request, The judicial officer must then determine whether there is probable cause for an at*644tachment.5 If the summons is issued, the plaintiff is required to post a bond prior to its execution.6 These safeguards adequately protect the defendant against wrongful deprivation of property without imposing a significant burden on the plaintiff or the court.
Supplemental Rule B does not require a particularized showing. Nor must a judicial officer be involved; the issuance of the summons of attachment is handled solely by the court clerk. The clerk is not allowed to consider the contents of the document filed or exercise discretion as to the issuance of the summons. Upon the filing of a verified complaint, accompanied by an affidavit of the plaintiff or his attorney, which may consist of conclusory statements based on information and belief, the clerk must issue the summons. No bond is required prior to the attachment.
The majority opinion indicates that the complaint and the affidavit in this case were sufficiently particularized. Even assuming the correctness of this finding, Supplemental Rule B, as applied here, is constitutionally deficient for the lack of a pre-at-tachment bond and a judicial determination that the complaint and affidavit justified attachment.
The majority finds that neither North Georgia Finishing nor Mitchell are applicable here to invalidate the attachment. They first argue that admiralty attachment should be presumed constitutional because it is an ancient procedure. It may be that there is an historical presumption in favor of attachment prior to notice and hearing. However, there is no presumption in favor of attachment without other procedural safeguards. See Grand Bahama Pet. Co., Ltd. v. Canadian Transp., 450 F.Supp. 447, 459 (W.D.Wash.1978).
*645If there is a presumption regarding the ex parte procedures at issue here, it is in favor of those procedures. Supreme Court cases such as Mitchell and North Georgia Finishing have established that when attachment is obtained ex parte, the balance of interests of the parties favors additional protection of the interest of the defendant, who is unable to oppose attachment. In order to displace these safeguards, the plaintiff must show that his interests would be unreasonably impaired by the procedures. In other words, the plaintiff must show that the detriment he would suffer due to the procedures outweighs the protection afforded the defendant. The plaintiff has made no such showing in this ease.
The majority next argues that an admiralty plaintiff’s interest in obtaining jurisdiction by attachment distinguishes admiralty actions from other due process cases. The majority finds that Fuentes v. Shevin, 407 U.S. 67, 92 S.Ct, 1983, 32 L.Ed.2d 556 (1972), carved out an exception for cases involving the need to establish jurisdiction. However, the Fuentes footnote upon which they rely merely states that “the Court has allowed attachment of property without prior hearing . .. (when) attachment (was) necessary to secure jurisdiction in a state court — clearly a most basic and important public interest.” id. at 91 n.23, 92 S.Ct. at 1999 n.23, citing Ownbey v. Morgan, 256 U.S. 94, 41 S.Ct. 433, 65 L.Ed. 837 (1921). Neither Fuentes nor Ownbey held that the need to obtain jurisdiction outweighs the need for safeguards in ex parte proceedings. In addition, the majority has not explained how such safeguards impair the interest in obtaining jurisdiction, much less how that presumed impairment outweighs the protection these procedures give to the defendant.
Furthermore, the need to obtain jurisdiction may not even be a factor that this court should consider. Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977), held that quasi in rem jurisdiction violates due process because it does not meet the minimum contacts standard of personal jurisdiction. This holding may well apply in admiralty. See Bohmann, Applicability of Shaffer to Admiralty in Rem Jurisdiction, 53 Tul.L.Rev. 135 (1978). Cf. Merchants Nat. Bank v. Dredge Gen. G. L. Gillespie, 663 F.2d 1338, 1353 (Tate, J. dissenting) (minimum contacts analysis applies to admiralty in rem attachment).
In essence, the majority has decided not to apply the procedural safeguards set forth in North Georgia Finishing and Mitchell because this is an admiralty case, without explaining how the unique characteristics of admiralty make the safeguards unreasonable. The primary differentiating aspect of admiralty — the mobility of the assets to be attached — justifies an attachment without prior notice and hearing. It does not, however, justify the absence of a pre-attachment bond, a particularized showing of entitlement and a judicial determination whether the summons of attachment should issue. These safeguards provide defendants adequate protection against wrongful deprivation of property while imposing no significant burdens on the plaintiff or the courts. Accordingly, I dissent.

. North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601, 607, 95 S.Ct. 719, 723, 42 L.Ed. 751 (1975); 419 U.S. at 612-13, 95 S.Ct. at 725 (Powell, J., concurring) (“[t]he most compelling deficiency in the Georgia procedure is its failure to provide a prompt and adequate post-garnishment hearing”); 419 U.S. at 611 n.3, 95 S.Ct. at 725 n.3 (Powell, J., concurring) (“[t]he basic protection required for the debtor is the assurance of a prompt post-garnishment hearing before a judge”); Mitchell, 416 U.S. at 618, 94 S.Ct. at 1905; 416 U.S. at 625, 94 S.Ct. at 1909 (Powell, J., concurring).

. Other courts have held that the attachment procedures of Supplemental Rules B & C do not comport with the requirements of due process. See Alyeska Pipeline Serv. Co. v. Bay Ridge, *643509 F.Supp. 1115 (D.Alaska 1981) (Supplemental Rule C attachment unconstitutional under circumstances of case); Karl Senner, Inc. v. M/V Acadian Valor, 485 F.Supp. 287 (E.D.La. 1980) (Supplemental Rule C attachment unconstitutional where court had personal jurisdiction over defendant); Grand Bahama Petroleum Co., Ltd. v. Canadian Transportation Agency, Ltd., 450 F.Supp. 447 (W.D.Wash.1978); Cook Indus., Inc. v. Toyko Marine Co., Ltd., 1978 A.M.C.1979 (D.Alaska 1978) (adopting the rationale of Grand Bahama); Merchants Nat. Bank v. Dredge Gen. G. L. Gillespie, 663 F.2d 1338, 1351-1353 (5th Cir. 1981) (Tate, J. dissenting); see generally Techem Chem. Co., Ltd. v. M/T Choyo Maru, 416 F.Supp. 960 (D.Md. 1976) (constitutionality of attachment under Supplemental Rules seriously questioned); 7a Moore’s Federal Practice j[ E. 10, at E-456 (2d ed. 1981) (“the admiralty’s practice of near-automatically issuing process in rem and of attachment and garnishment is nonetheless still vulnerable to attack”); Note, Due Process in Admiralty Arrest and Attachment, 56 Tex.L. Rev. 1091 (1978); Note, The Due Process Mandate and the Constitutionality of Admiralty Arrests and Attachments Pursuant to Supplemental Rules B and C, 12 Vand.J. of Trans’l Law 421 (1979); Morse, The Conflict between the Supreme Court Admiralty Rules and Sniadach-Fu-entes: A Collision Course?, 3 Fla.St.U.L.Rev. 1 (1975); but see Merchants Nat’l Bank, 663 F.2d 1338 (Supplemental Rule C attachment constitutional); Amstar Corp. v. S/S Alexandros T., 664 F.2d 904 (4th Cir. 1981) (Supplemental Rule C attachment constitutional under circumstances of case); United States v. Kaiyo Maru No. 53, 503 F.Supp. 1075 (D.Alaska 1980) (Supplemental Rule C constitutional as an “extraordinary situation” in the context of an attachment effectuated by the federal government); Central Soya Co., Inc. v. Cox Towing Corp., 417 F.Supp. 658 (N.D.Miss.1976) (Supplemental Rule C attachment constitutional as an “extraordinary situation”); A/S Hjalmer Bjorg-es Rederi v. The Tugboat Condor, 1979 A.M.C. 1696 (S.D.Cal.1979) (same); Stoner v. O/S Neiska II, 1978 A.M.C. 2650 (D.Alaska 1978) (same); Bethlehem Steel Corp. v. S/T Valiant King, 1977 A.M.C. 1719 (E.D.Pa.1974) (Supplemental Rule C attachment constitutional).

. See North Georgia Finishing, Inc., 419 U.S. at 607, 95 S.Ct. at 722 (1975); 419 U.S. at 611, 95 S.Ct. at 725 (Powell, J., concurring); Mitchell, 416 U.S. at 675, 94 S.Ct. at 1909 (Powell, J., concurring). It is unclear from the cases whether a party seeking attachment must show both a need for the attachment and a colorable claim on the merits of the case. Even if the dual showing is not required in the relatively simple debtor-creditor cases such as North Georgia Finishing and Mitchell, I believe such a showing should be required in admiralty, which runs the gamut of tort, contract and carriage actions.

. In Mitchell, the plurality opinion in upholding the validity of Louisiana sequestration statutes, emphasized that a judge had participated in the issuance of the writ. 416 U.S. at 616-17, 94 S.Ct. at 1904-05. In his concurring opinion, Justice Powell stated that “the constitutional guarantee of procedural due process is fully satisfied in cases of this kind where state law requires . . . that the creditor . .. make a specific factual showing ,before a neutral officer or magistrate of probable cause to believe that he is entitled to the relief requested.” [emphasis supplied], 416 U.S. at 625, 94 S.Ct. at 1909.
North Georgia Finishing invalidated a garnishment statute. The plurality distinguished the case before it, where a writ was issuable by the court clerk, from Mitchell, where a judge had participated in the issuance. 419 U.S. at 607, 95 S.Ct. at 722. Concurring, Justice Powell stated that adequate protection was afforded the defendant where state law required that the garnishment be preceded by the garnishor’s establishing “before a neutral officer ... a factual basis of the need to resort to the remedy.” 419 U.S. at 611, 95 S.Ct. at 725. Justice Powell noted that he was
not in accord with the Court’s suggestion that the Due Process Clause might require that a judicial officer issue the writ of garnishment. ... It thus should be sufficient for a clerk or other officer of the court to issue the original writ upon the filing of a proper affidavit.
419 U.S. at 611 n.3, 95 S.Ct. at 725 n.3. The potential complexity and magnitude of the seizures in admiralty cases militate strongly in favor of participation by a judicial officer in the issuance of a summons of attachment.

. See North Georgia Finishing, Inc., 419 U.S. at 611, 95 S.Ct. at 725 (Powell, J., concurring) (“[p]rocedural due process would be satisfied where state law requires that the garnishment be preceded by the garnishor’s provision of adequate security and by his establishment before a neutral officer of a factual basis of the need to resort to the remedy .... ” [footnote omitted]; Mitchell, 416 U.S. at 616, 94 S.Ct. at 1904 (“[w]here this case arose, the requisite showing must be made to a judge, and judicial authorization obtained”; defendant “was not at the unsupervised mercy of the creditor and court functionaries”); 416 U.S. at 625, 94 S.Ct. at 1909 (Powell, J., concurring) (due process is satisfied where, among other safeguards, the creditor must “make a specific factual showing before a neutral officer or magistrate of probable cause to believe that he is entitled to the relief requested”); Fuentes, 407 U.S. at 80, 92 S.Ct. at 1994 (under common law procedures “a state official made at least a summary determination of the relative rights of the disputing parties before stepping into the dispute and taking goods from one of them”).
In Mitchell, the Court noted that approval of a writ of sequestration by a neutral officer is not “a mere ministerial act.” Under the Louisiana procedures at issue there, specific facts as to the grounds relied upon for issuance of the writ must be contained in the verified petition “in order that the issuing judge can properly evaluate the grounds.” 416 U.S. at 616 n.12, 94 S.Ct. at 1905 n.12, quoting Wright v. Hughes, 254 So.2d 293, 296-97 (La.Ct.App.1971). The Supreme Court also cited Hancock Bank v. Alexander, 256 La. 643, 653-54, 237 So.2d 669, 672 (1970) (the remedies should not be availed unless “the proper grounds be alleged and sworn to”).
The Third Circuit has stated the clear concern of the Supreme Court in Mitchell and Di-Chem is “that the official making the required determinations exercise some discretion and possess the necessary professional competence” to determine whether a writ should issue. Jonnet v. Dollar Savings Bank of City of N. Y., 530 F.2d 1123, 1130 n.15 (3d Cir. 1976).

. See North Georgia Finishing Inc., 419 U.S. at 606-07, 95 S.Ct. at 722-23; 419 U.S. at 611, 95 S.Ct. at 725 (Powell, J., concurring); Mitchell, 416 U.S. at 606, 94 S.Ct. at 1899; 416 U.S. at 625, 94 S.Ct. at 1909 (Powell, J., concurring).
The majority argues that bond should not be required prior to attachment because of the uncertainty in fixing the amount of the bond. This uncertainty in admiralty attachment is not dissimilar to the uncertainty of setting bond in other contexts — for instance, on ex parte applications for seizure of items infringing copyrights, trademarks and patents. The judicial officer can set bond based on a factual presentation by the plaintiff of the value of the assets to be attached. Even if a judicial officer is not involved, bond may be set reasonably on the basis of the amount of damages sought, see North Georgia Finishing, 419 U.S. at 604, 95 S.Ct. at 721, and affidavits submitted by the plaintiff to establish the value of the property he seeks to attach. Any imperfections in the method of setting the amount of bond are outweighed by the incremental protection afforded the defendant.