ARCENEAUX, District Judge.
I. Introduction
This action challenges Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims, Federal Rules of Civil Procedure, 28 U.S.C.A., (“Rule C”), as viola-tive of an individual’s right to due process of law as guaranteed by the Fifth Amendment of the United States Constitution. More specifically, defendants, the M/V ACADIAN VALOR (“ACADIAN”), and Acadian Offshore Services, Inc. and/or Aca-dian Marine Services, Inc. (“Acadian Offshore”), attacked Rule C as failing to comport with the due process standard set forth by the Supreme Court in
Fuentes
v.
Shevin,
407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972), and its progeny.
The issue, as framed by this Court, is whether admiralty is so unique that Rule C, in its application to the facts of this case, should stand despite its failure to comply with the due process standard applicable to cases involving the seizure of property established by the Supreme Court.
The cases of
Fuentes, supra; North Georgia Finishing Co., Inc. v. Di-Chem, Inc.,
419 U.S. 601, 95 S.Ct. 719, 42 L.Ed.2d 751 (1975), and the line of cases following those decisions, provide four basic criteria for a constitutional seizure of property under the Fifth Amendment:
1. Effective (prior) notice to property owners (or) persons having interests in property seized;
2. A meaningful and timely hearing;
3. Avoidance of conclusory allegations in the complaint; and,
4. Posting of a bond.
These exact criteria may not be appropriate in all maritime cases; however, they set forth sufficient guidelines to determine
whether Rule C must be found unconstitutional as it relates to the facts of this case.
While cognizant that
in rem
seizures in admiralty have historically been viewed as “unique,” this Court is not convinced that such proceedings should be exempt from elemental requirements of procedural due process. In fact, it has long been recognized by this Court that the Fifth Amendment provides a critical safeguard in
in rem
admiralty matters:
Although recent developments in the constitutional requirements of Due Process have been more concerned with criminal and civil than with admiralty matters and more concerned with state than with federal procedures, the Fifth Amendment
does operate as a limitation on the power of courts of the United States in admiralty matters.
Even though the requirements necessary to constitute notice requisite for Due Process in admiralty
in rem
proceedings are perhaps the least demanding known to the law, considering the worldwide practical effect of the judgments added, still, as in all other areas of the law, notice is required.
United States v. Steel Tank Barge H 1651, Etc.,
272 F.Supp. 658, 659-660 (E.D.La.1967) (emphasis added).
In the case at bar, plaintiff Karl Senner, Inc. (“Senner”), pursuant to Rule C, directed the Marshal of the Eastern District of Louisiana to arrest and seize the M/V ACA-DIAN VALOR in order to enforce a maritime lien resulting from an alleged failure to pay for services rendered. Defendant Acadian Offshore, the owner of the vessel, was joined,
in personam,
in this action.
Upon seizure by the Marshal, defendants brought this motion attacking the constitutionality of Rule C as permitting deprivation of property without due process of law. Defendants claim the summary seizure violates their right to prior notice and hearing and seek to have the arrest of the vessel vacated.
II. Background
Proceedings
in rem
against a vessel and proceedings
in personam
with process of maritime attachment have long been recognized as part of the maritime law administered by the District Courts of the United States pursuant to (1) Article III, Section 2 of the Constitution; (2) various statutes; and (3) rules adopted by the Supreme Court of the United States. Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims falls within the ambit of this maritime jurisdiction.
The
in rem
procedures set out in the Supplemental Rules permit the seizure of a vessel pursuant to a warrant for her arrest issued by the Clerk of the District Court without affording the owner prior notice or an opportunity to be heard.
No pre-sei-zure hearing or judicial review is contemplated; upon filing of the complaint, the Clerk is required by Rule C(3) to issue a warrant for the arrest of the vessel.
The
party requesting the seizure is not even required to post a bond which would provide some protection to the vessel owner, should the vessel owner prevail. If the parties are unable to agree with respect to the nature or amount of the security, a hearing before a district judge is provided for by Rule E(2), (5).
Relying upon recent Supreme Court cases holding that certain state attachment and garnishment procedures violate the due process clause of the Fourteenth Amendment,
defendants herein, the M/V ACADI-AN VALOR and its owner, a Louisiana corporation, contend that Rule C procedures deny those procedural safeguards found by the Supreme Court to be inherent in Fifth Amendment due process, and seek a release of the security posted and dismissal of the
in rem
proceeding.
III. Procedural Due Process
Due process is a flexible concept; what process is due in any situation is determined by an analysis of the particular circumstances, including the functions served and interests affected. Therefore, this Court is limited by the particular facts before it, and confines its decision to the narrow question presented by the facts of this case: whether a pre-hearing seizure of a vessel, where the Court has personal jurisdiction over the defendant/owner of the vessel, violates defendants’ right of due process before being deprived of the use of their property.
The fundamental requirements of due process are notice and a right to be heard, and both “must be granted at a meaningful time and in a meaningful manner.”
Fuentes v. Shevin,
407 U.S. 67, 80, 92 S.Ct. 1983, 1994, 32 L.Ed.2d 556 (1972), quoting from
Armstrong v. Manzo,
380 U.S. 545, 552, 85 S.Ct. 1187, 1191, 14 L.Ed.2d 62 (1965).
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ARCENEAUX, District Judge.
I. Introduction
This action challenges Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims, Federal Rules of Civil Procedure, 28 U.S.C.A., (“Rule C”), as viola-tive of an individual’s right to due process of law as guaranteed by the Fifth Amendment of the United States Constitution. More specifically, defendants, the M/V ACADIAN VALOR (“ACADIAN”), and Acadian Offshore Services, Inc. and/or Aca-dian Marine Services, Inc. (“Acadian Offshore”), attacked Rule C as failing to comport with the due process standard set forth by the Supreme Court in
Fuentes
v.
Shevin,
407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972), and its progeny.
The issue, as framed by this Court, is whether admiralty is so unique that Rule C, in its application to the facts of this case, should stand despite its failure to comply with the due process standard applicable to cases involving the seizure of property established by the Supreme Court.
The cases of
Fuentes, supra; North Georgia Finishing Co., Inc. v. Di-Chem, Inc.,
419 U.S. 601, 95 S.Ct. 719, 42 L.Ed.2d 751 (1975), and the line of cases following those decisions, provide four basic criteria for a constitutional seizure of property under the Fifth Amendment:
1. Effective (prior) notice to property owners (or) persons having interests in property seized;
2. A meaningful and timely hearing;
3. Avoidance of conclusory allegations in the complaint; and,
4. Posting of a bond.
These exact criteria may not be appropriate in all maritime cases; however, they set forth sufficient guidelines to determine
whether Rule C must be found unconstitutional as it relates to the facts of this case.
While cognizant that
in rem
seizures in admiralty have historically been viewed as “unique,” this Court is not convinced that such proceedings should be exempt from elemental requirements of procedural due process. In fact, it has long been recognized by this Court that the Fifth Amendment provides a critical safeguard in
in rem
admiralty matters:
Although recent developments in the constitutional requirements of Due Process have been more concerned with criminal and civil than with admiralty matters and more concerned with state than with federal procedures, the Fifth Amendment
does operate as a limitation on the power of courts of the United States in admiralty matters.
Even though the requirements necessary to constitute notice requisite for Due Process in admiralty
in rem
proceedings are perhaps the least demanding known to the law, considering the worldwide practical effect of the judgments added, still, as in all other areas of the law, notice is required.
United States v. Steel Tank Barge H 1651, Etc.,
272 F.Supp. 658, 659-660 (E.D.La.1967) (emphasis added).
In the case at bar, plaintiff Karl Senner, Inc. (“Senner”), pursuant to Rule C, directed the Marshal of the Eastern District of Louisiana to arrest and seize the M/V ACA-DIAN VALOR in order to enforce a maritime lien resulting from an alleged failure to pay for services rendered. Defendant Acadian Offshore, the owner of the vessel, was joined,
in personam,
in this action.
Upon seizure by the Marshal, defendants brought this motion attacking the constitutionality of Rule C as permitting deprivation of property without due process of law. Defendants claim the summary seizure violates their right to prior notice and hearing and seek to have the arrest of the vessel vacated.
II. Background
Proceedings
in rem
against a vessel and proceedings
in personam
with process of maritime attachment have long been recognized as part of the maritime law administered by the District Courts of the United States pursuant to (1) Article III, Section 2 of the Constitution; (2) various statutes; and (3) rules adopted by the Supreme Court of the United States. Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims falls within the ambit of this maritime jurisdiction.
The
in rem
procedures set out in the Supplemental Rules permit the seizure of a vessel pursuant to a warrant for her arrest issued by the Clerk of the District Court without affording the owner prior notice or an opportunity to be heard.
No pre-sei-zure hearing or judicial review is contemplated; upon filing of the complaint, the Clerk is required by Rule C(3) to issue a warrant for the arrest of the vessel.
The
party requesting the seizure is not even required to post a bond which would provide some protection to the vessel owner, should the vessel owner prevail. If the parties are unable to agree with respect to the nature or amount of the security, a hearing before a district judge is provided for by Rule E(2), (5).
Relying upon recent Supreme Court cases holding that certain state attachment and garnishment procedures violate the due process clause of the Fourteenth Amendment,
defendants herein, the M/V ACADI-AN VALOR and its owner, a Louisiana corporation, contend that Rule C procedures deny those procedural safeguards found by the Supreme Court to be inherent in Fifth Amendment due process, and seek a release of the security posted and dismissal of the
in rem
proceeding.
III. Procedural Due Process
Due process is a flexible concept; what process is due in any situation is determined by an analysis of the particular circumstances, including the functions served and interests affected. Therefore, this Court is limited by the particular facts before it, and confines its decision to the narrow question presented by the facts of this case: whether a pre-hearing seizure of a vessel, where the Court has personal jurisdiction over the defendant/owner of the vessel, violates defendants’ right of due process before being deprived of the use of their property.
The fundamental requirements of due process are notice and a right to be heard, and both “must be granted at a meaningful time and in a meaningful manner.”
Fuentes v. Shevin,
407 U.S. 67, 80, 92 S.Ct. 1983, 1994, 32 L.Ed.2d 556 (1972), quoting from
Armstrong v. Manzo,
380 U.S. 545, 552, 85 S.Ct. 1187, 1191, 14 L.Ed.2d 62 (1965).
Both notice and a hearing are ordinarily required
before
property is taken although, as the Court stated in Fuentes:
There are ‘extraordinary situations’ that justify postponing notice and opportunity for a hearing.
Boddie v. Connecticut,
401 U.S. [371], at 379 [91 S.Ct. 780, at 786, 28 L.Ed.2d 113]. These situations, however, must be truly unusual. Only in a few limited situations has this Court allowed outright seizure without opportunity for a prior hearing. First, in each case, the
seizure has been directly necessary to secure an important governmental or general public interest. Second, there has been a special need for very prompt action. Third, the State has kept strict control over its monopoly of legitimate force: the person initiating the seizure has been a government[al] official responsible for determining, under the standards of a narrowly drawn statute, that it was necessary and justified in the particular instance.
407 U.S. at 90-91, 92 S.Ct. at 1999-2000.
In
Central Soya Co., Inc. v. Cox Towing Corp.,
417 F.Supp. 658 (N.D.Miss.1976), Rule C was upheld as falling within the extraordinary exception of
Fuentes. Central Soya’s
facts were dissimilar to those present in this case because the hearing which permitted the seizure in
Central Soya
actually preceded the arrest of the vessel. Further, we believe the Court in
Central Soya
erroneously characterized the facts of its case as constituting one of the “extraordinary situations” alluded to in
Fuentes. Central Soya
demonstrates that Rule C is overbroad as it presently stands, because the Court was forced to find an “extraordinary situation” in a common maritime seizure.
The most recent case to analyze a due process challenge to Rule C also relied upon the “exception” stated in
Fuentes
for “exceptional circumstances.”
Hjalmar Bjorges Rederi and M/V Bjorghav v. The Tug Boat CONDOR,
1979 A.M.C. 1696 (S.D.Cal.1979).
The
CONDOR
Court found the three
Fuentes’
conditions satisfied because: 1) the arrest procedure has been an “integral and necessary feature” throughout the history of maritime law; 2) due to the “mobile and international character of shipping” arrest of the vessel is necessary to acquire jurisdiction and provide a forum for maritime claims; 3) “the need for prompt action is recognized as peculiar to admiralty”; and, 4) the government interest in admiralty procedures far exceeds those involved in state garnishment proceedings. 1979 A.M.C. at 1702.
In sum, the
CONDOR
Court also found admiralty to be “unique,” relying upon the “history of maritime law” and the “strong government interest” in admiralty proceedings to justify an absence of due process. It did not explain how these governmental interests would be compromised or how admiralty proceedings would be hampered by the imposition of due process safeguards. Certainly, “a clerk’s determination that plaintiff’s verified complaint presents an admiralty claim,” does not satisfy the
Fuentes’
third criteria that the seizure be initiated by “a government official responsible for determining, under standards of a narrowly drawn statute, that [the seizure] was necessary in the particular circumstances.”
A. “Necessary to Secure an Important Governmental or Public Interest”
'The case of
Ownbey v. Morgan,
256 U.S. 94, 41 S.Ct. 433, 65 L.Ed. 837 (1921), cited with approval in
Fuentes,
407 U.S. at 91, n. 23,92 S.Ct. at 1999, n. 23, holds that the due process requirement of effective prior notice is satisfied where a pre-hearing seizure is necessary to secure jurisdiction.
Central Soya
relied on this exception in finding Rule C constitutional. However, the viability of
Ownbey
is questioned by this Court, particularly insofar as it provides authority to remove due process constraints from Rule C seizures.
The status of
Ownbey
as a
quasi in rem
action preceding
Shaffer v. Heitner,
433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977), is automatically uncertain. Further, the more recent Supreme Court decision in
Calero-Toledo v. Pearson Yacht Leasing Co.,
416 U.S. 663, 94 S.Ct. 2080, 40 L.Ed.2d 452,
rehearing denied,
417 U.S. 977, 94 S.Ct. 3187, 41 L.Ed.2d 1148 (1974), indicates that acquiring jurisdiction is not an end in itself unless accomplished in aid of an important
governmental or public interest.
Calero-Toledo
correctly applies the
Fuentes
governmental interest test:
First, seizure under the Puerto Rican statutes serves significant governmental purposes: Seizure permits Puerto Rico to assert
in rem
jurisdiction over the property in order to conduct forfeiture proceedings, thereby fostering the public interest in preventing continued illicit use of the property and in enforcing criminal sanctions.
416 U.S. at 679, 94 S.Ct. at 2089-2090, 40 L.Ed.2d at 465. Thus, it seems clear that jurisdiction-securing devices must involve a governmental or public interest. When purely private interests are involved, such as those present in this case, the situation cannot be classified as “truly unusual.”
Fuentes, supra,
407 U.S. at 90, 92 S.Ct. at 1989. Application of jurisdiction-securing devices must, therefore, be narrow, and linked to an important governmental or public interest. The need to assess “the costs the procedure exacts [of] private interests,” must not replace procedural safeguards when the seizure is initiated by self-interested private parties. 419 U.S. at 610, 95 S.Ct. at 724.
The
Central Soya
Court did not deem the existence of personal jurisdiction over the defendants as relevant to the
in rem
jurisdiction over the vessel, relying on the personification theory, and concluded that
in rem
actions are essential to admiralty:
Plaintiff here, if foreclosed from attaching the vessel at this time, will be exposed to a definite risk of harm which would not exist should the court allow the arrest of the Mark Shurden. In order for plaintiff to impress a maritime lien against the vessel, this court must possess in rem jurisdiction over the Mark Shur-den. In order to acquire in rem jurisdiction over the vessel, seizure and arrest . must be effected.
Dow Chemical Co. v. Barge UM-23B,
424 F.2d 307 (5th Cir. 1970).
417 F.Supp. at 663-664. As the Court pointed out, destruction of a vessel extinguishes maritime liens by eliminating the
res.
Even insurance proceeds would be lost to plaintiff because maritime liens do not attach to insurance proceeds upon the loss of the vessel. 417 F.Supp. at 664.
These statements though true, provide no argument against constitutional due process guarantees. Seizure may be a prerequisite to impressing a maritime lien; however, the implementation of the seizure need not conflict with due process of law. Rule C and the “uniqueness” of admiralty law provide the sole .bases for summary seizure of a vessel. Research and briefing of this point by counsel revealed no compelling, or even persuasive, authorities, with the possible exception of
Central Soya,
to overcome the Supreme Court’s clear expression in
Di-Chem
that “We are no more inclined now than we have ever been in the past to distinguish among different kinds of property in applying the Due Process Clause.” 419 U.S. at 608, 95 S.Ct. at 723.
The
Central Soya
doctrine is particularly inappropriate here, where the vessel owner is before the Court. Courts have time and again acknowledged the personification theory to be a fiction whose real value is simply as a mechanism to enforce the
in personam
liability of the owner.
Thus,
when
in personam
jurisdiction exists, as it does in the case at bar, there is no basis for ignoring the fundamental safeguards contained in the due process clause.
B. “Special Need for Prompt Action”
Plaintiff urges this Court to find that
Fuentes
second requirement, a situation necessitating prompt action, is present, because a vessel may be easily removed from the Court’s jurisdiction. However, it has not been shown that the Rule’s present provisions, which clearly permit a seizure without notice or hearing, are an appropriate solution to the need for prompt action.
In
Mitchell v. W. T. Grant Company,
416 U.S. 600, 94 S.Ct. 1895, 40 L.Ed.2d 406 (1974), the Court upheld the Louisiana sequestration statute which allows a seller/creditor holding a vendor’s lien after posting a bond, to secure a writ of sequestration and to cause the sheriff to take possession of property. A writ of sequestration may only be issued by a
judge
upon the creditor’s filing of an affidavit which clearly sets forth sufficient facts to justify the issuance of the writ.
The Louisiana law also expressly entitles the debtor to an immediate hearing after seizure and to dissolution of the writ absent proof by the creditor of the grounds on which the writ was issued. In upholding the narrowly-drawn Louisiana statute, the Supreme Court emphasized three “saving clauses:” (1) judicial control of the seizure process;
(2) the requirement of a pre-seizure bond; and, (3) the availability of an immediate post-seizure hearing.
Should the writ be dissolved, “there are ‘damages for the wrongful issuance of a writ’ and for attorney fees ‘whether the writ is dissolved on motion or after trial on the merits. (La.Civ.Code) Art. 3506.’”
Mitchell v. W. T. Grant Company, supra,
416 U.S. at 616-617, 94 S.Ct. at 1904-1905.
Rule C lacks at least two of the “saving” devices sanctioned by the Supreme Court in
Mitchell:
1) no judicial officer intervenes until defendant comes to Court to answer the plaintiff’s allegations; and 2) no pre-seizure bond is required, though, on cross-claim by defendant, plaintiff
may
be forced to furnish a bond.
A Georgia garnishment statute which did not have the “saving characteristics” of the Louisiana sequestration statute was struck down in
North Georgia Finishing Co., Inc. v. Di-Chem, Inc.,
419 U.S. 601, 95 S.Ct. 719, 42 L.Ed.2d 751 (1975). The Supreme Court, in describing the procedures laid out in the Georgia statute, was simultaneously enumerating its due process shortcomings:
The writ of garnishment is issuable on the affidavit of the creditor or his attorney, and the latter need not have personal knowledge of the facts. § 46-103. The affidavit, like the one filed in this case, need contain only conclusory allegations. The writ is issuable, as this one was, by the court clerk, without participation by a judge. Upon service of the writ, the debtor is deprived of the use of the property in the hands of the garnishee. Here a sizable bank account was frozen, and the only method discernible on the face of the statute to dissolve the garnishment was to file a bond to protect
the plaintiff creditor. There is no provision for an early hearing at which the creditor would be required to demonstrate at least probable cause for the garnishment. Indeed, it would appear that without the filing of a bond the defendant debtor’s challenge to the garnishment will not be entertained, whatever the grounds may be.
Di-Chem, Inc., supra,
419 U.S. at 607, 95 S.Ct. at 722-23.
Property, simply because it is movable, possesses no inherent characteristics which immunize it from due process.
To hold otherwise would invite distinctions which the Supreme Court has consistently refused to recognize. Indeed, it is difficult to contemplate property more mobile or more susceptible of concealment than automobiles, motorboats, or refrigerators. Yet, it was in the context of litigation involving such “transitory” items that
Fuentes
was conceived.
C. “Strict State Control Over Its Monopoly of Legitimate Force”
The third prerequisite to seizure listed in
Fuentes
is that the state maintain strict control over its monopoly of legitimate force: the person initiating the seizure must be a government official who determines, under a narrowly-drawn statute, that the seizure is necessary and justified. 407 U.S. at 91, 92 S.Ct. at 2000. In striking down the replevin statutes, the
Fuentes
Court stated:
No state official participates in the decision to seek a writ; no state official reviews the basis for the claim to repossession; and no state official evaluates the need for immediate seizure. There is not even a requirement that the plaintiff provide any information to the court on these matters. The State acts largely in the dark.
407 U.S. at 93, 92 S.Ct. at 2001.
As noted above, Rule C does not require any pre-seizure judicial supervision, nor does it require the pleading with specificity of the facts supporting the claim.
Indeed, in our case, the plaintiff’s complaint was clearly conclusory and conspicuously void of any clarifying statements which might present a factual basis for the seizure. Thus, this minimal requirement of
Fuentes
has not been met. Obviously, Rule C is devoid of that “strict control” over the federal government’s monopoly of legitimate force, i. e., admiralty jurisdiction, that
Fuentes
requires.
IV. Bethlehem Steel
The Eastern District of Pennsylvania upheld the constitutionality of Rule C in
Bethlehem Steel Corp. v. S/T VALIANT KING, et al.,
1977 A.M.C. 1719 (E.D.Pa.1974). There, the Court elected to disregard the
Fuentes
line of cases, declaring that they were “decided without reference to Admiralty practice and procedures.” 1977 A.M.C. at 1721. Although it is appropriate to consider the uniqueness of admiralty in certain areas, this Court does not believe that “uniqueness” is relevant in respect to basic Fifth Amendment due process requirements. The
Bethlehem
Court had difficulty in understanding “how a
res
or thing which is itself
the
‘property’ can allege that
it
has been deprived of
its property
without due process of law.” 1977 A.M.C. at 1721. But that Court refused to consider the personification theory which transforms a vessel into a legal person for jurisdictional purposes. Inasmuch as the creation of that legal person endows the Courts with power over it, that power must be exercised as it would be exercised over other legal persons.
In this case, however, we need not consider whether a vessel can or cannot have personal rights. In contrast to
Bethlehem Steel,
where the owners were not served, but attempted to make a special or limited appearance to contest the seizure, the owners in this case are subject to the personal
jurisdiction of this Court, and they are the “persons” who have been deprived of their property without due process of law.
Y. Conclusion
To say that the prophylaxis of judicial supervision or a protective pre-seizure bond are not required in admiralty seizures simply because admiralty is “unique” is not enough. This Court neither questions the necessity of seizures in admiralty, nor contemplates the promulgation of rigorous rules to effect such seizures, but is compelled to hold that the seizure in this case failed to comport with basic concepts of due process which the Court finds applicable to this seizure of a vessel.
To do otherwise would amount to a finding that due process stops at the water’s edge.
We, therefore, find that Rule C violates the due process clause of the Fifth Amendment where the Court has personal jurisdiction over the vessel owners and the seizure of the vessel,
in rem,
is accomplished without prior notice, hearing or judicial intervention.
The motion of defendants, Acadian Offshore Services, Inc. and Acadian Marine Service, Inc., to dismiss the
in rem
proceedings filed by the plaintiff pursuant to Rule C of the Supplemental Rules for Certain Admiralty and Maritime Claims, Federal Rules of Civil Procedure, 28 U.S.C.A., is hereby GRANTED.