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RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 24
ELECTRONIC CITATION: 1997 FED App. 0038P (6th Cir.)
File Name: 97a0038p.06
No. 95-1783
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
Fairport International
Exploration, Inc.,
Plaintiff-Appellant,
On Appeal from the
v.
United States District
Court for the Western
The Shipwrecked Vessel known
District of Michigan
as The Captain Lawrence,
in rem,
Defendant-Appellee,
The State of Michigan,
Intervenor-Appellee.
__________________
Decided and Filed January 30, 1997
__________________
Before: JONES, RYAN, and MOORE, Circuit Judges.
RYAN, Circuit Judge. The plaintiff, Fairport
International
Exploration, Inc., filed an
in rem admiralty action seeking salvage
rights against The Captain
1
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Fairport Int'l Exploration v.
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No. 95-1783
Lawrence, a vessel that
sank in Lake Michigan in 1933. The State
of Michigan intervened
under, inter alia, the Abandoned Shipwreck
Act of 1987 (the ASA),
43 U.S.C. 2101-2106, and filed a motion
to dismiss. Fairport
appeals from the district court's grant of
that motion, arguing that
the district court erred in concluding
that The Captain Lawrence had
been abandoned. For the reasons that
follow, we will affirm.
I.
The Captain Lawrence, rebuilt from
a yacht originally
constructed in 1898, first
sank in Lake Michigan in 1931. It was
towed into the shallow
water of a Milwaukee, Wisconsin, river and
sold for $150 to Wilfred
H. Behrens. Behrens apparently did what
needed to be done to
make The Captain Lawrence seaworthy, and the
ship departed Milwaukee
for Summer Island, Michigan, in August
1933, with Behrens as captain
and a crew of four.
According to a Record of Casualties to
Vessels filed by
Behrens in November 1933, The
Captain Lawrence became stranded near
Poverty Island,
Michigan, on September 19, 1933, and then sank
after a "terrific wind
came up" and blew the vessel onto some
rocks. The Captain
Lawrence was contacted by the Coast Guard the
next morning, but declined
offers of assistance. In the Record of
Casualties, Behrens declared
the estimated value of the total loss
to be $200, and
reported that the vessel was carrying no cargo.
Testimony in the
district court regarding the value of vessels
during the 1930s indicated that
comparable vessels, when new, would
have sold for $14,500.
In arguing on appeal that Behrens and his descendants did not
"abandon" The Captain
Lawrence after this incident, Fairport's
brief claims that
Wilfred Behrens, owner and master of
the Captain
Lawrence, evidenced the desire and intention to salvage
the vessel, building a cabin on Poverty
Island and
staying there for some time in the hope of
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No. 95-1783
salvaging the vessel . . . but, because of the
loss of
the ship and his equipment and
strained financial
circumstances, was unable to do so.
The transcript page cited by
Fairport fails to support this version
of events, as it simply recounts
the following:
There was an account that after the Captain Lawrence was
wrecked they stayed in a log cabin, and we went and found
one and there was portions of the wreckage that they had
used the door off the Captain Lawrence that they hauled
ashore, a door, a roof on this log cabin, and they stayed
there till they could get sufficient help to get off the
island.
To the extent this
testimony suggests anything about Behrens's
motive for staying
in a log cabin, it suggests that he did so
simply as a temporary
means of finding shelter after the ship went
down; it certainly does
not suggest that the crew "stay[ed] there
for some time
in the hope of salvaging the vessel,"
and if
anything, it contradicts
that assertion. Further, we find nothing
in our independent consideration
of the record that could support
Fairport's claim that
Behrens "evidenced the desire and intention
to salvage the vessel."
Steven Libert, the president of plaintiff Fairport,
has a
self-proclaimed obsession with
"the legend of a Civil War era gold
treasure allegedly lost
in northern Lake Michigan in the vicinity
of Poverty Island."
His research on the subject led him
to
conclude that The
Captain Lawrence had been searching for the
legendary treasure
at the time of the shipwreck,
and he
hypothesized that the
ship was "an important key" to locating the
gold. As a result,
Libert has been diving intermittently in the
Poverty Island vicinity since
1983. He has found two items that he
believes belong to The Captain
Lawrence: an anchor and a propeller
blade.
Fairport asserts title to the wreck of The Captain
Lawrence
based on its execution of a
Salvage Bill of Sale
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No. 95-1783
with Gladys Nally, a surviving
heir of Behrens who, in turn, is the
assignee of the
interests of all the other surviving
heirs.
Fairport filed this in
rem admiralty action in June 1994, seeking
to perfect its title to and
salvage rights in the wreck.
The State of Michigan intervened and moved
to dismiss in
August 1994, arguing that the
wreck belonged to Michigan under the
ASA. Under
the ASA, the federal government asserts title
to
certain historic wrecks, and
then transfers that title to the state
on whose submerged lands
the wrecks are found. 43 U.S.C. 2105.
A shipwreck
meets the requirements of the
ASA if it is
(1) abandoned; (2) located on
the state's submerged lands; and (3)
either embedded in the
sea floor or eligible for listing in the
National Register of
Historic Places. Michigan argued that the
wreck met the requirements
of the ASA, and that the district court
accordingly lacked
subject-matter jurisdiction over Fairport's
claim; that is,
the suit was in reality against the
State of
Michigan and thus barred by
the Eleventh Amendment.
Although initially noting its "very serious reservations as to
whether Plaintiff has
in fact found any evidence of the Captain
Lawrence," the district
court assumed for purposes of its analysis
that the "evidence
[was] sufficient to identify the
res."
Concluding that the second
and third prongs of an ASA claim were
satisfied because the
vessel asserted to be The Captain Lawrence
was embedded in the
sea floor of Michigan's submerged lands, the
district court then reasoned
that "in order to show that the ASA
applies, the State has the burden
of showing by a preponderance of
the evidence that the vessel
was abandoned." Such proof would give
rise to the conclusion that
Michigan had a "colorable claim" within
the meaning of the
ASA, thus divesting the district court of
jurisdiction. The court
concluded that The Captain Lawrence had in
fact been abandoned:
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No. 95-1783
The Captain Lawrence is a relatively recent wreck.
It
did not sink in deep water. It was stranded on
Poverty
Island. Assuming the evidence Plaintiff has
found is
from the Captain Lawrence, the vessel is in pieces close
to shore in only 40-60 feet of water.
It was not
technologically unfeasible to locate or to salvage
the
Captain Lawrence in the 1930's. Modern technology
was
not essential to the recover of the vessel.
The evidence, although
circumstantial, clearly
demonstrates Wilfred Behrens' intent to
abandon the
vessel. He valued the vessel at
only $200, had no
insurance on it, and wrote it off as a "total loss." Had
he wanted to salvage the vessel, the best time would have
been immediately after it was stranded on the beach. Yet
there is no evidence that he attempted
any salvage
operations immediately after the wreck. The
evidence
shows that Behrens was offered assistance from the Coast
Guard immediately after the storm, but declined it. The
evidence shows that Behrens was an experienced salvager,
and continued his salvage diving for over ten years after
the shipwreck. Yet there is no evidence that
he ever
attempted to salvage the Captain Lawrence in the
years
after the wreck.
Behrens did not discuss the location of the
Captain
Lawrence with his family. He died intestate. He did not
leave his interest in the vessel to his family
or to
anyone else. There is no evidence that his crew
showed
any interest in returning to the Captain
Lawrence.
Behrens' family did not seek out salvage divers to help
locate the remains of the Captain Lawrence. They showed
no interest in finding the Captain Lawrence until Libert
told them of the possibility of a link
between the
Captain Lawrence and the legendary gold treasure.
Based on these facts,
the court concluded that Michigan had "met
its burden of showing by a preponderance
of the
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No. 95-1783
evidence that the
Captain Lawrence was abandoned by Wilfred
Behrens."
From the judgment of dismissal, Fairport filed
this timely
appeal.
II.
In considering a motion to dismiss for lack of subject-matter
jurisdiction pursuant
to Fed. R. Civ. P. Rule 12(b)(1),
the
district court may look
beyond the jurisdictional allegations in
the complaint and
consider whatever evidence is submitted. See
Moir v. Greater Cleveland
Reg'l Transit Auth., 895 F.2d 266, 269
(6th Cir. 1990).
We then consider de novo the district court's
legal conclusion that
it lacked subject-matter jurisdiction. See
United States v.
Moncini, 882 F.2d 401, 403 (9th Cir.
1989).
Likewise, the question
of whether Eleventh Amendment immunity
applies is a question
of law, the determination of which we review
de novo. See Williams
v. Commonwealth of Kentucky, 24 F.3d 1526,
1543 (6th Cir.
1994). Whether a vessel has been
abandoned,
however, is a question
of fact, to be reviewed for clear error
only. See Deep Sea Research,
Inc. v. The Brother Jonathan, 89 F.3d
680, 684, 688 (9th Cir. 1996).
III.
A.
The ASA provides that "States have the responsibility
for
management of a broad
range of living and nonliving resources in
State waters and
submerged lands," including "certain abandoned
shipwrecks, which have
been deserted and to which the owner has
relinquished ownership
rights with no retention." 43 U.S.C.
2101(a) & (b).
To implement these congressional findings, the
statute provides
that the "United States asserts title to
any
abandoned shipwreck that is
. . . embedded in submerged lands of a
State," as well as
to certain other categories of shipwrecks not
implicated here. 43 U.S.C.
2105(a). The ASA then
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Fairport Int'l Exploration v.
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provides for a transfer
of title from the United States to the
individual state "in or
on whose submerged lands the shipwreck is
located." 43 U.S.C.
2105(c). Finally, the statute provides,
"[t]he law of salvage
and the law of finds shall not apply to
abandoned shipwrecks to which
section 2105 of this title applies,"
43 U.S.C. 2106(a),
although "the laws of the United States
relating to shipwrecks"
shall continue to apply in cases involving
wrecks that do not meet
the requirements of the ASA, 43 U.S.C.
2106(b).
B.
The foregoing provisions of the ASA have been interpreted
as
divesting federal courts
of admiralty jurisdiction over claims to
embedded shipwrecks, and
concurrently vesting state courts with
jurisdiction over such
claims, contrary to the general provisions
of Article III that "[t]he
judicial Power shall extend . . . to all
Cases of admiralty and
maritime Jurisdiction." U.S. Const. art.
III, 2, cl. 1;
see Zych v. Unidentified, Wrecked and Abandoned
Vessel, Believed to
be The Seabird, 941 F.2d 525, 533 (7th Cir.
1991) ("Seabird I"). This
divestiture is analytically accomplished
through the application
of the Eleventh Amendment, as it is well-
settled that when
the Eleventh Amendment applies to bar suit
against a state,
federal courts are divested of subject-matter
jurisdiction. Estate of
Ritter v. University of Michigan, 851 F.2d
846, 848 (6th Cir. 1988).
Fairport first argues that the Eleventh Amendment does not bar
its suit because the primary
purpose of the Eleventh Amendment is
to avoid having monetary
judgments rendered against states, and its
suit does not seek
a monetary judgment against Michigan. We may
readily dispose of this argument.
The Eleventh Amendment provides: "The Judicial power
of the
United States shall not
be construed to extend to any suit in law
or equity, commenced or prosecuted
against one of the United States
by Citizens of another State,
or by
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Fairport Int'l Exploration v.
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Citizens or Subjects of any
Foreign State." U.S. Const. amend. XI.
The Amendment presupposes
"first, that each State is a sovereign
entity in our federal
system; and second, that it is inherent in
the nature of sovereignty
not to be amenable to the suit of an
individual without
its consent." Seminole Tribe of Florida v.
Florida, 116 S. Ct. 1114,
1122 (1996) (internal quotation marks,
brackets, and citations
omitted). The Amendment embodies two
distinct purposes:
Adoption of the Amendment responded most immediately
to
the States' fears that "federal courts would force them
to pay their Revolutionary War debts, leading to
their
financial ruin." More pervasively,
current Eleventh
Amendment jurisprudence emphasizes the integrity retained
by each State in our federal system[.]
Hess v. Port Auth. Trans-Hudson
Corp., 115 S. Ct. 394, 400 (1994)
(citations and footnote omitted).
"[T]he Court has held that the Amendment
bars suits in
admiralty against
the States, even though such suits are not,
strictly speaking, `suits in
law or equity.'" Welch v. Texas Dep't
of Highways & Pub.
Transp., 483 U.S. 468, 472-73 (1987) (citing,
inter alia, Ex parte New
York, No. 2, 256 U.S. 503 (1921)). As the
Welch Court observed,
"to permit a creditor to seize and sell a
government-owned vessel . .
. would be to permit him in some degree
to destroy the government itself."
Id. at 489 (internal quotation
marks, brackets,
and citations omitted). Thus, "[a]
judgment
declaring that the
state possesses no interest in particular
property is a judgment
`against one of the United States' for
constitutional purposes."
Zych v. Wrecked Vessel Believed to be
The "Lady Elgin", 960 F.2d 665,
669 (7th Cir. 1992) ("Lady Elgin").
Finally, we note that the majority of those few intermediate
courts of appeals that have
had occasion to apply the ASA have held
that the Eleventh Amendment
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bars a suit such as this
when a state has a claim pursuant to the
ASA. See Zych
v. Unidentified, Wrecked, and Abandoned Vessel,
Believed to be The
Seabird, 19 F.3d 1136, 1141 (7th Cir. 1994)
("Seabird II");
Lady Elgin, 960 F.2d at 669. But see
Sindia
Expedition, Inc. v.
Wrecked and Abandoned Vessel, Known as "The
Sindia", 895 F.2d 116,
119-20 (3d Cir. 1990). We now join them,
finding Fairport's initial argument
to be without merit.
C.
Accepting, then, that the Eleventh Amendment applies to divest
the federal court of
subject-matter jurisdiction over this case so
long as the terms of the
ASA are satisfied, the question becomes
whether its terms are satisfied.
In that regard, the sole question
before us is whether The
Captain Lawrence was "abandoned" within
the meaning of the
statute. That question, in turn, has
two
components: one, the substantive
meaning of the term, and two, the
proper burden of proof.
Fairport's arguments focus on the
preliminary question.
Fairport contends that
the district court erred in determining that
the vessel was abandoned because
abandonment cannot be shown in the
absence of strong
and convincing evidence, such as an owner's
express declaration of abandonment,
and because the circumstantial
evidence relied on was
weak. Michigan, in turn, argues that the
district court applied the incorrect
burden of proof. The district
court, it asserts, should
have engaged only in a cursory review of
the merits to determine if Michigan's
claim was colorable, because
it is the
existence of its claim, not its strength,
that is
significant. It
contends that because it owns the lands beneath
its territorial water,
and because the ASA transfers to states
title to abandoned
shipwrecks embedded in state-owned lands, it
necessarily has stated a "colorable
claim."
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1.
We will address the latter argument first.
The State of
California, in Brother
Jonathan, argued, just as Michigan does
here, "that it need
not demonstrate by a preponderance of the
evidence that
the wreck of the Brother Jonathan
meets the
requirements of the
ASA in order to make a colorable claim of
ownership and qualify
for Eleventh Amendment immunity." Brother
Jonathan, 89 F.3d at 684.
California basically took the position
that it simply
needed to "assert" that the vessel was on
its
submerged lands, and that it
held title to abandoned shipwrecks on
those lands. Id.
at 685. The state contended that the Eleventh
Amendment "limits the showing
required to make a colorable claim to
ownership of an abandoned shipwreck."
Id. Otherwise, it reasoned,
if it had actually to prove
the merits of its claim, then it would
effectively be robbed
of immunity. Id. at 685-86. The
court
rejected this argument:
[A] federal court has both the
power and duty to
determine whether a case falls within its subject matter
jurisdiction. Therefore, it was appropriate
for the
district court to require the State to present evidence
that the ASA applied to the Brother Jonathan, i.e., that
it was abandoned and either embedded or eligible
for
listing in the National Register, before dismissing the
case. Otherwise, as DSR points out,
the State could
receive immunity simply by asserting that it was entitled
to it. For a federal court to renounce jurisdiction over
an admiralty case on the basis of a mere assertion
of
entitlement to immunity on the part of the
State is
inconsistent with the court's duty to assess whether
it
has jurisdiction.
Id. at 686 (emphasis
added) (citations omitted). The court also
reasoned that "`Eleventh Amendment
immunity . . . should be treated
as an affirmative defense,'
which `must be proved by the party that
asserts it and would benefit
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Fairport Int'l Exploration v.
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from its acceptance.'"
Id. at 687 (citation omitted). In closing,
the court noted that
in addressing the questions of abandonment, embeddedness,
and historical significance of the wreck under the ASA, a
federal court does not adjudicate the state's
rights.
The ASA does not vest title to wrecks that satisfy
its
requirements directly in the state. Rather, it provides
that the federal government may assert title
to such
wrecks. Only after the federal government takes title to
the abandoned shipwreck may title then be transferred to
the state. Thus, a federal court may
adjudicate the
question of whether a wreck meets the requirements of the
ASA without implicating the
Eleventh Amendment.
Therefore, we hold that the district court did not err in
requiring the State to prove by a preponderance of
the
evidence that it was entitled to Eleventh
Amendment
immunity.
Id. at 687-88 (citations omitted).
We agree with the reasoning of Brother Jonathan,
and find
Michigan's argument, essentially
that it should not have had to
prove abandonment at all,
unpersuasive. Brother Jonathan provides
an excellent analysis
of why it is appropriate to require a state
to prove the claimed lack
of subject-matter jurisdiction; indeed,
any other rule would tie
the hands of the federal court, and turn
over jurisdictional determinations
to the parties. Michigan points
to no case in any other context
where a court has simply accepted a
state's assertion
of Eleventh Amendment immunity, nor does
it
provide any rationale for why
the admiralty context should yield a
unique Eleventh Amendment jurisprudence.
2.
We turn now to Fairport's argument that the district
court
clearly erred in
finding that The Captain Lawrence had
been
abandoned. The
ASA itself does not define the term "abandoned,"
but two recent cases articulate
the
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No. 95-1783
conflicting views on what is
required to make an adequate showing.
The first is Brother Jonathan,
itself, decided after the district
court decision in this
case, but supporting its reasoning. A very
different definition
of "abandoned" is found in Columbus-America
Discovery Group v. Atlantic
Mut. Ins. Co., 974 F.2d 450 (4th Cir.
1992).
The Brother Jonathan court approved the following
test for
abandonment:
Traditionally, maritime law has found abandonment
when
title to a vessel has been affirmatively renounced,
or
when circumstances give rise to an inference that
the
vessel has been abandoned; courts have found abandonment,
for instance, when a vessel is "so long lost that
time
can be presumed to have eroded any realistic claim
of
original title."
. . . .
. . . [The district court's] holding that the Brother
Jonathan is not abandoned rests on the traditional rule
that a wreck is not abandoned unless either 1) title
is
affirmatively renounced or 2) abandonment can be inferred
from the lapse of time or failure to
pursue salvage
efforts on the part of the owners.
89 F.3d at 688 (emphasis added)
(citation omitted). This reasoning
accords with the vast majority
of decisions that have discussed the
issue. See, e.g., United
States v. Steinmetz, 973 F.2d 212, 222-23
(3d Cir. 1992).
The opposing view is expressed in Columbus-America. The first
important fact to note
about Columbus-America, however, is that it
is not an ASA
case. Rather, the court engaged in
a lengthy
discussion of the law
of salvage and the law of finds, and their
conflicting policies.
The law of salvage is aimed at preserving
title in the
original owner, allowing a salvor a
right to
possession and an award, but
not the title itself. Application of
the law of finds,
however, can result in the actual transfer of
title to the
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salvor. Thomas J.
Schoenbaum, 2 Admiralty & Maritime Law 16-7
(2d ed. 1994).
Abandonment can occur in either context,
but
because of
the differing results, different standards
for
determining abandonment are
imposed. In any event, the Columbus-
America court's interpretation
of these doctrines led it to reason
as follows:
Today, finds law is applied to previously owned sunken
property only when that property has been abandoned
by
its previous owners. Abandonment in this
sense means
much more than merely leaving the property, for it
has
long been the law that "[w]hen articles are lost at sea
the title of the owner in them remains." Once an article
has been lost at sea, "lapse of time and nonuser are not
sufficient, in and of themselves, to
constitute an
abandonment." In addition, there is no abandonment when
one discovers sunken property and then,
even after
extensive efforts, is unable to locate its owner.
While abandonment has been simply described as "the act
of deserting property without hope
of recovery or
intention of returning to it," in the lost property
at
sea context, there is also a strong
actus element
required to prove the necessary intent. "Abandonment
is
said to be a voluntary act which must be
proved by a
clear and unmistakable affirmative act to
indicate a
purpose to repudiate ownership." The proof that need
be
shown must be "strong . . ., such as the owner's express
declaration abandoning title."
Columbus-America, 974 F.2d
at 461 (citations omitted). The court
acknowledged, however,
that "'[i]n the treasure salvage cases,
often involving wrecks
hundreds of years old, the inference of
abandonment may
arise from lapse of time and nonuse
of the
property, or
there may even be an express
disclaimer of
ownership.'" Id. at 462
(citation omitted),
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This court will follow the lead of Brother Jonathan
rather
than that of Columbus-America.
The approach of Columbus-America is
premised entirely
on its policy choices involving the law
of
salvage and the law
of finds, neither of which applies under the
ASA. The only question
under the ASA is whether a ship has been
abandoned so as to
give the state a claim. Common sense makes
readily apparent that
the statute did not contemplate a court's
requiring express abandonment;
such explicit action is obviously
rare indeed, and application
of such a rule would render the ASA a
virtual nullity.
We find it unnecessary to undertake an analysis of whether the
Columbus-America court
correctly interpreted the laws of salvage
and finds and their varying
approaches to abandonment; we simply
note that there is ample
authority that abandonment may, for some
purposes at least, be
inferred from the surrounding circumstances.
And here, there is no question
that the district court's finding of
abandonment was not clearly
erroneous, as there was an abundance of
circumstantial evidence justifying
an inference of abandonment. In
fact, apart from
its argument that there must be a showing
of
express abandonment,
the only support Fairport offers for its
position is its
completely unsubstantiated claims about Behrens's
salvage attempts.
In short, Fairport has not shown that
the
district court's conclusion
was clearly erroneous.
IV.
The district court's judgment is AFFIRMED. |
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