ADMIRALTY & MARITIME LAW
VARIOUS ADMIRALTY DEFINITIONS:
a. Freight means the money paid for the shipment, and the
b. Cargo is what is being shipped.
c. Cabbatige Laws:
a) laws that restrict internal shipping to those ships that are part of the
b) coastwise trade which means the vessel must be
1) Built in the US,
2) never sold to foreign interests outright, and
3) at least 75% ownership of US persons.
c) This applies if a boat or ship is transporting goods or persons
d) from a point in the US to another point in the US;
e) the statute (Jones Act) is set up to pierce all corporate veils
f) as to whether the vessel actually is a “coastwise” ship.
EFFECT: The penalty for hauling people or property between points w/in the US, is forfeiture of the ship and/or cargo.
HYPO: most cruises to AL start in Vancouver, otherwise if going from Seattle to AL, then have to be a US Flag under Cabittage Laws.
EXCEPTION-Work Rigs and Platfoms: many platforms have a percentage of foreign ownership; if several companies own, then may not qualify b/c they cannot verify that their financial holdings are at least 75% US securities. A statute was passed in 58, to ease the statute so that the 75% rule didn’t apply to work rigs and platforms.
NUANCE: To fly the US flag in foreign commerce, the ship has less stringent requirements, it simply has to have the skipper and majority of the officers and some of the crew US citizens, but have strict standards for enrolling in the coast wise trade.
HISTORICAL & POLICY DEVELOPMENT: most Maritime nations have cabbitage laws that require that their internal shipping, from one river point to another, or coast to another coast w/in the country, is part of the nation’s internal commerce. There was a feeling, partly national security, partly a subsidy to the ship industry of the nation, we need this internal commerce, and if they allowed international ships in there, than if we become dependent, and they are called back, that would leave us high and dry. The US Cabbitage law emanates from the Jones Act (better known for its personal injury laws) exists as § 27 of the Merchant Marine Act of 1920. Sometimes GM has not been able to qualify for Coastwise trade b/c their stock is owned over 25% foreign. Say, a co has a certain % of citizens in an affiliate, and 80-90% of assets of that affiliate are in the US, than can have a vessel not self-propelled big, or self-propelled but only to 500 tons.
Now, you can have a US owner and a foreign person lease it as a charter. This is basically though a straw man transaction. E.g., Vietnamese woman who wanted to get a ship to engage in what is legally considered a cost-wise trade business, well Reed told them to get a US owner and lease it to her. There is no need today for coastwise trade, since they have a monopoly under §27 of the Jones Act. Now, France, get some of your vessels busy in foreign commerce where they say that 50% of commerce coming in and out must be in a french vessel, this would be a good idea for the US to engage in such a practice to help out the merchant marines in the US. Now, instead they have subsidies for merchant marines, in the 70’s to get about 20 vessels in foreign commerce.
d. Bottoms: modern ships carry cargo on the top (historically held in the bottom of the ship), but the “bottom” is still term used for describing the area of the ship where the cargo is held.
e. Libel: the term used for a lawsuit at admiralty.
f. Proctor: a word that means agent and has ecclesiastical overtones, was what an admiralty lawyer was called until the unification of the admiralty rules of procedure w/ the FRCP in 1966.
g. Libel: was the admiralty term for complaint or petition. The plaintiff was termed the libelant, and the defendant the respondent.
h. Prize: a vessel or cargo of a belligerent power captured by the other naval vessel or privateer.
i. Ships: ocean going vessels are ships.
j. Boats: Inland water crafts (i.e., crafts on lakes, ponds, rivers).
The development of Admiralty Law & Commerce
ENGLISH COMMON LAW INFLUENCE ADMIRALTY JD
England’s structure of Common Law Courts (arranged in ascending order)
1) Supreme Court of Judicature = The Judicature is the trial level, and has divisions
2) High Court of Justice;
3) High Court of Appeals;
4) House of Lords w/ seven law lords, over the High Court of Appeals.
CHANCERY: handled matters in equity.
PROBATE/DIVORCE/ADMIRALTY: these didn’t fit in the CL (Kings Division), and not in in the Court of Chancery.
THE HIGH COURT OF THE ADMIRAL: In the UK, Admiralty was in the court of the high admiral until the late 19th century.
1) The Lord High Admiral had equal stature as the lord high constable and treasurer;
(1) He ran the navy and had JD over
(2) disputes between the merchant marines
(3) occurring on the high seas or w/in the ebb and flow of the tide,
(4) until the CL courts and Admiralty clashed, resulting in the Admiralty JD
(5) being restricted to hearing cases against a particular vessel, i.e., only the legal person of the vessel was before the court where a collision between two ships occurred.
RELIEF: The only relief was to sell the vessel in rem (title against the whole world) and divide the pay off among the plaintiff claimants, and if left over the owner got the remainder money from the sale. This was all they could do originally. In Rem actions were peculiar to Admiralty.
Standard as to whether CL, Equity or Admiralty = depends on what the p seeks
(1) If damages sought: it’s a CL case, and only a lump sum could be awarded.
(2) If seeking Equity: go to Chancery court.
(a) Chancery JD was invoked only when
(b) An award of damages would be inadequate
(c) To compensate the p.
EFFECT of “INADEQUATE?” Asking the court to compel another to take action or inaction. This is termed asking for “in kind relief.” Typically, the p is asking for an injunction. A negative injunction sought to preclude behavior. Positive/Mandatory injunctions sought to compel action (usually force someone to give something; more common).
DEVELOPMENT OF ADMIRALTY LAW:
1) Admiralty developed from cases
2) Applying a uniform international law termed
3) The General Maritime Law,
4) followed by all maritime nations.
EFFECT: The General Maritime Law is still in force, the Congress has never adopted, and though the Art. III § 2 gives Fed JD to Admiralty actions, it doesn’t say what law to apply, so they assumed the Gen Maritime Law would be applied.
AUTONOMY of NATION SPECIFIC COURTS: Applying this, England would go one way, and US another if applied today. However, there is a uniformity around the world w/ General Maritime Law. Congress has power to change some of this though, and for a long time it was considered after the passing wrongful death statutes (didn’t have at original CL), on land. But the admiralty law did not have until the 20’s a wrongful death action, passed then by congress.
ADMIRALTY LAW VERSUS THE CL:
v There is no SOF in Admiralty, for Ks, can and are made w/o written instruments.
v Admiralty has always normally awarded pre-judgment interest, whereas the CL did not; today the CL courts do by statutes, TX does by case law.
v Admiralty apportions the negligence (fault) among the parties (some states still follow contributory negligence) [more flexible than CL
one mariner helping another and getting a reward. Plus, salvage has gotten into a new arm recently of salvaging ancient wrecks. Such as the titanic. And then bring pieces up. There is real money involved here. Say a ship goes down w/ 3 to 4 million in gold boullion. Today if you find a treasure wreck…such as a Spanish galleon…there is a great deal of money to be made in salvage due to an increase in technology.
-Admiralty JD in General-
POLICY: The fundamental interest, giving rise to maritime JD is the “protection of maritime commerce.”
Originally and still the Modern UK:
A. Admiralty JD applied to disputes occurring
B. On the high seas
C. And those occurring as far as the tide came (to the ebb and flow of the tide).
EFECT: originally, disputes that occurred on inland waters, such as lakes ponds, and rivers did not fall under admiralty JD (and still don’t in England).
HISTORICAL COMMON LAW/ADMIRALTY STRUGGLE: CL courts and Admiralty clashed, resulting in the Admiralty JD being restricted to hearing cases against a particular vessel, i.e., only the legal person of the vessel was before the court where a collision between two ships occurred. The only relief was to sell the vessel in rem (title against the whole world) and divide the pay off among the plaintiff claimants, and if left over the owner got the remainder money from the sale. This was all they could do originally. In Rem actions were peculiar to Admiralty.
1) The USSC in the The Eagle expanded
2) General Admiralty JD in US Federal Courts to
3) all navigable waters w/in the border of the US and
4) those waters surrounding the nation
5) under the authority of the Judiciary Act of 1789, § 9.
POLICY: the English restriction to tide water is not realistic in the US that has expansive river and lake commerce. Court says its constitutional one way or another under the necessary and proper clause, and under the commerce clause it says its constitutional due to interstate commerce.
CONSITUTIONAL GRANT: maritime SMJ.D. is given to federal courts in art. III § 2.
“MARITIME” vs. “ADMIRALTY:” historically
v Admiralty: more narrow term than maritime because admiralty applied only to disputes between two ships.
v Maritime: broader term because maritime disputes were all cases associated w/ the sea.
CONGRESS: (1789 Judiciary Act, set up the US Dist Courts, and originally, the only JD it had was criminal and admiralty and a little later bankruptcy)
Federal Subject Matter JD (civil cases):
(1) Cases arising under the federal laws, constitution, treaties, etc.
(2) Diversity, and
EFFECT: whereas Art. III sets the outer limit of federal court JD, congress narrowed more the types of cases that can be heard.
TORT or K: Admiralty JD applies to contract and tort cases, not criminal cases We don’t deal w/ crime, crimes on the high sea are not under admiralty but regular crime legislation.
The “Great Lakes” Statute: