Local Rule C: Action in Rem

RULE C. ACTION IN REM

(1) Verification Requirements. Every complaint and claim filed in an in rem proceeding pursuant to Supplemental Rule (C) shall be verified in accordance with Local Admiralty Rules A(5) and B(2).

(2) Pre-seizure Requirements. In accordance with Supplemental Rule (C)(3), the process of arrest in rem shall issue only after one of the following conditions has been met:

(a) Judicial Review Prior to Issuance. Except as provided in Local Admiralty Rule C(2)(b), a judicial officer shall first review the verified complaint, and any other relevant case papers, prior to the Clerk issuing the warrant of arrest and/or summons in rem. No notice of this pre-seizure judicial review is required to be given to any person or prospective party.

If the Court finds that probable cause exists for an action in rem, plaintiff shall prepare an order for the Court's signature directing the Clerk to issue a warrant of arrest and/or summons. This order shall substantially conform in format and content to the form identified as NDF 2 in the Appendix to these Local Admiralty Rules.

Upon receipt of the signed order, the Clerk shall file the order and, in accordance with Local Admiralty Rule C(2)(c), issue the warrant of arrest and/or summons. Thereafter the Clerk may issue supplemental process without further order of the Court.

(b) Certification of Exigent Circumstances. If the plaintiff files a written certification that exigent circumstances make review by the Court impracticable, the Clerk shall, in accordance with Local Admiralty Rule B(3)(b), issue a warrant of arrest and/or summons.

Thereafter at any post-arrest proceedings under Supplemental Rule (E)(4)(f) and Local Admiralty Rule C(7), plaintiff shall have the burden of showing that probable cause existed for the issuance of process, and that exigent circumstances existed which precluded judicial review in accordance with Local Admiralty Rule C(2)(a).

(c) Preparation and Issuance of the Warrant of Arrest and/or Summons. Plaintiff shall prepare the warrant of arrest and/or summons, and deliver them to the Clerk for filing and issuance.

The warrant of arrest shall substantially conform in format and content to the form identified as NDF 4 in the Appendix to these Local Admiralty Rules, and shall in all cases give adequate notice of the post-arrest provisions of Local Admiralty Rule C(7).

(3) Special Requirements for Actions Involving Freight, Proceeds and/or Intangible Property.

(a) Instructions to Be Contained in the Summons. Unless otherwise ordered by the Court, the summons shall order the person having control of the freight, proceeds and/or intangible property to either:

(1) File a claim within ten (10) days after service of the summons in accordance with Local Admiralty Rule C(6)(a); or

(2) Deliver or pay over to the Marshal, the freight, proceeds, and/or intangible property, or a part thereof, sufficient to satisfy plaintiff's claim.

The summons shall also inform the person having control of the freight, proceeds, and/or intangible property that service of the summons has the effect of arresting the property, thereby preventing the release, disposal, or other distribution of the property without prior order of the Court.

(b) Requirements for Claims to Prevent the Delivery of Property to the Marshal. Any claim filed in accordance with Supplemental Rule (E)(4) and Local Admiralty Rule C(6)(a) shall describe the nature of claimant's interest in the property, and shall articulate reasons why the seizure should be vacated.

The claim shall be served upon the plaintiff, the Marshal, and all other parties to the litigation. Additionally, the claimant shall file a Certificate of Service indicating the date and manner in which service was perfected.

(c) Delivery or Payment of the Freight, Proceeds, and/or Intangible Property to the U.S. Marshal. Unless a claim is filed in accordance with Supplemental Rule (E)(4)(f), and Local Admiralty Rule C(6)(a), any person served with a summons issued pursuant to Local Admiralty Rule C(2)(a) or (b), shall within ten (10) days after execution of service, deliver or pay over to the Marshal all, or part of, the freight, proceeds, and/or intangible property sufficient to satisfy plaintiff's claim.

Unless otherwise ordered by the Court, the person tendering control of the freight, proceeds, and/or intangible property shall be excused from any further duty with respect to the property in question.

(4) Publishing Notice of the Arrest as Required by Supplemental Rule (C)(4).

(a) Time for Publication. If the property is not released within ten (10) days after the execution of process, the notice required by Supplemental Rule (C)(4) shall be published by the plaintiff in accordance with Local Admiralty Rule A(7). Such notice, unless otherwise ordered by the Court, shall be published within seventeen (17) days after execution of process. The notice shall substantially conform to the form identified as NDF 7 in the Appendix to these Local Admiralty Rules.

(b) Proof of Publication. Plaintiff shall file proof of publication with the Clerk not later than ten (10) days following the last day of publication. It shall be sufficient proof for the plaintiff to file the sworn statement by, or on behalf of, the publisher or editor, indicating the dates of publication, along with a copy or reproduction of the actual publication.

(5) Undertaking in Lieu of Arrest. If, before or after the commencement of an action, a party accepts any written undertaking to respond on behalf of the vessel and/or other property in return for foregoing the arrest, the undertaking shall only respond to orders or judgments in favor of the party accepting the undertaking, and any parties expressly named therein, to the extent of the benefit thereby conferred.

(6) Time for Filing Claim or Answer. Unless otherwise ordered by the court, any claimant of property subject to an action in rem shall:

(a) File the claim within ten (10) days after process has been executed; and

(b) Serve an answer within twenty (20) days after the filing of the claim.

(7) Post-arrest Proceedings. Coincident with the filing of a claim pursuant to Supplemental Rule (E)(4)(f), and Local Admiralty Rule C(6)(a), the claimant may also file a motion and proposed order directing plaintiff to show cause why the arrest should not be vacated. If the Court grants the order, the Court shall set a date and time for a show cause hearing. Thereafter, if the Court orders the arrest to be vacated, the Court shall award attorney's fees, costs, and other expenses incurred by any party as a result of the arrest.

Additionally, if the seizure was predicated upon a showing of "exigent circumstances" under Local Admiralty Rule C(6)(b), and the Court finds that such exigent circumstances did not exist, the Court shall award attorney's fees, costs and other expenses incurred by any party as a result of the seizure. Upon an award of attorney's fees under this rule, the parties will be directed to comply with Local Rule 54.1(E).

(8) Procedural Requirements Prior to the Entry of Default. In accordance with Rule 55, Fed.R.Civ.P., a party seeking the entry of default judgment in rem shall first file a motion and supporting legal memorandum. The party seeking the entry of default shall also file such other proof sufficient to demonstrate that due notice of the action and arrest have been given by:

(a) Service upon the master or other person having custody of the property;

(b) Delivery, or by certified mail, return receipt requested (or international effective equivalent), to every other person, including any known owner, who has not appeared or intervened in the action, and who is known to have, or claims to have, a possessory interest in the property. The party seeking entry of default judgment under Local Rule C(8) may be excused for failing to give notice to such Aother person@ upon a satisfactory showing that diligent effort was made to give notice without success; and

(c) Publication as required by Supplemental Rule (C)(4) and Local Admiralty Rule C(4). Upon review of the motion, memorandum, and other proof, the Clerk may, where appropriate, enter default in accordance with Rule 55, Fed.R.Civ.P. Thereafter, the Clerk shall serve notice of the entry of default upon all parties represented in the action.

(9) Procedural Requirements for the Entry of Default Judgment. Not later than thirty (30) days following notice of the entry of default, the moving party shall file a motion, and supporting legal documents, for the entry of default judgment pursuant to Rule 55(b), Fed.R.Civ.P. The moving party may also file as exhibits for the motion such other documentation as may be required to support the entry of default judgment. Thereafter the court will consider the motion as indicated below:

(a) When No Person Has Filed a Claim or Answer. Unless otherwise ordered by the court, the motion for default judgment will be considered by the court without oral argument.

(b) When Any Person Has Filed an Appearance, But Does Not Join in the Motion for Entry of Default Judgment. If any person has filed an appearance in accordance with Local Admiralty Rule C(6), but does not join in the motion for entry of default judgment, the party seeking the entry of default judgment shall serve notice of the motion upon the party not joining in the motion, and thereafter the opposing party shall have five (5) days from receipt of the notice to file written opposition with the court. If the court grants the motion and enters the default judgment, such judgment shall establish a right on the part of the party or parties in whose favor it is entered. The judgment shall be considered prior to any claims of the owner of the defendant property against which it is entered, and to the remnants and surpluses thereof; providing, however, that such a judgment shall not establish any entitlement to the defendant property having priority over non-possessory lien claimants. Obtaining a judgment by default shall not preclude the party in whose favor it is entered from contending and proving that all, or any portion, of the claim or claims encompassed within the judgment are prior to any such non-possessory lien claims.