Local Rule Rule C: ACTIONS IN REM

Rule C. ACTIONS IN REM

(1) Verification Requirements. Every complaint and claim filed in an in rem proceeding under Supplemental Rule (C) must be verified in accordance with L.A.R. A(6) and B(2).

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

(a) Judicial Review Before Issuance. Except as provided in L.A.R. C(2)(b), no seizure warrant may be issued until a judicial officer has reviewed the verified complaint and any other relevant case papers and entered an order directing the clerk to issue the warrant for arrest or summons in rem. No notice of this pre-seizure judicial review is required to be given to any person or prospective party.

The plaintiff must submit a proposed order to the judicial officer directing the clerk to issue a warrant of arrest or summons to be entered in the event that the court finds that probable cause exists for an action in rem. The order must substantially conform to Admiralty Form 3 on the courts' Websites.

After entry of the signed order, the clerk will issue the warrant for arrest or summons in accordance with L.A.R. C(2)(c). The warrant must conform to Admiralty Form 4 on the courts' Websites. 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 will issue a warrant of arrest or summons.

At any post-arrest proceedings under Supplemental Rule (E)(4)(f) and L.A.R. C(7), plaintiff has 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 L.A.R. C(2)(a).

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

The warrant for arrest must substantially conform to Admiralty Form 4 on the courts' Websites and must give adequate notice of the post-arrest provisions of L.A.R. C(7) to all parties including, but not limited to, any person or entity known to plaintiff to have a claim or interest in the vessel or property seized.

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

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

(i) File a claim within fourteen days after service of the summons in accordance with L.A.R. C(6)(a); or

(ii) Deliver or pay over to the United States Marshal the freight, proceeds or intangible property, in the form that the property is typically represented, or a part of the property which is sufficient to satisfy plaintiff's claim.

The summons must also inform the person having control of the freight, proceeds or intangible property that service of the summons has the effect of arresting the property and prohibiting the release, disposal or other distribution of the property without prior order of the court.

(b) Requirements for Claims to Prevent the Delivery of Freight, Proceeds or Intangible Property to the United States Marshal. Any claim filed in accordance with Supplemental Rule (E)(4) and L.A.R. C(6)(a) must describe the nature of claimant's interest in the property and articulate reasons why the seizure should be vacated.

The claim, accompanied by a certificate of service, must be served upon the plaintiff, the United States Marshal, and all other parties to the litigation.

(c) Delivery or Payment of the Freight, Proceeds or Intangible Property to the United States Marshal. Unless a claim is filed in accordance with Supplemental Rule (E)(4)(f), and L.A.R. C(6)(a), any person served with a summons issued under L.A.R. C(2)(a) or (b) must, within fourteen days after execution of service, deliver or pay over to the United States Marshal all, or part of, the freight, proceeds or intangible property sufficient to satisfy plaintiff's claim. Between the time that the summons is served and the property delivered or the court rules on a motion to prevent the delivery of the property, the person served with the summons may not remove the property from the district or otherwise transfer or dispose of it.

Unless otherwise ordered by the court, the person tendering control of the freight, proceeds or intangible property will 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 fourteen days after the execution of process, the notice required by Supplemental Rule (C)(4) must be published by the plaintiff in accordance with L.A.R. A(9), and must begin not later than twenty-one days after execution of process.

The notice must substantially conform to Admiralty Form 5 on the courts' Websites. See also Admiralty Forms 6, 7 and 8.

(b) Proof of Publication. Not later than fourteen days after the last day of publication plaintiff must file a copy of the actual notice and proof of publication in the form of a sworn statement by or on behalf of the publisher or editor indicating the dates of 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 or other property in consideration of plaintiff's refraining from seeking arrest of the vessel or other property, the undertaking will only respond to orders or judgments in favor of the party accepting the undertaking and any parties expressly named in it, and only to the extent of the benefit conferred in the undertaking. See Admiralty Form No. 9 on the courts' Websites.

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

(a) File the claim within fourteen days after process has been executed. See Admiralty Form Nos. 10 and 11 on the courts' Websites; and

(b) Serve an answer within twenty-one days after filing the claim.

(7) Post-arrest Proceedings. Upon filing a claim, the claimant may also file a motion and proposed order directing plaintiff to show cause why the arrest should not be vacated, and if after a hearing on the motion the court vacates the arrest because the plaintiff did not have a reasonable basis to seize the claimant's property, the court may 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 claim of "exigent circumstances" under L.A.R. C(2)(b), and the court finds that exigent circumstances did not exist, the court may award attorneys' fees, costs and other expenses incurred by any party as a result of the seizure.

(8) Procedural Requirements for Entry of Default. In accordance with Fed.R.Civ.P. 55(a), a party seeking the entry of default judgment in rem must first move for entry of default and then file its motion and supporting legal memorandum.

The party seeking the entry of default must also file proof sufficient to demonstrate that due notice of the action and arrest have been given by:

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

(b) Delivery, personally or by certified mail, return receipt requested (or international effective equivalent), to every other person, entity, 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 "other 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 L.A.R. C(4). The clerk may, where appropriate, enter default in accordance with Fed.R.Civ.P. 55(a). The clerk will serve notice of the entry of default upon all parties represented in the action.

(9) Procedural Requirements for Entry of Default Judgment. Not later than thirty days after notice of the entry of default, the moving party must file a motion, and supporting legal documents, for the entry of default judgment under Fed.R.Civ.P.55(b). The moving party may also file as exhibits to the motion such other documentation as may be required to support the entry of default judgment.

(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 No Claim or Answer, or Has Filed a Claim or Intervention But Has Not Answered. If any person has filed an appearance, claim or intervention in accordance with L.A.R. C(6), but does not join in the motion for entry of default judgment, the party seeking the entry of default judgment must serve notice of the motion upon the party not joining in the motion, and any opposing party will have seven days from receipt of the notice to file written opposition with the court.

A default judgment establishes a right on the part of the party or parties in whose favor it is entered and will be considered prior to any claims of the owner of the defendant property against which it is entered, as to the remnants and surpluses thereof, but does not establish the priority over, or ranking among, non-possessory lien claimants. Ranking in priority may subsequently be established on the motion of any party.