Madruga v. Superior Court of California ex rel. San Diego County/Opinion of the Court

This case for sale of a vessel and partition of the proceeds pursuant to a California statute began in the Superior Court of San Diego, the home port of the vessel. The plaintiffs were eight individuals including Edward, Anthony, and Joseph Madruga. The defendant was Manuel Madruga on whom personal service was had by summons. The defendant owned a 15% interest and the eight plaintiffs owned undivided interests aggregating 85% in a ship certificated under the maritime laws of the United States. The defendant 15% owner challenged the jurisdiction of the San Diego court on the ground that only the United States district court sitting in admiralty could take jurisdiction to consider such a case. The San Diego court decided it had jurisdiction and was upheld by the State Supreme Court which declined to issue a writ of prohibition. 40 Cal.2d 65, 251 P.2d 1. Certiorari was granted to consider the state court's jurisdiction. 345 U.S. 963, 73 S.Ct. 950.

First. Article III, § 2, of the Constitution extends the judicial power to 'all Cases of admiralty and maritime Jurisdiction * *  * .' And since the first Judiciary Act, United States district courts have had jurisdiction of all civil cases of 'admiralty or maritime jurisdiction *  *  * .' 28 U.S.C. § 1333, 28 U.S.C.A. § 1333. Whether this grants United States district courts power to sell ships for partition of the proceeds has never been squarely decided by this Court. The partition power of admiralty was discussed but left in doubt by Mr. Justice Story in The Steamboat Orleans v. Phoebus, 1837, 11 Pet. 175, 183, 9 L.Ed. 677. Some cases in lower federal courts appear to support the jurisdiction of district admiralty courts to order sales for partition, at least where there is a dispute as to use of the ship between part owners having equal interests and shares. Other cases indicate that admiralty should not exercise jurisdiction to order partition of ships at the instance either of minority or majority interests. The reasoning in all the cases appears to have been that majority control of the ship's operations was in the public interest and admiralty should interfere only to protect minority interests by such special indemnities or bonds as the Court might require of the controlling majority. Other cases have indicated that either a majority or a minority could obtain partition from admiralty on a proper showing. Some state courts have sold ships for partition, and even at the behest of minority interests; others have refused to do so. However the diverse holdings in the cases may be viewed, there can be no doubt today that United States district courts have broad power over ships that ply navigable waters and are required to be registered or enrolled under a series of Acts of Congress that have been in effect since the first one was passed September 1, 1789, 1 Stat. 55. This Court has said that admiralty's broad power can under some circumstances be extended to protect the rights and title of persons dealing in such ships. White's Bank of Buffalo v. Smith, 7 Wall. 646, 656, 19 L.Ed. 211. On the other hand, the Court has held that admiralty cannot exercise jurisdiction over a variety of actions which may change or otherwise affect possession of or title to vessels. The Steamer Eclipse, 135 U.S. 599, 608, 10 S.Ct. 873, 875, 34 L.Ed. 269. We think, however, that the power of admiralty, as Congress and the courts have developed it over the years, is broad enough for United States district courts to order vessels sold for partition. This brings us to the contention that this federal admiralty power is exclusive.

Second. Had Congress simply granted district courts 'admiralty or maritime jurisdiction exclusive of the states' California might not have power to order partition of a ship. But Congress did not stop there. It went on in the first Judiciary Act to say 'saving to suitors, in all cases, the right of a common law remedy, where the common law is competent to give it'. 1 Stat. 73, 77. Viewed superficially the clause giving United States district courts exclusive admiralty or maritime jurisdiction appears inconsistent with the clause which permits persons to sue on maritime claims in common law courts. But former decisions of this Court have clarified this seeming conflict. Admiralty's jurisdiction is 'exclusive' only as to those maritime causes of action begun and carried on as proceedings in rem, that is, where a vessel or thing is itself treated as the offender and made the defendant by name or description in order to enforce a lien. See, e.g., The Moses Taylor, 4 Wall. 411, 427, 18 L.Ed. 397; The Resolute, 168 U.S. 437, 440-441, 18 S.Ct. 112, 113, 42 L.Ed. 533. It is this kind of in rem proceeding which state courts cannot entertain. But the jurisdictional act does leave state courts 'competent' to adjudicate maritime causes of action in proceedings 'in personam,' that is, where the defendant is a person, not a ship or some other instrument of navigation. Rounds v. Cloverport Foundry & Machine Co., 237 U.S. 303, 306-309, 35 S.Ct. 596, 597-598, 59 L.Ed. 966. Aside from its inability to provide a remedy in rem for a maritime cause of action, this Court has said that a state, 'having concurrent jurisdiction, is free to adopt such remedies, and to attach to them such incidents, as it sees fit' so long as it does not attempt to make changes in the 'substantive maritime law.' Red Cross Line v. Atlantic Fruit Co., 264 U.S. 109, 124, 44 S.Ct. 274, 277, 68 L.Ed. 582.

The proceedings in this California partition case were not in rem in the admiralty sense. The plaintiffs' quarrel was with their co-owner, not with the ship. Manuel Madruga, not the ship, was made defendant. Thus the state court in this proceeding acts only upon the interests of the parties over whom it has jurisdiction in personam, and it does not affect the interests of others in the world at large, as it would if this were a proceeding in rem to enforce a lien. The California court is 'competent' to give this partition remedy and it therefore has jurisdiction of the cause of action.

Third. Petitioner contends that for the California court to entertain this partition suit at the instance of the majority shipowners would run counter to an admiralty rule which is said to permit sales for partition only as between equal interests. Such a national admiralty rule would bind the California court here, even though it has concurrent jurisdiction to grant partition. See Garrett v. Moore-McCormack Co., 317 U.S. 239, 63 S.Ct. 246, 87 L.Ed. 239; Butler v. Boston & S.S.S.C.o., 130 U.S. 527, 557-558, 9 S.Ct. 612, 619, 32 L.Ed. 1017. Congress has passed detailed laws regulating the shipping industry with respect to ownership, sales, mortgages and transfers of vessels. It has even prescribed special rules for ship registration after their judicial sale. But Congress has never seen fit to bar states from making such sales, or to adopt a national partition rule. Nor has any such rule been established by decisions of this Court. And as pointed out above, decisions of lower federal courts and of state courts show varying ideas as to what kind of partition rule should be adopted if any. We do not think the circumstances call on us to add to congressional regulation by attempting establishment of a national judicial rule controlling partition of ships. See Kelly v. State of Washington ex rel. Foss Co., 302 U.S. 1, 9-14, 58 S.Ct. 87, 91-94, 82 L.Ed. 3. Cf. Cooley v. Board of Wardens of Port of Philadelphia, 12 How. 299, 13 L.Ed. 996.

The scarcity of reported cases involving such partition since the Constitution was adopted indicates that establishment of a national partition rule is not of major importance to the shipping world. We can foresee at this time no possible injury to commerce or navigation if states continue to be free to follow their own customary partition procedures. Easily accessible local courts are well equipped to handle these essentially local disputes. Ordering the sale of property for partition is part of their everyday work. Long experience has enabled states to develop simple legislative and judicial partition procedures with which local judges and counsel are familiar. Federal courts have rarely been called on to try such disputes and have established no settled rules for partition. In some parts of the country the inaccessibility of federal courts as compared with state courts would cause needless expense and inconvenience to parties. We have no reason to believe federal procedure if applied to partition cases would be simpler, speedier, less expensive or fairer than the procedures of state courts. Nor are we convinced that any theoretical benefits to shipping would justify us in restricting the partition jurisdiction of state courts by fashioning an exclusive national rule to govern quarreling shipowners. Cf. Halcyon Lines v. Haenn Ship Ceiling & Refitting Corp., 342 U.S. 282, 285-287, 72 S.Ct. 277, 279-280, 96 L.Ed. 318. State laws making partition easily available, like state pilotage laws, see Cooley v. Board of Wardens of Port of Philadelphia, 12 How. 299, 13 L.Ed. 996, may well help fill the needs of a vigorous commerce and navigation. Since the absence of such a national rule has produced few difficulties over the years, it appears to us that it would be better to let well enough alone.

Affirmed.