01-3882, 01-4326 Ehorn v. Sunken Vessel Known as the "Rosinco"

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“We need not determine whether the district court abused its discretion in declining to accept an untimely answer-a subject on which Alter Barge may be a ticket good for one ride only, see 272 F.3d at 398 (‘[w]e limit our holding to the facts of this case’)-because the state was entitled to withhold an answer until it had been served. Let us assume without deciding that a vessel may be “arrested” without a visit from the Marshal. (That question remains open for decision when the answer matters.) Still, even in an in rem proceeding personal service may be essential. Admiralty Supp. R. C requires publication but does not forbid personal service, nor would a prohibition make sense. Usually the arrest and posting on the vessel affords notice to the vessel’s owner.

The normal admiralty in rem proceeding follows a collision, allision, or other accident of which the owner is bound to be aware. As this case shows, though, arrest in admiralty does not always ensure that the principal competing claimant has actual knowledge of the contest. There was no accident or equivalent event, no notice that was likely to come to the attention of Wisconsin-which Ehorn knew from the criminal prosecution to be his major, if not only, rival for ownership. These circumstances make it impossible to excuse Ehorn from sending written notice of the pending action. Even in an in rem action, the initiator must give notice reasonably calculated to alert any known competing claimant. See Dusenbery v. United States, 534 U.S. 161 (2002). The due process clause of the fifth amendment requires no less. …

Ehorn readily could have served the persons authorized to represent Wisconsin in admiralty proceedings. Yet he has not done so to this day. Wisconsin’s time to file an answer thus has not started to run … and the district court was not entitled to enter a default judgment for lack of a timely answer.”

Reversed and remanded.

Appeals from the United States District Court for the Eastern District of Wisconsin, Callahan, Mag. J., Easterbrook, J.