Case of the Day: Sea Search Armada v. Colombia

A Spanish GalleonAargh! We return today to Sea Search Armada v. Republic of Columbia, a case I first covered in October 2011. Here was my description of the facts:

According to the complaint, Sea Search Armada had an agreement with the government of Colombia for salvage of the treasure of the San Jose,a Spanish ship carrying $4 to $17 billion of coins and bullion. In 1708, when Britain really ruled the waves, the British navy sank the San Jose, and the ship came to rest off the coast of what is now Colombia. In 1980, the Colombian government authorized the Glocca Mora Co. to explore the continental shelf for shipwrecks, and the next year GMC discovered the wreck of the San Jose. GMC and Colombia agreed that GMC would be entitled to receive 35% of the treasure recovered. GMC assigned its rights to Sea Search Armada, and in 1984, Colombia agreed that SSA would be entitled to GMC’s 35% share, but it refused to enter a written contract with SSA and refused SSA permission to conduct full salvage operations at the shipwreck site. The Colombia parliament then passed a law giving the state the right to all of the treasure, leaving SSA with a 5% finder’s fee, which was to be taxed at 45% to boot!

SSA sued Colombia in its own courts in 1989. The Colombia Constitutional Court struck down the law at issue as unconstitutional in 1994. Later, the Circuit Court of Baranquilla held that SSA and Colombia each owned 50% of the San Jose treasure, although the source of the 50% figure is mysterious given that the original agreement called for a 65/35 split.

As we saw in the earlier post, SSA sued Colombia for recognition and enforcement of the Colombian judgment in the District of Columbia in 2010. SSA also sought damages in the amount of $17 billion. The judge dismissed the claim for recognition and enforcement on the grounds that the Colombian judgment was not one for damages but was merely declaratory and thus was not entitled to recognition UFMJRA,1 which as its name suggests deals only with money judgments.2

The DC Circuit has now summarily affirmed, just two weeks after oral argument. It adopted the district court’s reasoning in full.

The statute of limitations analysis seems correct. The courts are also correct to conclude that there is no claim here under the UFMJRA, but I still do not understand why there might not be an action for recognition of the Colombian judgment at common law rather than under the statute. Neither the UFMJRA nor the UFCMJRA precludes recognition of judgments not within the scope of the statute. See, e.g., DC Code § 15-371 (” This subchapter does not prevent the recognition under principles of comity or otherwise of a foreign-country judgment not within the scope of this subchapter”). But unfortunately, SSA’s brief does not really make this point, or does not make it clearly,3 and so it is perhaps not surprising that the court missed it.

The case is not over: SSA has filed a petition against Colombia with the Inter-American Commission on Human Rights, alleging violations of Articles 21 and 25 of the Inter-American Convention on Human Rights.

Photo credit: Yellow Cat

  1. In 2011, the District of Columbia adopted the UFCMJRA.
  2. The judge also dismissed the common law claims for conversion and breach of contract on statute of limitations grounds—a point I didn’t cover in my prior post.
  3. The brief seems to argue that the judgment is a money judgment, but then it says: “In any case the principle of comity requires that the District Court enforce the Colombian decision.” Is this an argument that the judgment should be recognized even if it is not within the scope of the statute? It’s hard to say—the very next sentence is: ” The Uniform Enforcement of Money Judgments Act is a codification of common laws of comity.” As far as I can tell, SSA did not cite the savings provision of the Act.

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