Why Seek a ‘Federal Vessel Arrest’ Instead of a State Court Judgment?

I won a $15,000 judgment against a boat owner in state court. The judgment related to repair work that I did on the boat — and, since the boat is documented with the Coast Guard, I recorded a notice of claim of lien against the Coast Guard title. The owner has no assets other than the boat and no real income, so I would like to go after the boat to satisfy the judgment. I assume that since federal law trumps state law and the boat is Coast Guard-documented, it is protected from a sheriff’s levy to satisfy a state court judgment. It, therefore, appears that a federal vessel arrest is the only way that I can initiate legal action against the boat, but I understand that a federal vessel arrest is very expensive. Do I have any other recourse?

The short answer is that, since our reader already has a judgment against the vessel owner, he can pursue him using the collection tools available through a state court to go after any of the debtor’s assets, including the boat. The judgment could be for anything, and the fact that the underlying claim was for repairs to a boat is irrelevant at this point. Similarly, the fact that the boat is Coast Guard-documented doesn’t make any difference.

Federal law only “trumps” state law in areas where a specific federal law or federal legal concept applies. There is no specific federal law or legal concept that protects a vessel from being seized to satisfy state court judgment. A vessel is, therefore, not protected from a sheriff’s levy (through a court-ordered writ of execution) to satisfy a state court judgment.

Notwithstanding the state law option, technically — yes — a vessel arrest through a federal court is, in fact, the only way to “initiate legal action against the boat.” But in this case, our reader does not need to initiate legal action against the boat.  He can satisfy the judgment through action against the owner and his assets, one of which happens to be the boat.

This sounds like we’re splitting hairs, but a federal vessel arrest is literally an action against the boat itself, as if it were the entity responsible for the debt. It is a procedure that is available in a maritime collection case, but it is not required and it is often prohibitively expensive. The deposit required by the U.S. Marshals alone may amount to $20,000, and this does not include the fees charged by the commercial custodian who keeps the boat during the pendency of the legal action or the legal fees charged by the attorney.

There are, nonetheless, a few problems that our reader may face when using state law procedures to satisfy a claim involving a boat. The biggest problem is that he may need to deal with competing creditors and other maritime lienholders. A county sheriff may sell a boat on behalf of a judgment creditor, such as our reader, but neither the sheriff nor a state court judge has the power to sell a documented vessel free of all liens or claims. That power rests solely with a federal judge in a vessel arrest case.

The relative speed of federal vs. state procedures may also be a problem for a claimant. The state law procedure described by our reader required him to sue the boat owner and take that litigation all the way to judgment before a writ of execution could be issued by the court to order the sheriff to take the boat into custody. A federal arrest case calls for the boat to be taken into custody on the first day of the federal lawsuit. This could be a significant issue if the boat is a “flight risk.”

Ultimately, the question of whether to use a state or federal procedure will depend on the facts of the case, and an experienced maritime attorney should be consulted before any decision is made.