Article by Joseph J. Kalo
Shaffer v. Heitner altered the parameters of state court jurisdictional power by wiping out an historic basis of jurisdiction-that based upon the mere presence of the defendant's property within the state. Numerous courts and commentators have explored the limits of Shaffer's implications for state court jurisdiction. Most forms of what traditionally was known as quasi in rem jurisdiction fell by the wayside as Shaffer' s full impact was felt. Admiralty in rem jurisdiction for rule C actions and quasi in rem jurisdiction for rule B actions, however, have escaped Shaffer relatively unscathed even though in many rule C and B situations the presence of property within the forum is the principal, if not the sole, justification for asserting jurisdiction over a nonresident defendant. Much has been said about whether Shaffer applies to rule C or B actions, and if it does, what impact it has. The discussion has focused either upon those characteristics of rule C or B actions which make Shaffer inapplicable, or upon those features which lead to the conclusion that, if Shaffer applies, jurisdiction in rule C or B actions is nonetheless constitutional. Most of this discussion predates the Supreme Court's decisions in World-Wide Volkswagen v. Woodson and Rush v. Savchuk and, therefore, does not address the impact of these cases upon rule C or B actions.
Analysis of jurisdiction in rule C actions-those which primarily involve the seizure of vessels as part of an assertion of a maritime lien-either places these actions in jurisdictional categories which Shaffer would appear to accept as consistent with the “minimum contacts” standard of International Shoe Co. v. Washington or explains why Shaffer's minimum contacts theory is inapplicable to in rem actions. Similarly, in respect to rule B actions, some courts and commentators argue that Shaffer does not apply because admiralty quasi in rem jurisdiction has a constitutional lineage distinct from common law quasi in rem jurisdiction. Other courts and commentators accept Shaffer's application to rule B actions, but instead apply a “minimum national contacts” test to them. In all the decisions using the “minimum national contacts” test, the courts have found sufficient contacts to permit the assertion of jurisdiction. Thus, the overall result has been that jurisdiction in rule C and B actions has been found consistent with the due process clause. In fact, the recent proposed amendments to rule C and B and the accompanying commentary do not even address the issue that Shaffer poses, but simply assume the validity of jurisdiction in rule C and B actions. The proposed amendments and commentary address only the constitutional notice issue raised by Fuentes v. Shevin, Mitchell v. W.T. Grant Co., and related cases.
This article does not challenge the judgment of courts and others that jurisdiction in rule C and B actions meets due process requirements. Jurisdiction under rule C, however, need not be treated separately from that under rule B, and the adequacy of jurisdictional contacts in rule B actions need not be examined on a case-by-case basis. The mere presence of the nonresident's property within the forum is, in and of itself, a sufficient contact for purposes of the “minimum national contacts” test applied in such actions. It is in this respect that Shaffer's application to state quasi in rem jurisdiction is distinguishable from Shaffer's potential impact upon admiralty jurisdiction in rule C or B actions.
Shaffer's statement that the mere presence of property unrelated to the claim is an insufficient basis for state court jurisdiction is predicated upon what the Supreme Court in World-Wide Volkswagen referred to as the sovereignty function of the fourteenth amendment. The fifth amendment, which provides the appropriate standard for federal court jurisdiction in nondiversity cases, also has a sovereignty function, but it is not inconsistent with that function to hold that the mere presence of property is a sufficient contact for purposes of national court jurisdiction. Thus, what constitutes a “contact” for purposes of a “minimum national contacts” test, when admiralty or another basis of federal subject matter jurisdiction exists, is measured by a standard different from the “minimum state contacts” test, which is employed for purposes of state court jurisdiction.
This article addresses three subjects. It first examines exactly how the courts and commentators have applied or refused to apply Shaffer to rule C and B actions. Second, the article argues that a uniform constitutional basis for jurisdiction in rule C and B actions exists. As part of this discussion, the third subject, involving the meaning of “contact” for purposes of a “minimum national contacts” test, is explored.
About the Author
Joseph J. Kalo. Professor of Law, University of North Carolina School of Law; A.B. 1966, Michigan State University; J.D. 1968, University of Michigan.
Citation
59 Tul. L. Rev. 24 (1984)