Case of the Day: Sea Search Armada v. Republic of Colombia
October 26, 2011Colombia, Recognition and EnforcementTed Folkman
Aargh! The case of the day, Sea Search Armada v. Republic of Colombia (D.D.C. 2011), is, in the words of the judge, “like a marriage between a Patrick O’Brian glorious-age-of-sail novel and a John Buchan potboiler of international intrigue.” 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.
In 2010, SSA sued Colombia in the District of Columbia, seeking recognition and enforcement of the judgment and seeking damages in the amount of $17 billion. The District of Columbia has enacted the Uniform Foreign-Money Judgments Recognition Act, which applies, on its face, only to foreign judgments “granting or denying recovery of a sum of money.” The judge granted Colombia’s motion to dismiss. The gist of the decision was that because the Colombian judgment did not award any damages to SSA, it was not within the scope of the UFMJRA. First, the value of the treasure had not been determined, and SSA’s $ $17 billion figure was only its own estimate. Second, the award was, in essence, a declaration of the parties’ rights rather than an award of damages.
lettersblogatory.com/2011/10/26/sea-search-armada/ 
