Receivership and Admiralty Orders

Section 1292(a) opens three kinds of interlocutory order to immediate appeal. Injunction orders come first, in § 1292(a)(1).¹ Receivership orders and admiralty decrees follow, in § 1292(a)(2) and (3).² These provisions differ from the special rules for multi-claim, multi-party cases, which are standards for applying the final judgment rule and not exceptions to it.³ Subsections (a)(2) and (a)(3) speak by their own terms of “interlocutory” orders and decrees, so they permit an appeal before any final decision. Each provision works as a list: the statute names the orders, and an order that matches no name waits for final judgment unless another route applies. The first task with any order in either field is to set what the order does beside the statutory words.

Receivership Orders

Section 1292(a)(2) permits appeal from “[i]nterlocutory orders appointing receivers, or refusing orders to wind up receiverships or to take steps to accomplish the purposes thereof, such as directing sales or other disposals of property.”⁴ A receiver is an officer the court appoints to hold and manage disputed property or a business while the suit goes on, and winding up a receivership means ending it by collecting and disposing of its assets. The provision thus reaches a receivership at its two ends, the appointment and the effort to close it out. Because the statute itself permits the appeal, the losing party needs neither the district judge’s certification nor the court of appeals’ permission, which belong to the separate route taught in the next section.

Courts read that text as a closed list. In SEC v. Black, the Third Circuit interpreted § 1292(a)(2) narrowly, to permit appeals only from three discrete categories of receivership order:⁵

Orders appointing a receiver.
Orders refusing to wind up a receivership.
Orders refusing to take steps to accomplish the purposes of winding up, such as directing a sale or other disposal of property.

The first category covers the order that puts property or a business in the hands of the court’s officer. The other two cover refusals. A party asks the court to end the receivership, or to move it toward its end by directing a sale or other disposal of property, and the court declines. A creditor who asks the court to direct the sale of a receivership’s warehouse and is refused may therefore appeal at once.

The narrow reading keeps the list at three. A long receivership produces rulings on fees, accountings, claims, and the daily running of a business; if the statute reached every one, parties could appeal each ruling as it came, and the three categories would do no work.

A caption that mentions a receiver earns nothing under § 1292(a)(2). The statute looks to what the order does, and an order made inside a receivership qualifies only if it falls within one of the three categories. On its face, the statute also names orders appointing receivers and says nothing of orders refusing to appoint one, so an order of that kind must be tested against the list and not assumed to be covered.⁶

Admiralty Liability Decrees

Section 1292(a)(3) completes the list. It permits appeal from “[i]nterlocutory decrees of such district courts or the judges thereof determining the rights and liabilities of the parties to admiralty cases in which appeals from final decrees are allowed.”⁸ A decree is admiralty’s word for a court’s formal ruling. Two features carry the weight: the decree must determine the parties’ rights and liabilities, and it must come from a case in which appeals from final decrees are allowed. The provision hastens review in cases that are appealable eventually, and it opens no new class of cases to appeal.

The provision was designed for a circumstance distinctive to admiralty. It is not uncommon for a court to enter an order finally determining liability between the parties and then to refer the case to a master for a determination of damages.⁹ An immediate appeal from the liability decree lets the court of appeals test liability before anyone computes damages.

The working test comes from the First Circuit’s decision in Martha’s Vineyard Scuba Headquarters. An aggrieved party must show that the order is interlocutory and that it finally determines the parties’ rights and liabilities as to a discrete issue.¹⁰ The order must affect substantive rights, not “merely procedural, tactical, or adjectival entitlements,” and the statute applies when the order “lashes down the merits of some particular claim or defense.”¹¹

The label on a decree does not control. Courts have construed the provision rather narrowly, and it has not been read to permit interlocutory appeals in admiralty except where the order, “regardless of the label affixed to it,” determines the rights and obligations of the parties. Interlocutory appeals are not favored, and the statutes allowing them must be strictly construed.¹²

An in rem suit, a suit against the ship itself, shows the test at work, because two different rulings in such a suit land on opposite sides of the line. In Puerto Rico Ports Authority v. Barge Katy-B, the court quoted earlier authority for the point that a decree holding void the process under which the ship was arrested, and directing her release, ends the suit “as effectually as if it formally dismissed the libel,” the libel being the admiralty complaint.¹³ A decree of that kind finally determines the claim against the ship, which is what § 1292(a)(3) requires.

An order refusing to vacate the arrest leaves the suit where it stood. A court of appeals that had never decided the question held that such an order is not appealable under § 1292(a)(3), because “whether or not a vessel is subject to arrest says nothing about the ‘rights and liabilities’ of the parties; it is merely a procedural matter.”¹⁴ A vacated arrest has a second route to the court of appeals as well. An order vacating a maritime arrest or attachment would be appealable as a collateral order, the exception for orders that finally determine claims of right separable from and collateral to the rights asserted in the action.¹⁵ That doctrine is taught below.

Rejected defenses fall on the same side of the line as refusals. The same court read § 1292(a)(3) to authorize appeals only when “a claim has somehow been terminated.” The provision, it said, “may allow more interlocutory appeals than are generally permitted in civil litigation, but it does not permit litigants to parade piecemeal appeals before the court of appeals.” Had a rejected statute of limitations defense been appealable, “we could think of few orders that would not be subject to immediate appeal.”¹⁶

The rule runs both ways. A conclusive ruling for the defendant on a defense, one that leaves the plaintiff unable to succeed on its claim, may be appealed at once by the plaintiff. A conclusive ruling for the plaintiff on a claim may be appealed at once by the defendant.¹⁷

Exam stems set in admiralty invite the mistake of treating § 1292(a)(3) as opening every ruling to appeal. The better first question is whether the order finally decides someone’s rights and liabilities on a claim or defense, or only decides how the case will be run. A liability decree that sends damages to a master qualifies, and so does a decree vacating an in rem arrest and releasing the ship. An order refusing to vacate an arrest, a ruling that rejects a defense, and any ruling that touches only procedural, tactical, or adjectival entitlements do not.