Salvage rewards are only available when the work is performed on waterways subject to federal admiralty and maritime jurisdiction. If the waters are not within federal admiralty and maritime jurisdiction, then no salvage reward is available, even though property has been voluntarily and successfully saved from a marine peril.

In order to determine whether admiralty and maritime jurisdiction exists, the courts have fashioned a two-part test. First, there must be a maritime locality (the “situs” of the incident must be on “navigable waters”); and second, there must be a maritime nexus (a relationship to or impact upon traditional commercial maritime activity). Since court rulings have held that recreational boating has a maritime nexus, and since virtually every salvage operation involves commercial or recreational vessels, the maritime nexus portion of the two-part test is automatically satisfied in any salvage operation. Therefore, admiralty jurisdiction will exist as long as the locality test is also satisfied. Since the only real question in a salvage situation is whether the locality test is satisfied, this article will only examine the locality test and how it may be satisfied.

In order to satisfy the locality test, the waters in question must be “navigable waters.” The courts have wrestled with the definition of “navigable waters” for over a century. In 1870 the Supreme Court stated that it would regard those waters that are navigable in fact, as waters that are navigable in law. The Court stated that waters are navigable in fact “when they are used, or are susceptible of being used, in their ordinary condition, as highways for commerce, over which trade and travel are or may be conducted in the customary modes of trade and travel on water.” In other words, the waters must either lead to the sea (and international commerce), or must be capable of use in interstate commerce. This definition of “navigable waters” clearly excludes those landlocked lakes and dammed up streams that are completely contained within the borders of a single state (regardless of whether they are owned by the State or by private individuals). The “navigable” status of rivers is usually the most challenging question.

Even though a river in its natural state may pass between two or more states on its journey to the sea, it may become removed from navigability by natural obstacles such as rapids or waterfalls, or by man-made obstacles such as dams. While the river may continue to be considered “navigable” downstream of these hurdles, the upstream waters will not be considered navigable unless they happen to touch another state. It is the present condition of the river that is controlling. Arguments that jurisdiction should depend upon historical use of the waterway have been rejected. Waters upstream of a dam that were once used or capable of use in interstate commerce may lose their character as navigable waters once a dam is built. On the other hand, the removal of an obsolete dam may result in returning a portion of a river to navigable status.

In some cases, navigable waters may become temporarily blocked or inaccessible for significant periods of time. This may be caused by ice blockages, dike closings, low water, etc. These temporary interruptions in the ability to support commerce will not cause navigable waters to lose their status. On the other hand, waters that only become navigable for limited purposes (such as floating logs) or for short times (during Spring floods) are not deserving of “navigable” status.

Judicial decisions have held that many substantial bodies of water are not “navigable” and are therefore beyond the reach of admiralty jurisdiction and salvage claims. These include the Hudson River (above Ft. Edward), the Catawba River (N.C.), the Lake of the Ozarks (Missouri), and numerous other dammed rivers and landlocked lakes. While the Corps of Engineers and U.S. Coast Guard may issue administrative determinations as to which waters they consider navigable within their districts, these determinations are not binding upon the courts, which must make the final decision.

What if a salvor happens to perform a “salvage” job on non-navigable water? Unfortunately, no claim for a salvage reward may be made, since maritime jurisdiction is lacking. The salvor will be left to seek a recovery under state law. This may include seeking compensation for the value of the services rendered under equitable principles (unjust enrichment) or under implied contractual principles. Unfortunately neither of these remedies provides the salvor with a lien on the salvaged property or with the possibility of obtaining a reward in excess of the value of the services rendered. The prudent salvor should ascertain the navigable character of the waters before expending time and effort on an “upstream” job.

© Stephen F. White 2001