COLUMBUS-AMERICA DISCOVERY GROUP V. ATLANTIC MUTUAL INSURANCE CO.
974 F.2d 450 (4th Cir. 1992)
NATURE OF THE CASE: This was a dispute over the ownership of sunken treasure.
FACTS: Columbus-America Discovery Group (P) located the wreck for the S.S. Central
America on September 11, 1988. The ship had sunk off the South Carolina coast in 1858 in
8,000 feet of water. P recovered all the lost gold on board the ship with very special and
unique equipment. The cost of the recovery was close to $30 million. P secured exclusive
rights to salvage from the federal district court which acted in exercise of its admiralty
jurisdiction. When the public discovered the find 39 insurance companies claimed ownership
of the treasure. The gold on board was valued at $1.3 million in 1857 but that did not
include any personal treasure troves of the passengers. The commercial shipments of gold had
been insured and most if not all claims for the losses were promptly paid off by the
underwriters. Once the claims were paid by the underwriters, the gold became theirs.
Interest in salvaging the gold came up when technology made that process feasible. The
insurance companies did attempt negotiations about salvage but they did not enter any such
contracts nor did they relinquish their rights to the gold. When the gold was recovered, D's
immediately asserted their rights. The trial court found for P on all issues under the
ruling that the insurance companies had abandoned the gold; the insurance companies had
intentionally destroyed any documentation they had once had concerning the case. Ds appealed.
ISSUE:
RULE OF LAW:
HOLDING AND DECISION:
LEGAL ANALYSIS:
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