§ 56305 — Vessel Encumbrances

(a) The existence of an encumbrance on a vessel does not prevent the requisition of the vessel under this chapter. (1) If an encumbrance exists, the Secretary of Transportation may deposit part of the compensation or advance of compensation to be paid under this chapter (but not more than the total amount of all encumbrances) in a fund in the Treasury. The Secretary shall publish notice of the creation of the fund in the Federal Register. (2) Amounts deposited in the fund shall be available to pay the compensation or any of the encumbrances (including encumbrances stipulated to in a court of the United States or a State) existing at the time the vessel was requisitioned. (1) Within 6 months after publication of notice under subsection (b), the holder of an encumbrance may bring a civil action in admiralty, according to the principles of libels in rem, against the fund. (2) The action must be brought in the district court of the United States— (A) from whose custody the vessel was or may be requisitioned; or (B) in whose district the vessel was located when it was requisitioned. (3) Service of process shall be made on the appropriate United States Attorney, the Attorney General, and the Secretary, in the manner provided by the Federal Rules of Civil Procedure (28 App. U.S.C.). Notice of the action shall be given to all interested persons as ordered by the court. (4) The action shall proceed and be determined according to the principles of law and the rules of practice applicable in like cases between private parties.