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Divestiture of Admiralty Jurisdiction

Divestiture is the involuntary or voluntary giving up of a possession or right.  Divestiture is a common result in an anti-trust action to prevent monopoly or other restraint of trade.  With regard to admiralty, the parties may not oust the court of admiralty jurisdiction by means of an agreement which declares the parties’ intention to regard the contract as nonmaritime in nature, within admiralty jurisdiction. 

Agreements to submit controversies to arbitration are valid in admiralty.  Moreover, an arbitration award could be given effect in admiralty.  An executory arbitration agreement could be made a rule of court.  A libel for damages would lie for breach of an executory arbitration agreement.

Generally, a state arbitration statute is not applicable in admiralty, arbitration being a procedural matter.  The Federal Arbitration Act establishes a strong federal policy in favor of arbitration and the presumption in favor of arbitration carries special force when international commerce is involved.

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