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Introduction To Maritime Law - A.rogers
Introduction To Maritime Law - A.rogers
Introduction To Maritime Law - A.rogers
The sole judgement in the case was delivered by Lord Steyn (all other judges
concurring) to the effect that the actions in rem and in personam, where they arose out
of the same facts did not amount to separate actions against separate parties. However,
the House of Lords specifically refused to rule that this was the case where the claim
was based upon a maritime lien e.g. Salvage and Collision situations. In the light of this
the distinction between actions in rem and actions in personam continues.
The advantage which the action in rem possesses over the action in personam is that it
permits the object against which the writ is issued; the res, to be arrested following the
issue and a warrant for arrest, (the term “writ” is one which is universally understood
and means the legal paperwork whereby a court acknowledges that a case is being
brought and authorises this to take place. However, please note that under the new Civil
Procedure Rules which came about in English law as a result of the Woolf Report the
terminology has changed and from the time that they came into force the correct
terminology in England and Wales is to describe the document as a “claimform”). This
ensures that the defendant is unable to remove the res from the jurisdiction of the court.
Ultimately the plaintiff may be able to have the res sold in order to satisfy, or partially
satisfy, the claim.
The mere fact that the plaintiff has issued a writ against the res does not necessarily
mean that he will proceed to have the res arrested. In many cases the issue of the writ is
used merely as a means of forcing the defendant either to make an immediate
settlement or to put up security to the value of the claim so that in the event that the
plaintiff is successful in his action there will be sufficient money available to satisfy his
claim.
Note that the res does not have to be arrested before the court has jurisdiction in an
action in rem. Successful service of the writ will suffice. See:
See further:
The Conoco Britannia [1972] 1 Lloyd’s Rep 342 at 347 per Brandon J
Where the plaintiff does not wish to arrest the vessel immediately he may serve the writ
on the defendant personally and this will be an action in rem. See:
As to the time when the court is actually seized of the action in an action in rem. See:
Here it was decided that the Court is seized of the action either from service of the writ
or arrest of the ship.
Where a number of ships are named in the writ the Court will only become seized of the
action from the moment the plaintiff decides on the particular ship and either serves the
writ or proceeds to arrest the ship.
Once a writ has been served, even if the vessel then leaves the jurisdiction the court
could still proceed to give judgement in the action against the ship.
If the vessel is already under arrest and in the custody of the Admiralty Marshal, then a
separate claimant should proceed to a writ in rem and request a caveat against release.
The court would than be seized of the action, from the time of the issue of the writ, the
vessel already being in the Custody of the Court. (See p392 col2. of the Nord Sea,
above).
If an action is commenced in personam, application can be made to the court for leave to
serve the writ outside the jurisdiction of the court (although this often raises the
question of whether there has been effective service). However, with the action in rem
the writ cannot be served outside the jurisdiction. The writ must be served on the res in
England and Wales (or be deemed to have been served on the Defendant). See:
Today the right to proceed by way of action in rem is accorded in respect of the
following:
Maritime liens are only defeated by a sale under the order of a competent court, or the
termination of time under a limitation statute.
See S 21(3) Senior Court Act 1981 (previously called the Supreme Court Act
1981)
2. Actions arising from any claim or question mentioned in S 20(2) (a) - (c) or (s)
against the ship or property [s21 (2)]
3. Claims mentioned in S20 (2) (e) - (r). [S 21 (4)] In order for an action to lie it is
necessary:
Where this is satisfied the action in rem is available (whether or not the claim gave rise
to a maritime lien) against the following:
(i) that ship, if at the time when the action is brought the relevant person is
either the beneficial owner of that ship as respect all the share in it or the charterer of it
under a charter by demise;
Issue of writ after the vessel had ceased to be subject to a demise charterparty. Held writ
must be set aside.
or
(ii) any other ship of which, at the time when the action is brought, the relevant
person is the beneficial owner as respects all the shares in it.
The Stephen J [1985] 2 Lloyd’s Rep 334
Arrest of an ‘alleged’ sister ship. The question was whether or not the plaintiffs, (since
Woolf these are now to be correctly known as “claimants” in England and Wales) were
entitled to arrest the vessel in connection with which the cause of action arose. Held
vessel not a sister ship, but arrest of a second vessel permitted.
See the judge’s comments as to the effect of good faith where the plaintiffs believed the
vessel to be in same beneficial ownership.
Writs were issued against seven ships 9 January 1987, of which the Mawan was one. The
Mawan was sold on 30th October 1987. Also on the 30th October 1987 the Mawan was
arrested. Held. Person liable to the claim was the registered owner at the time of
incident. At the date of issue of the writ the company did not own and never had owned
shares in the sister ship.
A question before the court was whether owners of the ship involved in the incident
were ‘beneficial owners’ of arrested ship. Please note that it was contended that
directors and shareholders of both shipowning companies were the same. Held no
evidence that the owners of the original vessels were also owners of the arrested vessel.
Writ and warrant set aside.
Note - under S21 (7) in determining whether a person would be liable on a claim in an
action in personam it shall be assumed that he has his habitual residence or place of
business within England and Wales.
In respect of the right of sister-ship arrest provided for under S21 (4) it is provided by
S21 (8) that where a ship has been served with a writ or arrested in an action in rem
brought to enforce the claim, no other ship may be served with a writ or arrested in that
or any other action in rem brought to enforce that claim. This does not prevent the issue,
in respect of any one such claim, of a writ naming more than one ship or of two or more
writs each naming a different ship.
There is NO sister-ship arrest in respect of claims arising under s21 (2) (a)-(c) or (s).
For the purpose of S21 (4): although it is necessary that the ‘relevant person’ be liable to
an action in personam at the time when the cause of action arose - that is at the time
when the incident occurs - it is not necessary for the plaintiff to prove this is in order for
the court to have jurisdiction and for the writ in rem to issued:
Rome & Bathhurst v Punjab National Bank (No 2) [1989] 2 Lloyd’s Rep
354.
“The time when the action is brought” is the date of the issue of the writ:
As to the right to arrest the particular ship where it is still in the possession or control of
the demise charterer at the time of the issue of the writ see:
Note - the decision that a ‘demise charterer’ is a “beneficial owner as respects all the
shares” in a ship is no longer good law.
[The case went to the House of Lords - but not on this point]
Where sister-ships exist at the time of the issuing of the original writ in the action then
they ought to be added to the writ at that time. If this is not done the court may refuse to
allow them to be added at a later date, particularly if the period for limitation of actions
has otherwise passed. See:
Refusal to allow the addition of a party or of a cause of action which would defeat a
limitation period.
Security or Bail
It is the purpose of the action in rem to achieve security or bail to the amount for which
judgement is claimed (or for settlement). It is usual for the parties to come to an
arrangement. As to the nature and form of the security to be provided see:
Under English court rules a caveat against release may be entered particularly where
security may relate to only one claim and other claims exist. See:
Court rules provide for the entering of a caveat to prevent arrest i.e. agreeing to lodge
security in respect of potential claims. Such a caveat does not in fact prevent a party
from proceeding to arrest a vessel. But such a party may be required to pay the other
parties costs and the warrant may be discharged.
Once security has been given then the defendant may apply for the vessel to be released
from arrest. This is a matter for the discretion of the court but only in rare
circumstances will the arrest be continued after security or bail has been given. See:
A party who demands excessive bail may have to pay the costs of the action in which the
bail is reduced. See:
The court may otherwise warn that, it may take a demand for security which is
excessive into account when the time for costs in the action arrives. See:
IT was alleged that excessive security had been demanded by the salvors.
It was held that the Court has a discretion in relation to granting an order for the release
of security which has been lodged. See:
The power to demand security should not be used excessively, but where there is a
genuine dispute as to the amount of the security then the party making the demand
ought to give full information about the nature of his claim. See:
A plaintiff should be careful to see that the security demanded is sufficient, since the res
cannot be arrested or re-arrested after judgement if the security or bail is not enough -
[the need to be certain about security may be very important in ‘Limitation’ actions].
See:
Once the plaintiff has obtained his writ in rem he must, if he wishes to proceed to the
arrest of the ship, take the writ to the Admiralty Registry and there obtain a warrant for
the arrest.
The warrant will be served by the Admiralty Marshal (or one of his substitutes - outside
of the London ports the officers of H.M. Customs and Excise Act as substitutes).
Undertaking as to costs
Before the Admiralty Marshal will proceed to the arrest he will require an undertaking
to be given by the plaintiff (or his solicitor) that all the Marshal’s costs in the action he is
about to take will be paid by that party if necessary.
Form of Arrest
The issued writ must be served on the property, but this is not necessary where the writ
has been served on the defendant.
If the plaintiff wishes the vessel to be arrested then he may request a warrant for arrest
be executed by the Admiralty Marshal.
The warrant or writ will be attached to the superstructure or mast of the ship.
In the case of arrest of cargo the writ or warrant must be attached to the cargo.
The Admiralty Marshal may place a ship keeper on board to ensure the safety of the
ship.
As to the rights of the parties following the arrest of the vessel see:
Contempt
After the res has been arrested any interference with it without the permission of the
court will be treated as contempt of court. See:
a) Action by Master
The Synova [1976] 1 Lloyd’s Rep 40
The Merdeka [1982] 1 Lloyd’s Rep 40
Where the party is in contempt it has been suggested that the innocent party may have
an action for damages against the party in contempt.
In earlier proceedings the Court of Appeal urged the need to prove that the party in
alleged contempt was “wilful or contumacious in disobeying the order of the judge”.
The Sale
The effect of the sale under the order of a competent court is to free the ship in respect
of all claims which existed against her prior to the sale. Thus a purchaser in such a case
obtains good title to the ship, free of all charges and encumbrances, including maritime
liens, existing at that time.
Once a ship is sold then proceeds of sale are paid into court and from that time the fund
represents the vessel insofar as persons may come forward in respect of claims
outstanding against the vessel at the time of the sale.
The first claim against the fund arises in respect of the Admiralty Marshal’s costs and
any other expenses incurred by him in carrying out the sale. The second charge on the
fund is the costs of the plaintiff instituting the action and his costs up to and including
the time of the sale.
Any surplus remaining after all the successful claimants have all been paid will be paid
over to the former owner of the ship.
Where the proceeds of sale are insufficient to pay the plaintiffs claim, the right of the
plaintiff to proceed against other property belonging to the defendant may depend on
whether the defendant has appeared to defend the res. Where the defendant has
entered an appearance then the defendant may proceed against such other property as
the defendant may possess within the jurisdiction. The right of the plaintiff to recover
his full claim may be restricted by reason of the right of the defendant to limit his
liability in respect of the claim made.
Where the ship owner does not enter an appearance then it may well be that the
plaintiff cannot proceed against any other property of the shipowner at all. This is based
on the assumption that in this case the action has been against the res and that the fund
in court represents all there is. However, this assumption has been doubted by the
Admiralty Court for example see the comments in: