THE LAW AND PRACTICE OF ADMIRALTY MATTERS SARAH C.

DERRINGTON

The University ofQueensland, School of Law, Brisbane JAMES M. TURNER Quadrant Chambers Quadrant House, London

OXFORD UNIVERSITY PRESS

CONTENTS

Table of Cases Table of Legislation

xxi xli

1. Introduction A. Jurisdictional Overview Maritime claims Claims enforceable only inpersonam The residual jurisdiction Procedural jurisdiction

B. The Action In Rem Introduced C. Issues of Procedure and Dispute Resolution D. A Comparative Overview 2. The Nature and Scope of the Modern Admiralty Action A. Introduction B. The Modern Action In Rem Preliminary observations The characteristics of the action in rem The functions of the action in rem The categories of in rem claims 'Proprietary' maritime claims Maritime liens General maritime claims Some claims relating to aircraft Maritime liens and statutory actions in rem Maritime liens Statutory actions in rem

C. The Competing Theories of the Nature of the Action In Rem The personification theory The procedural theory The Indian Grace (No. 2)

D. The 'True Nature' of the Modern Action In Rem

XI

1.03 1.03 1.05 1.06 1.09 1.10 1.15 1.17 2.01 2.05 2.05 2.07 2.09 2.10 2.11 2.12 2.13 2.14 2.15 2.17 2.23 2.26 2.27 2.30 2.35 2.48

Contents E. Overview of the Mode of Exercise ofAdmiralty Jurisdiction The meaning of 'ship' 'Vessel' 'Used in navigation' The meaning of'property'

2.58 2.62 2.63 2.64 2.72

E Claims Enforceable Only In Personam Damage received by a ship Limitation claims Applications under the Merchant Shipping Acts

2.78 2.79 2.82 2.83

3. Proprietary Maritime Claims A. The Jurisdictional Foundation for Proprietary Maritime Claims Claims to ownership or possession (section 20(2)(a)) Questions arising between co-owners (section 20(2)(b)) Claims in respect of a mortgage or charge (section 20(2)(c)) Claims for the forfeiture or condemnation of a ship or goods (section 20(2) (s)) B. The Approach to Proprietary Claims in Other Jurisdictions

3.01 3.03 3.07 3.10 3.12 3.14

4. Maritime Liens (and 'Other Charges') A. Introduction B. The Regime Applicable to the Enforcement of Maritime Liens Preliminary considerations The transfer or assignment of maritime liens

4.01 4.06 4.06 4.12

C. The Maritime Liens Recognized in English Law Claims for damage done by a ship Damage done by those engaged in the navigation or management The ship as the noxious instrument Damage external to the ship Claims for personal injury and death Claims for salvage Claims for seamen's wages Meaning of'seamen' Service not contract Scope of'wages' Not wages Claims for masters wages and disbursements Meaning of 'master' Meaning of 'disbursements' Bottomry and respondentia

4.17 4.17 4.19 4.21 4.22 4.23 4.28 4.31 4.34 4.35 4.37 4.38 4.41 4.42 4.44 4.46

D. Foreign Maritime Liens

4.48

XII

Contents

5. General Maritime Claims A. The Scope of the General Maritime Claims B. The Conditions Relating to In Personam Liability The 'relevant person' The meaning of the phrase 'would be liable . . . in personam The concept of'ownership' The meaning of'charterer' The meaning of'demise charterer' The meaning of'beneficial owner' The lifting of the corporate veil

C. The Individual General Maritime Claims Damage done by a ship Loss of life or personal injury Loss of or damage to goods carried in a ship Agreements relating to the carriage of goods in or to the use or hire of a ship Nature of remedy sought irrelevant Meaning of'arising out o f and 'relating to' Salvage Towage and pilotage Necessaries Construction, repair, or equipment of a ship or dock charges or dues Wages Disbursements made on account of a ship General average Bottomry

D. Heads of Claim Recognized in Other Jurisdictions E. Claims Against Aircraft

5.01 5.06 5.13 5.15 5.16 5.20 5.21 5.22 5.24 5.31 5.32 5.34 5.37 5.39 5.40 5.41 5.47 5.53 5.60 5.69 5.72 5.74 5.78 5.79 5.80 5.83

6. Admiralty Procedure and the Arrest Process

A. B. C. D. E.

Sources ofAdmiralty Procedure Features of Admiralty Procedure The Admiralty Marshal The Procedure Applicable to Claims In personam The Procedure Applicable to Claims In rem Commencement of a claim in rem Service of a claim form in rem Renewal of a claim form in rem Acknowledgment of service of a claim in rem Generally In relation to challenges to the jurisdiction In relation to disputes regarding security

Xlll

6.02 6.04 6.10 6.13 6.15 6.15 6.18 6.20 6.22 6.22 6.23 6.25

Contents Judgment in default Summary judgment Challenges to the jurisdiction No jurisdiction under sections 20 to 21 of the Supreme Court Act 1981 Applications under the European legislation Foreign jurisdiction clauses Section 34 of the Civil Jurisdiction and Judgments Act 1982 Forum non conveniens Waiver and submission Preservation of security Procedure subsequent to acknowledgment of service References to the Registrar Agency Interest

6.26 6.29 6.30

F. The Procedure Applicable to Arrest Entitlement to arrest Cautions against arrest Procedure for obtaining an arrest warrant Validity of arrest warrant Service of arrest warrant Manner of arrest One claim/one ship Impact of human rights legislation on arrest procedure

6.31 6.32 6.34 6.35 6.36 6.37 6.39 6.40 6.42 6.44 6.46 6.47 6.47 6.57 6.59 6.65 6.66 6.67 6.70 6.77

G. Proceedings Concerning the International Oil Pollution Compensation Fund

6.79

7. Post-arrest Procedure A. The Effect of Arrest

7.01

B. Insurance

7.06

C. Joinder of Parties

7.08

D. Subsequent In Rem Proceedings

7.09

E. Applications Relating to Undertakings

7.10

F. The Provision of Security Form of security Amount of security Variation of security terms

7.15 7.16 7.18 7.19

G. Release from Arrest Cautions against release Release

7.22 7.22 7.24

H. Rearrest

7.26

I. Applications Relating to the Discharge of Cargo

7.28

xiv

Contents J. Applications Relating to the Loading of Cargo

7.36

K. Applications Relating to the Discharge of the Ship when the Cargo is Arrested

7.38

L. Applications Relating to the Crew The Marshal's position The employment relationship The continued presence of the crew on board

7.39 7.43 7.47 7.49

M. Appraisement and Sale Sale pendente lite Private sale before order The sale process Stopping the sale process The proceeds of sale and the determination of priorities The effect of judicial sale

7.55 7.59 7.61 7.62 7.63 7.64 7.66

N . Applications Relating to Wrongful Arrest

7.70

8. Distribution of the Fund A. Priorities The priority ranking of maritime claims Theprimafacie ranking New Zealand South Africa Actions on judgments and awards The classesindetail The Admiralty Marshal's costs and expenses Costs of the producers of the fund Maritime liens Mortgages Statutory rights of action in rem Effect of contractual security on priority Ranking of claims where sister-ship arrest Ranking of claims where there is a possessory li en Ranking of claims where there is a statutory power of detention Reopening the question of priorities

8.01 8.05 8.09 8.12 8.13 8.14 8.15 8.15 8.19 8.22 8.37 8.41 8.42 8.45 8.49 8.52 8.54

B. Insolvency Issues Issue of proceedings prior to petition for winding up Issue of proceedings after petition for winding up Recognition of foreign winding up orders

8.55 8.59 8.61 8.71

9. Procedure in Collision Cases A. Procedure Commencement of a collision claim

xv

9.01 9.03

Contents Acknowledgment of service Objections to jurisdiction Collision statements of case (Preliminary Acts) Purpose Form Filing and service Amendment Dispensing with collision statements of case Judgment in default Agency Counterclaims and security Costs in collision cases The default position Offers to settle On appeal

9.07 9.08 9.09 9.11 9.12 9.14 9.15 9.16 9.19 9.20 9.21 9.22 9.22 9.23 9.25

B. Assessors Assessors and expert evidence Assessors on appeal The treatment of assessors' evidence Assessors' remuneration Assessors in other jurisdictions

9.26 9.29 9.33 9.34 9.36 9.37

C. Collision Cases in the Computer Age

9.38

10. Limitation of Liability for Maritime Claims A. Introduction Preliminary considerations The exercise and nature of the right to limit Historical outline The 1976 Convention The Athens Convention

10.01 10.01 10.08 10.11 10.16 10.18

B. The Statutory Regimes The United Kingdom—The Merchant Shipping Act 1995 The Australian limitation of liability regime The Canadian limitation of liability regime The Hong Kong limitation of liability regime The New Zealand limitation of liability regime The Singapore limitation of liability regime The South African limitation of liability regime

10.21 10.21 10.25 10.28 10.30 10.32 10.36 10.38

C. The Principles Applicable to Limitation of Liability Persons entitled to limit liability Shipowners Charterers Slot charterers

10.39 10.39 10.40 10.42 10.44

xvi

Contents Managers Salvors Others Mortgagees Insurers Australia Canada Hong Kong New Zealand Singapore SouthAfrica Claims subject to limitation of liability '... consequential loss ...' Damage to the vessel Costs Australia Canada Hong Kong New Zealand Singapore SouthAfrica Claims exempt from limitation Australia Canada Hong Kong New Zealand Singapore SouthAfrica Conduct barring limitation Australia Canada Hong Kong New Zealand Singapore SouthAfrica The limitation amounts Cross claims Australia Canada Hong Kong New Zealand Singapore SouthAfrica Reservations

xvn

10.45 10.47 10.48 10.51 10.52 10.53 10.54 10.56 10.57 10.60 10.61 10.63 10.65 10.68 10.77 10.78 10.80 10.82 10.83 10.85 10.86 10.88 10.90 10.91 10.92 10.94 10.97 10.98 10.99 10.104 10.105 10.106 10.107 10.109 10.110 10.111 10.123 10.126 10.128 10.130 10.132 10.134 10.136 10.138

Contents D. Jurisdiction to Bring a Limitation Claim Introduction Invoking the right to limit The location of limitation proceedings Lispendens

10.144 10.144 10.146 10.150 10.152

E. Limitation Procedure The distinction between limitation as a defence and as a decree Commencement of a claim Service of the claim form Acknowledgment of service Defence or notice admitting right to limit Restricted limitation decree General limitation decree Consequences of—and challenges to—the grant of a limitation decree Advertisement Claiming against the fund Challenging the decree Manner of constitution of the limitation fund Effect of constitution of the limitation fund Distribution of the fund Interest Costs Australian procedure Canadian procedure Hong Kong procedure New Zealand procedure Singapore procedure South African procedure

10.155 10.155 10.156 10.157 10.160 10.162 10.163 10.164

F. The Effect of a Limitation Decree in Other Countries Preliminary remarks Within the EU At common law

10.203 10.203 10.205 10.206

G. The Effect of the Insolvency of the Owner on the Constitution of a Limitation Fund

10.209

10.166 10.167 10.168 10.169 10.171 10.175 10.179 10.181 10.182 10.183 10.189 10.191 10.193 10.199 10.202

11. Arbitration Issues A. Introduction B. The Arbitration Act 1996 Overview Arbitrations to which the 1996 Act applies The obj ects of the Act

XVlll

11.01 11.04 11.04 11.05 11.07

Contents C. The Objects Explored Fair resolution of disputes without unnecessary expense or delay The London Maritime Arbitrators' Association Other arbitral organizations Party autonomy Powers of the arbitral tribunal Powers of the court Confidentiality and privacy Minimal court interference Rights of appeal Stay of the proceedings Anti-suit injunctions

11.11 11.11 11.12 11.15 11.21 11.21 11.22 11.23 11.41 11.41 11.43 11.55

Appendix 1: Admiralty Court Act, 1840 Appendix 2: Admiralty Court Act, 1861 Appendix 3: Supreme Court ofJudicature (Consolidation) Act, 1925 Appendix 4: Administration of Justice Act, 1956 Appendix 5: Supreme Court Act, 1981 Appendix 6: Admiralty Act 1988 (Australia) Appendix 7: Federal Courts Act Appendix 8: High Court Ordinance Chapter 4 (Hong Kong) Appendix 9: New Zealand Maritime Law Admiralty Act 1973 Appendix 10: High Court (Admiralty Jurisdiction) Act (Cap 123,2001 Rev Ed) Appendix 11: Admiralty Jurisdiction Regulation Act 105 of 1983 Appendix 12: Admiralty Court Forms Appendix 13:The Arrest Conventions of 1952 and 1999

317 319 323 325 329 335 353 365 371

Index

413

xix

377 381 393 395