You mean i can arrest a ship..!! – Part 1

South African admiralty law assists those who have a claim against shipowners by granting claimants the entitlement to arrest a ship that enters its jurisdiction. Such action may be taken by virtue of the South African Admiralty Regulation Act, No. 105 of 1983 (the “Act”) which effectively prevents a ‘guilty’ ship from legally departing from the jurisdiction by means of a warrant of arrest of the vessel. Such warrant of arrest may be issued whilst court action is pending, irrespective of the flag she is sailing under.

A comprehensive number of incidents trigger the application of an arrest of a vessel as contemplated in section 1 of the Act, such as claims relating to:

  1. the ownership of a ship or a share in a ship;
  2. the possession, delivery, employment or earnings of a ship;
  3. any mortgage, hypothecation, right of retention, pledge or other charge on or off a ship, and any bottomry or respondentia bond;
  4. damage caused by or to a ship, whether by collision or otherwise;
  5. loss of life or personal injury caused by a ship or any defect in a ship or occurring in connection with the employment of a ship;
  6. loss of or damage to goods (including the baggage and the personal belongings of the master, officers or seamen of a ship) carried or which ought to have been carried in a ship; or
  7. salvage; etc.

The ways in which one may arrest a ship in South Africa are as follows:

Arrest in rem:

A maritime claim may be enforced by an action ‘in rem’ if the claimant has a maritime lien as recognised by the Act over the property to be arrested. These are for seamen’s and master’s wages; salvage; damage received by or done by a ship; and bottomry and respondentia bonds. Alternatively, an arrest may be made where the owner (or demise charterer) of the property to be arrested would be liable to the claimant in an action ‘in personam’ where he/she would be personally liable in a direct action against them.

Arrest in personam:

An arrest ‘in personam’ may occur when the Defendant is a:

  1. person resident or carrying on business at any place in South Africa;
  2. person whose property within the Court’s area of Jurisdiction has been attached by the claimant to found or confirm jurisdiction;
  3. person who has consented or submitted to the jurisdiction of the Court;
  4. if the court has jurisdiction over him or her in terms of Chapter lV of the Insurance Act, No. 27 of 1943, which relates to business underwritten by underwriters at Lloyds; or
  5. company, if the company has a registered office in South Africa.

The property arrested may be any property belonging to the defendant and may include bunkers, rights to freight or hire due (which are situated where the defendant’s debtor is located), rights to monies in a bank account, and rights in a pending action against a fund.

MORE CATEGORIES IN PART 2 – make sure you read it.

Please note that the above article is not intended to represent an exhaustive or all-inclusive synopsis of all the aspects relating to maritime ship arrests in South Africa as same has been simplified for the purposes of this publication. It should furthermore not be assumed that there have not been further developments in the law subsequent to the publication hereof. Readers are therefore cautioned to seek legal assistance before taking any decisions based on the information herein.

About the Author – Kavisha Baboolal : 

Kavisha Baboolal is an attorney with over four years’ experience in the legal industry, holding an LLB degree and a Masters in Maritime Commerce.

She has worked

  • as a Judge’s Associate at the Durban Labour Court
  • as a Legal Adviser at  Mediterranean Shipping Company (Pty) Ltd.
  • in the shipping, energy and trade department at Garlicke & Bousfield Inc
  • part-time at the University of KwaZulu-Natal as a researcher, lecturer and supervisor of masters’ dissertations.

She has also lectured on Fundamental Human Rights at Varsity College.

Her experience includes maritime and logistics claims, company formation and restructuring, mergers and acquisitions, and other corporate and commercial matters.

 

What did you think of the above article..?? Comment below..

5 comments on “You mean i can arrest a ship..!! – Part 1

  1. Nadeesh says:

    Beautiful! Brilliant Read!

  2. Of interest to all claimants will be the unique associated ship provisions of the South African Admiralty Jurisdiction Regulation Act. Those provisions allow claimants that have a claim against ship A to proceed with the claim by way of the arrest of ship B provided both ships are ultimately owned or controlled by the same person or persons. The Act then sets out what an associated ship is as follows:

    An associated ship is defined as a ship other than the wrongdoing ship, owned or controlled, at the time when the action is commenced by a person who owned or controlled the wrongdoing ship at the time when the claim arose.

    The first thing which has to be done is to determine who owned or controlled the wrongdoing ship at the time the claim arose. Thereafter it is necessary to establish who owned, or controlled the ownership of the associated ship at the time when the action against that ship is commenced. The various permutations of associated ships are as follows:

    Both the guilty and the associated ships are owned by the same company.

    The owner of the guilty ship controls the owner of the associated ship.

    The owner of the associated ship controlled the owner of the guilty ship.

    A third party controlled the owner of the guilty ship and controls the owner of the associated ship.

    A person is deemed to control a company if he has the power, directly or indirectly, to control the company.

    Depending on the law relevant to the companies, such control may be either direct or indirect, and may be either legal or factual.

    Legal control may exist where the same majority shareholders are present in both companies whether they be nominee shareholders or not.

    Factual control may exist where it can be established that somebody other than the shareholders control the company. Whether or not a person or persons controls a company is a question of fact under the law of that company’s country of domicile.

    The Act further provides that:

    “If at any time a ship was the subject of a charterparty the charterer or sub-charterer, as the case may be, shall for the purposes of [association] be deemed to be the owner of the ship concerned in respect of any relevant maritime claim for which the charterer or the sub-charterer, and not the owner, is alleged to be liable.”

    The effect of this is that where a claim lies against a company that is the charterer of the carrying vessel, that company is deemed to own that vessel but only for the purposes of association in order to create a guilty ship. This does not entitle the claimant to arrest the carrying vessel.

    The only exception to this is if the charterer is the bareboat or demise charterer in which case the Act allows for the arrest of the carrying vessel for claims that lie against the demise or bareboat charterer.

    Kind regards

    Malcolm Hartwell
    Director and Master Mariner
    Admiralty and International Trade Department
    Norton Rose South Africa

  3. Dear Arish,

    I refer to the recent article posted with regard to arrests.

    Contrary to what the author says, ships cannot be arrested in personam. They can either be attached to found and confirm jurisdiction or arrested in rem for an action in South Africa or arrested for security for proceedings overseas or in South Africa.

    In brief, claimants who have maritime claims have a number of alternatives available to them for the enforcement of their claims. They have an action in personam which simply means they have the right to claim their loss from the person responsible for that loss whether that is in contract or delict. This is the type of procedure that claimants will be familiar with from the non-maritime courts. It simply involves suing a person for the loss.

    If that person/company is resident in South Africa then the claim is brought by serving a summons on that person/company. If that person/company is a foreigner to South Africa then it is first necessary to attach property owned by that foreigner to found and confirm the jurisdiction of the South African courts.

    In the limited circumstances set out in the Admiralty Jurisdiction Regulation Act and reflected in your author’s article, the claimants can also proceed with their claim in rem. Claims in rem can be enforced if the claimant has a maritime lien or if the claimant has a claim against the owner of the property concerned.

    That property can be the ship, her equipment or bunkers, cargo, freight, a container or a fund created from the proceeds of the sale of one of these properties. Typically it is a claim against the owner or demise charterer of the ship.

    The claim is then enforced by arresting that property.

    Maritime property can also be arrested by claimants in order to obtain security for claims that are being pursued either in South Africa or overseas. This so-called security arrest procedure is widely used to obtain security, for example for claims under charterparties that are being enforced by way of London arbitration.

    Insofar as liens are concerned, your author correctly identifies the five traditional liens that have been received into South African law. For practical purposes, the only ones that currently exist are seaman’s and master’s wages, salvage or damage caused to or by a ship.

    Kind regards

    Malcolm Hartwell
    Director and Master Mariner
    Admiralty and International Trade Department
    Norton Rose South Africa

  4. manoj says:

    Thank U for your current updations.

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