MT Pretty Scene: Galsworthy Ltd v Pretty Scene Shipping S.A. and Another (684/2019) [2021] ZASCA 38; [2021] 3 All SA 115 (SCA); 2021 (5) SA 134 (SCA) (12 April 2021)

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[2021] ZASCA 38
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MT Pretty Scene: Galsworthy Ltd v Pretty Scene Shipping S.A. and Another (684/2019) [2021] ZASCA 38; [2021] 3 All SA 115 (SCA); 2021 (5) SA 134 (SCA) (12 April 2021)

THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case no: 684/2019
MT ‘PRETTY SCENE’
In the matter between:
GALSWORTHY
LIMITED

APPELLANT
and
PRETTY SCENE
SHIPPING S.A.

FIRST RESPONDENT
MT   ‘PRETTY
SCENE’

SECOND
RESPONDENT
Neutral citation:
MT Pretty Scene: Galsworthy Ltd v
Pretty Scene Shipping S.A. and Another
(Case
No 684/19)
[2021] ZASCA 38
(12 April 2021)
Coram:
WALLIS, ZONDI, MOCUMIE and SCHIPPERS JJA and
GOOSEN AJA
Heard
:
19 March 2021
Delivered
:
This judgment was handed down electronically by circulation to the
parties’ representatives by email, publication
on the Supreme
Court of Appeal website and release to SAFLII. The date and time for
hand-down is deemed to be 09h45 on 12 April
2021.
Summary:
Arrest
of an associated ship in terms of ss 3(6) and (7) of the
Admiralty Jurisdiction Regulation Act 105 of 1983 (the AJRA)
–
defect in summons not justifying the setting aside of a warrant of
arrest – procedural requirements of Admiralty
Rule 4 –
requirements for a summons in terms of Admiralty Rule 2(1) –
Practice Directive 27 of the KwaZulu-Natal Division
of the High Court
– summons only required to set out a clear and concise
statement of the claim – does not require
same detail as a
pleading.
Association –
provisions of s 3(7)(
c
) of the AJRA – charterer
deemed to be the owner of the ship concerned when the claim in issue
arose – immaterial whether
charterer no longer the charterer at
that time.
When does a claim arise –
in case of a claim on an arbitration award claim inextricably linked
to underlying maritime claim
– claim arises when the underlying
claim arose.
Second arrest in
anticipation of first arrest being set aside – such an arrest
permissible – not barred by s 3(8)
of AJRA – proper
interpretation of that section.
ORDER
On
appeal from:
KwaZulu-Natal Division of
the High Court, Pietermaritzburg (Mbatha J, Madondo DJP and Van Zyl J
concurring):
1
The appeal is upheld with costs.
2
The order of the full court of the KwaZulu-Natal Division in the
appeal in case no A23/2015
is set aside and replaced by the following
order:
'(a)
The appeal is upheld with costs, such costs to include the costs of
two counsel where two counsel were
employed.
(b) The order
of the high court is set aside and replaced by the following order:
'The
application to set aside the arrest of the
Pretty Scene
is
dismissed with costs.'
3
The order of the full court of the KwaZulu-Natal Division in the
appeal in case no A65/2016
is set aside and replaced by the following
order:
'The appeal is
dismissed with costs.'
JUDGMENT
Wallis JA (Zondi,
Mocumie and Schippers JJA and Goosen AJA concurring)
[1]
On 18 June 2007 and by way of the exchange
of recapitulation messages dated 17 and 18 June 2007, the appellant,
Galsworthy Ltd (Galsworthy),
let and Parakou Shipping PTE Ltd
(Parakou Shipping) hired the MV
Canton
Trader
(to be renamed
Jin
Kang
) on a time charter party for a
minimum of 60 and maximum 63 months with delivery due to take place
at Singapore between March and
April 2009. Parakou Shipping did not
intend to trade the
Jin Kang
,
but concluded a back to back five year charter party with
an entity called Ocean Glory at a slightly higher charter
rate.
However, with the collapse in the charter market as a result of the
world financial crisis in 2008, Ocean Glory went into
liquidation.
Thereafter the shareholders and directors of Parakou Shipping sought
unsuccessfully to extricate it from the charter
with Galsworthy.
Ultimately Parakou Shipping refused to take delivery of the vessel
when tendered.
[2]
Arbitration in London followed in which
Galsworthy sought damages from Parakou Shipping for its repudiation
of the charter party.
In a First Final Arbitration Award dated 31
August 2010 the appointed arbitrators declared:
‘…
that
the parties entered into a legally binding charter party as a result
of the ratification by the Charterers of the terms set
out in the
recapitulation messages of 17 and 18 June … and that the
Charterers are accordingly in repudiatory breach
of charter.’
Flowing from
that conclusion the arbitrators made an award in favour of Galsworthy
in an amount of US$2 673 279.15. Parakou
Shipping had
conceded during the course of the hearing that if they were found to
be in breach of charter they were liable for
damages in that sum. The
balance of Galsworthy’s claim for additional damages and costs
was reserved for further adjudication.
On 13 May 2011 the
arbitrators made a Second Final Arbitration Award in favour of
Galsworthy for payment of damages in the
sum of US$38 579 000,
together with interest and costs.
[3]
The present appeal arises from Galsworthy’s
attempts to enforce payment of those awards by way of an action
in
rem
against the MT
Pretty
Scene
as an associated ship in relation to
the
Jin Kang
. It
initially arrested the
Pretty Scene
on 18 June 2016. The first respondent, Pretty Scene Shipping SA
(PSS), the owner of the
Pretty Scene
,
applied to set the arrest aside. The application came before Vahed J
and the arrest was set aside on 31 October 2016. Vahed J
refused
leave to appeal, but this court granted leave to appeal to the full
court of the KwaZulu-Natal Division. In anticipation
of an
unfavourable judgment from Vahed J, Galsworthy effected a second
arrest of the
Pretty Scene
on 28 October 2016. An application by PSS to set aside that
arrest, and a counter-application for security for a claim
for
wrongful arrest under s 5(4) of the Admiralty Jurisdiction
Regulation Act 105 of 1983 (the AJRA), were dismissed by Henriques
J
on 10 August 2017. Reasons were provided on 22 September 2017. Like
Vahed J, Henriques J refused leave to appeal, but this court
again
granted leave to appeal to the full court.
[4]
The two appeals were heard in a consolidated
hearing on 1 August 2018 and judgment was delivered (Mbatha
J, with Madondo
DJP and Van Zyl J concurring) on 4 March 2019. The
appeal against Vahed J’s order was dismissed and that against
Henriques
J’s judgment upheld. In the result both arrests were
set aside and the counter-application for security for costs was
granted.
The order of the full court does not specify the terms on
which security was ordered, merely recording that:
‘
The
applicant's counter-application be and is hereby upheld with costs,
costs to include costs of two counsel where applicable.’
It must be
accepted therefore that the order was in the terms prayed and meant
that security was to be provided in an amount in
excess of
US$6.6 million, plus interest and costs. The appeals are before
us by virtue of the grant of special leave by this
court.
Mootness
[5]
PSS contended that the appeals had become moot, because after
its arrest the
Pretty Scene
was sold and the proceeds
distributed under ss 9 and 11 of the AJRA. It is common cause
that Galsworthy received nothing in
consequence of that sale and
distribution. On that basis it was submitted that success in the
appeals would have no practical effect
or result and therefore that
they should be dismissed in terms of s 16(2)
(a)
(i) of the
Superior Courts Act 10 of 2013
.
[6]
There is no merit in this contention. In
the first instance there remains a live issue in that the full
court's order that Galsworthy
provide security for PSS's claim for
damages for wrongful arrest remains in existence, albeit that
security has not yet been furnished.
In any event the jurisdiction of
the South African courts to deal with such a claim has been
established.
[1]
Furthermore, the case raises matters of importance in regard to
admiralty procedure and it is desirable that these be resolved
in the
wider interests of clarifying the law and practice in admiralty
cases.
[2]
THE FIRST
ARREST
The
procedural objection to the first arrest
[7]
Galsworthy applied ex parte to judges in
KwaZulu-Natal,
[3]
the Eastern Cape and the Western Cape, for orders directing the
registrars of those courts to issue warrants of arrest and
accompanying
writs of summons in respect of eight vessels. The eight
vessels were product tankers alleged to be associated ships in
relation
to the
Jin Kang
.
Galsworthy brought the applications before judges because it wanted
confidentiality orders in respect of the applications and
the
warrants of arrest, with a view to ensuring that Parakou Shipping
would not learn of them and divert the vessels elsewhere
to avoid
arrest. This could occur via an inspection of the register of
admiralty actions at the courts. It is not uncommon for

confidentiality orders to be sought and granted in admiralty
proceedings, both
in rem
and
in personam
.
[8]
The application was brought in the
conventional form on notice of motion supported by an affidavit
detailing the claim; the basis
for association; and the reasons for
seeking confidentiality. The order was granted in all three
divisions. The warrants and writs
of summons in the KwaZulu-Natal
Division were subsequently extended for two years by way of a further
order granted on 29 March
2016.
[9]
An application to set aside the arrest of
the
Pretty Scene
was
launched on 1 July 2016, two weeks after its arrest. When the arrest
was made only the warrant of arrest and writ of summons
were served,
but a copy of the application papers was furnished to PSS's attorneys
by Galsworthy's attorneys before the application
to set aside the
arrest was launched. The application raised a number of issues,
principal among which was a procedural objection
that the summons did
not comply with the requirements of the judgment in
The Galaecia
[4]
and Practice Directive 27 ('the Directive') issued by the
KwaZulu-Natal Division of the High Court. This objection was upheld

by Vahed J and the arrest set aside. He did not address any of the
other grounds on which the arrest was challenged. His decision
was
upheld by the full court for essentially the same reasons as his.
[10]
With respect, this conclusion was erroneous
for the following reasons:
(a)
PSS's procedural objection was misconceived, as a warrant of arrest
cannot be set aside because of deficiencies
in the writ of summons;
(b)
the decision in
The Galaecia
was misconstrued;
(c)
the approach to the Directive misconstrued Admiralty
Rule 2(1)(
b
)
and imposed requirements on the contents of a summons that are
inconsistent with the general structure of the Admiralty Rules,

unnecessary and unduly burdensome;
(d)
the summons in any event complied with the requirements of the
Directive in the only respect in which
it was challenged.
Each of these
will be dealt with in turn.
The
misconceived challenge to the warrant
[11]
For the purposes of considering this point
I will assume that PSS was correct in saying that the writ of summons
was defective.
However, its aim was to set aside the arrest of the
Pretty Scene
.
Accordingly, it needed to show that the order directing the registrar
to issue the warrant of arrest was invalid. For the procedural

objection to have effect, the defect in the summons had to invalidate
both the order that the warrant of arrest be issued and the
warrant
itself.
[12]
The parties appeared to accept that
the invalidity of the summons would lead inexorably to the invalidity
of the warrant of arrest.
The assumption was that the two are
mutually interdependent, that is, the one cannot exist without the
other. That is not the case.
This is apparent from Admiralty
Rule 4(3), which provides that the registrar may only issue a
warrant of arrest if summons
has been issued, but makes an exception
in the case where the arrest is ordered by the court. The court may
order an arrest without
a summons being issued, as may well occur in
circumstances of extreme urgency. If a vessel is about to depart from
the jurisdiction
an arrest may be ordered on affidavits, or oral
evidence, placed before a judge at home in the middle of the night.
While this
is fortunately relatively unusual, it does occur and the
rule accommodates it. What it demonstrates is that there is no link
between
the arrest and the summons. A deficiency in the latter does
not affect the validity of the former.
[13]
Even were the summons and the warrant of
arrest linked I fail to see on what basis, a defect in the summons
would invalidate the
arrest. A summons that is defective for
non-compliance with Admiralty Rule 2(1)(
b
),
which was the complaint here, is nonetheless a summons. It is not a
nullity, merely because the claim is insufficiently specified.
A
defective summons may serve to interrupt the running of
prescription
[5]
and may be amended.
[6]
Although counsel for PSS devoted a substantial portion of the heads
of argument to the procedural objection, he did not suggest
that the
summons was either invalid or a nullity. Nor did he explain why the
defect in the summons should invalidate the arrest.
[14]
A warrant issued by the registrar under
Admiralty Rule 4(3) might possibly be invalid if no summons had been
issued, but that is
not the situation here. There was a summons, but
it was alleged to be defective. Nonetheless, the judge ordered the
registrar to
issue it and to issue the warrant of arrest. He did so
on the basis of the information contained in an affidavit that dealt
in
detail with the basis for the alleged association. On the facts
contained in the affidavit he was correct to order the registrar
to
issue the summons and warrant of arrest.
[15]
That brings me to the last point under this
head. Where an
in rem
arrest
is challenged, the onus is on the arresting party to justify the
arrest. It is well established that in doing so they may
rely on
grounds not advanced at the time of the arrest. On this basis it has
been held that an entirely new case may be advanced
to sustain the
arrest.
[7]
In the
Andrico Unity
the
claimants said they had supplied bunkers to the owner of the vessel.
When it transpired that the vessel was subject to a demise
charter,
this case was abandoned in favour of an allegation that the supply of
bunkers created a maritime lien enforceable against
the owners, even
though they were not personally liable. The court held this change in
stance to be permissible because it was
open to the arresting party
to justify the arrest on any lawful basis available to it. That is
precisely what Galsworthy did in
response to the application to set
aside the arrest. It relied on the affidavit before the judge who
granted the initial order
to show that notwithstanding any
deficiencies in the summons there was a sufficient case that the
Pretty Scene
was
an associated ship in relation to the
Jin
Kang
.
[8]
If one is entitled to alter the entire basis of one’s
case in order to sustain an arrest, I can see no reason why one
cannot,
when the arrest is challenged, supplement a deficient summons
in the same way.
The
Galaecia and Practice Directive 27
Background
[16]
Ordinarily, a party seeking to arrest a
vessel
in rem
for the purpose of an admiralty action against the vessel applies to
the registrar of the high court for the issue of a warrant
of
arrest.
[9]
This is a procedure that has been part of our admiralty procedure
since 1799 in the Cape and 1856 in KwaZulu-Natal. Before the

enactment of the AJRA it was the procedure followed in our courts
sitting as courts of admiralty under the Colonial Courts of Admiralty

Act of 1890.
[10]
It also reflects in large measure the procedure in actions
in
rem
in many other jurisdictions around
the world. In view of the consequences for the shipowner whose ship
is wrongly arrested,
[11]
courts in practice generally accept (and are correct to do so) that
an application to set aside an arrest is a matter that should
be
dealt with urgently and given priority.
[17]
The registrar may refer the question
whether the warrant should be issued to a judge.
[12]
In determining whether to do so the registrar does not rely on any
personal knowledge of maritime law, but is concerned with whether
the
requirements for such an arrest as set out in the rules and the AJRA
are satisfied. On occasion the legal representatives for
the
applicant indicates that this is desirable, because the facts were
not straightforward. However, most arrests are relatively

straightforward.
[18]
In order to assist the registrar, the
rule provides that a warrant of arrest will only be issued if the
summons in the action has
been issued and a certificate from the
arresting party has been submitted to the registrar:
(a)
stating that the claim is a maritime claim and is one in respect of
which the court has jurisdiction,
or will have jurisdiction once the
arrest is effected;
(b)
stating that the property sought to be arrested is the property in
respect of which the claim lies,
or an associated ship that may be
arrested in terms of s 3(6) of the AJRA;
(c)
saying whether any security has been given to prevent the arrest or
procure the release of the
vessel from arrest and, if so, providing
details of such security;
(d)
certifying that the contents of the certificate are true and correct
to the best of the knowledge, information
and belief of the signatory
and the source of such knowledge and information.
[13]
[19]
In practice the certificate will almost
invariably be furnished by the applicant's attorney, who owes duties
to the court as one
of its officers. These duties are particularly
onerous where the proceedings are ex parte as is almost always the
case with both
an arrest and an attachment
ad
fundandam et confirmandam jurisdictionem.
The
potentially contentious legal issues in relation to the contents of
the certificate are whether the claim is a maritime claim;
whether
the court has jurisdiction or will acquire jurisdiction as a result
of an arrest; and, in the case of an associated ship
arrest, whether
the target of the arrest is an associated ship in relation to the
ship concerned. One would expect that, if the
facts showed that any
of these were potentially controversial, this would be drawn to the
attention of the registrar and the latter
would refer the matter to a
judge. Otherwise, the matters set out in the certificate are largely
of a formal nature and not such
as to put the registrar on enquiry or
require consideration by a judge.
The decision in The Galaecia
[20]
The process outlined above, together with
the brevity of the summons in the case before him, occasioned
Combrinck J some concern
in
The Galaecia
.
[14]
He criticised the summons in that case for its lack of particularity
and perceived non-compliance with the provisions of Admiralty
Rule
2(1)
(b)
.
He said that the certificate under Admiralty Rule 4(3), the
requirements for which were summarised in the previous paragraph,
did
little to ensure that the arresting party's claim was not frivolous
or spurious, especially as the signatory might have no
personal
knowledge of the contents. In regard to the procedure generally he
thought it debatable whether it would pass constitutional
muster and
expressed concern at the time it took to resolve issues concerning
the validity of arrests.
[21]
Combrinck J concluded, by saying:
'In
future practitioners would be well advised to ensure that a summons
complies with the provisions of Rule 2(1)
(b)
. In addition, I
see no reason why the Certificate in terms of Rule 4(3) should not be
made by a representative of the arresting
party who has knowledge of
the matter and that a facsimile of such Certificate accompany the
arrest warrant. With respect to the
registrars of this and other
Courts, I doubt whether they have any knowledge whatsoever of
Admiralty law. Yet they must decide
whether sufficient facts and
contentions are made in the summons for the defendant to know on what
basis for instance, it is said
that the defendant vessel is an
associated ship of the ship in respect of which the claim is made. In
terms of Rule 4(2)
(b)
, the Registrar may refer to a Judge the
question whether a warrant should be issued. Without of course
wishing to fetter the Registrar's
discretion it would appear to me a
salutary precaution for the Registrar in the majority of cases to
refer these matters to a judge
for decision. As a matter of practice
this should henceforth be done. I have discussed this matter with a
number of senior judges
in this Division and they are in agreement
that a practice rule to the above effect should be introduced.'
[22]
This judgment led to the introduction of
the Directive. It reads:
'
27
Admiralty Arrest Warrants in terms of Rule 4(3)
The
attention of practitioners is drawn to the fact that Rule
2(1)
(a)
provides for a clear and concise statement of the
nature of the claim. The certificate with regard to the warrant in
terms
of Rule 4(3) provides for a statement by the giver of the
certificate that the contents of the certificate are true and correct

to the best of the knowledge, information and belief of the
signatory. The source of any such knowledge and information must be

given.
As
the matters to be certified include a statement that the claim is a
maritime claim and that the property sought to be arrested
is the
property in respect of which the claim lies or, if the arrest is an
associated ship arrest, that the ship is an associated
ship which may
be arrested, it is inherent in the nature of the certificate that the
signatory should believe on proper grounds
that there is a claim and
also that it is enforceable by the arrest of the property to be
arrested. It follows therefore, in the
case of an associated ship
arrest, that the certifier believes that the ship is an associated
ship. It is therefore necessary that
the summons should contain a
statement of the
facts
upon which the claim is based
and a statement of the
facts
on the basis of which
it is stated that the ship is an associated ship.
It
is desirable that the certificate should be signed by an attorney
practising in the Court out of which the warrant is issued.
In order
to deal with cases of difficulty Rule 4(2)
(b)
provides
that the Registrar may refer to a judge the question whether a
warrant should be issued. In the vast majority of
cases this is
neither necessary, practicable nor desirable. It should be done in
any case of difficulty either in regard to the
claim or in regard to
a question of association. In order to assist the Registrar the
responsibility for identifying cases that
should be referred to a
judge will in the first instance rest on the attorney providing the
certificate. When requesting a warrant,
therefore, the attorney
should submit in addition to the certificate required by Rule 4(3)
a statement that the attorney knows
of no circumstances making it
desirable to refer the issue of the warrant to a judge. In the
absence of such a statement the Registrar
will refer the matter to a
judge under Rule 4(2)
(b)
.'
[23]
The Directive diverged in significant
respects from the judgment in
The
Galaecia
, in part no doubt because of
the representations made by the Maritime Law Association referred to
in a note in the South African
Law Journal that criticised the
departure from established practice occasioned by the practice
directive.
[15]
The two principal suggestions in the judgment, namely that the
certificate under Admiralty Rule 4(3) be made by a representative
of
the arresting party and that the registrar should in the majority of
cases refer the matter to a judge, were not included. Like
the
judgment the Directive emphasised the need for the summons to comply
with Admiralty Rule 2(1)
(b)
.
This merely emphasised the existing position.
[24]
The Galaecia
did not lay down any new rule or provide any authority relevant to
this or any other case. The owner had not sought to set aside
the
arrest on procedural grounds.
[16]
It was set aside because the claim was not a maritime claim.
[17]
The judgment drew attention to the provisions of Admiralty Rule
2(1)(
b
)
and suggested that three allegations in the summons were conclusions
of law.
[18]
Without elaboration it was said that the failure to comply with the
rule gave rise to practical problems for the owner seeking
to set
aside the arrest and procedural difficulties.
[19]
It criticised the certificate furnished by the attorney because he
had no personal knowledge of the facts being certified as true
and
correct. However, the Directive performed a
volte
face
by requiring the certificate to be
given by an attorney practising in the jurisdiction of the KwaZulu
Natal Division. It rejected
the automatic referral of applications to
a judge.
[25]
The argument for PSS, and the
judgments in the high court at first instance and the full court,
attached far greater significance
to
The
Galaecia
than was warranted. Given that
no procedural issue was addressed in argument and the application was
determined on the basis that
the claim was not a maritime claim
advanced, the judgment was no more than an extended
obiter
dictum
concerning procedural issues. It
had no binding effect and was not adopted in terms in the Directive.
It stressed the importance
of Admiralty Rule 2(1)(
b
)
without any analysis of its requirements. It has not been reported
and its relative anonymity should be preserved.
The
Practice Directive
[26]
The Directive is of greater importance,
because it involves a matter of practice that the high court is
entitled to regulate in
the exercise of its inherent powers.
[20]
It does not have the same standing as a rule promulgated under
statutory authority, but it may supplement any rule, provided that
it
does not subvert it or the overall scheme of the rules governing a
particular area of practice. Three of the Directive's explicit

requirements are uncontroversial. They are that it is desirable that
the person giving the certificate under Admiralty Rule 2(3)
be an
attorney practising in the KwaZulu-Natal Division; that the signatory
should specify the source of their knowledge; and that
the signatory
should state that they know of no circumstance making it desirable
that the matter be placed before a judge, failing
which the registrar
will refer it to a judge.
[27]
The only potentially controversial
provision was the requirement that the summons should contain the
facts upon which the claim
was based and the facts on which it was
stated that a ship was an associated ship. I say potentially
controversial because it is
not clear what facts were being referred
to. The two courts below erred in relation to what constitutes facts
for the purposes
of a summons and the extent of the facts required to
be embodied in the summons. They demanded more than was contemplated
in the
Directive and, in the result, approached the summons on the
stringent basis demanded of a pleading, which is inapplicable to a
summons.
[28]
The application to set aside the first
arrest focussed entirely on the adequacy of the writ of summons. It
quoted the following
allegation from para 17:
'Parakou
Shipping is deemed to be the owner of the 'Jin Kang' in terms of
Section 3(7)
(c)
of the Admiralty Jurisdiction Regulation Act
105 of 1983, as amended.'
The deponent
said that 'such a statement is a conclusion of law and not a
statement of fact' and submitted that it did not comply
with the
practice directive because it did not satisfy the requirement that
'sufficient particulars [must be pleaded] to enable
the defendant to
identify the facts and contentions upon which the claim is based'. No
other part of the summons was attacked.
[29]
I will deal at a later stage with three
arguments raised on the merits of the arrest and the claim that the
Pretty Scene
was an associated ship in relation to the
Jin
Kang
. It suffices for present purposes
to say that none raised any dispute in regard to the facts on which
Galsworthy relied in alleging
an association. These were that the
individual who controlled Parakou Shipping, at the time the original
claim arose and when the
first arbitration award was handed down, was
a Mr Por Liu and that he controlled PSS through being the sole
shareholder of
its parent company Parakou Tankers Inc. These
allegations were contained in the founding affidavit in the
application for an order
that the registrar issue the warrants of
arrest. They were therefore before the judge who granted that order.
[30]
Although none of this was disputed on
the papers before it, the full court decided that Mr Por Liu did not
control Parakou Shipping.
It did so after reading a Singaporean
judgment in proceedings where the court held that, despite all the
shares in Parakou Shipping
having been transferred by his parents to
Mr Por Liu and an associate in December 2008, his father Mr CC
Liu continued to
control the affairs of Parakou Shipping. That was
not an issue before the full court and it was not a finding that the
court was
entitled to make. Even if factually correct this was not
decisive of the issue of control in the light of the judgment in the
Heavy Metal
.
[21]
While that judgment is controversial, its application was not in
issue before either the full court or this court. On the basis
of the
distinction it drew between
de facto
and
de iure
control
of a company, even if Mr CC Liu retained
de
facto
control of Parakou Shipping, his
son acquired
de iure
control,
which sufficed for the purposes of the association.
The
judgments
[31]
Vahed J held that the absence of any
factual support for the allegations in para 17 of the summons
rendered it defective in
accordance with the practice directive and
the principles espoused in
The Galaecia
.
He correctly identified that this was the cause for complaint and
then quoted in full the judgment in
The
Galaecia
. After citing two decisions
dealing with pleadings,
[22]
not the contents of a summons, he rejected the contention that the
summons only required the cause of action to be set out 'in
concise
terms' and also the submission that the writ of summons had been
authorised by a judge on the basis of an affidavit setting
out the
facts in considerable detail. His conclusion was that had the judge's
attention been drawn to
The Galaecia
and
the practice directive he would not have authorised the issue of the
writ of summons and the warrant of arrest. This led him
to set aside
the arrest without addressing the other grounds advanced by PSS.
[32]
Turning to the full court's decision it is
difficult to distil the precise ground upon which it upheld the high
court's judgment.
I trust I do it no injustice in saying that the
principal points appear to be the following. The requirements of
Admiralty Rule
2(1)
(b)
are
peremptory.
The Galaecia
was
the progenitor of the practice directive and was a binding judgment
of the court. In
The Galaecia
the
arrest of the vessel was set aside on the basis of procedural defects
in the summons. The court rejected the contention that
defects in the
summons did not matter as the facts were before the judge at the time
he granted the order for the issue of the
summonses and warrants of
arrest.
[23]
It held that in any event the high court had exercised its discretion
judiciously in setting aside the arrest. In this it erred
because
there was no indication in Vahed J's judgment that he thought that he
was exercising a discretion.
[33]
Bar the last item, these were the same
reasons that motivated the high court in reaching its conclusion.
There was also a separate
section of its judgment, in which the full
court held that the high court was correct to conclude that
association had not been
proved on a balance of probabilities.
However, this section did not deal with whether association was
proved on a balance of probabilities,
nor did it address any of the
grounds raised by PSS and mentioned in para 29 as reasons why
association had not been established.
Instead, it relied on the
deficiencies in the summons and certificate by Galsworthy's attorney
that had already been considered.
This led it to the conclusion that
the summons was defective and had properly been set aside.
[34]
For the sake of completeness, I should
mention that the full court referred to the decisions in
Windrush
Intercontinental
[24]
and the
Cape Courage.
[25]
However, neither case was concerned with an alleged deficiency in the
summons. Both were opposed applications seeking to set aside
the
arrest of the vessels concerned on a full set of affidavits supported
by documents and expert evidence. The question in
Windrush
was whether the applicant had
established that the claims enjoyed a maritime lien. In the
Cape
Courage
it was whether, where the
ownership of the ship concerned changed on delivery of the vessel
under a sale agreement, the association
had been established. The
argument was a technical one about when the maritime claim arose.
Neither case bore upon the present
situation.
The proper
approach to Admiralty Rule 2(1)(b)
[35]
Given that the decision in relation to the
first arrest was based on
The Galaecia
and the Directive and their approach to
a conventional application to the registrar for the issue of a
warrant of arrest it is best
to start there. The process in such an
application was outlined earlier in paras 16 to 18 of this judgment.
Ordinarily the summons
will be issued at the same time as the warrant
of arrest. The requirements in respect of a summons are contained in
Admiralty Rule
2, the relevant portions of which read as follows:
(1) (
a
) A
summons shall be in a form corresponding to Form 1 of the First
Schedule and shall contain a clear and concise statement
of the
nature of the claim and of the relief or remedy required and of the
amount claimed, if any.
(
b
)  The
statement referred to in paragraph (
a
) shall contain
sufficient particulars to enable the defendant to identify the facts
and contentions upon which the claim is based.
(2)  Subject
to the provisions of subrule (3), the summons shall set forth the
matters referred to in rule 17(4) of the
Uniform Rules.'
[36]
Some background to this rule is helpful.
Until the AJRA came into force, our admiralty law and procedure were
contained in the Colonial
Courts of Admiralty Act (the CCA) and the
Rules promulgated under the CCA (the CCA Rules). The action
in
rem
was derived from the CCA and was
deliberately preserved in the AJRA. Under CCA Rule 3(1) every
action was commenced by a writ
of summons indorsed with the nature of
the claim, the relief or remedy required and the amount claimed, if
any. Forms of indorsement
of claims were provided in Appendix 7 to
the CCA Rules. The first example read:
'(1)
Damage by collision
The
Plaintiffs as owners of the Ship "Mary" [her cargo and
freight
&c, or
as the case may be
]
claim
the sum of £ _____ against the Ship "Jane" for damage
occasioned by a collision which took place [
state
where
] on the _____
day of _________ 18__; and for costs.'
Similar forms
of indorsement in respect of salvage, pilotage, towage, master's
wages and disbursements and seamen's wages followed.
All were
characterised by the same brevity.
[37]
CCA Rule 29 provided that a warrant
for the arrest of property in an action
in
rem
might be issued by the registrar at
the time of, or at any time after, the issue of the summons. The
warrant was to be issued on
the filing of an affidavit to lead
warrant filed with the court. The affidavit was required to state the
nature of the claim and
that the aid of the court was required. The
form of an affidavit to lead warrant was set out in Appendix 11. It
was terse requiring
only a statement that the claimant had a claim
against the named vessel and stating the nature of the claim. This
would normally
follow the indorsement to the summons. CCA Rule 30
added some simple requirements in respect of three claims. For
example,
in an action for wages the national character of the ship
had to be specified and the indorsement had to show that notice had
been
given to the consular officer of the state to which the ship
belonged, if there was one residing in the particular colony where

the CCA was being invoked. These did not affect the overall
requirement in relation to the nature of the claim.
[38]
The procedure incorporated into the AJRA
was simple and uncomplicated. This was reflected in the original
rules. Admiralty Rule 2(1),
which remains in its original form,
follows the language of CCA Rule 3(1). Form 1 to the Admiralty
Rules, requiring the concise
terms of the cause of action to be set
out in the summons, clearly intended an endorsement along the lines
of those contained in
Appendix 7. Insofar as an arrest was concerned,
the requirement of an affidavit to lead warrant was abolished and
replaced by the
certificate required under Admiralty Rule 4(3), which
rule has been unaltered since inception. The certificate is generally
to
much the same effect as the previous affidavit to lead
warrant.
[26]
[39]
The amendment to Admiralty Rule 2(1) by the
introduction of Rule 2(1)(
b
)
merely clarified what was required from a claimant in providing a
clear and concise statement of the nature of the claim. Sufficient

particulars had to be furnished to enable the defendant to identify
the facts and contentions on which the claim was based, but
no more
than that. The amendment was not directed at expanding the scope of
Rule 2(1)(
a
).
[40]
In England the requirements in regard to a
summons and the issue of a warrant of arrest are not significantly
different. The claim
form in an admiralty claim
in
rem
[27]
requires only 'brief details of the claim'. Particulars of claim may
be annexed or must follow within 75 days. The latter is what
usually
happens.
[28]
A claim for damages for breach of contract on behalf of eighteen
unidentified parties situated at eighteen different addresses
in
regard to unspecified goods carried on board a ship in 1982 was
rightly said to be insufficient to give brief details of the
claim as
required.
[29]
In another case it was said that the writ should give sufficient
information to enable the recipient to identify the occasion on
which
the breach of contract occurred, by identifying the voyage on which
on which the ship was engaged when the cargo was damaged
and the
approximate date of the voyage.
[30]
Neither judgment suggested any greater detail. Nor is the
declaration
[31]
in support of an application for the issue of a warrant of arrest any
more stringent. It requires only that the nature of the claim
be
stated.
[41]
Unlike Rule 17(2) of the Uniform Rules of
Court, which distinguishes between a combined summons and a simple
summons, the latter
being used when the claim is for a debt or
liquidated demand, Form 1 to the Admiralty Rules applies to all
claims, whether
liquid or unliquidated. Its terms are the same as
Form 9 in the First Schedule to the Uniform Rules. It requires
plaintiffs
to set out in 'concise terms' their cause of action. I do
not think that the requirement in Admiralty Rule 2(1)(
a
)
that the claim be clear materially adds to this. Clarity and
conciseness are not mutually exclusive. I share Cooke's view
[32]
that:
'
It
is difficult to think of a situation where a plaintiff sets out the
concise terms of the cause of action, but in doing so does
not
provide a clear statement of the nature of the claim in the summons.'
[42]
Admiralty Rule 2(2) should not be
overlooked. It requires a summons in admiralty to set forth the
matters in Uniform Rule 17(4).
Those are the identification of the
defendant – name, address, occupation and if being sued in a
representative capacity,
that capacity – and the full names,
gender (if a natural person), residence and, if suing in a
representative capacity, that
capacity of the plaintiff. Bearing in
mind that Admiralty Rule 2(3) permitted the plaintiff to be cited as
the owner or insurer
of a named ship or cargo, or the owner, master
and crew of a particular ship and Rule 2(4) permitted the property
being sued
in rem
to be named as the defendant, these are not onerous requirements.
[43]
A comparison of the Admiralty Rules with
the Uniform Rules is helpful. Long-standing authority holds that a
simple summons requires
no more of the plaintiff than a label for the
claim, giving a general indication of the claim the defendant has to
meet.
[33]
It does not require the particularity or precision of particulars of
claim. The similarity between the language of Admiralty Rule
2(1)(a)
and Form 1, and their counterparts in the Uniform Rules, suggests
that little more should be required in Admiralty. Under
the Uniform
Rules an unliquidated claim requires a summons to which are attached
particulars of claim. In admiralty no distinction
is drawn between a
liquidated and unliquidated claim and no pleadings are required
unless the action is opposed.
[34]
This is consistent with the earlier admiralty practice where
pleadings were only required if ordered by the court.
[35]
Provided the nature of the claim – not necessarily a complete
cause of action – appears from the summons that appears
to
suffice.
[44]
Did the introduction of Admiralty
Rule 2(1)(
b
)
alter this in the manner suggested in
The
Galaecia
? The rule's wording is
unfortunate, in that it borrowed from Uniform Rule 18(4), which deals
with the requirements of pleading
in a set of particulars of claim or
a declaration accompanying a combined summons. This led the high
court in this case to cite
the two judgments dealing with the
requirements of pleadings referred to earlier.
[36]
However, neither addressed the problem before it, not least because
they dealt with pleadings, not the contents of a summons, and
a
summons is not a pleading.
[37]
[45]
The first judgment,
Trope
,
is authority for the proposition that one pleads facts and not
conclusions of law, unless they flow from those facts. But, in
a
summons, the plaintiff is not required to plead its case. The rule
requires it to set out sufficient particulars to enable the
defendant
to identify the facts and contentions upon which the claim is based.
Neither the facts nor the contentions need be set
out in the summons
provided the defendant has sufficient particulars to identify them.
To hold otherwise would require the summons
to assume the form of
particulars of claim, which are not required unless the action is
defended. That seems, however, to have
been the consequence of
The
Galaecia
and the Directive, if this
case is any guide. The summons runs over six pages and twenty
paragraphs, with two annexures adding another
sixteen pages. That is
hardly consistent with a concise statement of the nature of the
claim.
[46]
Buchner
is a very confusing judgment. A summons in the
format prescribed in form 9 stated that the defendant owed the
plaintiff the amount
claimed 'pursuant to an agreement' concluded on
a specified date. The court held that it could not provide a proper
foundation
for a claim for summary judgment, because an affidavit
confirming the validity of the claim was ineffective unless the terms
of
the agreement giving rise to the defendant's liability had been
set out. In concluding that the 'label' was insufficient the court

relied upon the provisions of rule 18(4). This was incorrect as the
stage of pleadings had not been reached, so that rule was
inapplicable. Whether the result was correct, because the label was
insufficient to support a claim for summary judgment, is neither
here
nor there. It had no relevance to the issue in this case.
[47]
To sum up, Admiralty Rule 2(1)(
a
)
requires only a clear and concise statement of 'the nature of the
claim'. A clear and concise statement of the material facts
on which
the claim is based, with sufficient particulars to enable the other
party to reply thereto, is only required when it becomes
necessary to
file particulars of claim.
[38]
By way of example therefore, a statement that the claim is for damage
to cargo under a bill of lading; or for hire due under a

charterparty; or for salvage of a named vessel or cargo; or for
collision damage to a named vessel; satisfies that requirement.

Sub-rule (
b
)
requires that sufficient particulars of the claim are given to enable
the defendant to identify the facts and contentions on which
the
claim is based. In the examples given, that can be achieved by
identifying the bill of lading; identifying the charterparty;

identifying the vessels involved in the collision and saying when and
where it took place; or saying what was salvaged and whether
this was
in terms of a salvage agreement. This is slightly more detailed than
is necessary to satisfy the 'label' requirement of
a simple summons
under the Uniform Rules, but not much. Beyond the few pertinent facts
needed to satisfy this requirement, the
rule does not require the
facts upon which the claim is based to be furnished.
[48]
The aim of Admiralty Rule 2(1) is to ensure
that the registrar, the defendant, and the court seized of the matter
if it is not defended
and no pleadings were filed,
[39]
would know in broad terms what the claim was about. It was not
intended that the summons should be equivalent to a set of
particulars
of claim, which is what occurred in the present case.
That would fly in the face of Admiralty Rules 9(1) and (2), which
direct
that particulars of claim are only delivered when the action
is defended. It accords with the historic approach of admiralty cases

that they should be dealt with quickly,
[40]
inexpensively and relatively informally. This is reinforced by the
fact that in admiralty cases there are no requests for particulars

and no exceptions on the grounds that a pleading is vague and
embarrassing.
[49]
The approach in
The
Galaecia
and the Directive has
occasioned uncertainty in regard to the requirements of Admiralty
Rule 2(1)(
b
)
and led to precisely the situation that the rules were intended to
avoid, namely excessive and unnecessary prolixity in drafting

summonses. The Directive has created confusion in regard to the facts
needed to be set out in the summons. Equally unclear was
the
requirement to state the facts on which an associated ship arrest was
based.
Did this require the same, or
possibly more, detail than a set of particulars of claim? No-one
knew. And the consequence of this
uncertainty was the taking of
technical objections to arrests, such as the procedural objection in
this case that has now engaged
the attention of four courts.
[50]
The time has come to end this confusion and
to return admiralty practice to the simplicity the Admiralty Rules
intended it to have.
The Directive acted as a wholesome corrective to
some of the views expressed in
The
Galaecia
and is in general
unimpeachable. Regrettably the one sentence reading:
'It
is therefore necessary that the summons should contain a statement of
the
facts
upon which the claim is based and a
statement of the
facts
on the basis of which it is
stated that the ship is an associated ship'
has been the
source of confusion. A well-meaning attempt to convey to
practitioners that achieving what Rule 2(1) required necessitated

enough information to enable the defendant to identify in broad terms
the facts and contentions on which the claim was based, has
been
misconstrued. In the present case, a reference to and identification
of the two awards without more would have sufficed to
indicate the
nature of the claim. Instead, the Directive has been taken to
require, and been interpreted by two courts as requiring,
the kind of
detail that should appear in particulars of claim. The only way in
which to remedy this is to say that the final sentence
in para 2 of
the Directive is inconsistent with the requirements of the rule and
is no longer to be followed. There is no reason
to qualify any of the
other requirements of the Directive.
The
summons was not defective
[51]
The summons contained twelve paragraphs
dealing with the two arbitration awards, both of which were annexed.
The defendant therefore
knew the nature of the claim against it and
the facts on which it was based. It was only necessary for Galsworthy
to say that it
suffered damages as a consequence of the repudiation
of a charterparty and these damages had been quantified in the two
identified
arbitration awards in proceedings between Galsworthy and
Parakou Shipping. Everything else was surplusage.
[52]
As far as association was concerned, the
summons made repeated references to the repudiated charterparty
between Galsworthy and
Parakou Shipping. The pleaded reliance on
s 3(7)(
c
)
was unmistakeably based on this. Even assuming that para 17 of the
summons was a conclusion of law, it was one that followed inevitably

from the factual allegations concerning the charterparty. The summons
said that Parakou Shipping was the charterer of the
Jin
Kang
and referred to the statutory
provision deeming the charterer to be the owner. The basis for
reliance on s 3(7)(
c
)
was clear. The defendant was apprised of the facts and contentions on
which the claim that it was an associated ship was based.
It was not
entitled to anything more. Accordingly, the summons was not defective
on the basis advanced in the application to set
aside the arrest.
[53]
No attack was mounted on the
following allegation reading:
'The
Defendant is an associated ship of the mv "
Jin
Kang
" as
defined in terms of Section 3(6) and (7) of the Admiralty Act.
The Plaintiff's claims are
accordingly enforceable by an action in rem against the Defendant.'
For the
avoidance of doubt, it is desirable to deal with this. I do not
regard this as purely a conclusion of law. It is primarily
one of
fact, because it is necessarily implicit in it that PSS fitted one of
the three categories set out in s 3(7)(
a
)
of the AJRA.
[41]
All are concerned with control of the two vessels at the critical
times. Either the two vessels have the same owner; or the owner
of
the one and the person controlling the company owning the other are
the same; or the person controlling the two ship-owning
companies at
the statutorily relevant times are the same.
[42]
This is not an allegation that is in any way bewildering to the owner
of the arrested vessel, who will undoubtedly know whether
any of
these situations is in fact the case. The allegation did not come as
any surprise to PSS, as is apparent from the founding
affidavit in
the application to set aside the first arrest. Nonetheless it
studiously avoided dealing with the allegations of common
control
implicit in the summons and explicitly made in the founding affidavit
in support of the application for an order that the
registrar issue
the warrants of arrest. This allegation also satisfied the
requirements of Rule 2(1)(
b
).
[54]
For those reasons, even on the basis of the
requirements of the practice directive and
The
Galaecia
as construed in the courts
below, the summons was not defective.
Summary
on the procedural objection
[55]
It follows that for the reasons set
out in para 10 and amplified above, the summons was not defective and
the warrant of arrest
under which the
Pretty
Scene
was arrested was valid. Subject
to the arguments on the merits, which the judge did not decide, the
arrest should not have been
set aside at first instance and the full
court should not have dismissed the appeal against that order. I turn
then to deal with
the arguments on the merits.
Association
[56]
If its procedural objection was dismissed,
PSS contended that the
Pretty Scene
was
not in fact an associated ship in relation to the
Jin
Kang
. The focus of the objection was
the application of s 3(7)(
c
)
in relation to the
Jin Kang
.
In regard to the underlying claim based on repudiation of the charter
party – the conclusion of which was not disputed –
it
alleged that as Parakou Shipping had refused to take delivery of the
vessel it never became the charterer for the purposes of
s 3(7)(
c
).
As regards the claims under the arbitration awards it contended that
at the stage of those awards Parakou Shipping was no longer
the
charterer of the
Jin Kang
.
Lastly it contended that at the time the second arbitration award was
handed down Parakou Shipping had been placed in voluntary
liquidation
in Singapore and accordingly was no longer controlled by Mr Por Liu
but by the liquidators.
[57]
Each of these arguments depended upon the
proper construction of s 3(7)(
c
)
of the AJRA, but in order to appreciate the point it is necessary to
examine s 3(7)(
a
)
as well. The two sections read as follows:
'(7)
(a)
For
the purposes of subsection (6) an associated ship means a ship, other
than the ship in respect of which the maritime claim
arose—
(i)
owned, at the time when the action is commenced, by the person who
was the owner of the ship concerned at the time when the
maritime
claim arose; or
(ii)
owned, at the time when the action is commenced, by a person who
controlled the company which owned the ship concerned when
the
maritime claim arose; or;
(iii)
owned, at the time when the action is commenced, by a company which
is controlled by a person who owned the ship concerned,
or controlled
the company which owned the ship concerned, when the maritime claim
arose.
(
c
)
If at any time a ship was the subject of a charter-party the
charterer or subcharterer, as the case may be, shall for the purposes

of subsection (6) and this subsection be deemed to be the owner
of the ship concerned in respect of any relevant maritime
claim for
which the charterer or the subcharterer, and not the owner, is
alleged to be liable.’
[58]
Sub-section 3(7)(
a
)(iii)
was the provision relevant to Galsworthy's claims. The
Pretty
Scene
was owned at the time the action
was commenced by a company that was controlled by Parakou Tankers
Inc, which was in turn controlled
by its sole shareholder, Mr Por
Liu. Where the charterer is personally liable for the claim it is
deemed in terms of s 3(7)(
c
)
to be the owner of the ship concerned for the purposes of an
associated ship arrest. In order therefore for the
Pretty
Scene
to be an associated ship in
relation to the
Jin Kang
it
was necessary that Mr Por Liu should have controlled the charterer
Parakou Shipping at the time the claims arose. That is how
this court
explained the provisions of ss 3(7)(
a)
and (
c
) in
the
Silver Star
.
[43]
[59]
A new submission, advanced for the first
time in this court, was based on the judgment in the
Seaspan
Grouse
,
[44]
where it was held that the action commenced on the date of service,
rather than the date of issue, of the summons. It was submitted
that
no evidence had been led to show who controlled PSS at the time of
service of the summons. It will be recalled that the shares
in PSS
were wholly owned by Parakou Tankers Inc and when the order for
the arrest was sought it was alleged that Mr Por Liu
was the sole
shareholder in Parakou Tankers Inc. This was admitted in the
application to set aside the arrest. The attorney who
deposed to the
founding affidavit said that his instructions came
inter
alia
from Mr Por Liu, 'the Director and
President' of PSS. There was no suggestion that his position in
regard to either Parakou Tankers
Inc or PSS had altered in the
interim. Had that been alleged Galsworthy would have been entitled to
respond to it. There was no
merit in this point.
The
original claim
[60]
PSS contended in regard to the original
claim based on the repudiation of the charterparty that Parakou
Shipping never became the
charterer of the
Jin
Kang
. It submitted that for this reason
the deeming provision could not be invoked against it. The difficulty
with this submission was
that in the First Final Arbitration Award
dated 31 August 2010 the appointed arbitrators declared:
‘…
that
the parties entered into a legally binding charter party as a result
of the ratification by the Charterers of the terms set
out in the
recapitulation messages of 17 and 18 June … and that the
Charterers are accordingly in repudiatory breach of
charter.’
The
finding that there was a binding charterparty binds PSS. Until the
repudiation was accepted that charterparty existed, albeit
that
Parakou Shipping was in repudiatory breach thereof. While technically
its claim for damages would only have arisen at the
moment the
repudiation was accepted, in the
Cape
Courage
,
[45]
the correctness of which was not challenged, it was said:
'…
when a claim has 'originated' and enough factors are present to
indicate that the owner or controller of the ship concerned
at that
time (or those for whose actions or omissions it is liable) has
'offended', … another ship owned or controlled by
that person
when the claim is enforced may be arrested in respect of the claim.
Damage resulting from the offending actions or
omissions by the owner
or controller (or for which it is liable) may not yet have been
suffered but if it is clear that it will
in due course be suffered, I
think that it is not stretching language to say that the claim has
"arisen".'
This
broad, one might say practical, approach to when a claim arises
suffices to dispose of the objection insofar as it related
to the
original claim for damages.
[61]
In its heads of argument in this court and
before the full court, PSS advanced an alternative argument that the
original claim had
been extinguished as a matter of English law in
consequence of the two arbitration awards. The contention that
English law applied
relied on the choice of law clause in the
charterparty and the provisions of s 6(1) of the AJRA. The
proposition that the
claim had been extinguished by the award was
based on a passage from the speech of Lord Goff of Chieveley in
The
Indian Grace (No 1).
[46]
[62]
As to the first of these, the arbitration
clause in the charterparty provided that 'English law shall apply.'
PSS argued that this
clause was effective by virtue of s 6(5) of
the AJRA and operated to make s 34 of the English Civil
Jurisdiction and
Judgments Act 1982 applicable to the awards, thereby
resulting in the original claim becoming merged with the arbitration
awards.
I am not persuaded that this proposition is correct. A choice
of law clause in a charterparty serves to identify the legal system

that will apply to the dispute between the parties. It does not
ordinarily serve to identify the law governing the conduct of the

arbitration proceedings or the consequences of an arbitration award.
That is determined by the law of the seat of the arbitration,
in this
case, England, where the Arbitration Act 1996 (1996, c 23) would
apply. English law would have applied to the resolution
of the
charterparty dispute even if the seat of the arbitration had been
Singapore or South Africa. But that would not have brought
the
provisions of either the English Arbitration Act or the Civil
Jurisdiction and Judgments Act into play. The argument accordingly

stumbles at the first hurdle. But even if it did not, it would fall
at the second.
[63]
The passage from the speech of Lord Goff
was contrasting a discussion on the principles of
res
judicata
and issue estoppel in English
law, with the doctrine of merger. It reads:
'
The principle, which is sometimes called the doctrine of merger in
judgment, is that a person—
"in
whose favour an English judicial tribunal of competent jurisdiction
has pronounced a final judgment … is precluded
from afterwards
recovering before any English tribunal a second judgment for the same
civil relief on the same cause of action
…"
(See
Spencer
Bower and Turner on the Doctrine of Res Judicata
(2nd edn,
1969) p 355, para 423.)
The
basis of the principle is that the cause of action, having become
merged in the judgment, ceases to exist, as is expressed in
the Latin
maxim transit in rem judicatam'
After
explaining that the principle did not apply to a foreign judgment,
although it could give rise to both
res
judicata
and
issue estoppel, Lord Goff went on to say:
'
It
was to remove this anomaly that s 34 of the Civil Jurisdiction
and Judgments Act 1982 was enacted. This provides:
"No
proceedings may be brought by a person in England and Wales or
Northern Ireland on a cause of action in respect of which
a judgment
has been given in his favour in proceedings between the same parties,
or their privies, in a court in another part of
the United Kingdom or
in a court of an overseas country, unless that judgment is not
enforceable or entitled to recognition in
England and Wales or, as
the case may be, in Northern Ireland."'
[64]
Two points emerge from this passage. The
first is that the principle of merger that concerned Lord Goff
related to the effect of
a judgment by an English court, not an
arbitration. The second is that s 34 applies to judgments of
foreign courts not arbitration
awards. This disposed of the
alternative argument.
[65]
For the sake of completeness an argument
that an English arbitration award had a similar effect to the
doctrine of merger in judgment
was advanced and rejected in the
Silver Star
.
[47]
Counsel did not submit that we should depart from that decision and,
having reviewed what I said there, I can see no reason to
do so. The
argument that the claim for damages for repudiation of the
charterparty no longer exists must fail.
The
arbitration awards
[66]
The
Silver
Star
[48]
held that the intervention of an arbitration award did not mean that
the ship in respect of which the claim had originally arisen
was no
longer the ship concerned for the purposes of an arrest. Accordingly,
the
Jin Kang
is
the ship concerned in determining whether the
Pretty
Scene
is an associated ship in relation
to it. But Parakou Shipping was no longer the charterer of the
Jin
Kang
when the two arbitration awards
were made. PSS argued that for this reason Parakou Shipping's deemed
ownership of the
Jin Kang
had
ceased, so that it was not the owner of the ship concerned when the
claims arose.
[67]
When does the claim on an arbitration award
arise? In its heads of argument PSS submitted that the AJRA
contemplates that an arbitration
award is a 'self-standing' claim not
dependent upon the merits of the underlying claim. But that does not
mean that the claim on
the arbitration award can be detached from the
underlying claim. In the
Yu
Long
Shan
,
[49]
Marais
JA described a claim based on an arbitration award as an entirely
derivative cause of action. By that he meant that
there must be an
underlying claim that is essential to the existence of an award. This
is also apparent from sub-sec (
aa
)
of the definition of a maritime claim
[50]
which refers to a claim for, arising out of or relating to:
'any
judgment or arbitration award
relating to a maritime claim
,
whether given or made in the Republic or elsewhere'. (Emphasis
added.)
An
arbitration award alone is not a maritime claim. Only one that has
the quality of 'relating to a maritime claim' is a maritime
claim. It
does not suffice to allege that an arbitration award has been made.
It is necessary to plead and prove that it was an
award in relation
to a maritime claim. The two are inextricably tied together.
The
arbitration award is the determination of the existence and extent of
the pre-existing liability in respect of that maritime
claim.
It is a distinct claim in the sense that its fate
is not dependent on the merits of the underlying maritime claim and
proof of such
a claim requires proof of different elements to the
original claim,
[51]
but in considering when that claim arises for the purposes of an
associated ship arrest it is necessary to have regard to the
underlying claim.
[68]
The
claim on which the award is based must necessarily have arisen before
the award was made and the award refers back to the original
claim.
If one applies the logic of the
Cape
Courage
in
that situation, then the claim on the award arises at the same time
as the original claim on which the award is based. That conclusion

disposes of the objections in relation to the awards.
[69]
There is, however, an even stronger
reason for saying that the objection is unsound. It flows from the
language of s 3(7)(
c
)
itself and the scope of its deeming provision. The charterer is
deemed to be the owner of the ship concerned 'in respect of any

relevant maritime claim for which the charterer and not the owner is
alleged to be liable'. The ship concerned is the
Jin
Kang
. The relevant maritime claims are,
in the first instance the underlying claim giving rise to the awards,
and secondly the claims
based on the awards, of which the underlying
claim is an essential component. The charterer is the person
personally liable for
those claims. Section 3(7)
(c)
says that, for the purposes of an
associated ship arrest in relation to those claims, the charterer is
deemed to be the owner of
the ship concerned. PSS submits that this
is irrelevant because it was not the charterer when the arbitration
awards were made.
But the deeming is for the purpose of s 3(7)(
a
),
and the sole concern of s 3(7)(
a
)
is ownership of the ship concerned at the time the maritime claim
arose. It follows that the deeming must be a deeming of ownership

when the claim arose, because no other situation is relevant under
s 3(7)(
a
).
On PSS's argument, the deeming would still exist, but it would be a
'deeming in the air', because of an unexpressed qualification

attaching to it. There is no justification for that construction in
the language of the section.
[70]
The opening words of s 3(7)(
c
),
namely, 'if at any time a ship was the subject of a charterparty',
reinforce this. PSS's contention would add a qualification
to these
words, namely: 'If at the time the claim arose a ship was the subject
of a charterparty'. Not only is such reading-in
not justified on
ordinary principles of interpretation, but it would undermine the
purpose of introducing the deeming, namely to
make a vessel under the
control of the erstwhile charterer liable to be arrested as an
associated ship in relation to a claim against
the charterer.
[52]
The critical feature for the purposes of the deeming is that the ship
concerned was under charter and the claim is one for which
the
charterer is liable. It is not concerned with whether the claim arose
while the charterparty remained extant.
[53]
[71]
When the claim lies against the owner of
the vessel, the fact that their ownership has terminated
subsequently, or even that the
vessel no longer exists, is neither
here nor there. They were the owner at the time the claim arose and
that is an end to the matter.
The purpose of the deeming provision is
to place the charterer who is liable for the claim in the same
position as the owner. The
vessel was under charter and the
charterer, and not the owner, was liable for certain claims arising
in relation to the vessel.
Accordingly, for the purpose of
identifying an associated ship that may be pursued in respect of that
claim they will be deemed
to be the owner of the ship when the claim
arose. PSS's second argument cannot be sustained.
The
liquidation
[72]
In regard to the second arbitration award
PSS had a further string to its bow. It arose from the fact that
before the second arbitration
award was handed down Parakou Shipping
had been placed in voluntary winding up in terms of the Singapore
Companies Act (Cap 50,
Revised 2006). It was submitted that the
effect of this was that at the time the claim arose Parakou Shipping
was no longer controlled
by Mr Por Liu, but by the liquidators.
[73]
The fallacy in this contention is that it
assumes that the claim under the second arbitration award arose when
the award was made.
This seeks to separate it from the arbitration
process that led to the first award. Such separation is
impermissible. There was
only one arbitration process arising out of
one referral under the charterparty. At the end of the initial
hearing the first award
was made and the question of further damages
was reserved for future determination.
[54]
Accordingly the claim being adjudicated in the second award was the
claim that had been the subject of the initial reference and
the
first award. That claim arose at the same time as the claim in the
first award. For the reasons given in relation to the first
award
this objection too cannot be sustained.
The
additional arguments
[74]
PSS contended in the application to set
aside the first arrest that the original claim for damages for
repudiation of the charterparty
had prescribed in terms of the
English Limitation Act 1980. I do not think it necessary to canvass
the merits of this argument.
On its own it is not a ground upon which
the arrest could be set aside. Prescription, or limitation as it is
referred to in some
other jurisdictions, usually requires a careful
consideration of the facts surrounding the claimant's endeavours to
pursue a claim.
The original claim related to the repudiation of a
charterparty concluded between companies operationally based in Hong
Kong and
Singapore. Whether the choice of English law to govern the
contract imports the English Limitation Act is by no means clear. It

is one thing to say that the claim could not be pursued in an English
court, but all that the statute appears to do is bar, not
extinguish,
the claim. We received no argument on why a South African court would
be bound by an English statute governing limitation,
if our own law
would not regard the claim as prescribed. If limitation is viewed as
a procedural question, the ordinary principle
that the procedural
rules of other jurisdictions are not enforced by our courts would
come into play. It seems to me that the point
is one that can only be
resolved at trial on a full conspectus of the facts. It is a defence
on the merits and does not form a
basis for setting aside the arrest.
[75]
Many of these considerations point to the
same conclusion in relation to the further contention that the claim
for damages is
res judicata
in
consequence of the arbitration awards. In any event, if that is so,
it is unclear how it assists PSS or why it should lead to
the arrest
being set aside. If anything, it would prevent PSS from disputing
liability for the claim.
Conclusion
on the first arrest
[76]
For the reasons set out above the
procedural objection that formed the main ground of objection to the
first arrest should not have
been upheld and the arguments
challenging the association on its merits were without merit. The
other two points raised in the
affidavit in support of the
application to set aside the arrest did not, whatever their merits,
suffice to justify the setting
aside of the arrest.
[77]
It follows that on every ground
advanced in the papers, whether or not dealt with in the judgment,
the arrest of the
Pretty Scene
should
not have been set aside. Nor should the judgment have been upheld on
appeal by the full court. However, one cannot, without
more, conclude
that the appeal in that regard must be upheld.
[78]
The reason for this slightly
surprising statement is that the second arrest occurred because it
was correctly anticipated that the
first arrest would be set aside.
The application brought to set aside that arrest raised several
additional issues that had not
been part of the argument in the first
case and the full court reached conclusions on them in upholding the
appeal against the
judgment of Henriques J. Some of these new issues,
albeit not raised in the first application, overlap with the issues
in that
application. In this appeal no clear distinction has been
drawn between the first and the second arrest in advancing the
arguments
and it has been submitted indiscriminately that both
appeals should fail on all the grounds argued. It was correctly
submitted
that PSS was entitled to advance any legal argument open to
it on the papers to sustain the judgment of the full court in
relation
to both appeals.
[79]
This gives rise to the curious situation
that on the grounds advanced in the application to set aside the
arrest and the arguments
advanced before Vahed J the arrest should
have been sustained. Had that occurred there would have been no call
to maintain the
second arrest obtained two days before his judgment.
The certificate in terms of Admiralty Rule 4(3) stated expressly that
Galsworthy
would withdraw the second action if the first arrest was
sustained and its existing action were held to be valid. In that
event,
the new arguments that were advanced in the application to set
aside the second arrest and canvassed before the full court and this

court, would probably never have seen the light of day. However, it
is necessary, with as little repetition as possible, to deal
with
these arguments, and any that arose specifically in relation to the
second arrest. This will affect the order we make and
possibly also
questions of costs.  I turn then to deal with the second arrest.
THE SECOND
ARREST
[80]
Galsworthy applied to the registrar for the
issue of a warrant of arrest and this was granted without the matter
being referred
to a judge. At the outset of her judgment Henriques J
summarised the grounds upon which PSS applied to set aside the
arrest. The
only grounds not common to the application to set aside
the first arrest were:
(a)
that the second arrest was an abuse of process and both the issue of
the fresh summons and the application
for the issue of the warrant of
arrest should have been referred to a judge;
(b)
Section 299(1) of the Singaporean Companies Act imposed a moratorium
on the enforcement of Galsworthy's
claims;
(c)
In terms of ss 3(6) and (8) of the AJRA it was not permissible
for Galsworthy to arrest the
Pretty Scene
for the same debt,
while the original arrest was still in place.
Abuse of
process
[81]
The basis for this contention was set out
in the founding affidavit in the application to set aside the second
arrest. It claimed
that it was prima facie vexatious to issue and
serve a second summons for the same relief on the same cause of
action while the
first action was still pending. This was
particularly so given the nature of the action. Furthermore it was
deliberately concealed
from Vahed J and from PSS so as to constitute
a material non-disclosure. Finally, it was said that Galsworthy
already had sufficient
security for its claims as a result of steps
taken by the liquidators of Parakou Shipping in Singapore resulting
in security in
excess of its claims being provided.
[82]
The underlying premise of this was that it
was an abuse of process for Galsworthy to take steps to protect its
position in the event
of the first arrest being set aside. It was not
suggested that there was any legal bar to it seeking a second arrest.
The permissibility
of a second arrest in those circumstances has been
recognised since 1842.
[55]
The cases where it was held that a duplication of proceedings
constituted an abuse of process, were cases in which an issue had

been fully litigated before one court and the losing party then
sought to relitigate them in other proceedings.
[56]
That was not the situation here. The second action was instituted in
anticipation of the first arrest being set aside. The warrant
was
only served two days before Vahed J delivered his judgment. There was
an undertaking to withdraw the second arrest and summons
if the first
was held to be valid. None of that is indicative of an abuse. The
defence of
lis alibi pendens
was available to PSS if Galsworthy did not fulfil its undertaking.
There was no risk of double security having to be furnished.
There
was no ulterior purpose underlying the arrest.
[57]
It was being used for its intended purpose of commencing an action
in
rem
.
[83]
The complaint that Vahed J was not informed
of the second arrest was without substance. He was not concerned with
what Galsworthy
intended to do in anticipation, or in consequence, of
his judgment. It could not have affected the judgment. The
proceedings before
him were complete, save for the issue of the
judgment. If anything, approaching him in relation to the second
arrest might have
been seen as an attempt to influence or interfere
with his judgment. There was no need to refer the application for the
issue of
the summons and warrant to a judge. Had it been referred,
the fact that an arrest already existed and that the application was
brought in anticipation of that being set aside, would not have
provided grounds for refusing to instruct the registrar to issue
the
summons – its perceived flaws having been remedied – and
the warrant of arrest.
[84]
An allegation of abuse of process is not
lightly upheld,
[58]
especially given the constitutionally protected right of access to
courts. The only point raised in this regard that might give
pause
was the allegation that Galsworthy already held sufficient security
for its claims. It transpired from its answering affidavit
that the
allegation was not correct. Arising out of
Mareva
injunctions, security had been given to
the liquidators of Parakou Shipping in Singapore in respect of claims
against its former
directors and associated entities. It was not
security available to Galsworthy to execute on the arbitration
awards. Any advantage
accruing to it was indirect and dependent on
the outcome of that litigation and the execution on that security by
the liquidators.
In its only reference to the abuse of process
argument the full court said that this security provided security for
the claims
of all the creditors including Galsworthy. That was
incorrect as was the statement that it sufficed to cover all the
claims by
Galsworthy. For those reasons the abuse of process argument
was correctly rejected by Henriques J.
The
moratorium
[85]
It is unclear whether the full court upheld
this argument. It depended on the application of a moratorium granted
to Parakou Shipping
under Singaporean law having worldwide effect.
Ordinarily statutes have territorial effect only and the statutes of
one country
do not apply elsewhere in the world.
[59]
Section 299 has no binding effect in South Africa unless the
liquidators in Singapore have sought and been granted recognition
in
this country on terms that would impose a moratorium not only in
respect of direct claims against Parakou Shipping, but also
claims
against vessels owned by other companies and arrested as associated
ships.
[60]
That is not the case and there is no merit in this point.
Sections
3(6) and (8) of the AJRA.
[86]
Section 3(8) of the AJRA provides that:
'
Property
shall not be arrested and security therefor shall not be given more
than once in respect of the same maritime claim by
the same
claimant.'
The
wording of the section is adapted from the opening words of Article
3(3) of the Arrest Convention, 1952,
[61]
which reads:
'A ship shall
not be arrested, nor shall bail or other security be given more than
once in any one or more of the jurisdictions
of any of the
Contracting States in respect of the same maritime claim by the same
claimant: and, if a ship has been arrested in
any of such
jurisdictions, or bail or other security has been given in such
jurisdiction either to release the ship or to avoid
a threatened
arrest, any subsequent arrest of the ship or of any ship in the same
ownership by the same claimant for the maritime
claim shall be set
aside, and the ship released by the Court or other appropriate
judicial authority of that State, unless the
claimant can satisfy the
Court or other appropriate judicial authority that the bail or other
security had been finally  released
before the subsequent arrest
or that there is other good cause for maintaining that arrest.'
The context of this
provision of the Convention, which was an agreement between States,
was the possibility of multiple arrests
in multiple different
countries arising out of the same maritime claim. In the United
Kingdom and jurisdictions applying English
maritime law an action
in
rem
could only be pursued against the ship in respect of which
the maritime claim arose. In other countries any property could be
attached
provided it was owned by the person liable on the claim.
Article 3(1) was a compromise between these two situations in
permitting
the arrest not only of the particular ship in respect of
which the maritime claim arose, but also any other ship owned by the
same
person as the owner of the particular ship. Article 3(3) was
directed at the possibility of multiple arrests in different
countries
with security having to be furnished several times in
respect of the same claim.
[62]
[87]
The background to s 3(8) of the AJRA
was fundamentally different from that of the Arrest Convention. Prior
to the enactment
of the AJRA, if a ship was arrested
in
rem
, either the ship would stand as
security, or any bail furnished to secure its release would stand in
its stead, precluding a further
arrest.
[63]
Similarly once a vessel had been attached
ad
fundandam et confirmandam jurisdictionem
either
it remained under attachment, or security would be furnished for its
release. Save in unusual circumstances,
[64]
a second attachment was impermissible. When the AJRA was enacted s
3(8) stated the general rule in admiralty, but made it subject
to the
power of the court to order increased security and authorise the
arrest of property under s 5(2)(
d
).
[65]
[88]
Construing s 3(8) as if it were a
statutory enactment of Article 3(3) of the Arrest Convention in South
Africa is therefore
inappropriate. South Africa is not a party to the
Convention and the extensive list of maritime claims in the AJRA, as
well as
the associated ship arrest provisions, would preclude our
membership. Section 3(8)'s sole purpose is to govern arrests in South

Africa under the AJRA. If proceedings have been brought elsewhere a
disaffected defendant may raise the defence of
lis
alibi pendens
. If vessels have been
arrested, or security furnished, elsewhere, this must be disclosed in
the certificate furnished by the attorney
for the arresting party in
terms of Admiralty Rule 4(3) and may affect the terms of the arrest
and the security that may be obtained
in that way. It will also be
relevant to the exercise by the court of its powers under s 5(2)
of the AJRA in regard to the
terms of any arrest, and s 7(1) of
the AJRA to decline jurisdiction or stay proceedings.
[89]
This brief exposition of the purpose
and effect of s 3(8) is necessitated by the fact that in
argument before Henriques J and
the full court reliance was placed
upon the decision in the
Fortune 22
[66]
in support of PSS's arguments. While this is not the occasion to deal
with that court's approach to s 3(6), which was mentioned
in the
high court, but formed no part of the argument in the full court or
before us, it is right to say that in two respects the
Fortune
22
does not correctly reflect the law
in relation to s 3(8) and was in consequence wrongly decided.
First, it held that English
law applied to the application of the
section, by virtue of s 6(1) of the AJRA.
[67]
Second, it held, on the basis of the international nature of maritime
disputes, that the section extended to arrests made in jurisdictions

other than South Africa.
[68]
Neither proposition is correct. The interpretation of s 3(8) is
not a matter of English law, but one of the proper construction
of a
South African statute, by a conventional process of statutory
interpretation in terms of South African law.
[69]
Second, the AJRA is concerned with the jurisdiction and procedure to
be applied in admiralty cases in South Africa. It is a piece
of
domestic legislation and there is nothing to indicate that its
purpose in s 3(8) was to extend its application to arrests

occurring in other jurisdictions contrary to the general rule that
statutes do not have extra-territorial effect.
[70]
[90]
Henriques
J correctly approached s 3(8) on the basis outlined above. She
held that the effect of this section is that a second
arrest of the
same ship in relation to the same claim is only prohibited where
security has been given for that claim. The section
prohibits the
arrest of the same property more than once. It is only when there has
been an arrest of specific property and security
has been given
'therefor' that the prohibition applies.
[71]
This accords with the decision in
Great
River Shipping
.
[72]
The only difference between that case and this is that there the
second arrest was obtained after the first arrest had been set
aside,
but in my view that is a difference of no moment.
[91]
The
section provides that if particular property has been arrested and
security given to secure its release, it may not be arrested
again in
respect of the same maritime claim by the same claimant. If the
security is insufficient the remedy is to be found in
s 5(2)(
dA
)
of the AJRA. But the prohibition in the section is narrow. It does
not operate to prevent the arrest of other property in respect
of the
same maritime claim by the same claimant, even where security has
been furnished in relation to the property first arrested.
T
he
decision to the contrary in
MV La
Pampa
[73]
is plainly wrong on this point.
Where there is a second arrest the only possible issue is whether
that is an abuse of process or
vexatious rendering the arrest liable
to be set aside on that ground.
Conclusion
on the second arrest
[92]
For those reasons Henriques J
correctly dismissed the application to set aside the second arrest.
The primary ground upon which
the full court overturned her decision
was that the
Pretty Scene
was not an associated ship in relation to the
Jin
Kang
. That subject has been fully
addressed in dealing with the first arrest and it is unnecessary to
explore it further. The full court
erred in upholding the appeal
against the judgment of Henriques J. That leaves only the question of
the counter-application.
The
counter-application
[93]
The counter-application was based on
ss 5(2)(
b
)
and (
c
) of
the AJRA and security was sought for a claim for wrongful arrest in
terms of s 5(4) of the AJRA. Two grounds were advanced
for
saying that Galsworthy had arrested the
Pretty
Scene
without reasonable and probable
cause and requiring excessive security. The first was the allegation
that Galsworthy was pursuing
the arrest as a tactical ploy and not
seeking to recover payment through the court process. In other words,
it was contended that
the arrests were an abuse of the process of the
court. The second was that the claim for security was excessive
because of the
first arrest – which had been set aside –
and because of the security allegedly held by Galsworthy in
Singapore.
[94]
These allegations were disputed. Galsworthy
maintained that its sole purpose in pursuing the arrests was to
obtain a judgment and
payment of what was owing to it. As discussed
in para 84 it transpired that Galsworthy held no direct security for
its claims,
but was dependent on the liquidators of Parakou Shipping
succeeding in their actions against former directors and being able
to
realise from the security they held amounts sufficient to pay
Galsworthy's claims. A creditor who arrests or attaches property to

pursue a claim in terms of the AJRA is entitled to security (possibly
restricted to the value of the property) up to the amount
of its
reasonably arguable best case.
[74]
That means that Galsworthy was entitled to security for the full
amounts owing to it under the arbitration awards, together with

interest and costs. There is nothing to sustain the contention that
its requirements for security were excessive.
[95]
In upholding the counter-application the
full court commenced by asking, but not answering, the question:
'When do the multiple
arrests give rise to an action against
Galsworthy?' After referring to s 3(8) it arrived at the
conclusion that:
'Galsworthy
has pursued its claim against Parakou Shipping in Singapore and there
was no need for it to pursue the same claim in
South Africa. …
This was a classic case of pursuing the same claims in two different
jurisdictions. … I find the
arrests to have been wrongful. It
is my finding that Galsworthy was not entitled to pursue any claim
against the Pretty Scene parties.'
It seems that
the full court confused the
in rem
proceedings by Galsworthy
in South Africa, with the proceedings by Parakou Shipping through its
liquidators against its previous
directors. It was not correct to say
that Galsworthy had brought proceedings against Parakou Shipping in
Singapore. There was no
question of it having pursued the same claim
in different jurisdictions.
[96]
Not surprisingly there was no
attempt to support these conclusions in PSS's heads of argument. The
argument advanced in support
of the order for security was the one
advanced in the application. For the reasons I have given it should
not have succeeded.
Result
[97]
In the circumstances, the full court erred
in dismissing the appeal against Vahed J's judgment and upholding the
appeal against
the judgment of Henriques J. The appropriate relief is
simply to reverse this situation. The practical implications of that
in
the light of the sale of the
Pretty
Scene
will no doubt be resolved between
the parties.
[98]
I make the following order:
1
The appeal succeeds with costs.
2
The order of the full court of the KwaZulu-Natal Division in the
appeal in case no A23/2015
is set aside and replaced by the following
order:
'(a)
The appeal is upheld with costs, such costs to include the costs of
two counsel where two counsel were
employed.
(b) The order
of the high court is set aside and replaced by the following order:
'The
application to set aside the arrest of the
Pretty Scene
is
dismissed with costs.'
3
The order of the full court of the KwaZulu-Natal Division in the
appeal in case no A65/2016
is set aside and replaced by the following
order:
'The appeal
is dismissed with costs.'
M J D WALLIS
JUDGE OF APPEAL
Appearances
For appellant:
M Wragge SC
Instructed by:
Shepstone & Wylie, Durban;
Matsepes Inc, Bloemfontein
For respondent:
G D Harpur SC
Instructed by:
Norton Rose Fulbright South Africa Inc,
Durban;
Webbers, Bloemfontein.
[1]
Mediterranean Shipping Co v Speedwell Shipping
Co Ltd and Another
1986 (4) SA 329
(D).
[2]
Merak S, The: Sea Melody Enterprises SA v
Bulktrans (Europe) Corporation
2002
(4) SA 273 (SCA).
[3]
The application came before Mnguni J under Case
No A20/2015.
[4]
The Galaecia: Vidal Armadores SA v Thalass
Export Co Ltd
SCOSA D 252 (D). SCOSA
is an acronym for Shipping Cases of South Africa a private
publication of maritime judgments. The judgment
is on the Maritime
Law Association of South Africa's website
http://www.mlasa.co.za/wp-content/uploads/downloads/2010/02/Durban%20Division/2006/MFV%20Galaecia%20part%201.pdf.
[5]
Sentrachem Ltd v Prinsloo
1997
(2) SA 1
(A) at 15J-16D.
[6]
Uniform Rule 28. See the discussion on this rule
in Van Loggerenberg et al
Erasmus
Superior Court Practice.
[7]
Transol Bunker BV v MV Andrico Unity and
Others; Grecian-Mar SRL v MV Andrico Unity and Others
1987
(3) SA 794
(C) at 798D-800E, confirmed on appeal in
Transol
Bunker BV v MV Andrico Unity and Others; Grecian-Mar SRL v MV
Andrico Unity and Others
1989 (4) SA
325 (A).
[8]
The full court mistakenly thought that this
affidavit may not have been before Mnguni J because it bore a
different case number
to the summons. It overlooked that it bore the
case number of the application that served before Mnguni J.
[9]
Admiralty Rule 4(2)
(a)
.
[10]
Colonial Courts of Admiralty Act of 1890 (53 &
54 Vic. C27).
[11]
See the oft-quoted remarks of Didcott J in
Katagum Wholesalers Commodities Co Ltd
v The MV Paz
1984 (3) SA 261
(D) at
269H-270A in regard to the serious consequences of arresting a ship.
It must be borne in mind that this was a minority
judgment and its
strictures in regard to procedures and the strength of the case that
an applicant has to make were not shared
by the majority and have
not been endorsed in later decisions.
[12]
Admiralty Rule 4(2)
(b)
.
[13]
Admiralty Rule 4(3).
[14]
Op cit, fn 4.
[15]
Darryl Cooke 'The
Galaecia
'
(2007) 124
SALJ
247
at 251. The representatives of the MLA were D J Shaw QC
and M J D Wallis SC. We were informed from the Bar by Mr Wragge
SC,
who appeared for Galsworthy, that there is no equivalent practice
directive in either the Western Cape or Eastern Cape divisions
of
the high court. Cooke's criticism was described as 'well-directed'
in Gys Hofmeyr
Admiralty Jurisdiction
Law and Practice in South Africa
(2d,
2012) at 157, fn 291.
[16]
The owner was represented by senior counsel
experienced in maritime matters.
[17]
The full court erred in thinking otherwise.
[18]
This was a mistake as at most the summons
contained only two allegations that might be characterised as
conclusions of law. It
seems that the judge had in mind the
certificate by the attorney under Admiralty Rule 4(3), which
referred to three separate
provisions of the AJRA.
[19]
The court referred to
SY Sandokan:
Owner of the SY Sandokan v Liverpool and London Steamship Protection
and Indemnity Association Ltd
2001 (3)
SA 824
(D) at 827D-828J, and the explanation for admitting a fourth
set of affidavits, to enable the arresting party to respond to the

allegations by the owner of the arrested vessel. It did not suggest
that this was problematic. It is by no means unusual for
this to be
done in applications to set aside arrests and attachments.
[20]
Section 173 of the Constitution.
[21]
The Heavy Metal: Belfry Marine Ltd v Palm Base
Maritime SDN BHD
[1999] ZASCA 44; 1999
(3) SA 1083 (SCA).
[22]
Trope and others v South African Reserve Bank
[1993] ZASCA 54
;
1993 (3) SA 264
(A)(
Trope
)
at 273A-B and
Buchner and Another v
Johannesburg Consolidated Investment Co Ltd
(
Buchner
)
1995 (1) SA 215
(T) at 216G-H.
[23]
For some reason it went on to express doubts as
to whether that was factually the case, on the basis that the case
number of the
summons differed from that on the affidavit placed
before the judge in the initial application. This was incorrect as
the full
court overlooked the fact that this application bore the
case number that it said gave rise to a doubt.
[24]
Windrush Intercontinental SA and Another v
UACC Bergshav Tankers AS
[2016] ZASCA
199; 2017 (30 SA 1 (SCA).
[25]
MV Cape Courage: Bulkship Union SA v Quannas
Shipping Co Ltd and Another
[2009]
ZASCA 74; 2010 (10 SA 53 (SCA).
[26]
Shaw,
Admiralty
Jurisdiction and Practice in South Africa
107.
[27]
Practice Direction 61.3.1 requiring the claim to
be in Form ADM 1.
[28]
Nigel Meeson and John A Kimbell
Admiralty
Jurisdiction and Practice
(4d, 2011)
para 4.7, p 144.
[29]
The "Tuyuti"
[1984]
2 Lloyd's Rep 51.
[30]
The "Jangmi"
[1988]
2 Lloyd's Rep 462.
[31]
Practice Direction 61.5.1 (2) and Form ADM 5.
[32]
Op cit, fn 15, at 252.
[33]
See the general discussion in
Globe
Engineering Works Ltd v Ornelas Fishing Co (Pty) Ltd
1983
(2) SA 95 (C).
[34]
Admiralty Rule 9(1).
[35]
Incorporated General Insurance Ltd v Shooter
t/a Shooter's Fisheries
1987 (1) SA
842
(AD) was conducted under the AJRA without pleadings under the
rules applicable before the Admiralty Rules were promulgated.
[36]
Op cit, fn 29 and 30.
[37]
Icebreakers No 83 (Pty) Ltd v Medicross Health
Care Group (Pty) Ltd
2011 (5) SA 130
(D), followed in the cases cited in
ABSA
Bank Ltd v Janse van Rensburg and another
2013 (5) SA 173
(WCC) para 5.
[38]
Admiralty Rule 9(3)(
a
).
[39]
Admiralty Rule 9(1).
[40]
Between tide and tide was the historical
description.
[41]
Owners of the MV Silver Star v Hilane Ltd
[2014] ZASCA 194
;
2015 (2) SA 331
(SCA) para 14.
[42]
It would be unusual, but there is no reason in
principle why in a pleading the three possibilities could not be
pleaded in the
alternative.
[43]
Op cit, fn 41
,
paras 14 and 16.
[44]
The Seaspan Grouse: Seaspan Holdco 1 Ltd v MS
Mare Traveller Schiffahrts GmbH
[2019]
ZASCA 2; 2019 (4) SA 483 (SCA).
[45]
MV Cape Courage: Bulkship Union SA v Quannas
Shipping Co Ltd and Another
[2009]
ZASCA 74
;
2010 (1) SA 53
(SCA) para 23.
[46]
The Indian Endurance: Republic of India and
others v India Steamship Co Ltd
[1993]
1 All ER 998
(HL) at 1003-1004. It is known as
The
Indian Grace
because that was the name
of the ship on which the damaged cargo giving rise to the claim was
carried.
[47]
Op cit, fn 41, paras 21-32.
[48]
Op cit, fn 41, para 32.
[49]
MV Yu Long Shan: Drybulk SA v MV Yu Long Shan
1998 (1) SA 646
(SCA) at 653F-H. See
also
MV Ivory Tirupati: MV Ivory
Tirupati v Badan Urusan Logistik (aka Bulog)
2002
(2) SA 407
(C) at 419 C D.
[50]
AJRA, s 1(1) s v 'maritime claim'.'
[51]
MV Ivory Tirupati: MV Ivory Tirupati v Badan
Urusan Logistik (aka Bulog)
2003 (3)
SA 104
(SCA) para 32.
[52]
Silver Star
op
cit, fn 41, para 15.
[53]
MV F Elephant: Gulf Sheba Shipping Ltd v MV F
Elephant and Others
2012 (3) SA 633
(WCC) para 23 and 28. I do not agree with the proposition in the
latter paragraph that this interpretation does not fit comfortably

in the scheme of the AJRA.
[54]
Para D of the First and Final Award reads:
'
WE RESERVE
jurisdiction to deal with all outstanding issues in the arbitration,
including all remaining issues as to quantum and all issues
as to
costs.'
[55]
Roberts v Tucker
(1828-1840)
3 Menzies 130.
[56]
See the authorities referred to in
Caesarstone
Sdot-Yam Ltd v The World of Marble and Granite 2000 CC and Others
[2013] ZASCA 129
;
2013 (6) SA 499
(SCA) paras 45 – 48.
[57]
Hudson v Hudson and Another
1927
AD 259
at 268.
[58]
MV Alina II (No 2): Transnet Ltd v The
Owner of the MV Alina II
[2011] ZASCA
129
;
2011 (6) SA 206
(SCA) para 10.
[59]
Chancellor. Masters and Scholars of the
University of Oxford v Commissioner for Inland Revenue
1996
(10 SA 1196
(A) at 1250F-H;
American
Soda Ash Corporation CHC Global (Pty) Ltd v Competition Commission
of South Africa and Others
2003 (5) SA
633
(CAC) para 17.
[60]
Ward and Another v Smit and Others: In re Gurr
v Zambia Airways Corporation Ltd
1998
(3) SA 175
(SCA) at 179D-J;
CMC v CIPC
and Others
[2020] ZASCA 151
para 32.
[61]
International Convention Relating to the Arrest
of Sea-Going Ships (Brussels, May 10, 1952).
[62]
C/f
Inter Maritime
Management SA v Companhia Portuguesa de Transportes Maritimos EP
[1990] ZASCA 112
;
1990 (4) SA 850
(AD) (the
H
Capelo
) where the appellant had
attached two different vessels in different jurisdictions in South
Africa and two other vessels in Senegal
in respect of the same
claim. For a more detailed discussion see Wallis
The
Associated Ship and South African Admiralty Jurisdiction
231-235.
[63]
The Christiansborg
(1885)
10 PD 141
(CA) at 152, 154 and 155-6;
The
Point Breeze
[1928] P 135
;
The
Daien Maru No 18
[1986] 1 Lloyd's Rep
387.
[64]
See the
H Capelo
op
cit, fn 62.
[65]
Shaw, op cit, fn 26, p 67.
[66]
MV Fortune 22: Owners of the MV Fortune 22 v
Keppel Corporation Ltd
1999 (1) SA 162
(C)(
Fortune 22
).
[67]
Ibid
at 165E-H.
[68]
Ibid at 165H-166B and 167G-H.
[69]
Silver Star
op
cit, fn 41, para 31.
[70]
See the cases cited in fn 59.
[71]
A submission that the prohibition extended to the
arrest not only of the specific property but to property in general
was advanced
in
MV Ivory Tirupati: MV
Ivory Tirupati v Badan Urusan Logistik (aka Bulog)
2002
(2) SA 407
(C) at 419I-J. It was incorrect.
[72]
Great River Shipping Inc v Sunnyface Maritime
Ltd
1992 (2) SA 87
(C) at 88E-90A. See
also
MV Wisdom C: United Enterprises
Corporation v STX Pan Ocean Co Ltd
[2007] ZAWCHC 12
;
2008
(1) SA 665
(C) para 15. The point was not pursued in the subsequent
appeal.
[73]
MV La Pampa: Louis Dreyfus Armateurs SNC v Tor
Shipping
[2006] ZAKZHC 3
;
2006 (3) SA 441
(D) para 42.
[74]
The Moschanthy'
[1971]
Lloyd's Rep 37 at 44 recently endorsed by the Court of Appeal in
Stallion Eight Shipping Co SA v Natwest
Markets PLC
[2018] EWCA Civ 2760
;
[2019] 1 Lloyd's Rep 406 para 82(iv).