Galsworthy Limited v Pretty Scene Shipping SA and Another, Pretty Scene Shipping SA and Another v Galsworthy Limited (AR469/2017, A23/2015, AR157/2018, A65/2016) [2019] ZAKZPHC 10; [2019] 2 All SA 355 (KZP) (4 March 2019)

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[2019] ZAKZPHC 10
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Galsworthy Limited v Pretty Scene Shipping SA and Another, Pretty Scene Shipping SA and Another v Galsworthy Limited (AR469/2017, A23/2015, AR157/2018, A65/2016) [2019] ZAKZPHC 10; [2019] 2 All SA 355 (KZP) (4 March 2019)

IN
THE HIGH COURT OF SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
(Exercising
its Admiralty Jurisdiction)
Appeal
Case No: AR469/2017  Admiralty Case No: A23/2015
Name
of ship:
MT “PRETTY SCENE”
In
the matter between:
GALSWORTHY
LIMITED
APPELLANT
and
PRETTY
SCENE SHIPPING SA

FIRST RESPONDENT
MT
“PRETTY
SCENE”

SECOND RESPONDENT
Full
Court Appeal Case No: AR157/2018
Admiralty
Case No: A65/2016
Name
of ship:
MT “PRETTY SCENE”
In
the matter between:
PRETTY
SCENE SHIPPING SA

FIRST APPELLANT
MT
“PRETTY
SCENE”

SECOND
APPELLANT
and
GALSWORTHY
LIMITED
RESPONDENT
JUDGMENT
Delivered:
4 March 2019
Mbatha
J (Madondo DJP and Van Zyl J concurring)
Introduction
[1]
This is an appeal from judgments delivered on 31 October 2016 and 22
September 2017
by Vahed J and Henriques J, respectively, in the
KwaZulu-Natal Local Division of the High Court, sitting as a court of
admiralty,
in terms of the Admiralty Jurisdiction Regulation Act
[1]
(the Act).
1.1
In the first judgment under case number
A23/2015
on 31 October 2016 Vahed J in an application brought by Pretty Scene
Shipping SA and MT “Pretty Scene” (jointly
referred to as
‘the Pretty Scene parties’) against Galsworthy Limited
made the following orders in favour of the applicant:
‘
(a)
The writ of summons
in rem
and the warrant of arrest issued out of this court in respect of MT
“Pretty Scene” are set aside;
(b)
The MT “Pretty Scene” is released from arrest forthwith;
(c)
The Sheriff of this Court is directed to effect the release of the MT
“Pretty Scene” from the arrest by service
of a warrant of
release to be issued by the Registrar of this Court; and
(d)
The respondent is directed to include the costs of two counsel where
employed and are to include all costs reserved on previous

occasions.’
1.2
In the second judgment under case number A65/2016 involving the same
parties, Henriques
J dismissed the application by Pretty Scene
Shipping SA and MT “Pretty Scene” to set aside the arrest
of the MT “Pretty
Scene” at the instance of Galsworthy
Limited and dismissed the counter-application for security brought by
Pretty Scene Shipping
SA arising from the arrest of the MT “Pretty
Scene”. The applicant was ordered to pay costs in respect of
both applications.
[2]
In both matters leave to appeal was sought but the applications for
leave to appeal
were dismissed by Vahed J and Henriques J,
respectively.  However, having petitioned the Supreme Court of
Appeal (the SCA)
leave to appeal was granted to the Full Court,
KwaZulu-Natal Division of the High Court, Pietermaritzburg, in
respect of both matters.
The two appeals were consolidated for
hearing before the full court.
The
background to both the matters
[3]
On 16 April 2015 Galsworthy Limited, under case number A23/2015,
caused to be issued
out of the KwaZulu-Natal, Division of the High
Court, Durban, exercising its Admiralty Jurisdiction, a writ of
summons
in
rem
against Pretty Scene Shipping SA and the vessel MT “Pretty
Scene” as the defendants. A warrant of arrest supported
by a
Certificate in terms of Rule 4(3) of the Admiralty Rules (the
Rules)
[2]
was issued
simultaneously with the writ of summons
in
rem
. To
ensure the arrest of the vessels belonging to Pretty Scene Shipping
SA similar anticipatory orders were obtained from the Western
Cape
and Eastern Cape High Courts, in the event that the vessels failed to
dock at the Durban Harbour. Fearing that it may become
common
knowledge that such processes were issued, with the result that the
cited vessels may not dock in the aforementioned harbours,
the
applicant sought an order that the details thereof not be published
and be kept in a secure place by the registrar of the court.
The
matter served before Mnguni J on 16 April 2015, who granted the order
authorising the registrar to issue the warrants of arrest
and writs
of summons
in
rem
;
that the details of the application not be published and the court
files in each of the actions be kept in a secure place and
not to
cause the details of the applications and the actions
in
rem
to
be entered into the court records and that they be made available for
public inspection only upon written confirmation received
from
Galsworthy’s attorneys or in the event of the court so
ordering.
[4]
Subsequently thereafter Galsworthy brought an application on 29 March
2016 in terms
of s 1(2)
(b)
(iii) of the Act read with Rule
6(1)
(a)
where it sought orders to extend the period of
validity of the writs and the periods within which the summons and
the warrant of
arrest may be served up to the 15 April 2018. This
matter served before Radebe J in this division, who extended the
orders. All
the courts who previously granted the anticipatory
orders, extended the orders.
[5]
On 19 June 2016 the MT “Pretty Scene” being one of the
vessels cited in
the writ of summons docked within the jurisdiction
of this court and Galsworthy caused the vessel to be arrested and
summons was
served in accordance with the Rules. The service of the
warrant of arrest and the issuing of the summons on 16 April 2015
commenced
the action against MT “Pretty Scene”, as the
defendant.
[6]
On 1 July 2016 an application was brought by Pretty Scene Shipping SA
and the vessel
MT “Pretty Scene”, who sought an order
setting aside the arrest of the MT “Pretty Scene”. The
application
which was opposed by Galsworthy and this application came
before Vahed J who on 31 October 2016 set aside the writ of the
summons
in rem
and the warrant of arrest on the basis of the
applicant’s failure to comply with the provisions of Rule
2(1)(b) and Practice
Directive 27, of the KwaZulu-Natal High Court.
He found this ground to be dispositive of the matter and did not
consider other
grounds advanced in the alternative by Pretty Scene
Shipping SA and the vessel MT “Pretty Scene”.
[7]
The application before Vahed J was argued on 12 August 2016 and
judgment was reserved.
Whilst the judgment of Vahed J was awaited,
Galsworthy caused a second warrant of arrest and summons
in rem
under case number A65/2016 to be issued against the vessel on 18
August 2016. This was also done
ex parte
, without any
notification to Pretty Scene Shipping SA and the vessel MT “Pretty
Scene” in the matter before Vahed J
and also without any
notification to the Judge himself as he was seized with the matter.
This application was granted by the Registrar
of the High Court.
[8]
Galsworthy did not immediately serve the processes until 28 October
2016, when the
parties were informed that Vahed J’s judgment
would be delivered on 31 October 2016. Having received such a
notification,
Galsworthy, before delivery of the judgment caused the
warrant of arrest and the summons to be served upon the vessel MT
“Pretty
Scene” for the second time. On 31 October 2016,
when the judgment of Vahed J was handed down, neither the Pretty
Scene parties’
attorneys nor the Judge concerned were advised
of the second arrest of the vessel.
[9]
As a consequence of the actions of Galsworthy, Pretty Scene Shipping
SA and MT “Pretty
Scene” brought an application to set
aside the second arrest of the vessel under case number A65/2016.
They also sought security
in respect of a counter-application for
damages for wrongful arrest, which they intended pursuing against
Galsworthy in the action
in rem
. This application was heard
before Henriques J, who dismissed the applications by Pretty Scene
Shipping SA and MT “Pretty
Scene” on a number of grounds,
which I will deal with at a later stage. She confirmed the order for
the arrest of the vessel
in favour of Galsworthy.
The
appeal against the judgment of Vahed J under case number A23/2015
[10]
For the sake of convenience, I will deal first with the appeal
arising from the setting aside
of the writ of summons
in rem
and the warrant of arrest arising from Vahed J’s judgment.
[11]
Galsworthy by way of a writ of summons
in rem
and the warrant
of arrest sought to enforce two arbitration awards made by an
arbitration tribunal in London in its favour against
Parakou Shipping
PTE Ltd (“Parakou Singapore”):
(a)
A first and final arbitration award in the sum of US$2,673,279.15
plus interest and costs
dated 13 August 2010; and
(b)
A second and final arbitration award in an amount of US$38,579,000.00
plus interest and
costs dated 13 May 2011, and
(c)
Alternatively, a claim for damages on
the same amounts arising from a breach on the part of “Parakou

Singapore” of the terms of the charterparty agreement that the
arbitrators found had been concluded between the parties on
or about
18 June 2008 (the original claim), which orders were authorised by
Mnguni J.
[12]
Pretty Scene Shipping SA and the vessel MT “Pretty Scene”
brought an application
to set aside the writ of summons
in rem
and the warrant of arrest. The Pretty Scene parties advanced the
following grounds:
(a)
Galsworthy’s failure as regard the writ of summons, to comply
with Rule 2(1) and Practice
Directive 27 as the summons did not
contain “a clear, concise statement of the nature of the claim”
and “a statement
of the facts upon which the claim is based”
and “a statement of facts on the basis of which it is stated
that the ship
is an associated ship”.
(b)
They advanced that Galsworthy’s alternative claim has
prescribed and is res judicata.
(c)
The provisions of s 299(1) of the Singapore Companies Act
[3]
have imposed a moratorium on the enforcement of the appellant’s
claims, which moratorium came into effect after the commencement
of
the winding-up of “Parakou Singapore”.
(d)
Galsworthy’s failure to demonstrate that the MT “Pretty
Scene” is an associated
ship in relation to the MT “Jin
Kang”, because of the misplaced reliance by Galsworthy upon the
deeming provisions
of s 3(7)(c) of the Act, as “Parakou
Singapore” was not the charterer of the ship concerned, the MT
“Jin Kang”,
when the appellant’s claim arose.
(e)
Galsworthy has failed to demonstrate that the MT “Pretty Scene”
was an associated
ship in relation to the MT “Jin Kang”,
by reason of the intervening liquidation of “Parakou
Singapore”,
at the time of which Galsworthy’s cause of
action for the enforcement of the second arbitration arose, which it
is claimed
that was when the second award was made on 13 May 2011.
(f)
The Pretty Scene parties further asserted that Por Liu, the person
alleged to be in
control or being the owner of the MT “Pretty
Scene”, was not in control of “Parakou Singapore”,
as control
had been transferred to the liquidators when the
winding-up of the Parakou Singapore company commenced.
[13]
In his judgment Vahed J found that the first ground relied upon by
the Pretty Scene parties was
dispositive of the matter and that the
other grounds were preferred as arguments in the alternative. He then
went on to consider
the first ground.
[14]
Vahed J set aside the arrest for non-compliance with Rule 2(1)(a) and
(b), which provides that:
‘
(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.’
This
should be read with the provisions of s 1(2) of the Act which
provides as follows:
‘
(2)
(a)
An admiralty action shall for any relevant purpose commence—
(i)
by the service of any process by which that action is instituted;
(ii)
by the making of an application for the attachment of property to
found jurisdiction;
(iii)
by the issue of any process for the institution of an action
in
rem
;
(iv)
by the giving of security or an undertaking as contemplated in
section 3 (10)
(a)
.
(b)
An action commenced as contemplated in
paragraph
(a)
shall lapse and be of no force and effect if—
(i)
an application contemplated in paragraph
(a)
(ii) is not
granted or is discharged or not confirmed;
(ii)
no attachment is effected within twelve months of the grant of an
order pursuant to such an application or the final decision
of the
application;
(iii)
a process contemplated in paragraph
(a)
(iii) is not served
within twelve months of the issue thereof;
(iv)
the property concerned is deemed in terms of section 3 (10)
(a)
(ii)
to have been released and discharged.’
Vahed
J’s judgment rested on the leading judgment on the subject, the
Galaecia
,
[4]
a judgment by Combrinck J, which places emphasis on sufficient
compliance with the requirements of Rule 2(1)
(b)
.
Was
the nature of the claim established?
[15]
In general, when one is proceeding to enforce a maritime claim the
plaintiff issues a writ of
summons
in rem
as prescribed in
terms of s 3(4) of the Act and Rule 2(1). One applies to the
Registrar, of the High Court, (not the court) for
the issuing of an
arrest warrant supported by a Rule 4(3) Certificate either signed by
the applicant or his attorney. The registrar
is empowered to issue
such process unless if he/she feels that the matter should serve
before a judge.
[16]
The requirements of Rule 2(1)(b) are peremptory in nature. To
restrict any abuse of the process
for a party to obtain a warrant of
arrest
in rem
pursuant to the issue of the summons in the
action
in rem
, hence a certificate in terms of Rule 4(3)
signed by the applicant or his attorney must be filed therewith. The
contents of the
certificate serve as a safeguard to the respondent as
it has to contain the following averments: (a) that the claim is a
maritime
claim; (b) that it is a claim in respect of which the court
has or will have jurisdiction on the effecting of the arrest; (c)
that
the property to be arrested is property in respect of which the
claim lies or that it is an associated ship, (d) whether security
or
an undertaking has been given in respect of the claim or to procure
the release, or prevent the arrest or attachment of the
property
sought to be arrested and if so, what security or undertaking has
been provided and the grounds for seeking the attachment
order
despite such security having been given; and (e) that the contents of
the certificate are true and correct to the best of
the knowledge and
belief of the signatory and what the source of the knowledge and
information is.
[17]
In terms of Rule 4(2)(a) the registrar is empowered to issue the
summons
in rem
and the warrant of arrest
in rem
without
the authorisation of the court. However, as a safeguard, the
registrar may refer the application to the court as to whether
the
process may be issued or not. The registrar will do so if it appears
from the certificate filed or where he/she has knowledge
that
security or an undertaking to give security in terms of the relevant
provisions of the Act is to prevent the arrest or attachment
of the
property in question. In these circumstances a warrant can only be
issued by the registrar once it has been authorised by
the court.
[18]
I defer to Vahed J’s judgment, where he states as follows:
‘
[14]
When the
Pretty
Scene
was arrested the warrant of arrest was accompanied by the writ of
summons and a certificate in terms of rule 4(3) of the Admiralty

Rules. The writ of summons consisted of 20 numbered paragraphs, a
format very similar to a simple summons issued out of the courts

parochial. The first paragraph described the respondent and the
second paragraph described the second applicant simply as a vessel
“.
. . which is expected to call at a port within the jurisdiction . . .
at some time in the future”. The third to
fifteenth paragraphs
described the first and second arbitration awards and concluded in a
claim for their enforcement. The sixteenth
paragraph set up the
alternative claim. Nowhere in what was set out in the third to
sixteenth paragraphs was there any reference
or allegation connecting
the
Pretty
Scene
or its owner to the claims made. In the seventeenth paragraph a
statement is made concerning the deeming of ownership of the
Jin
Kang
by Parakou Singapore. The nineteenth and twentieth paragraphs
contained allegations that the claims were Maritime claims and the

claims for payment interest and costs.
[15]
The eighteenth paragraph was formulated in the following terms:
“
The
[
Pretty
Scene
]
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

accordingly are enforceable by an action
in
rem
against
the
Defendant.”
[16]
In its material provisions the accompanying certificate made the
identical claim as to association.
[17]
Annexed to the writ of summons were copies of the first and second
arbitration awards. Those
documents contained nothing connecting the
Pretty
Scene
or its owner to the claims made.’
And
compare it with paras 1 and 2 in the
Galaecia:
‘
[1]
On 20
February 2006, the respondent issued a summons in an
in
rem
action
against the mfv “Galaecia”.  The vessel called at
Durban and on 14 March 2006 was arrested pursuant to a
writ issued in
the
in
rem
action.
The applicant, the owner of the vessel, applied on notice for the
setting aside of the arrest.  The application
was opposed by the
respondent.  After hearing argument, I set aside the arrest on
the basis that the respondent's claim was
not a maritime claim as
defined in section 1 of Act 105 of 1983.  I indicated that I
would hand down my reasons later.
These are the reasons
.
[2]
The
arrest was effected in terms of Admiralty Rule 4(3) a summons having
been issued in terms of Admiralty Rule 2.  In the
summons, the
respondents claim is worded thus
:
“
1.   Payment
of the sum of US$1,825,330.00 being damages suffered by the Plaintiff
arising from the purchase of a
cargo of frozen sea bass ex the motor
fishing vessel “Carran” on or about 1 April 2004.
2.   The
Plaintiff's claim is a maritime claim within the meaning and
definition of section 1(1)(g) and/or section
1(1)(v) and/or section
1(1)(ee) of the Admiralty Jurisdiction Regulation Act No. 105 of 1983
as amended (“the Act”).
3.   The
Defendant is an associated ship of the mfv “Carran”
within the meaning and definition of sections
3(6) and 3(7) of the
Act.
WHEREFORE
the Plaintiff claims:
1.   Payment
of the sum of US$1,825,330.00 (One Million Eight Hundred and Twenty
Five Thousand Three Hundred and
Thirty United States Dollars);
2.   Interest
on the above mentioned amount according to law;
3.   Costs
of suit.
4.   Further
and/or alternative relief.”’
The
certificate in terms of Rule 4(3) by the Pretty Scene
parties’attorney which has to accompany the arrest warrant
reads
as follows:
‘
I
the undersigned, MALCOM CHARLES HARTWELL, do hereby state:
1.
I am an attorney of the High Court of South Africa, Natal Provincial
Division,
practicing as a director of Deneys Reitz Inc. 4th Floor,
The Marine, 22 Gardiner Street, Durban.
2.
To the best of my knowledge, information and belief the contents of
this certificate
are true and correct. The source of my knowledge
arises,
inter alia
from Roger Field of Webber Wentzel Bowens,
the Plaintiff’s attorneys who received instructions and
documentation from Benoit
Lenoir, Director, Thalassa Export Co Ltd.
Mauritius.
3.
The Plaintiff’s claim is a maritime claim within the meaning
and definition
of section 1(1)(g) and/or section 1(1)(v) and/or
section 1(1)(ee) of the Admiralty Jurisdiction Regulation Act No. 105
of 1983
as amended (‘the Act’).
4.
The motor fishing vessel “
Carran
” is the maritime
property against which the Plaintiff’s claim lies. The
Defendant is an associated ship of the “
Carran
”
within the meaning and definition of sections 3(6) and 3(7) of the
Act.
5.
No security or undertaking to pay has been given in respect of the
Plaintiff’s
claim.
6.
The Honourable Court has jurisdiction to determine this matter by
virtue of section
2(1) of the Act read with sections 1(1) (g),
1(1)(v), 1(1)(ee), 3(6) and 3(7) of the Act.’
[19]
In the
Galaecia
,
the court set aside the arrest of the vessel on the basis of
procedural defects in the summons
in
rem
,
where the arrest of the ship was in terms of Rule 4(3). The summons
in rem
was found to be non-compliant with Rule 2(1); in that it did not
contain sufficient particulars to enable the defendant to identify

the facts and contentions upon which the claim was based; it merely
contained conclusions of law. The court took exception to the

deprivation of a person of valuable property on a bare skeleton of a
summons
in
rem
and
an inadequate certificate, as it would have caused enormous prejudice
to the owner of the ship concerned. This is the state
of affairs that
made Combrinck J in para 4 to question such a “
procedure
which allows a person to be deprived of the possession of his
property without a court order
”
,
as it may not be constitutionally sound. This was echoed against the
backdrop of s 25 of the Constitution
[5]
which provides that no law may permit arbitrary deprivation of
property. This is clear from the wording of the Rules that the
applicant needs to discharge the onus on a balance of probabilities
to show that he has a prima facie case on the merits. This is
the
first hurdle that the applicant has to cross before consideration is
given as to whether the applicant is entitled to enforce
the claim
against the respondent in line with s 3(6) read with s 3(7) of the
Act.
[20]
Though acknowledging the concerns raised by Combrinck J the learned
author John Hare,
[6]
holds the
view that there should be no constitutional difficulty upon an arrest
granted by the registrar upon a Rule 4(3) Certificate,
‘
properly
prepared
’
(my emphasis). He goes on to state that ‘[procedurally], the
powers of the bench are delegated to the registrar in
limited
circumstances, with the safeguard that the registrar’s order
may be set aside upon the motion of any interested party
thus giving
that party a “fair public hearing before a court.”’
[7]
The concerns raised in the
Galaecia
are
genuine as the authorisation of these processes are final in nature,
if no application is made to set aside the warrant of arrest.
In
terms of the common law and our civil jurisdiction an
ex
parte
order is provisional until confirmed on the return date after service
upon the respondent, which is not the case with the Rule
4(3)
certificate procedure.
[21]
The high court exercising admiralty jurisdiction, subject to the
provisions of the Act, is empowered
to exercise jurisdiction to hear
and determine any maritime claim irrespective of where it arose, the
place of registration of
the ship concerned, or the residence,
domicile or nationality of its owner (s 2(1)). This is confirmed in
Lawsa
where it is stated that ‘[admiralty] jurisdiction is therefore
said to be a jurisdiction based on the nature of the claim
in
dispute, without regard to the grounds on which courts generally
exercise civil jurisdiction.’
[8]
It goes on to state that the opening phrase in s 2(1) which states
“subject to the provisions of the Act” means that
there
is a qualification to the courts’ exercise of admiralty
jurisdiction based on the maritime nature of the claim in
dispute.’
[9]
That being
the case the nature of the claim must be established in the summons
in rem
and all the processes relating to the enforcement of the maritime
claim. It is common cause that the first two maritime claims
relied
upon by Galsworthy is the arbitration awards. Therefore a reference
to s 1(1)(aa) of the Act and any alternative maritime
claim should be
alleged in the summons
in
rem
.
This requirement has been highlighted in a number of judgments
including,
Windrush
Intercontinental SA & another v UACC Bergshav Tankers AS
[10]
where in an application the defendant sought to set aside the deemed
arrest of the vessel, the court held that there must have
existed a
maritime lien for crew wages to entitle the plaintiff to arrest the
ship. An applicant must satisfy the court if it has
a maritime claim
recognised in terms of the Act and enforceable by an action
in
rem
. It
is therefore imperative that the facts, though concise, give the
basis of what case the respondent has to meet.
[22]
In
MV
Cape Courage
Bulkship
Union SA v Qannas Shipping Co Ltd & another
[11]
the court confirmed in the application for the arrest of the vessel,
brought
ex
parte
,
that the appellant had to show: ‘(a) that the
MV
Cape Courage
is susceptible to arrest
in
rem
in
respect of its claim; and (b) that it has a prima facie case in
respect thereof.’ In respect of the first issue the appellant

had to establish its case on a balance of probabilities while on the
second case it had only to establish that there was evidence
which,
if accepted, would establish a cause of action. It is therefore
significant that the summons passes this jurisdictional
hurdle before
the arrest is authorised. The plaintiff has to satisfy the first leg
of the enquiry by setting out facts to establish
that it has a
maritime claim against the respondent as decided in
Windrush
.
In the absence of a maritime claim the court cannot exercise its
admiralty jurisdiction. It flows from this that the arrestor
has to
show the existence of a maritime claim.
[23]
Vahed J found that there was non-compliance by the appellant of the
provisions of s 1(2) of the
Act read with the provisions of Rule
2(1
)(b)
and the failure to abide by the
Galaecia
judgment,
which has never been set aside and which is binding in this Division
and of great importance as it was adopted in this
Court’s
Practice Directive 27. The Directive should not be read in isolation
from the Act and the Rules. Rule 2(1)(a) which
states that ‘[a]
summons …shall contain a clear concise statement of the nature
of the claim and of the relief or
remedy required and of the amount
claimed, if any’ and  Rule 2(1)(b) states that ‘[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.’

The grammatical language used in the provisions is clear that though
this may be a concise statement it must identify the facts
and
contentions upon which the claim is based.
[12]
When one applies the purposive interpretation as stated in
Natal
Joint
Municipal Pension Fund v Endumeni Municipality,
[13]
one discerns that the
intention of the Legislature is that the defendant ought to know what
case he has to meet. This is even more
relevant in this matter, as
the defendants are part of a huge shipping enterprise.
[24]
Vahed J also found that the status of the MT “Pretty Scene”
as an associated ship
as described in s 3(6) and 3(7) of the Act made
in para 18 of the summons and the certificate were conclusions of
law. Galsworthy
contends that the facts establishing that the MT
“Pretty Scene” as an associated ship were known to the
Pretty Scene
parties as they had already been canvassed in previous
proceedings relating to the arrest of another vessel related to the
MT “Pretty
Scene”; that Parakou Singapore was the
charterer of the “Jin Kang” and therefore deemed to be
the owner of the
vessel in terms of s 3(7)(c) of the Act; that at the
time when the Galsworthy claim arose; Parakou Singapore was
controlled by
Por Liu, the registered owner of the majority of the
shares in the company; that the Pretty Scene parties did not dispute
that
all of the shares in the company which owned the MT “Pretty
Scene” were owned by Parakou Tankers Inc and that Por Liu
in
turn owned all of the shares in that company. Therefore in that
regard, the facts relating to the ownership of the MT “Pretty

Scene” were ‘predictable’ and established.
[25]
Furthermore, Galsworthy asserted that those facts were by way of an
affidavit placed before Mnguni
J, who authorised the issue of the
writ of summons and warrant of arrest. Similarly, the same facts were
put before Radebe J for
the extension of the writ of summons and the
warrant of arrest. Therefore the facts relating to the association
were before the
court at all times. It was submitted on behalf of
Galsworthy that it was not contended that the alleged failure on the
part of
Galsworthy to comply with the provisions of Rule 2(1)
rendered the action
in
rem
a
nullity, unlike in
Northern
Assurance Co Ltd v Somdaka
.
[14]
The facts in
Somdaka
are distinguishable to the facts before this court as the summons was
complete and regular and all that was missing was the power
of
attorney to sue and the court had condoned the irregularity. The
defect relied upon in this matter lay in the lack of particularity
in
the summons and the certificate, particularly in failing to establish
the association in terms of Rules 3(6) and 3(7). The non-compliance

with Rule 2(1)(b) goes to the heart of the pleadings; it is not just
a mere omission which can be regulated by the provision of
an omitted
document.
[26]
The bone of contention was that the order authorised by Mnguni J, who
Vahed J, believed that
had Mnguni J been aware of the
Galaecia
judgment and the Practice Directive would not have authorised the
issue of the summons and the warrant of arrest. It is my view that

whether or not Mnguni J was aware of the
Galaceia
and the
Practice Directive, Galsworthy had to comply with the Rules, as the
Rules provide the safeguards put up by the Rules, which
are
peremptory in their nature.
[27]
I accept the contention by Galsworthy that the purpose and the effect
of the Practice Directives
is that they are not binding and should be
understood not to fetter the exercise of the judge’s discretion
in appropriate
cases. It is my view that Practice Directive 27, is
not just a guideline but an embodiment of Rule 2(1)
(a)
and
2(1)
(b),
which is couched in peremptory provisions. The
Practice Directive was borne out of a binding decision of this court.
It serves
only to highlight to the practitioners and judges of the
court the significance of the provisions of Rule 2(1)
(a)
and
2(1)
(b)
. It cannot be said to be some kind of a regulatory
procedure, like the other directives in the division, which set out
the time
frames and procedures relating to the filing or attending to
certain issues for purposes of ‘proper governance’ and

control of the matters that serve before this court. Practically,
only one party is before the court asking the court to constrain

another’s rights. Ordinarily in these matters the absent party
is a foreigner who may not be aware of the allegations against
them
and who will only be able to salvage their fortune after the fact so
to speak. The absent party must therefore be put in a
proper position
regarding to what the allegations relate and the extent of their
relevance to the possible remedies. How far such
details must extend
depends on the facts of each case. The directive sought to emphasise
how the Rules ought to reflect the Rules
in these circumstances.
[28]
It is my view that it was not only the failure to comply with the
Practice Directive, as suggested
by the Pretty Scene parties
but the failure to comply
with Rule 2(1)
(b)
,
which, if not complied with, impugns on the constitutional rights of
the Pretty Scene parties. In fact the Practice Directive,
highlights
the requirements of the provisions of Rule 2(1)
(a)
and
(b)
and rule 4(3) and does not impose any new obligations on the party
seeking an arrest. Its purpose is to emphasise that parties
should
comply with the material requirements of the aforesaid provisions. It
provides as follows: (I have inserted the alphabetic
paragraph
numbers for convenience)
‘
27.
Admiralty arrest warrants in terms of Rule 4(3)
(a)
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.
(b)
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.
(c)
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)
.
’
[29]
Paragraph (a) above draws the attention of the practitioners to the
requirement of ‘a clear
and concise statement of the nature of
the claim’. Paragraph (b) refers to
‘
a
statement of the
facts
upon
which the claim is based’
and
‘statement of the
facts
on the
basis of which it is stated that the ship is an associated ship’.
The words ‘facts’
appear in bold in the directive. The Oxford South African Concise
Dictionary
[15]
defines ‘facts’ as ‘information used as evidence or
as part of a report’. If one attributes such a meaning
to a
summons it could only mean facts as would have been placed in the
summons in line with Uniform rule 18. This is in line with
Rule
2(1)
(b)
of the
Act which refers to a statement which ‘shall contain sufficient
particulars to enable the defendant to identify the
facts and
contentions upon which the claim is based’. The bold part in
the directive emphasises that ‘facts’
and ‘not
conclusions of law’ are required. Furthermore, paragraph (b)
above does not take the powers of the registrar
away, but highlights
only that the registrar is not a judge who can identify difficult
issues and places the responsibility on
the attorney to identify such
a difficult case to the registrar.
[30]
I cannot understand Galsworthy
’
s
submission that it was not competent for Vahed J to set aside the
order of Mnguni J, as it had been placed before a judge and
not the
registrar of the court. In the
Galaecia
,
Combrinck J picked up the same defects as Vahed J did in setting
aside the application. If the matter ‘slipped through’,

for whatever reasons it can be set aside where there is a procedural
or substantive challenge. In
Transol
Bunker BV v MV Andrico Unity & others; Grecian-Mar SRL v MV
Andrico Unity & others,
[16]
the court held that in an
application to set aside an arrest, the party who obtained an order
may advance any ground to justify
the arrest, irrespective of whether
or not such ground was relied upon in initially obtaining the order.
This persuasive judgment
was endorsed by the Supreme Court of Appeal
(the SCA) in
Cargo
Laden & Lately Laden on Board – the MV Thalassini Avgi v MV
Dimitris
[17]
and
MV
Wisdom C United Enterprises Corporation v Stx Pan Ocean Co Ltd.
[18]
This means that an
applicant can reply to a respondent’s application to set aside
the arrest. This gives an applicant an opportunity
to cure defects in
the original application. In the
Thalassini
[19]
,
the SCA confirmed in an application made in terms of s 3(3) of the
Act that since the onus is on the applicant who brought the

application for arrest to justify the arrest and prove that he
satisfied the requirements for an arrest he may file a replying

affidavit or a further affidavit to support his case. The same
approach was adopted by Wallis J, in
Golden
Meats & Seafood Supplies CC v Best Seafood Import CC &
another
[20]
in an arrest made in terms of s 3(4) (b) of the Act.
[31]
The suggestion by Galsworthy
is
that the Pretty Scene parties
failed
to invoke Uniform rule 42 to have the order made by the judge set
aside or varied as erroneously granted is misplaced. I
do not believe
that that rule 42 is applicable here. Rule 42 would have been
applicable if there had been no procedural defects
to the process
before the court.  Though this process has the effect of a final
judgment if it is unopposed, the Uniform Rules
provide for the
setting aside of the order, whether it is on procedural or
substantive grounds.
[32]
Previously where an order for an arrest which has been granted by the
registrar, has been set
aside, there is no order having operation
which may be suspended in terms of Uniform rule 49(11) and s 18 of
the Superior Courts’
Act, which have been repealed. The effect
of the order in terms of s 4(3) of the Act is that it is final if not
challenged. It
is my view that since the Rules allow for the
applicant to supplement his application, there is no bar to the
respondent to challenge
the procedural defects in the summons.
[33]
According to Hofmeyr:
[21]
‘
A
party wishing to set aside an arrest can seek to do so in terms of
Uniform Rule 6(12)
(c)
.
The Rule provides that a person against whom an order was granted in
its absence in an urgent application may by notice set down
the
matter for reconsideration of the order.’
He
goes on to say that ‘once these threshold requirements have
been met the Rule confers a wide discretion on the court to

reconsider the original order’.
Rule
25 provides that:
‘
(1)
The court may in any admiralty proceedings
mero
motu
or on the application
of any party or other person having a sufficient interest give any
directions which it considers proper for
the disposal of any matter
before it.
(2)
Any such direction may deviate from or supplement any provision of
these rules, or
of the Uniform Rules, or of any other rules relating
to the division in question.’
It
is clear that the provision gives a discretion to the court. In
The
MV Urgup: Owners of the MV Urgup v Western Bulk Carriers (Australia)
(Pty) Ltd & others
[22]
the court held that Rule 25(2) should not be applied to compel an
applicant to disclose the existence or non-existence of documents
to
which a respondent claimed no proprietary or other right or interest
simply for purposes of assisting it, in an interlocutory
application,
to establish the jurisdiction of the court to arrest a ship, still
less to order their production for inspection and
copying.
[34]
Admiralty Rule 20 provides for the courts’ inherent powers:
(a)
Rule 20(1) provides that “The court may strike out any
proceedings which are vexatious or an abuse of the process of the

court.”
(b)
Rule 20(2) provides “If it appears to the court on application
that there have been any irregular proceedings by any party,
or
non-compliance with the rules, or any order of court, it may make any
such order as appears to it to be just with regard to
the said
proceedings, or non-compliance, including an order that any such
party be deemed to be in default or that judgment be
given against
any such party.
(c)
In terms of Rule 25(1) the court may in any admiralty proceedings
mero motu, or on application of any party or any other person
having
a sufficient, interest give any directions which it considers proper
for the disposal of any matter before it.
This
did not require any rectification of the process, as the deficiencies
struck at the core of the proceedings. The section confers
an
unfettered discretion to the court, which may strike out the matter
as being vexatious and/or an abuse of the process of court.
[23]
It has not been shown that the court a quo failed to exercise a
judicial discretion. The court of appeal has limited powers in
this
regard
[24]
and cannot therefore interfere with the courts’ exercise of
discretion.
[35]
What is a just order? The Constitutional Court in
Allpay
Consolidated Investment Holdings (Pty) Ltd & others v CEO, South
African Social Security Agency, and others
[25]
dealt with the approach that the court should take when dealing with
an irregularity. The issue of mandatory and material conditions
were
dealt with by the SCA in
Dr
JS Moroka Municipality v Betram (Pty) Ltd
[26]
where it held that failure to comply with a mandatory requirement can
be condoned and the tender can be accepted if it would be
in a public
interest.
[36]
In
Trencon
Construction (Pty) Ltd v Industrial Development Corporation
of South
Africa Ltd & another
[27]
the Constitutional Court, set out the principles which serve as
guidance to a court, where the exercise of a discretion is
challenged.
My view is that Rule 20(2) should be read in line with
the specific purpose of the provisions of the Act which should be
complied
with.
[37]
As every pleading must contain a clear and concise statement of the
material facts upon which
the party relies upon for his/her claim the
provisions of Rule 9 of the Rules are applicable. In terms of rule
9(5)(b)(i) where
the pleadings lack such averments to sustain a cause
of action or defence, the opposing party may deliver an exception to
such
pleading within 10 days of receipt thereof and may set down the
exception for hearing. Be that as it may, the provisions of Rule
9(1)
do not affect the court’s powers in terms of Rule 20 in dealing
with vexatious and irregular proceedings. The court
is imbued with
the exercise of a discretion, and it is competent for the court to
give any of the orders as stated in the Rule
20. Uniform rule 6(8)
applies in admiralty proceedings. It allows any person against whom
an order was granted
ex parte
to anticipate the return day
upon delivery of not less than 24 hours’ notice. This confirms
that the order granted by Mnguni
J was not appealable.
[38]
I cannot find any relevance in the submission that similar orders
were granted by the Western
Cape and the Eastern Cape High Courts,
without any challenge to the alleged procedural defects. This did not
bar the applicants
to challenge the arrest in those courts too. It
must be borne in mind that maritime law matters are not your everyday
civil matters
in South Africa and these applications are sought from
a specialised court on an urgent basis, mostly on an
ex
parte
basis. It would lead to a miscarriage of justice and tardiness on
behalf of Galsworthy
in
not complying with Rule 2(1)(a) and (b) if missed by the court, would
allow the applicant to get away with murder.
[39]
The submission that the inadequacies in the summons did not cause the
respondents’ to suffer
any prejudice is misplaced. The
Galaecia
expressly states that there are massive commercial losses that are
suffered by the defendants as a result of wrongful arrests.
This is
supported by the provisions of s 3(10) of the Act which caters to
counteract such prejudices by the provision of security
to avoid the
arrest of the vessel. The provisions of s 3(10) provide as follows:
‘
(10)
(
a
)
(i) Property shall be deemed to have been arrested or attached and to
be under arrest or attachment at the instance of a person
if at any
time, whether before or after the arrest or attachment, security or
an undertaking has been given to him to prevent the
arrest or
attachment of the property or to obtain the release thereof from
arrest or attachment.
(ii)
Any property deemed in terms of subparagraph (i) to have been
arrested or attached, shall be deemed to be released and discharged

therefrom if no further step in the proceedings, with regard to a
claim by the person concerned, is taken within one year of the
giving
of any such security or undertaking.’
A
further remedy, to curtail the commercial damage, provided in the Act
is that any vessel deemed to be under arrest, is deemed
to be
released if no proceedings are pursued within a period of one year of
giving security or an undertaking.
[28]
The provision of security therefore prevents the physical arrest of
the vessel, and this minimises prejudice to the ship owner.
[40]
The court in the exercise of its admiralty jurisdiction may receive
statements which may be inadmissible
in general civil proceedings in
terms of s 6(3) of the Act. The weight to be attached to such
evidence is at the discretion of
the court.
[29]
I am highlighting this aspect because it impacts on what the
applicant can include in the Rule 4(3) certificate to persuade the

court to authorise the warrant of arrest. In such certificates even
double hearsay evidence is admissible as in most cases the

information supplied by the attorneys is made in respect of what he
has been informed of by someone who could also have established
the
information from another source. In this regard the courts take into
consideration the urgency and access to such information.
[30]
Galsworthy, before Vahed J, relied on the affidavit in a different
case, in case number A20/2015 as having been used in support
of the
application before Mnguni J. Vahed J held that no reference was made
to the affidavit in the papers before Mnguni J, though
it was
submitted that the affidavit which dealt with the issue of
association formed part of the papers before Mnguni J. Vahed
J ruled
that the affidavit did not form part of the matter before his court
as it related to another matter. There was no certainty
that it
formed part of the proceedings before Mnguni J. I fully agree with
Vahed J in that regard.
[41]
Galsworthy
contends
that the cause of action was known by the respondents as the facts
upon, which the underlying claim is based, are fully
set out in the
arbitration awards. The basis for this is set out in para 13.3.2 of
Reddy’s affidavit a deponent to Galsworthy
’
s
affidavit that
‘
Mr
Por Liu, who is described in paragraph 3.1 of Mr Hartwell’s
affidavit as a director and president of the Owner, and from
whom Mr
Hartwell has obtained his instructions and the information set out in
the affidavit is also the person who controlled Parakou
Singapore
from the end of 2008 until its liquidation in March 2011 and would
therefore be fully aware of the manner in which the
Owner and Parakou
Singapore were operated at the relevant times, as well as the details
of Galsworthy’s claim and the arbitration
awards which date
from August 2010 and May 2011.’
It
is further stated in para 13.3.3 that had there been any question
‘
regarding
the factual basis for Galsworthy’s allegation that the vessel
is an associated ship as described in sections 3(6)
& (7) of the
Act, I would have expected that an immediate enquiry would have been
made by or on behalf of the owner. No such
enquiry was made.’
These
are the contentions that Galsworthy
relied
on as the basis upon which it contends that the ships are associated.
However, the Pretty Scene parties
’
contention
was that ‘at the time of the issue of the summons and issue of
the warrants’, the details relating to the
association as
required in terms of rule 2(1)
(a)
and
(b)
were missing, thus making the processes procedurally flawed.
[42]
Notwithstanding that Vahed J’s judgment states that counsel for
Galsworthy
conceded
that the application was procedurally defective, it was advanced that
Vahed J failed to exercise his discretion judiciously
in line with
Admiralty Rule 20(2), therefore this court is entitled to exercise
its own discretion regarding the matter at present.
In this regard
they referred this court to
Trencon
Construction (Pty) Ltd v Industrial Development Corporation
of South
Africa Ltd & another
.
[31]
The most interesting development was that after the application was
argued before Vahed J, Galsworthy
did
not waste time in amending its original papers, in line with the
views expressed by Vahed J in his judgment. The writing must
have
been on the wall when the matter was argued as this was done long
before the judgment was delivered. Had Galsworthy
felt
that all was kosher, there would have been no need for it to amend
its summons
in
rem
and
the certificate in terms of s 4(3) and await the expected outcome of
the application.
[43]
The Act provides for two measures: the arrest in terms of s 3(4)
which deprives a person of a
property without being given notice or a
hearing and the arrest of the associated ship, not the ship
concerned, in line with the
provisions of s 3(6) and s 3(7). Both
processes require the plaintiff/applicant to prove on a balance of
probabilities the entitlement
to such orders, because of the drastic
nature of the procedures. In my view, the court cannot just ignore
procedural defects or
irregularities when considerable harm may be
suffered if a wrong entity is arrested.
[44]
The issue of the exercise of the court’s discretion takes me
back to the
Galaecia
,
[32]
where Combrinck J in dealing with the summons in an action
in
rem
,
that did not comply with the express provisions of Rule 2(1)(b),
stated that not only is the owner of the vessel arrested severely

prejudicing his ability to have the arrest set aside, but the
practice also gives rise to procedural difficulties, and referred
to
similar the remarks of Hugo J in
SY
Sandokan.
[33]
The prejudice he alluded to is that the owner has to bring an
application to have the warrant set aside and this requires payment

of harbour fees and of course requires legal representation. He
referred to the following remarks of Didcott J in
Katagum
Wholesale Commodities v The MV Paz:
[34]
‘
It
is a serious business to attach a ship. To stop or delay
its departure from one of our ports, to interrupt its voyage for

longer than the period it was due to remain, can have and usually has
consequences which are commercially damaging to its owner
or
charterer, not to mention those who are relying upon its arrival at
other ports to load or discharge cargo. Especially when
the
attachment is sought
ex
parte
, as can be and
almost always is done, the Court must therefore be given sufficient
information to show that a measure with
results so harmful to others
is nevertheless necessary for the protection of the applicant's
legitimate interests. It will therefore
want to assure itself, for
instance, that his claim in the main proceedings is apparently no
spurious one, that he is not bent
on merely harassing the other side
in these or gaining a tactical advantage in relation to them, that
his need for security is
both genuine and reasonable, that no
alternative and less disruptive opportunity for obtaining such has
been or is likely to become
available to him and, if one has already
been lost, that this was not his fault or, I should rather say, not
his fault to such
a degree as to be fairly held against him. The
Court must be told enough to put it at its ease on all these scores.’
Combrink
J stated that the same criticism of the contents of the summons were
made in the English Court judgments of “
The
Tuyuti
”
[35]
and “
The
Jangmi”
.
[36]
Was
the association established?
[45]
It is a requirement of an action
in rem
that ownership of the
res
as an associated ship by the defendant must be
established, as the
res
must be linked to the ownership of the
ship concerned. The processes issued in terms of s 3(4) of the Act
being final in nature,
require an adequate concise statement of facts
as to the establishment of the association between the arrested
vessel and the claim.
[46]
Galsworthy
submitted
that Vahed J misdirected himself by failing to follow the approach in
the
Andrico
Unity
,
confirmed in the
Thalassini
,
which requires the court to consider all the facts placed before it
and should not have set aside the writ of summons and warrant
of
arrest.
[47]
In the exercise of the court’s admiralty jurisdiction, the
courts are enjoined to apply
s 3(6) read with s 3(7) of the Act.
Section 3(6) provides that:
‘
An
action
in rem
,
other than an action in respect of a maritime claim referred to in
paragraph
(d)
of the definition of “maritime claim”, may be brought by
the arrest of an associated ship instead of the ship in respect
of
which the maritime claim arose.’
It
is trite that whether it’s an arrest
in
rem
or
a security arrest, that the arrestor has to prove that the
property/vessel to be arrested is the ship concerned or an associated

ship of the ship concerned.
[37]
[48]
Section 3(7)
(a)
of the Act recognises three scenarios where
the ship is considered to be an associated ship:
‘
(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.
(b)
For the purposes of paragraph
(a)
-
(i)
ships shall be deemed to be owned by the same persons if the majority
in number
of, or of voting rights in respect of, or the greater part,
in value, of, the shares in the ships are owned by the same persons;
(ii)
a person shall be deemed to
control a company if he has power, directly or indirectly,
to control
the company;
(iii)
a company includes any other juristic
person and any body of persons, irrespective of whether
or not any
interest therein consists of shares.
(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.
’
[49]
Euromarine
International of Mauren v The Ship Berg & others
[38]
was the first case, which
recognised the uniqueness of the associated ship arrest principle as
providing for an action
in
rem
against different defendants owned or controlled by the owner of the
ship concerned. “
The
Ship Berg
”
has been followed in a number of maritime cases, including the
judgment of the SCA in
MV
Heavy Metal; Belfry Marine Ltd v Palm Base Maritime SDN BHD
[39]
which dealt with the interpretation of the provisions of s 3(7)
(a)
,
(b)
and (c) of the Act. The court carefully analysed s 3(7)
(a)
(i),
(ii) and (iii) and the circumstances in which ships were to be
regarded as associated and the deeming provisions in s 3(7)
(b)
(i),
(ii) and (iii) which were obviously designed to defeat defensive
strategies which ship owners devise deliberately to ward off

potential arrests of associated ships by disguising their ownership
or control of such ship.
[50]
In the
Heavy
Metal
judgment the court, in considering the aforementioned provisions of
the Act, had regard to the language used, the purpose of the

provision, its context and the object of the Act as a whole. It held
that the object of the associated ship provisions were enacted
to
enable the associated ship to be arrested in respect of the maritime
claim and the purpose was to afford the claimant with an
alternative
defendant to enforce its claim. It held that the subsection
distinguishes between “direct” and “indirect”

control and that power can be exercised by a person who was wielding
power behind the scenes “
de
facto
”
or by a person who was in
de
jure
control of the company. The court
[40]
recognised this as
‘
[the]
extension
of
de
jure
power to
de
facto
power is in line with the objective of the section: to prevent the
true 'owner', by presenting a false picture to the outside world,

from concealing his assets from attachment and execution by his
creditors
.’
The
court concluded that the same approach should be adopted in the
deeming provisions of the Act, ie, s 3(7)
(c)
, 3(10)
(a)
(i)
and (ii) and
(b)
, and 3(11)
(b)
.
[51]
In a more recent SCA judgment,
MV
Silver Star: Owners of MV Silver Star v Hilane Ltd
[41]
the
court held that:
51.1
The Silver Star was an associated ship arrested in terms of s 3(6)
read with s 3(7) of the Act. In this matter
Hilane had an arbitration
award from London which it sought to enforce by an action
in rem
in South Africa brought against the Silver Star as an associated ship
of the Sheng Mu. The question before the court was whether
Hilane
established the association on a balance of probabilities. It held
that the section caters for claims against the demise
charterer not
the owner for claims arising from a bill of lading or goods supplied
to the charterer. Therefore such claims can
be pursued by associated
arrests; however, the court further held that it does not cater for a
time charterer responsible for the
supply of bunkers or provisions to
the vessel.
51.2
The court further held that, the provisions of s 3(7)
(c)
relating to the charterer in respect of a maritime claim arising
during the course of the charter to be the deemed owner of the
vessel
concerned. The only exception is pointed out as follows:
[42]
‘
[When]
the maritime claim did not give rise to a maritime lien against a
particular vessel, and in personam claim did not arise
in respect of
a particular ship, there could be no action in rem against a
particular ship because the requirements of s 3(5) of
the Act could
not be satisfied.’
51.3
The court concluded that in respect of the maritime claims arising
from the charterparty between the Sheng
Mu and Phiniqia, which was
liable in respect of those claims, Sheng Mu was deemed to be the
owner for purposes of the arrest of
the associated ship. The fact
that it pursued the claim by way of arbitration is of no consequence
and does not alter the status
of the claim. It found that an
association must be proved on the balance of probabilities as
advocated in the
Thalassini
. It held further that though the
claimant bears the onus of proof, the court can draw an adverse
inference from a mere assertion
of a bare denial from the debtor.
51.4
This judgment supports Vahed J’s findings that the association
of the MT “Pretty Scene”
to the ship concerned was not
proved on a balance of probabilities. There was only a conclusion of
law that it was an associated
ship.
[52]
In
Galsworthy
Ltd v Pretty Time Shipping SA & others, Pretty Time Shipping SA &
others v Galsworthy Ltd
[43]
the
summons
in
rem
and
the warrant of arrest were set aside by the court on the basis that
control was not proved on a balance of probabilities. The
court held
that:
‘
The
founding affidavit read with the various annexures that were put up
simply did not make out a case that CC Liu by virtue of
his
shareholding of Parakou exercised control over that company.
The applicants clearly relied on the documentation it had
put up.
It made its bed and is forced to lie on it.  No case whatsoever
was made in the alternative to suggest that
Mr CC Liu notwithstanding
that he did not control Parakou by virtue of his shareholding
nevertheless was still the puppet master
pulling the strings and
controlling that company as well.’
Admiralty
practice allows hearsay evidence which parochial courts do not, so
extra caution must be taken to at least set out such
‘hearsay’
as fully as it may enable the party who learns of the basis of the
rem arrest
ex post facto
, so to speak.
[53]
I agree with the Pretty Scene parties’
contention
that due to the ‘draconian’ procedure provided by the
Act, the procedural safeguards require strict observance;
the
arrestor bears the onus to prove compliance with all procedural and
substantive issues. In our law a summons which propounds
the
plaintiff’s own conclusions and opinions instead of the
material fact is defective. ‘Such a summons does not set
out a
cause of action’.
[44]
Galsworthy
had
no grounds to effect the arrest as it failed to show the facts
leading to the conclusion that the MT “Pretty Scene”
was
associated to the ship concerned. The lack of averments, particularly
as to the association of the vessels strikes at the core
of whether
the MT “Pretty Scene” was an associated ship to the MT
“Jin Kang”. The simplistic averments
in the summons
in
rem
in
dealing with the proof of the association in para 18 merely stated
that ‘the defendant is an associated ship of the MT
“Jin
Kang” as defined in terms of s 3(6) and s (7) of the Admiralty
Act. The plaintiff’s claims are therefore
enforceable by an
action
in
rem
against the defendant.’ This is not sufficient proof on a
balance of probabilities of an association.
[54]
As aforesaid the Act provides for three broad scenarios of
association. These three broad scenarios
can be one of the following:
(a)
The arrest of the ship in the same ownership in respect of which the
claim arose –
the so called sister ship arrest (s 3(7)
(a)
(i)).
(b)
By the arrest of a ship owned by a company controlled by the person
who controlled the company
which owned the concerned ship (s
3(7)
(a)
(ii)).
(c)
A combination of the two, where either the ship concerned or, the
associated ship
is owned personally by the beneficial owner and the
other by him through a company (s 3(7)
(a)
(iii)).
None
of the specific subsection of either s 3(6) & (7) was referred to
in the summons for the judge seized with the
ex parte
application to consider.
[55]
Section 3(7)
(c)
is also of significance as it provides for the
three different scenarios for ‘beneficial ownership’
being deemed ownership.
The appellant’s case is based on s
3(7)
(c)
of the Act which provides as follows:
‘
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.’
[56]
The Rule 4(3) certificate bore a similar averment that ‘The
property sought to be arrested,
the MT “Pretty Scene” is,
in terms of s 3(6) and s (7) of the Act, an associated ship of the
ship in respect of which
the claim lies.’ Having made such bold
conclusions of law Galsworthy
sought
to rely on an affidavit made in respect of a different matter under a
different case number (A20/2015) of which it made no
reference to in
the present summons nor incorporated it by reference to the matter
which was before Vahed J. This was a new action
in
rem
where Galsworthy
sought
to arrest a new defendant and all the facts had to be presented
before the court in line with the provisions of the Act and
the
Rules. I am not persuaded by the submissions made on behalf of
Galsworthy and the appeal must
fail.
The
second appeal
[57]
The basis for the appeal against the judgment of Henriques J are as
follows:
57.1
Whether English Law was applicable in the enforcement of the
arbitration awards;
57.2
Whether the MT “Pretty Scene” was an associated ship of
the MT “Jin Kang” (the ship
concerned) and if Galsworthy
demonstrated compliance with procedural and substantive requirements
for the arrest of the associated
ship;
57.3
Whether the court erred in not finding that the second arrest by
Galsworthy (the respondent in this appeal)
of the MT “Pretty
Scene” whilst she was still under arrest was an abuse of the
process of court;
57.4
The effect of the intervening liquidation of Parakou Singapore on 23
March 2016;
57.5
Whether the application for counter security for the wrongful arrest
was correctly dismissed;
57.6
The effect of the provisions of s 299(1) of the Singapore Companies
Act
[45]
on the enforcement of
Galsworthy claims; and
57.7
Whether an association has been established between the owner of the
ship concerned and the associated ship.
The application of
English Law
[58]
Galsworthy claims against Parakou Singapore were referred to
arbitration by virtue of a choice
of law clause in the charterparty.
This was by virtue of the provisions of s 6(5) of the Act which
provides that:
‘
The
provisions of subsection (1) shall not supersede any agreement
relating to the system of law to be applied in the event of a

dispute.’
[59]
The Pretty Scene parties
and
Galsworthy
are
ad idem
that English Law did not apply because of the provisions of s 6(1) of
the Act, as found by Henriques J, but because of the provisions
of s
6(5) of the Act. Section 6 of the Act provides as follows:
‘
6.
Law to be applied and rules of evidence.
—(1)
Notwithstanding anything to the contrary in any law or the common law
contained a court in the exercise of its admiralty
jurisdiction
shall—
(
a
)
with regard to any matter in respect of which a court of admiralty of
the Republic referred to in the Colonial Courts of Admiralty
Act,
1890, of the United Kingdom, had jurisdiction immediately before the
commencement of this Act, apply the law which the High
Court of
Justice of the United Kingdom in the exercise of its admiralty
jurisdiction would have applied with regard to such a matter
at such
commencement, in so far as that law can be applied;
(
b
)
with regard to any other matter, apply the Roman Dutch law applicable
in the Republic.
(2)
The provisions of subsection (1) shall not derogate from the
provisions of any law of the Republic applicable to any of the

matters contemplated in paragraph (a) or (b) of that subsection.
(3)
A court may in the exercise of its admiralty jurisdiction receive as
evidence statements which would otherwise be inadmissible
as being in
the nature of hearsay evidence, subject to such directions and
conditions as the court thinks fit.
(4)
The weight to be attached to evidence contemplated in subsection (3)
shall be in the discretion of the court.
(5)
The provisions of subsection (1) shall not supersede any agreement
relating to the system of law to be applied in the event
of a
dispute.’
[60]
I now turn to deal with the provisions of the Act, case law and the
relevant charterparty clause
in the determination as to which law is
applicable. Clause 17 of the charterparty provided as follows:
‘
That
should any dispute arise between Owners and the Charterers, the
matter in dispute shall be referred to three persons at London
one to
be appointed by each of the parties hereto, and the third by the two
so chosen, their decision or that of any two of them,
shall be final
and for the purpose of enforcing any Award, this agreement may be
made a rule of the Court. English law to apply.
The Arbitrators shall
be commercial shipping men.’
Therefore
a South African court will apply English Law as at 1 November 1983 in
respect of English maritime claims as at that point
and time, which
law will be applicable in respect of the new maritime claims or heads
of jurisdiction as provided for in the Act.
The provision
of s 6(5) allows the parties to contract
out of the statue regarding the law which applies to them.
[61]
The court in
Bouygues
Offshore SA & another v Owners of the MT Tigr & another
,
[46]
held that the onus is on the defendant raising the defence to
establish on a balance of probability that there is another more

appropriate court or tribunal. If the defendant succeeds the
evidential burden shifts to the plaintiff to show special
circumstances
by reason of which justice trial requires that the
nonetheless to take place in the forum chosen by the plaintiff. In
the
MV
Spartan-Runner v Jotun–Henry Clark Ltd
[47]
the court also held that
where the parties have agreed that disputes are to be referred to a
foreign tribunal, the onus rests upon
the plaintiff in the South
African court to show why the court should not stay the proceedings
before it should give effect to
the agreement between the parties.
[62]
In an article appearing in the South African Law Journal by
Staniland, the following extract
provides clarity on the point:
[48]
‘
Section
6(1)(a) of the 1983 Act does not, however, have the effect that
English law is invariably applied. This is because s 6(5)
of the Act
provides that the provisions of s 6(1) “shall not supersede any
agreement relating to the system of law to be,
applied in the event
of a dispute”. The intention underlying s 6(5) appears to be to
reverse the right of the parties to
agree on the law to be applied.
Thus the parties are free to agree on the application of English or
Roman-Dutch law or, indeed,
any other system of law. But where the
parties decide to agree on the law to be applied, the trade practice
is that they are highly
likely to stipulate for the application of
English law and arbitration in London. Only if there is no such
stipulation does s 6(1)(a)
provide for the application of English
law.’
[63]
In
Representative
of
Lloyds v
Classic Sailing Adventures
[49]
the following was held: that Section 6(2) and s 6(5), which latter
provision provides that the provisions of s 6(1) shall not supersede

any agreement relating to the system of law to be applied, must be
read together, so that s 6(5) is qualified by s 6(2). The result
will
be that where parties agree upon the system of law to govern disputes
arising between them, this does not serve to oust any
law of the
Republic referred to in s 6(2), where that law is peremptory.
[50]
Hofmeyr’s
[51]
view
contends that this interpretation cannot be supported, ‘[as] s
6(2) is simply declaratory of the position which applied
before the
commencement of the Act that although the court in the exercise of
its admiralty jurisdiction applied admiralty law,
that law remained
subject to local statutes.’ He goes on further to say ‘[s]
6(2) does not qualify s 6(5) which deals
with the right of the
parties to agree that a legal system of their choice should govern
any disputes that arise between them.’
He goes on to state that
s 6 was not intended ‘to prescribe the limits of party autonomy
where the court exercises its admiralty
jurisdiction.’ He
states that the party autonomy is only subject ‘to two
fundamental limitations, namely where the
local statute in question
provides, either expressly or by necessary implication, that its
provisions cannot be ousted or where
the local statute regulates
matters for public policy, interest of a right.’ I support the
reasoning advocated by
Hofmeyr.
[64]
The following principles need to be taken into account when one
considers which law to apply:
64.1
The
Andrico Unity
judgment held that the law to be applied to
the resolution of a disputed claim in admiralty falls to be
determined, by reference
to s 6 of the Act;
64.2
It has to be established whether there is a statute or statutory
provision, applicable to the issue in dispute
and if there is that it
will generally apply;
[52]
64.3
If no statute or statutory provision is applicable, the courts will
generally give effect to an agreement,
if any, between the parties as
to the law to be applied in terms of s 6(5) of the Act;
64.4
Certain statutory provisions may however, restrict the parties’
freedom to choose the law to govern
their legal relationship, for
example s 3 of the Carriage of Goods by Sea Act.
[53]
It could also be that the provisions of the law applicable may not be
waived by agreement, for instance, s 3(1) of Carriage of
Goods by Sea
Act provides that where a cargo is carried in terms of a bill of
lading or similar documents of title to a destination
in SA, whether
final or not the consignee or the holder of the bill of lading may
enforce the claim in a competent division of
the High Court
exercising admiralty jurisdiction, irrespective that the carriage
contract contains a clause purporting to oust
the jurisdiction or
confers exclusive jurisdiction to a foreign court;
64.5
If no statute or statutory provision is applicable and the parties to
a dispute have not agreed on the applicable
law, the law to be
applied is the law provided in s 6(1), which differentiates between
the maritime claims existing before 1 November
1983 and those
governed by the provisions of the Act. The Act caters for the
preserved maritime claims and the new added heads
of jurisdiction. In
respect of the preserved heads of jurisdiction, the applicable law is
the law of the Supreme Court of England
and Wales exercising its
admiralty jurisdiction which would have applied as at 1 November
1983.
[54]
In respect of the new heads of jurisdiction the Roman Dutch Law would
apply.
[55]
64.6.
The court in the
Andico Unity
considered the rules in English
private international law in that a foreign contract is given the
same legal consequences as it
would be accorded under its proper law.
The rationale of the rule, being that by its application the
legitimate expectations of
the parties to the contract as to their
rights will not be defeated by any change of forum in which such
rights may be defeated.
[65]
In summary, the law to be applied if s 6(1)
(a)
of the Act is resorted to is the law which the High Court of Justice
of the United Kingdom in the exercise of its admiralty jurisdiction

would have applied in November 1983, including case law, statutes and
principles of English private law
.
[56]
The caveat to this position is that English Law was to be applied
only in so far as that law can be applied. South African statutes

have superseded the English statutes. Counsel for the appellants’
submitted that English law should apply because the chronology

indicates that the MT “Jin Kang” was sold by Galsworthy
in June 2009, the first arbitration award was delivered on
31 August
2010 and the second on 18 March 2011, a long time after the sale of
the “Jin Kang” by Galsworthy, when the
charterparty
relied upon was no longer in existence. Therefore in applying the
decision in
Indian
Grace
,
[57]
this court should be bound to apply English substantive law and
statutes. If the court is with them, claim 3 should fall away as
it
would be extinguished and res judicata would apply. Therefore the
only claims to be considered should be the two arbitration
awards
only.
[66]
If a question arises at any time if the claim is a maritime claim,
the court shall determine
if it is a maritime claim for the court to
exercise its exclusive admiralty jurisdiction. Once the court has
decided that it is
a maritime claim the jurisdiction becomes
exclusive, subject to the exercise of the court’s discretion in
terms of          s

7(1)
(a)
,
the matter will be heard in terms of s 7(2)
(a)
.
In the
Wave
Dancer
[58]
the court held that s 7(2) is peremptory in nature and confers
exclusive jurisdiction. The court can in the exercise of its
discretion
also stay proceedings for adjudication in a forum of
choice. However, having accepted that the parties have ‘contracted’

out of the jurisdiction of any other court, Roman-Dutch law and South
African statues are not applicable to the dispute. Galsworthy
has
failed to show that there are any exceptional circumstances which
will persuade this court to apply the
lex
fori
.
[67]     In an action
in
rem
in
terms of the Act the defendant is either the ship, or the owner or
both. In
The
Indian Endurance (No 2) Republic of India & another v India
Steamship Co Ltd
[59]
(“
Indian
Grace
”)
the court did not recognise
res
judicata
as a defence. According to various authorities the
Indian
Grace
should have no effect on Rule 8(3) which provides that the filing of
a notice of appearance to defend an action
in
rem
shall not by reason of the person filing it incur liability or be
liable
in
personam
,
save for the payment of costs. A maritime lien gives rise to a claim
in rem
,
therefore in terms of s 6(1) of the Act, the
lex
fori
will be English law applicable to them as of 1 November 1983 as it
recognises the maritime lien. If the arrest
in
rem
arose out of a lien, not recognised by English law, the English law
will not apply. In this case s 6(5) is what the parties determined

before any dispute arose and will govern their dispute. In
MV
Silver Star: Owners of MV Silver Star v Hilane Ltd
[60]
the following was stated:
‘
The
English cases are by no means unanimous in this regard. Sheen J,
the admiralty judge, expressed a contrary view in
The
St Anna
.
[61]
Relying on dicta in both the Court of Appeal and the House of Lords
he held that there was no reason not to give the words
in the statute
their ordinary meaning or to constrain them in the light of the
history of similar expressions in earlier statutes.
He held that an
action on an arbitration award is an action to enforce the
contract contained in the contract embodying the
submission to
arbitration, in that case the charterparty, and therefore the claim
was one arising out of an agreement for the use
and hire of a ship.
He added that he was pleased to reach that result because it enabled
the court to do justice —
“
in
a way which would be denied to it if creditors could not bring
proceedings in rem merely because they faithfully honoured their

agreement to submit to arbitration a dispute which is clearly within
the Admiralty jurisdiction
”.’
[62]
[68]
I need to consider the following submission by the Pretty Scene
parties:
68.1
It was submitted on behalf of these parties that in the
Indian
Grace,
Lord Steyn, abolished the difference between an action
in
rem
and an action
in personam
. He confined himself to s 34
of the Civil Jurisdiction and Judgments Act 1982, at 389 of the
judgment which states that:
‘
The
function of s 34 was to overcome the anomaly created by the fact that
the doctrine of merger did not apply in the case of foreign,
ie
non-English, judgments. The rationale of the bar against proceedings
caught by s 34 is that
it
is
unjust
to
permit
the
same
issue
to
be
litigated
afresh
between
the
same
parties
…
Given
this legislative objective, it would in my view be wrong to permit an
action in rem to proceed despite a foreign judgment
in personam
obtained on the same cause of action. The purpose of s 34 militates
in favour of the bar created by it applying to
the action in rem.
That seems to me to be a factor weighing strongly against the
arguments of the plaintiffs.’
68.2
In a book by Peter R Barnett
[63]
on the subject of foreign judgments and non-merger of the underlying
claim he states as follows:
68.2.1
At common law a foreign judgment does not merge with the underlying
claim, and so does not operate as a bar to further recovery.
A
successful party may elect either to enforce the judgment or if the
foreign judgment remains unsatisfied sue again in England
for further
relief upon its claim. Even though the foreign law might consider its
judgment has extinguished the cause of action,
this does not decide
the question for an English Court which indicates that the preclusive
effect of a foreign judgment at common
law, in so far as the cause of
action preclusion is concerned, is a matter for English Law.
68.2.2
Section 34 was enacted to provide a plea which might prevent a party
with a foreign judgment in his favour from reasserting
the same claim
in England and Wales or Northern Ireland as that upon which the
foreign judgment had been given. In his view what
was aimed at by s
34, is the extension of the English doctrine of merger to the
judgments of all overseas courts of competent jurisdiction
which are
enforceable and entitled to recognition in this country.
[69]
With due respect, I do not agree with Henriques J’s view that
the doctrine of merger should
not apply as it is not in line with the
Act and legal authorities. The doctrine applies in terms of the
English law, the choice
of law chosen by the parties to the
charterparty.
The
validity of the second
arrest
[70]
In considering whether the second arrest was valid or not I have
considered the following:
70.1
Before Henriques J it was argued that the appellant acted in breach
of s 3(8) of the Act, by arresting the
MT “Pretty Scene”
whilst it was still under the arrest order of Mnguni J. It was
submitted that this was an abuse of
the process of court, was
vexatious as the same issues and parties were brought before the
court. The provisions of s 3(8) prohibits
the arrest of the property
more than once in respect of the same claim by the same claimant nor
may security for it be given more
than once, even if security was
given in a foreign jurisdiction. This was confirmed in
MV
Fortune 22: Owners of the MV Fortune 22 v Keppel Corporation Ltd.
[64]
According to Hofmeyr
[65]
two
jurisdictional facts must be present before the section is invoked.
‘There must be an actual arrest or deemed arrest
in terms
3(10)(a) and security must have been furnished’ and  further
that ‘[the] arrest must have been legally
valid and be a
competent arrest and not an arrest which has been set aside for want
of legal validity’.
[66]
70.2
Section 3(8) links the arrest with the furnishing of security. A
second arrest effected before security is
lodged in respect of the
first arrest will not be prohibited by s 3(8).
[67]
The second question is whether a judgment flowing from an arrest
in
rem
constitutes, for the purpose of s 3(8), the same claim as the cause
of action giving rise to the judgment. The issue was dealt
with in
MV
"Ivory Tirupati".
[68]
In the
MV
"Ivory Tirupati"
it
was argued that the foreign judgment arising from the arrest
in
rem
in
respect of damage to cargo could not be enforced by the arrest of an
associated ship in the Republic because it would have fallen
foul of
the provisions of s 3(6) which does not allow the bringing of an
action
in
rem
against the ship concerned and thereafter against the associated
ship. The SCA held that the arrest of the associated ship did
not
fall to be set aside because the subsequent arrest of the associated
ship, being in respect of an enforcement of a judgment,
was not in
respect of the same maritime claim as the earlier arrest in respect
of the damage to the cargo which was erroneous.
The court held that
the judgment not only strengthened the main cargo claim but also gave
rise to a new cause of action, enforceable
in another court. The
result being that the subsequent arrest of the associated ship was
found not to be in conflict with s 3(6)
and s 3(8) as these were
different causes of action.
70.3
An exception to the rule arises from the provisions of s 5(2)(d)
which states that notwithstanding the provisions
of s 3(8) in
addition to property already arrested or attached, more property may
be arrested to provide for additional security.
Similarly, where
property has been arrested by a different claimant in connection with
a maritime claim, another creditor for a
different claim is not
barred from arresting the same property. Similarly, property attached
in terms of s 8(1) to found or confirm
jurisdiction, may still be
arrested in respect to specific direction by the court.
[71]
Similarly, the question whether a defence of
res
judicata
can stand, will depend on whether the dismissed decision was on the
merits or not. In the
MV
Wisdom C
judgment,
[69]
Farlam JA
confirmed that what is decisive is not the form of the order, but the
substantive question of whether the decision was
on the merits or
not. The same should apply in this matter as the challenge was on the
procedure and not on the merits.
[72]
The basis for an action
in
rem
is
the arrest of the
res
,
as the claim lies against the
res
itself. In
The
Argun
,
[70]
Farlam JA, held that once jurisdiction has been established, it
continues to exist, until the case is finalised. This will be
applicable to an action
in
rem
where the arrest of the ship had lapsed in terms of a court order. It
was held that the lapsing of an arrest did not result in
the lapsing
of an action. Even if an action
in
rem
lapses in terms of the court order, once jurisdiction is established
it continues to exist until the action is finalised. Therefore
the
lapsing of an arrest does not result in the lapsing of an action as
held in
The
Argun
.
[73]
In this case the anticipatory arrest orders were made in terms of s
4(4)
(a)
and
(b)
of the Act which provides that the
order may be carried into effect when the property comes within the
jurisdiction of the court.
In the case of an associated ship, the
basis of the liability lies with the owner, which serves as a link to
the associated vessel,
though a different defendant.  In the
case of a charter by demise, a ship in the hands of the charterer can
be subject to
proceedings
in rem
irrespective of the absence
of a maritime lien or owner’s personal liability. Section 1(3)
provides that for purposes of
an action
in rem
a charterer by
demise shall be deemed to be, or to have been, the owner of the ship,
during the period of the charter by demise.
[74]
The judgment of
Bocimar
NV v Kotor Overseas Shipping Ltd
[71]
is authority for the rule
that the applicant bears the onus of proof on a balance of
probabilities in arrest applications in terms
of s 3(4), (5) and (6)
of the Act and attachment and security arrests in terms of s 5(3).
[75]
It is trite that the party seeking the arrest must identify the claim
and establish it on a prima
facie basis, as decided in the
Thalassini
Avgi
judgment.
[72]
Bocimar
re-affirmed
the position that in an attachment to find or confirm jurisdiction
the onus lies with the applicant to prove on a balance
of
probabilities that the property belongs to the defendant, similarly
in an action
in
rem
against the property. This affirms the dual purpose for an arrest to
obtain security for the claim and obtain jurisdiction over
the
vessel. This requirement may be relaxed in exceptional cases to
establish a prima facie case.
[73]
It is trite that at the stage of the arrest the court will not
venture into the merits of the case, however, in
Dabelstein
& others v Lane & Fey NNO
[74]
the court emphasised that this is an extraordinary remedy where care
and caution should be applied; regard may be had to the evidence
of
the applicant which is not contradicted by the respondent. The arrest
serves to bring the defendants before the court. It is
only upon
effecting the arrest that the creditors’ interests are
secured.
[75]
[76]
In this case the
Mareva
injunctions sought in the Singaporean
Court, provided security for the claims of all the creditors
including Galsworthy. Galsworthy
had no reason to pursue any further
arrests in the South African courts.
Was
the MT “Pretty Scene” associated to the “Jin Kang”
[77]
The Pretty Scene parties
’
contended
that Parakou Singapore was not the deemed owner of the “Jin
Kang” as it never accepted delivery of the vessel
and that the
“Jin Kang” was sold by Galsworthy long before the
arbitration awards were made.
77.1
The purpose of the Act, built on the Arrest
Convention
[76]
and English
law, provides for a far reaching mechanism that the loss fall where
it belongs in terms of ownership or control and
provides the claimant
with the alternative defendant in the associated ship.
[77]
77.2
In
October
International Navigation Inc v MV Fayrouz IV
[78]
the court held that it is
not necessary that the ship concerned should still be owned by such a
person or company at the commencement
of the action. In the
Heavy
Metal
[79]
the court held that the intention of the legislature is found in s
3(7)
(a)
(i)
of the Act which provides that an associated ship is a ship, other
than the ship concerned, owned at the time the action is
commenced,
by the person who was the owner of the ship concerned at the time
when the maritime claim arose. All that is required,
it was held that
(a) they should have a common owner; (b) who was the owner of the
ship concerned when the claim arose and (c)
who is the owner of the
associated ship when the action is commenced by the arrest of the
associated ship. Therefore the sale of
the “Jin Kang” to
another party would have no effect on the existence of the action
in
rem
against the defendant.
77.3
In the
Cape
Courage
,
the court held that the meaning of when the claim arose in s 3(1)(a)
is to be decided in terms South African law, ie, at the time
when the
wrong gave rise to the maritime claim and not when the cause of
action was completed.
[80]
[78]
In the matter before us in the arbitration Galsworthy sought an order
enforcing the payment of
the awards, which are maritime claims in
terms of s 1(1)(aa), alternatively a claim based on the breach of the
charterparty due
to the failure to take delivery, which claim
allegedly arose on 16 March 2009. The first award settled the issue
whether Galsworthy
had concluded a charterparty with Parakou
Singapore or not. The arbitrators found in favour of Galsworthy.
Shortly after the first
arbitration award Parakou Singapore was
placed in liquidation by its shareholders. At the intervention of
Galsworthy, the provisional
liquidators appointed by Parakou were
removed at the creditors’ meeting and Galsworthy, as a major
creditor, appointed new
liquidators. This put Galsworthy into the
driving seat.
[79]
As of 21 November 2014, the liquidators suing in the name of Parakou
Shipping PTE (in liquidation)
sought Mareva injunctions against the
shareholders and directors of Parakou in liquidation in Singapore.
From the court order in
the matter of
Parakou
Shipping PTE (in liquidation) v Liu Cheng & other
s,
[81]
the following issues emanate from that judgment:
(a)
The first and second defendants were cited as Liu Cheng Chan and Chik
Sau Kam, who were
married to each other (“the parents”);
(b)
The third defendant is Liu Por, the son of the parents (“the
son”);
(c)
The fourth defendant is Yang Jianguo (“the friend”),
described as a friend
of Liu Por. Both Liu Por and Yang Jianguo were
said to have taken over the shipping business from the parents on 22
December 2008.
This was before the arbitration awards.
(d)
The fifth and sixth defendants, Parakou Investments Holdings (PTE)
Ltd and Parakou Ship
management (PTE) Ltd were described as companies
owned by the first, second and third defendants (“the family”).
(e)
At the commencement of the liquidation Galsworthy had commenced
proceedings against Parakou
Singapore, the first award was made 31
August 2010 and second award on 13 May 2011.
[80]
The injunction was sought by the Galsworthy liquidators on the basis
of a fear that assets from
Parakou may be diverted to the fifth and
sixth defendants. The defendants’ stance was that they were
restructuring the companies,
and this process had started long before
the Galsworthy action commenced and that this was part of a group
restructuring process.
The injunction was nevertheless granted.
[81]
In the second application in the Singaporean Court brought by Parakou
(in liquidation) against
the same defendants, the applicants sought
to increase the limit of the Mareva injunctions to include the first,
second and third
defendants’ 100% shareholding in the fifth and
sixth defendants. The sixth defendant (Parakou Shipping management
PTE Ltd),
was alleged to have been diminished by the transfer of the
first, second and third defendants’ shareholding in it to
Parakou
Tankers Incorporated for no consideration. It was further
alleged that Parakou Tankers Incorporated was to merge with an
unknown
US entity which would result in the dissipation of the shares
in Parakou Tankers Incorporation.  This was considered by the

liquidators to be a dissipation of assets in the guise of corporate
restructuring by the defendants. The court found that since
there was
sufficient security in line with the purpose of the Mareva
injunction, there was no evidence to show that there was dissipation

of assets. The court found no evidence that the shares would be
transferred to the merged entity and dismissed the applications
with
costs. That settled the matter. The respondent ought as recommended
by the court in Singapore to have brought an application
for the
extension of security, if additional security was required by the
liquidators of Parakou Singapore. Galsworthy liquidators
were in the
driving seat of the liquidation, which was then a creditor’
liquidation, but further failed to apply for the
increase in
security.
81.1.
I have also considered the arbitration judgments as well. The first
arbitration determined if a charterparty was
concluded between
Galsworthy and Parakou Singapore. Parakou denied the existence of the
charterparty between itself and Galsworthy
as a result it refused to
take delivery of the “Jin Kang”. The dispute was referred
to arbitration in terms of clause
17 of the charterparty. Oral
evidence was led by both parties. Having heard the evidence from both
parties, the arbitrators concluded
that a charterparty dated 17 June
2008 existed between the parties. Its findings were legally binding
on the parties. It was also
reserved in the first arbitration that
the arbitrators would be seized with the hearing for the
determination of the quantum of
damages due to the respondent,
Galsworthy. Having dealt with the primary issues of liability in the
first award, the arbitrators
found in favour of the respondent and
awarded damages to Galsworthy. The claim arose when Parakou breached
the terms of the charterparty.
81.2
In the first arbitration Parakou Singapore was legally represented
and all the contractual issues in dispute
were ventilated. The
confusion relating as to whether Parakou entered into a charterparty
with Galsworthy or someone else was cleared.
The arbitrators found
that Parakou also ratified the charterparty. The second award on
quantum was made on 13 March 2011. The arbitrators
found that though
at a certain stage of the second arbitration Parakou was not legally
represented due to the intervening liquidation,
the evidence was
already before the arbitrators and the arbitrators felt that it would
prejudice Galsworthy if proceedings were
adjourned at the instance of
Parakou due to the liquidation process that was going on in Hong
Kong. This led to the finalisation
of the second arbitration award on
13 May 2011.
[82]
It is common cause that this was not the first time that Galsworthy
tried to enforce its claim
against the respondent. On 30 April 2009,
the arrest of the MT “Pretty Time” was set aside by
Levinsohn DJP on the
basis of the failure by the applicant to show
that the vessel was an associated ship to “Jin Kang”.
[82]
It must also be noted that at the time when Levinsohn AJP was seized
with the matter the arbitration proceedings were pending in
London.
The application had sought to arrest the MT “Pretty Time”
to obtain security for such proceedings. The arrest
of the alleged
associated ship was based on s 3(6) read with s 3(7) of the Act
arising from the charterparty deeming Parakou Singapore
as the owner
of the “Canton Trader” (Jin Kang). An allegation had been
made that CC Liu as the majority shareholder
of Parakou, was
therefore the deemed owner of the “Canton Trader”, as he
was the person who both owned and controlled
the vessel. It turned
out that the applicant, Galsworthy had misinterpreted the
shareholders report. In fact as of 18 February
2009 Por Liu and Jian
Guo Yang were the shareholders appointed on 18 December 2008 and
their shareholding was reflected as 840
000 and 360 000 shares
respectively. Therefore the allegation that CC Liu was in control at
the time of the alleged breach of the
charterparty was made in error.
I must point out that at the time of the judgment there was no
certainty if Parakou was the deemed
owner of the “Canon
Trader”. That certainty was cleared by the first arbitration
award. In the same judgment of Levinsohn
DJP, the court held that
Galsworthy had also not shown that CC Liu, notwithstanding that he
was no longer the shareholder, that
he ‘was still the puppet
master pulling the strings and controlling that company as well.’
[83]
The court having found that the Pretty Time, one of the entities
owned by the first appellant was not owned by the deemed owner
of the
“Jin Kang”, respondent still arrested an entity owned by
the first appellant.
[83]
The following are the relevant facts appearing from the high court
judgments in Singapore suit
number 434/2014 and MT “Pretty
Time” by Levinshon DJP, which are relevant in the determination
of whether there is
an association between the MT “Pretty
Scene” and the “Jin Kang” which show the following:
83.1
That Parakou Shipping PTE Ltd (RC number 199 507 2739) was
incorporated on 13 October 1995. At the time
of incorporation, the
parents cited as the first and second respondents, Liu Cheng Chan and
Chik Sau Kam were directors and shareholders,
and as of 31 December
2008, the son and Yang Jianguo took over as directors since 22
December 2008;
83.2
That prior to liquidation Parakou Singapore PTE, it was at all
material times part of the Parakou Group,
including Parakou
Investment Holdings PTE Ltd; Parakou Shipping management PTE Ltd;
Parakou Shipping Ltd; Parakou International
Ltd and Parakou SA;
83.3
That at all material times the entities within the Parakou Group were
managed by Liu Cheng Chan and his wife
Chik Sau Kam. Liu Cheng Chan
was the Chairman of the Parakou Group and had ultimate control of the
entities within the group;
83.4
That as early as 31 December 2003 and at all material times
thereafter the Parakou Shipping PTE Ltd (in liquidation)
was
insolvent. At the incorporation of the company in liquidation; the
parents were directors and shareholders till 31 December
2008 and it
has been so since its incorporation on 21 December 2008. The couple
were Singapore citizens and married to each other.
At incorporation
they were equal shareholders. From 1 January 2015 the husband held
80%, the wife 8.33% and the son, Liu Por, 11.67%;
83.5
Pursuant to a resolution of 22 December 2008, the husband and wife
transferred their shares to the son and
his friend, Yang Jianguo. The
couple also resigned as directors from 31 December 2008. These facts
are almost similar to the facts
presented before Levinsohn DJP, where
the court found that Liu Por was the major shareholder in Pretty
Scene Shipping SA;
83.6
It was alleged that notwithstanding their resignations and the
transfer of their shares to their son and
the friend, the parents
retained control of the companies. The new shareholders consulted the
former chairperson and deputy chairperson
on all major decisions;
83.7
That the first, second and third respondents retained a 100%
shareholding in Parakou Shipping SA (incorporated
in Parakou) and
they were involved as directors in Pretty Diversity Shipping SA,
Pretty Harvest Shipping SA, Pretty Concept Shipping
SA, Pretty Scene
Shipping SA, Pretty Rich Shipping SA, Pretty Jewelry Shipping SA,
Pretty View Shipping SA, Pretty Time Shipping
SA, Pretty Shipping SA,
Pretty Urban Shipping SA and Pretty World Shipping SA; (the Pretty
Entities);
83.8
That the son Liu Por with effect from 22 December 2008 was a director
and shareholder of the company in liquidation
and that as of 22
December 2008 he held 70% of the shareholding in that company. The
son’s involvement is mentioned in other
Parakou companies in
Singapore ranging from 10% to 30% shareholding in the liquidated
company. It appears that his shareholding
was that of a minority
shareholder. This is an indication that the major shareholding and
control remained with Liu Cheng Chang.
This is clear from the
shareholding in Parakou Investment Holdings PTE Ltd and Parakou
Shipping management PTE Ltd where the shareholders
were only the
father, mother and son, holding 70-20-10 and 50-30-20 shares
respectively;
83.9
That as of 11 January 2007 the “Pretty Vessels”
collection was placed under management agreements
for a period of 12
months.  The “Pretty Vessels” collectively known as
“Pretty Entities” were all
single company owned vessels
ie. the St Michaelis by Pretty Diversity Shipping SA; St Gabriel by
the Pretty Harvest Shipping SA;
Overseas Hercules by Pretty Concept
Shipping SA; Pretty Scene by Pretty Scene Shipping S.A; Overseas
Orion by Pretty Rich Shipping
SA; Pretty Jewelry by Pretty Jewelry
Shipping SA; Overseas Cygnus by Pretty View Shipping SA; St Johannis
by Pretty Harmony Shipping
SA; Pretty Time by Pretty Time Shipping;
St Marien by Pretty Unity Shipping SA; Pretty World by Pretty World
Shipping SA; and Overseas
Sextans by Pretty Urban Shipping SA;
83.10
That the sole shareholder of the “Pretty Entities” was
none other than Liu Por as found by Levinsohn DJP
in MT “Pretty
Time”.
[84]
The aforementioned information shows who were acting as the
controlling minds at all material
times in respect of the various
entities.  I find that Liu Por was the
de jure
owner of
Pretty Scene Shipping SA. It had also been advanced that based on the
Equasis records that the MT “Pretty Scene”
was owned by
Pretty Scene Shipping SA. The Pretty Scene Shipping SA formed part of
the various entities owned or controlled by
Liu Por. I therefore come
to the conclusion that it was not associated to the “Jin Kang”,
as it was Liu Cheng Chang
who controlled Parakou Singapore, when the
claim arose.
[85]
The application brought by Galsworthy is vexatious and an abuse of
the process of court as it
cannot continue pursuing any asset owned
by the Pretty Scene parties on the basis that they are associated to
the “Jin Kang”.
Our law places control of a company
on the shareholders. This is a factual and a legal question. Hare
[84]
emphasises that the status of ownership or control of the ship
concerned remains even when the ship concerned has been sold or
lost.
It is not always easy to establish who is in control where the
company may be a shelf company or owned by a nominee who may
just be
an agent for a principal. This is also the case where the
shareholding is 50/50 as was the case in
MV
LA Pampalouis Dreyfus Armateurs SNC v TOR Shipping.
[85]
The shareholders lose control when the company gets deregistered or
is placed under liquidation. It is never easy to prove control,
hence
the Act in s 6(3) allows for the receipt of hearsay evidence. Our
courts accept records from Lloyd’s list of records
and
investigative reports to prove control as it was the case in the
Silver
Star
[86]
matter.
[86]
Wallis
[87]
states that it is
now possible to pursue claims relating to ownership or possession of
a ship by way of an associated ship arrest.
He goes on to say that
this extension must be taken to have effect in relation only to
monetary claims arising from the questions
of ownership or possession
of a ship, such as a claim for damages arising from late delivery of
a vessel under an agreement of
sale. Later in his thesis
[88]
,
and this is very significant, is that previously control was based on
shareholding but the amended section, concentrates on the
person in
whom the power of control vests and providing that the same person
controls both companies the association is established

notwithstanding the presence of minority shareholders in either
company, He goes on to say that this has the effect of rendering
the
presence of minority shareholders irrelevant, which may raise a
constitutional challenge for instance, where A owns 60% shareholding

in company X and B is a minority shareholder at 40% and in company Y
the shareholding is reversed as it may involve an arbitrary

deprivation of the property of the minority shareholder. Now in terms
of s 3(7)(b)(i) ships are deemed to be owned by those persons
who own
the majority in number of the shares in the ships. The section is
clear in that it does not speak of the majority owner
of the shares
but of owning the majority in number of shares. As stated in the
Heavy
Metal
judgment,
[89]
the ‘dominance
of control’ is the key to determining the association in such a
situation. It is clear that the ownership
and control of Parakou PTE
(in liquidation) lay with Liu Cheng Chang and his wife only. The
legal shareholder and controller of
the Pretty Shipping Company is
not Liu Cheng Chang but Liu Por. Lastly, the liquidators were in
de
jure
control
of Parakou Singapore.
[87]
As a guideline I have extensively relied on the views of Wallis and
other legal sources on the
subject, which show that:
87.1
In regard to the associated ship the relevant date at which to
determine ownership of the ship or control
of the company is the date
of commencement of the action. In relation to the ship concerned the
relevant date is the date upon
which the claim arose.
[90]
The date of the commencement of the action would be the actual date
of arrest or deemed arrest of the associated ship.
[91]
87.2
As the commencement of an action
in rem
may be
instituted by the arrest of the associated ship in terms of s 3(6) of
the Act instead of the ship concerned, it is not relevant
whether the
ship concerned no longer exists or that is has changed hands since
the claim arose. This protects the rights of the
claimants and is
advantageous to the claimants as the ship concerned may have been
lost at sea or destroyed. The associated ship
provisions are also
applicable to all forms of ownership in terms of s 3(7)
(b)
(iii),
thus giving a wider protection to the claimants. In this case this
would apply to the deemed ownership of the “Jin
Kang”.
87.3
Wallis in his thesis states that the language of s 3(7)
differentiates between the owner and the demise charterer
of the
vessel
[92]
. Wallis states that
s 1(3) which came into effect on 20 June 2003 specifically provides
that for the purposes of an action
in
rem
a
charterer by demise is deemed to be or to have been the owner of the
ship for the period of the charter. As a result thereof
the same
principle applies to all charterers being ‘that the party that
stands behind the debtor should be the party behind
the company that
owns the associated
ship.’
[93]
[88]
The main issue is to determine the owner of the associated ship, as
determined at the date of
arrest of the associated ship and the
determination of whether it is the same owner that owned the ship
concerned. It has not been
proven on a balance of probabilities that
Liu Cheng Chang was the deemed owner of the MT “Pretty Scene”.
The same dispositive
factor which they encountered in the Pretty
Time, where the court found that they have failed to prove that Liu
Cheng Chang was
the power behind the scenes. At the time when the
claim arose, Liu Por was not a shareholder in the Parakou Singapore.
[89]
Various legal authorities are in agreement that legal control or
limited managerial control is
not sufficient to support the arrest of
an associated ship. It is therefore important to identify where
actual control lies.
The
intervening liquidation and application of section 299(1)
[90]
The effect of intervening liquidation proceedings against Parakou
would be determined in terms
of the choice of law between the
parties. Similarly, the same should apply to the effect of the
maritime moratorium imposed in
terms of s 299 of the Singapore
Companies Act, which provides as follows:
‘
(1)
Any attachment, sequestration, distress or execution put in force
against the estate or
effects of the company after the commencement
of a creditors’ voluntary winding up shall be void.
(2)
After the commencement of the winding
up no action or proceeding shall be proceeded with
or commenced
against the company except by leave of the Court and subject to such
terms as the Court imposes.’
When
do the multiple arrests give rise to an action against Galsworthy?
[91]
Section 3(8) 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.’
This
provision is subject to the provision of s 5(2)
(dA)
which
provides that:
‘
notwithstanding
the provisions of section 3(8), order that, in addition to property
already arrested or attached further property
be arrested or attached
in order to provide additional security for any claim, and order that
any security given be increased,
reduced or discharged, subject to
such conditions as to the court appears just.’
[92]
The prohibition in s 3(8) relates only where there has been an arrest
and security has been given.
[94]
This is in line with the purposive interpretation of the Act that you
arrest for purposes of getting security for your claim. This
is also
clear from the deeming provisions of s 3(10)
(a)
(i)
which states that once security has been provided there is no need
for the actual arrest. The arrest cannot occur
in
vacuo
,
it has to be accompanied by the provision of security.
[93]
Where there is no arrest, whether set aside by the court or no
security in place, there is no
arrest. The second arrest is
permissible where the court sets aside the arrest on the basis of
failure to make out a prima facie
case.
Great
River Shipping Inc v Sunnyface Marine Limited
[95]
states
that where the initial arrest has been set aside on the basis that
the claimant failed to make out a prima facie case in
respect of the
causes of action on which it relied for that arrest, the second
arrest, was permissible
.
Where
there has been an arrest and no provision of security is made it is
permissible to re-arrest save in circumstances under s
5(2)
(d)
.
[94]
The legal authorities are in agreement in that the prohibition
operates only where the claimant
is in possession of valid security,
given in respect of the maritime claim and given for the purposes of
securing the release of
the vessel from arrest or to prevent the
arrest.
[95]
The territorial scope of s 3(8), as interpreted by Wallis, is that
‘[section] 3(8) is likewise
subject to territorial limitation
but the limitation is even narrower than those under the Arrest
Convention’.
[96]
The
limitation is that it is only concerned with the arrest of property
in South Africa in terms of the Act and the giving of security
for
that property, because the general principle in the interpretation of
statutes is that legislation is presumed not to have
an
extra-territorial application. The language of the Act indicates that
it is concerned with the arrest of the ‘property’
and s
3(5) sets out what property can be arrested. This is a limited group
of property unlike under the Arrest Convention. The
language used
does not indicate that it is applicable elsewhere other than in South
Africa; it is only applicable to arrests and
the provisions of
security only in South Africa.
[96]
However, (a)
The
Thalassini
[97]
judgment made it clear that where the arrest is for purposes of
obtaining security, the arrest will not be obtained where security

has been provided. (b) In terms of s 5(2)(c) of the Act a court is
empowered to order that any arrest be subject to such conditions
as
appears just whether as to the furnishing of security or liability
for costs, or damage caused and likely to be caused. It is
trite that
security is restricted to those claims in respect of which the
claimant is entitled to such security to pursue a claim
in South
Africa or in a foreign jurisdiction. Galsworthy has pursued its claim
against Parakou in Singapore and there was no need
for it to pursue
the same claim in South Africa.
[97]
On that basis I agree with the Pretty Scene parties that they have a
prima facie case against
the respondent for the wrongful arrest of
the “Pretty Scene”. This was a classic case of pursuing
the same claims in
two different jurisdictions.
[98]
In a claim for damages for wrongful arrest s 5(4) of the Act provides
as follows:
‘
Any
person who makes an excessive claim or requires excessive security or
without reasonable and probable cause obtains the arrest
of property
or an order of court, shall be liable to any person suffering loss or
damage as a result thereof for that loss or damage.’
Previously
before the amendment of the section the requirement was that ‘good
cause’ be shown and not ‘reasonable
and probable cause’.
This is a more stringent test.
[99]
In the light thereof 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.
[100]
the Pretty Scene parties have
satisfied
this court that they have a genuine and reasonable need for security
to pursue a claim for damages for wrongful arrests
against
Galsworthy.
[101]
Accordingly, I propose the following orders:
1. The appeal in respect
of case no. A23/2015 be dismissed with costs, to
include
costs of two counsel, where applicable.
2. The appeal in respect
of case no. A65/2016:
(a) be
upheld with costs, costs to  include the costs of two counsel
where applicable.
(b)
The arrest is set aside.
(c)
The applicants counter application be upheld with costs, costs to
Include
costs of two counsel, where applicable.
___________________
Mbatha
J
Date
of hearing

:      1 August 2018 (A Court)
Date
delivered

:     4 March 2019
Appearances
:
For
Pretty Scene parties

:    Adv GD Harpur SC
Instructed
by

:    NORTON ROSE FULBRIGHT SA INC
3
Pencarrow Crescent, Pencarrow Park
La
Lucia Ridge
c/o
TATHAM WILKES INC
200
Hoosen Haffejee Street
Pietermaritzburg
For Galsworthy
Limited

:    Adv M Wragge SC
Instructed
by

:    SHEPSTONE & WYLIE
24
Richefond Circle
Ridgeside
Office Park
Umhlanga
Rocks
c/o
SHEPSTONE & WYLIE
1
st
Floor, Absa House
15
Chatterton Road
Pietermaritzburg
[1]
Admiralty
Jurisdiction Regulation Act105 of 1983.
[2]
Rules
regulating the conduct of the admiralty proceedings of the several
provincial and local divisions of the supreme court of
South Africa,
GN R571,
GG
17926, 18 April 1997.
[3]
Singapore
Companies Act, Cap 50, available at
https://sso.agc.gov.sg/Act/CoA1967,
accessed
26 February 2019.
[4]
Vidal
Armadores SA (Owner of the MFV "Galaecia") v Thalassa
Export Co Ltd
2006
JDR 0379 (D).
[5]
The
Constitution of the Republic of South Africa, 1996.
[6]
John
Hare
Shipping
Law & Admiralty Jurisdiction in South Africa
2ed
at
83 para 2-2.2.2.
[7]
Hare
fn6 at 83 para 2-2.2.2.
[8]
GB
Bradfield ‘Shipping’ in WA Joubert and JA Faris 25(2)
Lawsa
2ed para 5.
[9]
Bradfield
fn8 para 5.
[10]
Windrush
Intercontinental SA & another v UACC Bergshav Tankers AS
[2016]
ZASCA 199; [2016] JOL 37018 (SCA).
[11]
MV
Cape Courage
Bulkship
Union SA v Qannas Shipping Co Ltd & another
2010
(1) SA 53
(SCA) para 4.
[12]
Natal
Joint Municipal Pension Fund v Endumeni Municipality
2012
(4) SA 593
(SCA)
.
[13]
Natal
Joint Municipal Pension Fund v Endumeni Municiaplity
fn12 para 18.
[14]
Northern
Assurance Co Ltd v Somdaka
1960
(1) SA 588
(A) at 595B.
[15]
Oxford
South African Concise Dictionary
2ed (2010).
[16]
Transol
Bunker BV v MV Andrico Unity
&
others
;
Grecian-Mar
SRL v MV Andrico Unity & others
1987 (3) SA 794
(C) at 798D-800E, this decision was confirmed in the
Transol
Bunker BV v MV Andrico Unity & others; Grecian-Mar SRL v MV
Adrico Unity & others
1989 (4) SA 325
(A).
[17]
Cargo
Laden & Lately Laden on Board the MV Thalassini Avgi v MV
Dimitris
1989 (3) SA 820
(A) at 834F-G.
[18]
MV
Wisdom C United Enterprises Corporation v Stx Pan Ocean Co Ltd
[2008] ZASCA 21
;
2008 (3) SA 585
(SCA) paras 15 – 16.
[19]
Cargo
Laden & Lately Laden on Board the MV Thaslassini Avgi v MV
Dimitris
fn17 at 833A-D.
[20]
Golden
Meats & Seafood Supplies CC v Best Seafood Import CC &
another
2011 (2) SA 491
(KZD) para 5 at 495C-D.
[21]
Gys
Hofmeyer
Admiralty
Jurisdiction: Law and Practice in South Africa
2ed
at 170 para X.40.
[22]
The
MV Urgup: Owners of the MV Urgup v Western Bulk Carriers (Australia)
(Pty) Ltd
& others
1999 (3) SA 500
(C) at 511D-E.
[23]
Golden
International Navigation SA v Zeba Maritime Co Ltd; Zeba Maritime Co
Ltd v MV Visvliet
2008 (3) SA 10
(C) at 13G-18D.
[24]
Ex
parte Neethling
&
others
1951 (4) SA 331
(A) at 335H.
[25]
Allpay
Consolidated Investment Holdings (Pty) Ltd & others v CEO, South
African Social Security Agency, and others
2014
(1) SA 604
(CC) para 22.
[26]
Dr
J S Moroka Municipality v Betram (Pty) Ltd
[2013] ZASCA 186
; 2013 JDR 2728 (SCA).
[27]
Trencon
Construction (Pty) Ltd v Industrial Development Corporation
of
South Africa Ltd & another
2015
(5) SA 245
(CC) paras 82-89.
[28]
MT
Cape Spirit Owners of the Cargo Lately Laden on board the MT Cape
Spirit and others
1999
(4) SA 321 (SCA).
[29]
The
Wave Dancer: Nel v Toron Screen Corporation (Pty) Ltd & another
1996
(4) SA 1167 (A).
[30]
Thalassini
fn17 at 841C-843D.
[31]
Trencon
Construction (Pty) Ltd v Industrial Development Corporation
of
South Africa Ltd & another
fn27
paras 82-89.
[32]
The
MFV "Galaecia"
fn4
para 4.
[33]
SY
Sandokan: Owner of the SY Sandokan v Liverpool and London Steamship
Protection and Indemnity Association Ltd
2001 (3) SA 854
(D) at 827D-828J.
[34]
Katagum
Wholesale Commodities v The MV Paz
1984 (3) SA 261
(N) at 269H-270A.
[35]
“
The
Tuyuti
”
[1984] 2 Lloyd’s Rep 51; [1984]
2
All
ER
545.
[36]
“
The
Jangmi” known as the “Grigorpan”
[1988]
2 Lloyd’s Rep 462.
[37]
Thalassini
n17.
[38]
Euromarine
International of Mauren v The Ship Berg
&
others
1984
(4) SA 647
(N) fn38.
[39]
MV
Heavy Metal, Belfry Marine Ltd v Palm Base Maritime SDN BHD
1999 (3) SA 1083 (SCA).
[40]
Heavy
Metal
fn39 para 30.
[41]
MV
Silver Star: Owners of MV Silver Star v Hilane Ltd
2015 (2) SA 331 (SCA).
[42]
The
Silver Star
fn41 para 20.
[43]
Galsworthy
Ltd v Pretty Time Shipping SA & others, Pretty Time Shipping SA
& others v Galsworthy Ltd
[2009] ZAKZDHC 10 para 20.
[44]
Buchner
& another v Johannesburg Consolidated Investment Co Ltd
1995 (1) SA 215
(T); see also
Durbach
v Fairway Hotel Ltd
1949 (3) SA 1080
(SR) at 1082; and
Trope
& others v South African Reserve Bank
[1993] ZASCA 54
;
1993 (3) SA 264
(A) at 273A-B.
[45]
Singapore
Companies Act fn3.
[46]
MT
Tygr: Bouygues Offshore SA & another v Owners of the MT Tigr &
another
1998
(4) SA 740 (C).
[47]
MV
Spartan-Runner v Jotun-Henry Clark Ltd
1991 (3) SA 803
(N).
[48]
H
Staniland ‘What is the law to be applied to a charterparty
dispute?’
(1992) 109
SALJ
528
at 534.
[49]
Representative
of
Lloyds
v Classic Sailing Adventures
2010 (5) SA 90
(SCA).
[50]
Representative
of
Lloyds
v Classic Sailing Adventures
fn49
para 26 – 29.
[51]
Hofmeyr
fn21 at 87 para 11.6.
[52]
See
MV
Stella Tingas: Transet Ltd t/a Portnet v The Owners of the MV Stella
Tingas & another
2003 (2) SA 473
(SCA) and
Representative
of
Lloyds
v Classic Sailing Adventures
n49.
[53]
Carriage
of Goods by Sea Act
1
of 1986.
[54]
Hare
fn6 paras 1-7.1; 1-7.2 and
Lawsa
n8 para 3.
[55]
Andrico
Unity (C)
fn 16 and
Stella
Tingas
fn52.
[56]
See
Andrico
Unity
fn16
and
Marcard
Stein and Co v Port Marine Contractors (Pty) Ltd & others
1995
(3) SA 663 (SCA).
[57]
The
Indian
Grace
reported
as
The
Indian Endurance (No 2) Republic of India & another v India
Steamship Co Ltd
[1997] UKHL 40
;
[1997]
4 All ER 380
(HL); [1998] 1 Lloyd’s Rep 1 (HL).
[58]
Wave
Dancer
fn29 at 1188H-1189C.
[59]
The
Indian Grace
fn57.
[60]
MV
Silver Star
fn41
para 29.
[61]
The
St Anna
[1983]
2 All ER 691.
[62]
The
St Anna
fn61
at 696.
[63]
Peter
R Barnett ‘Chapter 4: Causes of Action Preclusion’ in
Res
Judicata, Estoppel, and Foreign Judgments: The Preclusive Effects of
Foreign Judgments
,
(2001).
[64]
MT
Fortune 22: Owners of the MT Fortune 22 v Keppel Corporation Ltd
1999
(1) SA 162
(C) at 166G-H.
[65]
Hofmery
fn21 at 118 para V. 4.
[66]
See
also
MV
La Pampalouis Dreyfus Armateurs SNS v Tor Shipping
[2006] ZAKZHC 3
;
2006
(3) SA 441
(D) para 39.
[67]
The
Aven
:
The
Owner of the Aven v Lona Trading
(
Pty
)
Ltd
2002
SCOSA B165 (D).
[68]
MV
Ivory Tirupati: MV Ivory Tirupati and another v Badan Urusan
Logistik (aka BULOG)
2003
(3) SA 104
(SCA)
.
[69]
MV
Wisdom C United Enterprises Corporation v Stx Pan Ocean Co Ltd
fn18 paras 9 – 10.
[70]
MT
‘Argun’ v Master and Crew of the MT ‘Argun’
claiming under case number AC 126/99 and others
2004
(1) SA 1 (SCA); [2003] 4 All SA 139 (SCA).
[71]
Bocimar
NV v Kotor Overseas Shipping Ltd
1994
(2) SA 563 (A); [1994] 2 All SA 245 (A).
[72]
Bocimar
NV
fn71 at 580G or at 250.
[73]
MY
Summit One: Farocean Marine (Pty) Ltd v Malacca Holdings Ltd &
another
2005
(1) SA 428
(SCA) para 15 at 437D-438C;
Owner
of the MT Tigr and another v Transnet Ltd. t/a Portnet
[1998]
3 All SA 453
(A)
at
459 – 460.
[74]
Dabelstein
and others v Lane and another
[2000]
ZASCA 71; 2001 (1) SA 1222 (SCA); [2001] 1 All SA 532 (A) para 7.
[75]
Section
10 of the Act.
[76]
International
Convention Relating to the Arrest of Sea-Going Ships, Brussels, May
10, 1952 available at
http://www.admiraltylawguide.com/conven/arrest1952.html
,
accessed 27 February 2019.
[77]
Euromarine
International of Mauren v The Ship Berg
&
others
fn38;
MV
Heavy Metal
fn39
at 1105G-H.
[78]
October
International Navigation Inv V MV Fayrouz IV
1988 (4) SA 675 (N).
[79]
MV
Heavy Metal
fn39
at 1105G-H.
[80]
Hofmeyr
fn21 at 136 para IX.7.
[81]
Parakou
Shipping Pte Ltd (in liquidation) v Liu Cheng Chan and others
[2017] SGHC 91
, available at
https://www.supremecourt.gov.sg/docs/default-source/module-document/judgement/s434-2014-parakou-shipping-pte-ltd-v-liu-cheng-chan-and-ors-(costs)-(final)-pdf.pdf
,
accessed 27 February 2019.
[82]
Galsworthy
Ltd v Pretty Time Shipping SA; Pretty Time Shipping SA v Galsworthy
Ltd
fn43.
[83]
Galsworthy
Ltd v Pretty Time Shipping SA; Pretty Time Shipping SA v Galsworthy
Ltd
fn43 para 20.
[84]
Hare
fn6 at 108.
[85]
MV
La Pampalouis Dreyfus Armateurs SNC v TOR Shipping.
fn66.
[86]
MT
Silver Star
fn41.
[87]
MJD
Wallis ‘The Associated Ship and South African Admiralty
Jurisdiction’ unpublished LLD thesis (2010) at 199, available

at
http://researchspace.ukzn.ac.za/xmlui/bitstream/handle/10413/678/Wallis
_MJD_2010.pdf?sequence=1
; accessed 27 February 2019.
[88]
Wallis
fn87 at 202 – 203.
[89]
MV
Heavy Metal
fn39 para 6.
[90]
See
Wallis
fn87
at
203;
MV
Cape Courage
fn11.
[91]
See
s (1)(2)(iii), s 3(10)(a) and s 3(5) of the Act.
[92]
Wallis
fn87 at 210.
[93]
Wallis
fn87
at
210.
[94]
Wallis
fn87 at 330.
[95]
Great
River Shipping Inc. v Sunnyface Marine Limited
1992
(2) SA 87 (C).
[96]
Wallis
fn87 at 335.
[97]
Thalassini
fn17
at 833A.