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[2008] ZAWCHC 104
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MT ''Fotiy Krylov'' v Owners of the MT âRuby Delivererâ (AC181/2006) [2008] ZAWCHC 104 (30 April 2008)
JUDGMENT
IN
THE HIGH COURT OF SOUTH AFRICA
(CAPE OF GOOD HOPE PROVINCIAL
DIVISION)
CASE
NO:
AC181/2006
DATE: 30
APRIL 2008
In
the matter between
MT
"FOTIY KRYLOV" Applicant
and
THE
OWNERS OF THE
"RUBY
DELIVERER" Respondent
JUDGMENT
(Application
for Leave to Appeal)
DAVIS,
J
:
[1]
This is an application for leave to appeal to the Supreme Court of
Appeal against a judgment of this Court of 12 February
2008.
[2]
I do not propose to examine the background nor the essential
reasoning which is contained in the principal judgment. However,
there is one issue that I wish to raise before analysing the
arguments of Mr
Stewart
.
[3]
This case is governed by section 6(1) of the Admiralty
Jurisdiction Regulation Act 105 of 1983 which
provides that English law as at 1983 applies to maritime
liens,
which
is the subject of this particular dispute. In itself this
provision raises a host of difficulties in assessing
an
application for leave to appeal. The law which governs this
English law is determined by English Courts. As Mr
Wragge
,
who appeared on behalf of the respondent (in this matter) correctly
noted, in a number of relevant instances the English Courts
have set
out the law which applies in a case such as the present.
[4] The
test that I have to adopt is whether there is a reasonable prospect
that, in this case, the Supreme Court of Appeal may
either read the
relevant English law differently to the way I have adopted, or
indeed, give it a different content. Debates about
a foreign system
makes the exercise of leave to appeal even more problematic than is
ordinarily the case.
[5] Mr
Stewart
,
who appeared on behalf of the applicant (in this application),
submitted that the Court had erred in respect of its rejection
of
his reliance upon two essential cases, being the
Longford
and the
Burns
.
In both the
Longford
6
Asp.Mar.Law.Cas 371
(1889) and the
Burns
10
Asp.Mar.Law.Cas 424
(1907) the statutory time bar in protecting the
owners of defendant vessels was held not to apply to maritime
lien
claims
asserted
in
rem
against
the
vessels on the basis that an action
in
rem
is
different from an action
in
personam
and
only indirectly affects the owner of the defendant vessel. In
short, defences
in
personam
were
held not to avail the owners of the
arrested
vessel. According to Mr
Stewart
,
therefore, it should follow that a charterer by definition would be
an
even
weaker position.
[6]Turning
to critical facts in these two cases, in the
Longford
it was held that a statutory proviso that no action shall be brought
in which the Dublin Steam Pacet Company would be liable
for any
damage to a ship unless one month's notice in writing was given to
the company, did not apply to an admiralty claim
in
rem.
This
claim
concerned
a claim for collision damage which had given rise to a maritime
lien.
In
the Court a
quo,
Butt,
J
considered
that it was not in form a claim against the company, nor in
substance could it be a claim against the
company
because the remedy against the company was not co-extensive with the
remedy against the owners.
[7]
This decision was upheld by the Court of Appeal on a rather more
narrow basis that, before the passing of the Judicature
Act there
were only causes in the Admiralty Court and not actions. The
statute referred only to
actions
in the UK courts of law and the Admiralty Court had not been such a
court at the time the statute was
enacted.
[8] This
decision was considered by the Court of Appeal in the
Burns
where the Court had to consider whether a claim
in
rem
against
a ship owned by the London County Council was a claim against the
Council which, by statute, had a limitation period of
six months.
Again, this was a claim for damages arising out of a collision
between the two ships which had given rise to a maritime
claim.
Collins,
MR
referred to the decision in the
Longford
as follows:
"It
seems to me that that case in substance decides that there is a
real, and not a mere technical distinction between
an action
in
rem
personam
and an action
in
rem",
(at
427)
In
similiar fashion,
Fletcher
Moulton, LJ
said:
"The
very able argument of counsel for the appellants rests upon the
contention that the process of the arrest of a vessel...
is merely a
method of enforcing an appearance in an action
in
rem.
In
other words, that an action
in
rem
in
no way differs in its nature from an action
in
personam
save that there is attached to it a means of arrest of the vessel
of compelling the appearance of defendant. I am therefore
of the
opinion that the supplemental proposition of the argument of the
counsel for the appellant fails and that the action
in
rem
is
an action against the ship itself. It is an action in which the
owners may take part, if they
think
proper, in defence of their property but whether or not
they will do so is a matter for them
to
decide and if they do not decide to make themselves party
to the suit in order to defend their
property,
no personal liability can be established against them in that
action. It is perfectly true that
the
action indirectly affects them. So it would if it were an action
against a person whom they had
indemnified...
I do not think that we are entitled to suppose that there has been
a change in the nature
of
the action
in
rem
merely
because the modern language of the writ by which it commences is
unsuitable
for what I think the authorities established to be
its real manner", (at 428)
[9] Mr
Wragge
contended that this Court had been correct to reject the application
of both the
Longford
and the
Burns
and rather to apply the approach which had been adopted in the
Tasmania
1886 (6) Asp.LR 305 in which the Court did not deal with the
statutory provision, as had been the case in the
Longford
and
Burns
but whether a provision in a contract, as was the case in the
present dispute, was sufficient to represent an adequate defence.
That case (the
Tasmania
)
is direct authority for the proposition that, if there is a
provision in a contract pursuant to which the demise charterer of
the chartered ship is relieved of responsibility for the
damage, then, in those circumstances, no damage
lien
accrues.
As Hofmeyr:
Admiralty
Jurisdiction
(2006) at 154 writes:
"The
fact that a ship was the instrument of the damage is not sufficient
to give rise to a
lien.
There
must have been a breach of duty by those in control of the ship so
that the ship in their hands becomes the instrument of
the
damage...The breach of duty must, however, be a breach which renders
the owner of the offending ship (at the time when the
cause of
action arises) liable, either directly or vicariously".
[10]
If therefore, the personal liability of the
res
owner
is a condition precedent to the accrual of a damage
lien
(Hofmeyr
at 154) and if the charterers in whom the control of the ship has
been vested by the owners are treated
pro
hac vice
as
owners, then a contractual provision excluding owners'
liability means that it is difficult to see how the condition
has
been met insofar as the charterers are concerned.
[11]
Mr
Stewart
referred me to Halsbury's
Laws
of England
Admiralty
Vol. 1(1) 2001 in which the following appears:
"The
foundation of a claim
in
rem
is
the
lien
resulting
from the personal liability of the owner of the
res.
Therefore
a claim
in
rem
cannot
be brought to recover damages for injury caused to a ship by the
malicious act of the master of the defendant ship or for
damage done
at the time when the ship was in the control of third parties by
reason of compulsory requisition.
On
the other hand, in several cases ships allowed by their owners to be
in the possession and control of charterers have been
successfully
proceeded against to enforce
liens
which
arose whilst the ship was in control of such third parties
1
'.
[12]
That passage affords, in my view, authority for the
proposition of Hofmeyr, namely that if there is
a
contractual provision which excludes the owner's liabilitythen
somebody who steps into the shoes of the owner and is treated
for
the purposes of liability as the owner, should have the same benefit
of the contractual provision as do the owners.
[13] In
my view, on this ground I cannot see how applying the law as it was
put to me by counsel and as I have analysed it in
the judgment,
could give rise to a conclusion different to this Court.
[14]
Turning then to the application on the
Himalaya
clause. Mr
Stewart
submitted that as Blue Bottle had not contracted directly with
Tsvaliris, that is to say in performing under the Tow Hire
agreement,
Tsvaliris was not performing an obligation of Arusha's to
Blue Bottle under the Towcon and was therefore not a servant, agent
or
sub-contractor of Arusha performing services under the Towcon.
According to Mr
Stewart
what occurred was that Arusha had contracted with Tsvaliris for the
services of the Nikolay Chiker but Arusha did not do so in
order to
perform some obligation that it had to Blue Bottle and Tsvaliris was
according not a subcontractor of Arusha at all
and certainly did not
fall within the meaning of clause 1 9 of the Towcon.
[15]
Mr
Wragge
contended that when Arusha contracted with Tsvaliris it did so in
order that Tsvaliris would render services that (a) had contracted
to perform for Blue Bottle. Hence, Tsvaliris, as a subcontractor,
was entitled to the protection of the
Himalaya
clause. In my view, clause 80 of the Towcon made it clear that Blue
Bottle and Arusha intended, by the terms of the
contract,
to
protect
their subcontractors such as Tsvaliris. The clause also expressly
provided that Blue Bottle contract as agent or trustee
of and for
the benefit of subcontractors such as Tsvaliris. With regard to the
necessary authority, the ratification of Tsvaliris
of the contract
was sufficient. This ratification occurred when the Nikolai Chiker
was made available to render the service in
terms of the Tow Hire
contract, alternatively at a later stage. Accordingly, analysed in
terms of the evidence placed before
this Court, it is difficult to
see how Tsvaliris was not entitled to the protection of the
Himalaya
clause.
[16]
For these reasons the application for leave to appeal is
DISMISSED.
WITH COSTS.
DAVIS,
J