Admiralty Law in India

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New Admiralty Act 2017 extends admiralty jurisdiction to the High courts located in coastal states of India and extends it up to their territorial waters. Presently, admiralty jurisdiction is vested with only Kolkata, Mumbai and Chennai High court

Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017


Introduction

Admiralty law in England

As was held by Lord Halsbury in Currie v. M’Knight 1897 AC 97, is derived from the laws of Oleron and other ancient maritime codes like the Rhodian Sea Law, the Basilika, the Assizes of Jerusalem, the Baltic Laws of Wisbuy and the Hanseatic Code. In England, the common law courts could not give effective redress to cases which arose in admiralty, which were then left to the jurisdiction of specialist admiralty Judges. By the 18th Century, the admiralty jurisdiction had fallen into “a feeble and neglected condition, and for long its proceedings excited no attention” 2. The Admiralty Court Act, 1840 was the first of a series of statutes extending and defining

2. The Admiralty Court Act, 1840 was the first of a series of statutes extending and defining the jurisdiction of the High Court of Admiralty in England. This was followed by the 1861 Admiralty Court Act and various subsequent enactments which were consolidated by the Supreme Court of Judicature (Consolidation) Act, 1925. By the Administration of Justice Act of 1956, the admiralty jurisdiction of the High Court was further widened and the Supreme Court Act of 1981 now defines what the admiralty jurisdiction of the High Court in England is.

Devider

COMMENTIndian law       

Insofar as our law is concerned, the admiralty law of the chartered High Courts has historically been traced to the charters of 1774 and 1798 as subsequently extended and clarified by the Letters Patents of 1823, 1862 and 1865. The Admiralty Court Act, 1840 and 1861, and the Colonial Courts of Admiralty Act, 1890 and 1891 essentially stated what the admiralty law in this country is, and these enactments continued as existing laws under Article 372 of the Constitution of India. Some of the relevant provisions of these Acts are set out hereinbelow:-

BULLET 2Admiralty Court Act, 1840
The court in certain cases may adjudicate, etc.—
The High Court of Admiralty shall have jurisdiction to decide all claims and demands whatsoever in the nature of salvage for services rendered to or  damage received by any ship or seagoing vessel or in the nature of towage, or for necessaries supplied to any foreign ship or seagoing vessel, and to enforce the payment thereof, whether such ship or vessel may have been within the body of a country, or upon the high seas, at the time when the services were rendered or damage received, or necessaries furnished, in respect of which such claim is made.

Admiralty Court Act, 1861

As to claims for necessaries.—The High Court of Admiralty shall have jurisdiction over any claim for necessaries supplied to any ship elsewhere than in the port to which the ship belongs, unless it is shown to the satisfaction of the court that at the time of the institution of the cause any owner or partowner of the ship is domiciled in England or Wales:
Provided always, that if in any such cause the plaintiff do not recover twenty pounds, he shall not be entitled to any costs, charges, or expenses incurred by him therein, unless the judge shall certify that the cause was a fit one to be tried in the said Court.

Colonial Courts of Admiralty Act, 1890

Colonial Courts of Admiralty.—(1) Every court of law in a British possession, which is for the time
being declared in pursuance of this Act to be a
Court of Admiralty, or which, if no such declaration
is in force in the possession, has therein original
unlimited civil jurisdiction, shall be a Court of
Admiralty, with the jurisdiction in this Act mentioned,
and may for the purpose of that jurisdiction,
exercise all the powers which it possesses for the
purpose of its other civil jurisdiction and such Court
in reference to the jurisdiction conferred by this Act
is in this Act referred to as a Colonial Court of
Admiralty. …

(2) The jurisdiction of a Colonial Court of Admiralty
shall, subject to the provisions of this Act, be over
the like places, persons, matters, and things, as the
admiralty jurisdiction of the High Court in England,
whether existing by virtue of any statute or
otherwise and the Colonial Court of Admiralty may
exercise such jurisdiction in like manner and to as
full an extent as the High Court in England, and
shall have the same regard as that Court to
international law and the comity of nations.

Colonial Courts of Admiralty (India) Act, 1891

2. Appointment of Colonial Courts of Admiralty.—
The following courts of unlimited civil jurisdiction are
hereby declared to be Colonial Courts of Admiralty,
namely:
(1) the High Court of Judicature at Fort William in
Bengal,
(2) the High Court of Judicature at Madras, and
(3) the High Court of Judicature at Bombay.”

The Republic of India has finally woken up to the need for
updating its admiralty law. The Admiralty (Jurisdiction and
Settlement of Maritime Claims) Act, 2017 has been made by
Parliament and has received the assent of the President on
9.8.2017, though it has not yet been brought into force. In this
Act, “maritime claim” is defined in Section 2(1)(f) as being a
claim referred to in Section 4 and a “maritime lien” is defined in
sub-section (g) of 2(1) as follows:

“2. Definitions
(1) In this Act,—
(g) “maritime lien” means a maritime claim against
the owner, demise charterer, manager or operator
of the vessel referred to in clauses (a) to (e) of subsection
(1) of section 9, which shall continue to exist
under sub-section (2) of that section;”
Section 4 reads as follows:
“4. Maritime Claim
(1) The High Court may exercise jurisdiction to hear
and determine any question on a maritime claim,
against any vessel, arising out of any—
(a) dispute regarding the possession or ownership
of a vessel or the ownership of any share therein;
(b) dispute between the co-owners of a vessel as to
the employment or earnings of the vessel;
(c) mortgage or a charge of the same nature on a
vessel;
(d) loss or damage caused by the operation of a
vessel;
(e) loss of life or personal injury occurring whether
on land or on water, in direct connection with the
operation of a vessel;
(f) loss or damage to or in connection with any
goods;
(g) agreement relating to the carriage of goods or
passengers on board a vessel, whether contained in
a charter party or otherwise;(h) agreement relating to the use or hire of the

(h) agreement relating to the use or hire of the
vessel, whether contained in a charter party or
otherwise;
(i) salvage services, including, if applicable, special
compensation relating to salvage services in
respect of a vessel which by itself or its cargo
threatens damage to the environment;
(j) towage;
(k) pilotage;
(l) goods, materials, perishable or non-perishable
provisions, bunker fuel, equipment (including
containers), supplied or services rendered to the
vessel for its operation, management, preservation
or maintenance including any fee payable or
leviable;
(m) construction, reconstruction, repair, converting
or equipping of the vessel;
(n) dues in connection with any port, harbour, canal,
dock or light tolls, other tolls, waterway or any
charges of similar kind chargeable under any law for
the time being in force;
(o) claim by a master or member of the crew of a
vessel or their heirs and dependents for wages or
any sum due out of wages or adjudged to be due
which may be recoverable as wages or cost of
repatriation or social insurance contribution payable
on their behalf or any amount an employer is under
an obligation to pay to a person as an employee,
whether the obligation arose out of a contract of
employment or by operation of a law (including
operation of a law of any country) for the time being
in force, and includes any claim arising under a
manning and crew agreement relating to a vessel,
notwithstanding anything contained in the provisions of sections 150 and 151 of the Merchant Shipping
Act, 1958;
(p) disbursements incurred on behalf of the vessel
or its owners;
(q) particular average or general average;
(r) dispute arising out of a contract for the sale of
the vessel;
(s) insurance premium (including mutual insurance
calls) in respect of the vessel, payable by or on
behalf of the vessel owners or demise charterers;
(t) commission, brokerage or agency fees payable
in respect of the vessel by or on behalf of the vessel
owner or demise charterer;
(u) damage or threat of damage caused by the
vessel to the environment, coastline or related
interests; measures taken to prevent, minimise, or
remove such damage; compensation for such
damage; costs of reasonable measures for the
restoration of the environment actually undertaken
or to be undertaken; loss incurred or likely to be
incurred by third parties in connection with such
damage; or any other damage, costs, or loss of a
similar nature to those identified in this clause;
(v) costs or expenses relating to raising, removal,
recovery, destruction or the rendering harmless of a
vessel which is sunk, wrecked, stranded or
abandoned, including anything that is or has been
on board such vessel, and costs or expenses
relating to the preservation of an abandoned vessel
and maintenance of its crew; and
(w) maritime lien.
Explanation.—For the purposes of clause (q), the
expressions “particular average” and “general average” shall have the same meanings as
assigned to them in sub-section (1) of section 64
and sub-section (2) of section 66 respectively of the
Marine Insurance Act, 1963.
(2) While exercising jurisdiction under sub-section
(1), the High Court may settle any account
outstanding and unsettled between the parties in
relation to a vessel, and direct that the vessel, or
any share thereof, shall be sold, or make such other
order as it may think fit.
(3) Where the High Court orders any vessel to be
sold, it may hear and determine any question
arising as to the title to the proceeds of the sale.
(4) Any vessel ordered to be arrested or any
proceeds of a vessel on sale under this Act shall be
held as security against any claim pending final
outcome of the admiralty proceeding.”

14. Under Section 5 of the Act, the High Court may order for
the arrest of a vessel which is within its jurisdiction for the
purpose of providing security against a maritime claim. Under
Section 6 of the said Act, the High Court may also exercise
admiralty jurisdiction by an order in personam in respect of the
maritime claims referred to in Section 4. Section 9 of the Act
sets out the inter se priority of maritime liens, but in so doing
also informs us that they are restricted to five subject matters
only. Section 9 reads as follows:

“Sec. 9 Inter se priority on maritime lien
(1) Every maritime lien shall have the following
order of inter se priority, namely:—
(a) claims for wages and other sums due to the
master, officers and other members of the vessel’s
complement in respect of their employment on the
vessel, including costs of repatriation and social
insurance contributions payable on their behalf;
(b) claims in respect of loss of life or personal injury
occurring, whether on land or on water, in direct
connection with the operation of the vessel;
(c) claims for reward for salvage services including
special compensation relating thereto;
(d) claims for port, canal, and other waterway dues
and pilotage dues and any other statutory dues
related to the vessel;
(e) claims based on tort arising out of loss or
damage caused by the operation of the vessel other
than loss or damage to cargo and containers carried
on the vessel.
(2) The maritime lien specified in sub-section (1)
shall continue to exist on the vessel notwithstanding
any change of ownership or of registration or of flag
and shall be extinguished after expiry of a period of
one year unless, prior to the expiry of such period,
the vessel has been arrested or seized and such
arrest or seizure has led to a forced sale by the
High Court:
Provided that for a claim under clause (a) of subsection
(1), the period shall be two years from the
date on which the wage, sum, cost of repatriation or
social insurance contribution, falls due or becomes
payable.

(3) The maritime lien referred to in this section shall
commence—
(a) in relation to the maritime lien under clause (a)
of sub-section (1), upon the claimant’s discharge
from the vessel;
(b) in relation to the maritime liens under clauses (b)
to (e) of sub-section (1), when the claim arises,
and shall run continuously without any suspension
or interruption:
Provided that the period during which the vessel
was under arrest or seizure shall be excluded.
(4) No maritime lien shall attach to a vessel to
secure a claim which arises out of or results from—
(a) damage in connection with the carriage of oil or
other hazardous or noxious substances by sea for
which compensation is payable to the claimants
pursuant to any law for the time being in force;
(b) the radioactive properties or a combination of
radioactive properties with toxic, explosive or other
hazardous properties of nuclear fuel or of
radioactive products or waste.”

15. Section 12 states that the Code of Civil Procedure is to apply in all proceedings before the High Court insofar as it is not inconsistent or contrary to the provisions of the Act. By
Section 17, the Admiralty Court Acts of 1840 and 1861 and the Colonial Courts of Admiralty Acts of 1890 and 1891 stand repealed. Also, the Letters Patent of 1865, insofar as it applies to the admiralty jurisdiction of the Bombay, Calcutta and Madras High Courts, also stands repealed.

Devider

Commencement of action

An admiralty action in the courts of India commences
against a vessel to enforce what is called a “maritime claim”.
Though India is not a signatory to the Brussels Convention of
1952, a long list of maritime claims is given in Article 1 thereof.
Suffice it to say that sub-clause (k) of Article 1 states that
important materials wherever supplied to a ship for her
operation or maintenance would fall within the definition of a
maritime claim. A maritime lien, on the other hand, attaches to
the property of the vessel whenever the cause of action arises,
and travels with the vessel and subsists whenever and
wherever the action may be commenced. In The Bold
Buccleugh, (1852) 7 Moo PCC 267, Sir John Jervis defined
maritime lien as follows:-
“[A] maritime lien is well defined … to mean a claim
or privilege upon a thing to be carried
into effect by legal process … that process to be a
proceeding in rem…. This claim or privilege travels
with the thing into whosesoever possession it may
come. It is inchoate from the moment the claim or
privilege attaches, and, when carried into effect by legal process by a proceeding in rem, relates back to the period when it first attached.”

17. This judgment was referred to in M.V. Elisabeth and
others v. Harwan Investment and Trading Private Limited,
1993 Supp. (2) SCC 433 at 462, paragraph 56 and Epoch
Enterrepots v. M.V. Won Fu (2003) 1 SCC 305 at 311,
paragraph 13. In M.V. Al Quamar v. Tsavliris Salvage
(International) Ltd. and others, (2000) 8 SCC 278 at 301, the
Supreme Court observed as follows:-
“33. Be it noted that there are two attributes to
maritime lien: (a) a right to a part of the property in
the res; and (b) a privileged claim upon a ship,
aircraft or other maritime property in respect of
services rendered to, or injury caused by that
property. Maritime lien thus attaches to the property
in the event the cause of action arises and remains
attached. It is, however, inchoate and very little
positive in value unless it is enforced by an action.
It is a right which springs from general maritime law
and is based on the concept as if the ship itself has
caused the harm, loss or damage to others or to
their property and thus must itself make good that
loss. (See in this context Maritime Law by
Christopher Hill, 2nd Edn.).”

Only a small number of claims give rise to maritime liens as was noted in M.V. Won Fu (supra). Paragraph 19 of the said judgment states as follows:-

“19. We have in this judgment hereinbefore dealt with the attributes of maritime lien. But simply stated, maritime lien can be said to exist or restricted to in the event of (a) damage done by a ship; (b) salvage; (c) seamen’s and master’s wages; (d) master’s disbursement; and (e) bottomry; and in the event a maritime lien exists in the aforesaid five circumstances, a right in rem is said to exist. Otherwise, a right in personam exists for any claim that may arise out of a contract.” (at pages 314-315)


 Precedent set up by Calcutta High Court BULLET 2

In an illuminating judgment of the Calcutta High Court
Justice Mrs. Ruma Pal, as she then was, dealt with an action in
rem filed in the admiralty court jurisdiction in Calcutta. With
respect to the plaintiffs claim of the price of bunkers supplied to
the ship owners, the Court held that the supply of necessaries
to a vessel does not create a maritime lien. In Bailey
Petroleum Company v. Owners and parties interested in
the vessel M.V. Dignity, (1993) 2 CHN 208 at 213-214, the
learned Judge held:

“16. It has been established by a wealth of
decisions that the supply of necessaries does not
create a maritime lien. Indeed the point was
conceded by the counsel for the plaintiff at the
hearing. It is only necessary to refer to two
authorities on the point to emphasize the fact that
this Court does not base its conclusion on the
concession of the plaintiff’s counsel but on the
authorities cited.
17. It is not disputed that the jurisdiction of this court
is governed by the Admiralty Court Act 1861 (Imp).
Section 5 of the 1861 Act provides:
“5. The High Court of Admiralty shall have
jurisdiction over any claim for necessaries
supplied to any ship elsewhere than in the
port to which the ship belongs, unless it is
shown to the satisfaction of the court that
at the time of the institution of the cause
any owner or part owner of the ship is
domiciled in England or Wales: Provided
always, that if in any such cause the
plaintiff do not recover twenty pounds, he
shall not be entitled to any costs, charges,
or expenses incurred by him therein,
unless the judge shall certify that the
cause was a fit one to be tried in the said
Court.”
18. In the case of Laws and others and Smith: the
“Rio Tinto”: 9 PD 356, the plaintiff had supplied
necessaries to the vessel. The Trial Court held that
the necessaries were supplied on the credit of the
vessel and that the plaintiff had a right to a maritime
lien and that, therefore, in spite of the fact that the
vessel had been transferred subsequent to the
supply of necessaries, the ship was liable. Sir
James Hannen who delivered the opinion of the  Privy Council held that the phrase “the court shall
have jurisdiction” simply gave the Court jurisdiction
but did not create any lien. A distinction was drawn
between a provision for proceedings by arrest of the
ship and the express creation of a lien. The Court
held:
“The Admiralty Court Act, 1861 (24 Vict.
c. 10) and the decisions upon it must
next be considered. By the 5th section it
is enacted that the High Court shall
have jurisdiction over a claim for
necessaries supplied to any ship
elsewhere than in the port to which the
ship belongs, unless it is shown to the
satisfaction of the court that, at the time
of the institution of the cause, any owner
or part owner of the ship is domiciled in
England or Wales.
The words ‘the High Court of Admiralty
shall have jurisdiction’, mean only what
they purport to say, neither more nor
less, that is, that the court shall take
judicial cognizance of the cases
provided for.
The conclusion [is] that there is nothing
from which it can be inferred that by the
use of the words “the court shall have
jurisdiction” the Legislature intended to
create a maritime lien with respect to
necessaries supplied within the
possession.”
19. In Shell Oil Co. v. The Ship “Lastrigoni” 3 ALR
399 the plaintiff had filed a suit for enforcement of
the claim on the ground of bunkers provided by the plaintiff under a contract between the plaintiff and
the agents of the time charterer. The contract
provided that the sale and delivery of inter
alia necessaries would be made on the faith and
credit of the vessel. The arguments before the Court
were that the supply of fuel itself created maritime
lien to which the ship was subject and which could
be enforced by an action in rem in admiralty. The
second was that, in the circumstances, an action in
rem lay notwithstanding the absence of any
contractual liability on the part of the owners to pay
for the bunkers supplied and that this was so by
virtue of section 6 of the Admiralty Court Act 1840
(Imp), and section 5 of the Admiralty Court Act 1861
(Imp), either with or without the aid of cl. 6.4 of the
Bunker Fuel Oil Contract. Menzies, J. held:
“The matter was, I think, put at rest by
the decision of the Privy Council in the
Rio Tinto (1884) 9 APP Cas 356, by
which it was decided that no maritime
lien attaches to a ship in respect of
coals or other necessaries supplied to
it.


Difference between a maritime claim and a maritime lienBULLET 2

In Saba International Shipping and Project Investment
Private Limited v. Owners and parties interested in the
Vessel M.V. Brave Eagle, previously known as M.V. Lima-I
and others, (2002) 2 CHN 280 at 287-288 and 289-290,
another single Judge of the same High Court differentiated
between a maritime claim and a maritime lien and held as
follows:

“20. Now the issue is what is a maritime claim and
what is a maritime lien. These questions are to be
answered in this proceeding before continuation of
the interim order or passing any further interim
order.
21. All cases of maritime lien are based on maritime
claims but all maritime claims do not give rise to a
maritime lien on the ship. Normally a lien in the
general law is a rather limited right over some one
else’s property. It is a right to retain possession of
that property usually to receive a claim. But a
maritime lien differs from other liens in one very
important respect. Liens generally require
possession of the ‘res’ before they can come into
effect. As an example an innkeeper has a lien over
his guest’s luggage against the payment of the bill,
but if the guest is smart enough to remove his
luggage, the innkeeper is left without a lien. But a
maritime lien does not require prior possession for
its creation. In a fit and proper case a claimant on
the strength of his maritime lien can secure the
arrest of a ship which then comes under the
possession of the court and she cannot be moved
without the court’s order.
22. ‘No Indian Statute defines a maritime claim’ is
the clear finding of Supreme Court in M.V.
Elisabeth (AIR 1993 SC 1014, para 85, page 1040).
But our Supreme Court followed the provisions of
the Supreme Court Act 1981 of England where
maritime claims have been listed on the basis of
Brussels Convention of 1952 on the Arrest of Sea
Going Ships. Under Article 1 of the said Convention
various maritime claims have been catalogued. Out
of which 1(k) answers the description of the claims
of the plaintiff in this proceeding. Article 1(k) reads
“goods or materials whether supplied to a ship for her operation or maintenance”. Even though India is
not a signatory to the Brussels Convention, but the
Supreme Court held that the provisions of these
Conventions should be regarded as part of
International Common Law and these provisions
‘supplement’ and ‘complement’ our maritime laws
and fill up the lacunae in The Merchant Shipping
Act.
23. But in Elisabeth, the Hon’ble Supreme Court did
not notice any convention on maritime lien.
However the Hon’ble Supreme Court accepted in
para 57 of Elisabeth the judicial determination of the
concept of ‘maritime lien’ by English courts and
which I quote as follows:
“A maritime lien is a privileged claim
against the ship or a right to a part of the
property in the ship, and it “travels” with
the ship. Because the ship has to “pay
for the wrong it has done”, it can be
compelled to do so by a forced sale.
(See The Bold Buccleugh, (1852) 7 Moo
PCC 267).”
24. A definition of maritime lien has also been given
in Stroud’s Judicial Dictionary, 5th Edition page
1466 to the following effect:
“A maritime lien may be defined as a
right specifically binding a ship, her
furniture, tackle, cargo, and freight, or
any of them, for payment of a claim
founded upon the maritime law and
entitling the claimant to take judicial
proceedings against the property bound
to enforce, or to ascertain and enforce,
satisfaction of his demand; thus, a salvor has a maritime lien on the
property saved for such an amount as a
court exercising admiralty jurisdiction
shall award. Maritime lien are
distinguished from all other liens in
these two chief particulars: (i) they are in
no way founded on possession or
property in the claimant, (ii) they are
exercised by taking proceedings against
the property itself in a form of action
styled an action in rem (The Glasgow
Packet, 2 Rob. W. 312; The Repulse, 4
Notes of Cas. 170), and, from this and
their secret nature, they closely
resemble the species of security known
to Roman law under the name of
hypotheca (Dig. xiii). Interest, if any
allowed, and the costs of enforcing a
claim for which a maritime lien exists,
will be included in such lien (The
Margaret, 3 Hagg. Adm. 240).”
25. According to the well known treatise of Thomas
on maritime lien, the following claims may give rise
to maritime lien namely:
“(a) Damage done by a ship
(b) Salvage
(c) Seamen’s wages
(d) Master’s wages and disbursements
(e) Bottomry and respondentia”.
26. The aforesaid passage from Thomas has been
approved by the Division Bench of Calcutta High
Court in Mohammed Saleh Behbehani &
Company v. Bhoja Trader, reported in (1983) 2
Calcutta Law Journal 334. At 344 of the report, the
learned Judges of the Division Bench referred to
maritime liens as representing ‘a small cluster of claims’ and referred to the aforementioned passage from Thomas.
(27) and (28) xxx xxx xxx
29. Counsel for the respondent also relies on a
passage from Roscoe on The Admiralty Jurisdiction
and Practice, 5th Edition. While dealing with
necessaries, the learned author has stated as
follows:
“Persons who have supplied a ship,
whether British or foreign, with
necessaries have not a maritime lien
upon her, and the vessel does not
become chargeable with the debt till the
suit is actually instituted; consequently
there can be no claim against a ship
which has been sold, even with notice of
such a claim in respect of which an
action has not been commenced, and a
want of caution in supplying the
necessaries may, it would seem, cause
a postponement of claims to others
more carefully begun. The necessaries
claimant is not a secured creditor until
the moment of arrest.”
30. There is a direct judgment on this point by a
learned Judge of this court in Bailey Petroleum,
referred to above.
31. Relying on the judgment of the Privy Council
in Rio Tinto, reported in 1884 (9) Appeal Cases 356
and the judgment in Shell Oil Co. v. The Ship
Lastrigoni, reported in 1974 (3) All England Reports
399, the learned single Judge held in Bailey
Petroleum that a claim arising out of the supply of necessaries may give rise to a statutory right of
action ‘in rem’ under section 5 of Admiralty Court
Act, 1861 but it does not give rise to maritime lien.
Paragraphs 23 and 24 of the judgment in Bailey
Petroleum make it clear and I quote them in
extenso:
“23. Whereas a maritime lien attaches to
the res and travels with it and may be
enforced against a subsequent
purchaser of the res, a statutory right of
action in rem is defeated by a change of
ownership. This later principle follows
from the nature of the right described in
the preceding paragraph.
24. This view of the law is supported by
a catena of decisions.”


International Convention on Maritime Lien

International Convention on Maritime Lien and
Mortgages, 1993 defines maritime liens in Article 4 as follows:-
“Article 4: Maritime liens
I. Each of the following claims against the owner,
demise charterer, manager or operator of the vessel
shall be secured by a maritime lien on the vessel:
(a) claims for wages and other sums due to the
master, officers and other members of the vessel’s
complement in respect of their employment on the
vessel, including costs of repatriation and social
insurance contributions payable on their behalf;

(b) claims in respect of loss of life or personal injury
occurring, whether on land or on water, in direct
connection with the operation of the vessel;
(c) claims for reward for the salvage of the vessel;
(d) claims for port, canal, and other waterway dues
and pilotage dues;
(e) claims based on tort arising out of physical loss
or damage caused by the operation of the vessel
other than loss of or damage to cargo, containers
and passengers’ effects carried on the vessel.
2. No maritime lien shall attach to a vessel to secure
claims as set out in subparagraphs (b) and (e) of
paragraph 1 which arise out of or result from:
(a) damage in connection with the carriage of oil or
other hazardous or noxious substances by sea for
which compensation is payable to the claimants
pursuant to international conventions or national law
providing for strict liability and compulsory insurance
or other means of securing the claims; or
(b) the radioactive properties or a combination of
radioactive properties with toxic, explosive or other
hazardous properties of nuclear fuel or of
radioactive products or waste.”
22. Article 8 then states that the characteristics of such liens
are as follows:-
“Article 8: Characteristics of maritime liens
Subject to the provisions of article 12, the maritime
liens follow the vessel, notwithstanding any change
of ownership or of registration or of flag.”


It is clear that in our country at least claims for necessaries, though maritime claims,do not raise a maritime lien[CHRISOMAR CORPORATION VERSUSMJR STEELS PRIVATE LIMITED]hot-anim

Devider

Manner of enforcement of maritime claims in Indian CourtBULLET 2

In M.V. Elisabeth (supra) at
459-462, this Court laid down, in some detail, the basic features
of the admiralty jurisdiction in this country, and how maritime
claims are to be enforced. The Court held:
“Admiralty Law confers upon the claimant a right in
rem to proceed against the ship or cargo as
distinguished from a right in personam to proceed against the owner. The arrest of the ship is
regarded as a mere procedure to obtained security
to satisfy judgment. A successful plaintiff in an
action in rem has a right to recover damages
against the property of the defendant. “The liability
of the shipowner is not limited to the value of
the res primarily proceeded against …. An action …
though originally commenced in rem, becomes a
personal action against a defendant upon
appearance, and he becomes liable for the full
amount of a judgment unless protected by the
statutory provisions for the limitation of liability”.’
(Roscoe’s Admiralty Practice, 5th ed. p. 29)
The foundation of an action in rem, which is a
peculiarity of the Anglo-American law, arises from a
maritime lien or claim imposing a personal liability
upon the owner of the vessel. A defendant in an
admiralty action in personam is liable for the full
amount of the plaintiff’s established claim. Likewise,
a defendant acknowledging service in an action in
rem is liable to be saddled with full liability even
when the amount of the judgment exceeds the
value of the res or of the bail provided. An action in
rem lies in the English High Court in respect of
matters regulated by the Supreme Court Act 1981,
and in relation to a number of claims the jurisdiction
can be invoked not only against the offending ship
in question but also against a ‘sistership’ i.e., a ship
in the same beneficial ownership as the ship in
regard to which the claim arose.
“The vessel which commits the
aggression is treated as the offender, as
the guilty instrument or thing to which
the forfeiture attaches, without any
reference whatsoever to the character
or conduct of the owner ….” (Per Justice
Story, The United States v. The Big Malek Adhel [43 US (2 How) 210, 233
(1844)]).”
xxx xxx xxx
A ship may be arrested (i) to acquire jurisdiction; or
(ii) to obtain security for satisfaction of the claim
when decreed; or (iii) in execution of a decree. In
the first two cases, the court has the discretion to
insist upon security being furnished by the plaintiff
to compensate the defendant in the event of it being
found that the arrest was wrongful and was sought
and obtained maliciously or in bad faith. The
claimant is liable in damages for wrongful arrest.
This practice of insisting upon security being
furnished by the party seeking arrest of the ship is
followed in the United States, Japan and other
countries. The reason for the rule is that a wrongful
arrest can cause irreparable loss and damages to
the shipowner; and he should in that event be
compensated by the arresting party. (See Arrest of
Ships by Hill, Soehring, Hosoi and Helmer, 1985).
The attachment by arrest is only provisional and its
purpose is merely to detain the ship until the matter
has been finally settled by a competent court. The
attachment of the vessel brings it under the custody
of the Marshal or any other authorized officer. Any
interference with his custody is treated as a
contempt of the court which has ordered the arrest.
But the Marshal’s right under the attachment order
is not one of possession, but only of custody.
Although the custody of the vessel has passed from
the defendant to the Marshal, all the possessory
rights which previously existed continue to exist,
including all the remedies which are based on
possession. The warrant usually contains a
monition to all persons interested to appear before
the court on a particular day and show cause why the property should not be condemned and sold to
satisfy the claim of the plaintiff.
The attachment being only a method of
safeguarding the interest of the plaintiff by providing
him with a security, it is not likely to be ordered if the
defendant or his lawyer agrees to “accept service
and to put in bail or to pay money into court in lieu
of bail”. (See Halsbury’s Laws of England, 4th edn.,
Vol. 1, p. 375 etc.).
xxx xxx xxx
A personal action may be brought against the
defendant if he is either present in the country or
submits to jurisdiction. If the foreign owner of an
arrested ship appears before the court and deposits
security as bail for the release of his ship against
which proceedings in rem have been instituted, he
submits himself to jurisdiction.
An action in rem is directed against the ship itself to
satisfy the claim of the plaintiff out of the res. The
ship is for this purpose treated as a person. Such an
action may constitute an inducement to the owner to
submit to the jurisdiction of the court, thereby
making himself liable to be proceeded against by
the plaintiff in personam. It is, however, imperative
in an action in rem that the ship should be within
jurisdiction at the time the proceedings are started.
A decree of the court in such an action binds not
merely the parties to the writ but everybody in the
world who might dispute the plaintiff’s claim.
It is by means of an action in rem that the arrest of a
particular ship is secured by the plaintiff. He does
not sue the owner directly and by name; but the
owner or any one interested in the proceedings may
appear and defend. The writ is issued to “owners and parties interested in the property proceeded
against”. The proceedings can be started in
England or in the United States in respect of a
maritime lien, and in England in respect of a
statutory right in rem. A maritime lien is a privileged
claim against the ship or a right to a part of the
property in the ship, and it “travels” with the ship.
Because the ship has to “pay for the wrong it has
done”, it can be compelled to do so by a forced
sale. [See Bold Buccleaugh (The) [Harmer v. Bell,
(1851) 7 Moo PC 267 : 13 ER 884]]. In addition to
maritime liens, a ship is liable to be arrested in
England in enforcement of statutory rights in
rem (Supreme Court Act 1981). If the owner does
not submit to the jurisdiction and appear before the
court to put in bail and release the ship, it is liable to
be condemned and sold to satisfy the claims
against her. If, however, the owner submits to
jurisdiction and obtains the release of the ship by
depositing security, he becomes personally liable to
be proceeded against in personam in execution of
the judgment if the amount decreed exceeds the
amount of the bail. The arrest of the foreign ship by
means of an action in rem is thus a means of
assuming jurisdiction by the competent court

Devider

Common law of India BULLET 2

Though Indian statutes lag
behind international law in this context, the principles in these
Conventions derived from the common law of nations, will be
treated as a part of the common law of India. Paragraph 76 in
this behalf reads as under:-
“76. It is true that Indian statutes lag behind the
development of international law in comparison to contemporaneous statutes in England and other
maritime countries. Although the Hague Rules are
embodied in the Carriage of Goods by Sea Act,
1925, India never became a party to the
International Convention laying down those rules
(International Convention for the Unification of
Certain Rules of Law relating to Bills of Lading,
Brussels, 1924). The Carriage of Goods by Sea Act,
1925 merely followed the (United Kingdom)
Carriage of Goods by Sea Act, 1924. The United
Kingdom repealed the Carriage of Goods by Sea
Act, 1924 with a view of incorporating the Visby
Rules adopted by the Brussels Protocol of 1968.
The Hague-Visby Rules were accordingly adopted
by the Carriage of Goods by Sea Act 1971 (United
Kingdom). Indian legislation has not, however,
progressed, notwithstanding the Brussels Protocol
of 1968 adopting the Visby Rules or the United
Nations Convention on the Carriage of Goods by
Sea, 1978 adopting the Hamburg Rules. The
Hamburg Rules prescribe the minimum liabilities of
the carrier far more justly and equitably than the
Hague Rules so as to correct the tilt in the latter in
favour of the carriers. The Hamburg Rules are
acclaimed to be a great improvement on the Hague
Rules and far more beneficial from the point of view
of the cargo owners. India has also not adopted the
International Convention relating to the Arrest of
Seagoing Ships, Brussels, 1952. Nor has India
adopted the Brussels Conventions of 1952 on civil
and penal jurisdiction in matters of collision; nor the
Brussels Conventions of 1926 and 1967 relating to
maritime liens and mortgages [(a) International
Convention relating to the Arrest of Seagoing Ships,
Brussels, May 10, 1952 (IMC); (b) International
Convention on Certain Rules concerning Civil
Jurisdiction in Matters of Collision, Brussels, May
10, 1952 (IMC); (c) International Convention for the
Unification of Certain Rules relating to Penal Jurisdiction in Matters of Collision, Brussels, May 10, 1952 (IMC); and (d) International Conventions
for the Unification of Certain Rules of Law relating to
Maritime Liens and Mortgages, Brussels, April 10,
1926, and the Revised Convention on Maritime
Lines and Mortgages, Brussels, May 29, 1967
(IMC).] India seems to be lagging behind many
other countries in ratifying and adopting the
beneficial provisions of various conventions
intended to facilitate international trade. Although
these conventions have not been adopted by
legislation, the principles incorporated in the
conventions are themselves derived from the
common law of nations as embodying the felt
necessities of international trade and are as such
part of the common law of India and applicable for
the enforcement of maritime claims against foreign
ships.” (at pages 469-470)
A list of maritime claims was then referred to in paragraph
84 and the Brussels Convention relating to the Arrest of SeaGoing
Ships, 1992 was referred to and followed.

Devider

Ownership of the vessel BULLET 2

Ownership of the vessel to enforce a maritime claim has to be
seen at the stage of institution of the suit and not at the stage
of arrest. The general rule that is contained in our country as to
what crystallises on the date of a suit is reflected in Rameshwar and others v. Jot Ram and others, 1976 1 SCR
847 at 851-52. This Court held:-
“In P. Venkateswarlu v. Motor & General
Traders [(1975) 1 SCC 770, 772 : AIR 1975 SC
1409, 1410] this Court dealt with the adjectival
activism relating to post-institution circumstances.
Two propositions were laid down. Firstly, it was held
that [SCC p. 772, para 4] ‘it is basic to our
processual jurisprudence that the right to relief must
be judged to exist as on the date a suitor institutes
the legal proceeding.’ This is an emphatic statement
that the right of a party is determined by the facts as
they exist on the date the action is instituted.
Granting the presence of such facts, then he is
entitled to its enforcement. Later developments
cannot defeat his right because, as explained
earlier, had the court found his facts to be true the
day he sued he would have got his decree. The
Court’s procedural delays cannot deprive him of
legal justice or rights crystallised in the initial cause
of action. This position finds support in Bhajan
Lal v. State of Punjab [(1971) 1 SCC 34].
The impact of subsequent happenings may now be
spelt out. First, its bearing on the right of action,
second, on the nature of the relief and third, on its
impotence to create or destroy substantive rights.
Where the nature of the relief, as originally sought,
has become obsolete or unserviceable or a new
form of relief will be more efficacious on account of
developments subsequent to the suit or even during
the appellate stage, it is but fair that the relief is
moulded, varied or reshaped in the light of updated
facts. Patterson [Patterson v. State of Alabama,
(1934) 294 US 600, 607] illustrates this position. It is
important that the party claiming the relief or change
of relief must have the same right from which either the first or the modified remedy may flow.
Subsequent events in the course of the case cannot
be constitutive of substantive rights enforceable in
that very litigation except in a narrow category (later
spelt out) but may influence the equitable
jurisdiction to mould reliefs. Conversely, where
rights have already vested in a party, they cannot
be nullified or negated by subsequent events save
where there is a change in the law and it is made
applicable at any stage. Lachmeshwar Prasad
Shukul v. Keshwar Lal Chaudhuri [1940 FCR 84 :
AIR 1941 FC 5] falls in this category. Courts of
justice may, when the compelling equities of a case
oblige them, shape reliefs — cannot deny rights —
to make them justly relevant in the updated
circumstances. Where the relief is discretionary,
courts may exercise this jurisdiction to avoid
injustice. Likewise, where the right to the remedy
depends, under the statute itself, on the presence or
absence of certain basic facts at the time the relief
is to be ultimately granted, the Court, even in
appeal, can take note of such supervening facts
with fundamental impact. Venkateswarlu, read in its
statutory setting, falls in this category.”

Devider

International Convention on the Arrest of Ships, 1999 BULLET 2

the International Convention on the Arrest of Ships, 1999, in which India participated, states as follows:-
“Article 3: Exercise of right of arrest

1. Arrest is permissible of any ship in respect of which a maritime claim is asserted if:

(a) the person who owned the ship at the time when the maritime claim arose is liable for the claim and is owner of the ship when the arrest is effected; or (b) – (e) xxx xxx xxx (2) xxx xxx xxx

3. Notwithstanding the provisions of paragraphs 1 and 2 of this article, the arrest of a ship which is not owned by the person liable for the claim shall be permissible only if, under the law of the State where the arrest is applied for, a judgment in respect of that claim can be enforced against that ship by judicial or forced sale of that ship.”

India is not a signatory to the aforesaid Convention, yet following M.V. Elisabeth (supra), this Convention becomes part of our national law and must, therefore, be followed by this Court. Article 3(1)(a) is in two parts. First, arrest is only permissible of any ship if a maritime claim is asserted against the person who owned the ship at a time when the maritime claim arose for which the owner is liable, and second, that the same ship owner should be the owner of the ship when the arrest is effected. Thus, article 3(1)(a) sets the controversy at rest because a maritime claim can be asserted only at the time the arrest is effected and not at the time of the institution of the suit. This being so, Shri Divan’s reliance on English judgments to the contrary, namely Monica S. (1967) 2 Lloyd’s Rep. 113 as followed in Re, Aro Co Limited 1980 1 All  ER 1067, cannot be followed. Both judgments were prior to the 1999 Convention and it is this Convention that must be followed. It is, therefore, clear that the relevant date on which ownership of the vessel is to be determined is the date of arrest and not the date of institution of the suit

Devider

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