By: CRISTEA & PARTNERS LAW OFFICE
Constanta office: 54 Cuza Voda Street,ap.3,ground floor, Constanta,Romania,900682
Bucharest office: 12 Institutul Medico Militar Street,1st floor,ap.3,1st District,Bucharest,Romania,010919
Phone: +40241 518 112
Fax: +40 241 518 802
Mobile +40 744 518 583 ; +40 744 104 054
E-mail : adrian@cristealaw.ro ; ciprian@cristealaw.ro
Website: www.cristealaw.ro
Wrongful Arrest of Vessel
A recent ruling of Constanta Court of Appeal (Decision nr.12/MF/15th November 2023) decides that the plaintiff who exercised his rights and arrested a vessel in Romanian jurisdiction in order to have a guarantee for his claim is not responsible for the losses incurred by the owner in circumstances where the plaintiff exercised his rights in good faith.
In fact, the plaintiff arrested one of owner’s vessel in Constanta in order to secure his claim for unpaid bunkers. The owner, a Russian company, filed for bankruptcy in Russia and applied to Romanian Courts asking for the recognition of the Russian Court order in Romania.
Bucharest Court refused recognition of the foreign Court order, but the decision was later reversed by Bucharest Court of Appeal which admitted recognition of the Russian Court order in Romanian jurisdiction.
Plaintiff, a bunker company, arrested one of the vessels in the ownership of the Russian company, applying to Constanta Court in this respect. The Court admitted the request and arrested the vessel.
The owner applied to the Court, asking damages for wrongful arrest of the vessel. The Court rejected the claim in full, deciding that plaintiff exercised his rights in good faith, in accordance with Romanian law, being not responsible for any losses caused to the owner. The test in such cases is the good faith exercised or not by the plaintiff.
The judge mentioned that the plaintiff applied for the arrest before the date when Bucharest Court of Appeal ordered the recognition of bankruptcy proceedings on the agenda of the Russian Courts, both parties being aware of the order of the Bucharest Court that rejected the recognition of bankruptcy proceedings in Romania. Therefore, the plaintiff acted in good faith when they arrested the vessel.
Arbitration proceedings against the owner has been finalized and arbitrators admitted the claim of the plaintiff in full. Once more, the Romanian judge considered that the plaintiff acted in good faith since the claim on the merits was considered valid by arbitrators.
It is a well established jurisprudence of Romanian High Court of Justice (case nr.2284/16th October 2010) that the plaintiff is not responsible for wrongful arrest of the vessel when acting in good faith, trying to secure the claim and without causing unnecessary losses to the owner.
For any other information please contact us.
