Article issued for the third edition of “Ship Arrest in Practice”, 2008, published by shiparrested.com network.
ByLewis Moore & Tony Swinnerton
Swinnerton Moore LLP
Cannongate House, 64 Cannon Street
London EC4N 6AE
Tel +44 (0) 207 236 7111
Tel +44 (0) 207 236 1222
1. Please give an overview of ship arrest practice in your country.
Ship arrest in England is relatively straightforward and it involves lodging an application and supporting witness statements with the Admiralty Marshall and it does not involve any hearing. The Court fee is presently some £1,750 and the arresting party must give a personal undertaking to pay the fees of the Admiralty Marshall but these can be recovered when the ship is sold because the Admiralty Marshall’s costs and expenses are a first priority of the claims against the proceeds of sale of the vessel.
2. Which International Convention applies to arrest of ships in your country?
The UK is a party to the Convention Relating to the Arrest of Seagoing Ships, Brussels, 1952, which is in broad terms applicable in the U.K.
3. Is there any other way to arrest a ship in your jurisdiction?
4. Are these alternatives e.g. saisse conservatoire or freezing order?
It might be possible to arrest by seeking an injunction but this is more difficult and more expensive than an arrest.
Claims subject to ship arrest
5. For which types of claims can you arrest a ship?
Section 20(2) of the Supreme Court Act 1981 lists 19 types of maritime claim within the admiralty jurisdiction of the High Court and in respect of which a vessel may be arrested. These include claims relating to the possession or ownership of, or mortgage on, a ship, claims for damage done by or to a ship, claims for loss of life or personal injury due to a defect in a ship, claims for loss of or damage to goods carried on a ship, other claims relating to the carriage of goods on a ship, claims relating to the use or hire of a ship, claims for salvage, towage and pilotage, claims for goods and materials supplied to a ship, claims in respect of the construction or repair of a ship, claims by the master or crew for wages, claims arising out of a general average act, and claims arising out of bottomry and collisions. Notable exceptions to this list, i.e. where arrest is not possible, include claims for insurance premiums and claims for legal costs.
English law treats both English and foreign flag vessels equally and it does not distinguish between “convention” and “non-Convention” vessels either.
6. Can you arrest a ship irrespectively of her flag?
7. Can you arrest a ship irrespectively of the debtor?
8. What is the position as regards sister ships and ships in associated ownership?
It is possible to arrest sister ships but not associated ships. Sister ships are vessels that at the time when action is brought are owned by the same person who was the owner of the ship in connection with which the claim arises at the time when the cause of action arose.
9. What is the position as regards Bareboat and Time-Chartered vessels?
Bareboat yes; Time-Chartered no
By Russell Kelly
LA Marine, Lester Aldridge Solicitors
Alleyn House, Carlton Crescent
SO15 2EU Southampton, United Kingdom
Tel: +44 (0) 2380 820415
Fax: +44 (0) 2380 820410
10. Is counter-security required in order to arrest a ship?
No. All that is required is an undertaking by the solicitor instructed to make the arrest to pay the Admiralty Marshal’s reasonable costs in serving the arrest warrant. However, it may be necessary to pay expenses incurred as result of the ship being detained, including for example berthing charges throughout the period of arrest. These can be added to the claim and be recovered out of the proceeds of sale if the matter proceeds to that stage.
11. Is there any difference between an arrest for a maritime claim and an arrest for a maritime lien?
Maritime claims are dependant upon the ownership of the ship. The ship can only be arrested provided that the party who was the owner at the time that the cause of action arose is still the owner at the time of arrest. Maritime liens can be enforced irrespective of ownership and entitle the claimant to issue a claim and to arrest the ship despite a change of ownership. The procedure for arrest is the same however.
12. Does your county recognise maritime liens?
Yes, but only in respect of claims for salvage; crew wages; damage done by a vessel; Master’s wages and disbursements; and bottomry and respondentia – which are claims in which the ship is pledged as security in return for monetary advances and usually during times of distress and are uncommon today as a result of modern mortgage agreements.
13. What period of time is required in order to arrest a ship following receipt of instructions by your law firm?
Subject to the receipt of all documentation relevant to the claim, the application to the court can take place within a matter of hours. The actual arrest will be dependent on the availability of local court marshals and bailiffs in the area that the ship is located but should be effected within 24 hours of the warrant being issued.
14. Do you need to provide a POA, or any other documents in support of the claim to the Court?
A Power of Attorney is not required in order to arrest a ship. Documents in support of the claim should be filed with the claim form, together with details of the ship’s location and port of registration. Prior to the arrest, the arrestor should determine whether there is a caution against arrest in force against the ship in question.
15. What original documents are required, what documents can be filed electronically, what documents require notarisation and/or apostille, and when are they needed?
All original court documents (the warrant of arrest and a claim form) must be filed with the court before the arrest. The warrant of arrest must be accompanied by an admiralty claim form detailing the particulars of the claim, together with a signed declaration to confirm the ownership of the ship, the level of security sought and confirmation that the claim has not been satisfied. A signed undertaking from the solicitor must also be submitted to cover the Admiralty Marshal’s expenses in serving the arrest and claim form.
At present, no documents can be filed electronically. Certification or apostille by a Notary is not required although if supporting documents need translating then the translations should be certified by a Notary.
16. Will your Courts accept jurisdiction over the substantive claim once the vessel has been arrested?
This will depend on the circumstances. If the claim arises out of a contract which contains an exclusive foreign jurisdiction clause it may be the case that the proceedings are stayed in favour of the relevant foreign court. However, for most other claims the Court will usually accept jurisdiction.
17. What period of time will be granted by the Courts in order for the claimants to take legal action on the merits?
The claim form must be issued at the same time as the arrest warrant. There is accordingly no period of delay between the arrest taking place and the action on the merits being commenced. The defendant has 14 days to acknowledge service and a further 14 days to file a defence if settlement is not concluded immediately.
18. Do the Courts of your country acknowledge wrongful arrest?
Yes, but damages will only be recoverable if the defendant can show that the arrest was made in bad faith or with gross negligence.
19. Do the Courts of your country acknowledge piercing and lifting of the corporate veil?
The courts will be prepared to accept the piercing and lifting of the corporate veil in very limited circumstances. Usually there must be an element of improper conduct with intent to defraud. The use of the corporate structure must have been established to evade liabilities imposed by the law.
20. Is it possible to have a ship sold pendente lite; if so how long does it take?
Yes, but the court will only make an order for sale if there is good reason to do so. The fact that the costs of maintaining the arrest may exceed the value of the claim and therefore diminish or extinguish the value of the claimant’s security may be deemed to be sufficient grounds for a sale pendente lite.