Shipping-Admiralty-Maritime Lawyers & Law Firms Karachi Pakistan

Osmani Law Associates

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BEST ADMIRALTY SHIPPING | MARITIME LAWYERS | TOP LAW FIRMS KARACHI | PAKISTAN

BEST ADMIRALTY SHIPPING MARITIME LAWYERS KARACHI PAKISTAN, The Shipping – Admiralty and Maritime mainly involve Carriage of Goods by Sea Act 1925 (Hague Rules), Merchant Shipping Ordinance 2001, and Admiralty Jurisdiction of High Courts Ordinance, 1980. We, as BEST ADMIRALTY SHIPPING | Maritime Lawyers | Top Law Firms Karachi Pakistan represent clients concerning shipping breaking, shipping companies, and individual consignees to appear against national and international shipping organizations. The Osmani Law is a group of top lawyers and advocates. So, we can handle your issue by our team strengthening.

The Admiralty Courts assume jurisdiction by the presence of the vessel in its territorial jurisdiction irrespective of whether the vessel is national or not and whether registered or not and wherever the residence or domicile or their owners may be. A vessel is usually arrested by the court to retain jurisdiction. State-owned vessels are usually immune from arrest.

We deal in matters involving:

Short Landing of Cargo, Loss of Cargo, Damage, and Contamination.
Tort of Conversion
Maritime liens
Ship arrests and Releases from arrest.
Collision, Fire, Grounding, General Average, and Salvage
Shipbuilding, Sale, and Purchase of Vessels
Charter Party Claims Bills of Lading disputes
Shipowners liability
Demurrage
Over and under Invoicing issues
Charter parties

Ship Arrest:

In Pakistan admiralty jurisdiction is conferred upon the Sindh and Baluchistan High Court under the “Admiralty Jurisdiction of High Court Ordinance 1980”. The 1980’s Ordinance is almost similar to the English Law and therefore it is not complicated to arrest a ship in Pakistan. Any Ship or one of her sister ships may be arrested in the case having a proper cause of action and the ship & sister ship available in Pakistani waters.

Cargo claims:

Claims for damage to cargo shipped in international commerce are governed by the Carriage of Goods by Sea Act. One of its key features is that a shipowner is liable for cargo damaged from “hook to hook,” meaning from loading to discharge unless it is exonerated under one of 17 exceptions to liability, such as an “act of God,” the inherent nature of the goods, errors in navigation, and management of the ship.

Personal injuries to seamen:

For seamen injured aboard the principle of maintenance and cure was applied. The principle of maintenance and cure requires a shipowner to both pay for an injured seaman’s medical treatment until maximum medical recovery is obtained and provide basic living expenses until completion of the voyage, even if the seaman is no longer aboard the ship. The seaman is entitled to maintenance & cure as of right unless he was injured due to his willful gross negligence. It is similar in some ways to workers’ compensation.

Personal injuries to passengers:

Shipowners owe a duty of reasonable care to passengers (for a broad overview of this theory in law, see negligence). Consequently, passengers who are injured aboard ships may bring suit the same as if they had been injured ashore through the negligence of a third party. The passenger bears the burden of proving that the shipowner was negligent. While the statute of limitations is generally three years, suits against cruise lines must usually be brought within one year because of limitations contained in the passenger ticket. Most cruise line passenger tickets also have provisions requiring that suit to be brought in either Karachi or Quetta.

Maritime lien:

Banks that loan money to purchase ships, vendors who supply ships with necessaries like fuel and stores, seamen who are due wages, and many others have a lien against the ship to guarantee payment. To enforce the lien, the ship must be arrested or seized. This is one of those remedies which must be brought in a court of the respective two provinces in Pakistan.

Osmani Law Associates

Suite # 17, 7th Floor, Office Towers, Rimpa Plaza, M.A. Jinnah Road, Karachi, Pakistan.

Cell & WhatsApp # +92- 321-2770225.

BEST ADMIRALTY SHIPPING | MARITIME LAWYERS | TOP LAW FIRMS KARACHI PAKISTAN

Admiralty Jurisdiction of High Courts Ordinance, 1980.

International Convention on Maritime Liens and Mortgages, 1993.

International Convention on Maritime Search & Rescue (SAR)

International Convention Relating to the Arrest of Sea-Going Ships

International Convention on the Arrest of Ships

LEADING REPORTED CASES

SHIPPING | ADMIRALTY & MARITIME LAW

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A & B PETROL URUNLERI. V/S. MV NAZLICON & OTHERS

ACTION IN PERSONAM: (2021 CLD 1049) …..BALOCHISTAN HIGH COURT.

Plaintiff sought recovery of liability of outstanding price of fuel/bunker services provided by it to defendant company for 2 ships. When the suit was filed defendants had already sold the ships which were in the process of breaking. Admiralty jurisdiction of the High Court under S. 3 (2) (1) of Admiralty Jurisdiction of High Courts Ordinance 1980, could be invoked to determine any cause/claim in respect of necessaries supplied to a ship including fuel / bunker service. According to S.4 (4) of Admiralty Jurisdiction of High Courts Ordinance, if a claim under S. 3 (1) of Admiralty Jurisdiction of High Courts Ordinance, 1980, arising in connection with a ship, the claim could give rise to a maritime lien on the ship only when Admiralty jurisdiction of High Court could be invoked by an action in rem against the ship, if at the time when the action was brought, that ship was beneficially owned in respect of majority shares therein by that person who was liable to the claim in an action in personam. Suit filed by plaintiff was not maintainable under Admiralty jurisdiction of High Court. Suit was dismissed, in circumstances.

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MSC TEXTILES (PVT) LTD. V/S. ASIAN POLLUX & OTHERS

BILL OF LADING: (2007 CLD 1465) ..KARACHI HIGH COURT.

Bills of lading in original were with the plaintiff as the contract with the name consignee was rescinded; cargo was never delivered, it was in the defendant’s warehouse; correspondence on record showed that the delivery was not made and amidst reshipment negotiations the notice of auction was issued yet the defendants did not inform the plaintiff about the auction proceedings and goods were eventually auctioned which fact the plaintiff learned later. Defendants until last minute continued to represent that they were making arrangements and efforts to re-export the goods to Pakistan. Allegation of fraud, committed by one of the employees of the consignee, who allegedly was mixed up with the auction-purchaser of the subject goods was, on record. Held, prima facie, at the best, date of auction could be taken as reckoning date to compute limitation of one year on which date the defendant could be said to have failed to deliver the goods.

SLOT CHARTER:

“Slot Charter” There is no reason to construe the word “Charterer” as if it meant demise charterer. If the draftsman had meant to confine the expression “charterer” to one type of charterer namely the demise charterer, there is no reason why he should not have done so. Charterers have for many year ordinarily included demise charterers, time charterers and voyage charterers, among others. Whether or not the expression “charterer” includes slop charterer, it naturally includes a time charterer or voyage charterer. The expression the charterer of the ship can include a slot charterer and that a slop charterer can properly be described as the charterer of the ship.

Term “charterer” has varied shades of meaning, term charterer includes voyage charterer, time charterer, sub-charter, desmise charterer, there is no reason why the slot charterer be excluded. In subsection (4) referred to above, words used are ‘when a person who would be liable on the claim in action in personam was when the cause of action arose the owner or charterer of or in possession and control of the ship. The word charterer is not qualified, unlike English Act therefore, no restricted meaning could be assigned to it. The term charterer clearly includes slot charterer. A slot charterer is liable for all the consequences for the contract of carriage of goods s any charterer could be. Slot charter is in fact lease or hire of a space or cell on board of a vessel, for storage of goods and cargo. Through slot charter, the owner or the charterer lets out or sublets and allocates space/cell or more popularly known as a slot on board a vessel to more than one sub-charterer.

Thus, no doubt is left in mind that slot charterers cannot escape the liability to answer the claim in rem against the very offending vessel or against any other ship which at the time when the action is brought is either under charter’s ownership or is a sister ship.

ACTION IN RAM:

Admiralty jurisdiction under S.4 of the Ordinance could be invoked by action in rem, against the offending ship or against the sister ship. Claim in personam lies where the person who would be liable on the claim was the owner or charterer of, or in possession or in control of the ship when the cause of action arose. Slot charterer could not escape the liability to answer the claim in rem against the very offending vessel or against any other ship which at the time when the action was brought was either under charterer’s ownership or was sister ship. Jurisdiction in rem could be invoked, against offending vessel, when the proceeds in rem, the purpose is to draw out the owner of charterer, or any person who claimed to be interested or in possession or in control of the offending vessel. In such event, the person having any interest in the offending vessel had two options either to come out and defend the entire claim or abstain. However, if such person chose to abstain, then the liability was limited to the extent to the vessel otherwise not.

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VESSEL MT PORTOFINO. V/S. MT PORTOFINO & OTHERS

ADMIRALTY JURISDICTION: (2003 CLD 1655) ..KARACHI HIGH COURT.

Plaintiff had invoked he admiralty jurisdiction of the High Court against the defendant vessel by an action in rem. Contention was that documentary evidence showed that the proposed defendant was owner of the vessel who had filed written statement therefore his presence before the Court was necessary for proper adjudication. Action in personam could have been brought in respect of damage, loss of life or personal injury as a result of collision. Contention that since the written statement on behalf of the vessel had been filed by the proposed defendant, it had submitted to the jurisdiction of the Court and thus should be asked to be present in the Court was repelled and application of the plaintiff was dismissed. The Osmani Law is a group of top lawyers and advocates. So, we can handle your issue by our team strengthening.

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GLOBAL TRADEWAYS LTD. V/S. TSAVLIRIS RUSS & OTHERS

RULES OF KPT: (2004 YLR 2581) ..KARACHI HIGH COURT.

Provisions of S.52 of Karachi Port Trust Act, 1886 had fixed liability to pay any rolls, dues, rates, charges or penalty on the master of any vessel. If the said charges were not paid, the Board of Trustees could cause the vessel to be restrained or arrested and sold to satisfy the outstanding tools, dues, rates, charges and penalties. Dues and charges were to be specified in respect of particular vessel. Liability to pay all said dues and charges, was on the master or owner of vessel and without payment or securing payment of such dues and charges, port clearance could not be granted. Conservator could only detain a vessel till such time port dues were not paid by any particular vessel under S.52 of Karachi Port Trust Act, 1886.

PUNISHMENT OF MASTER OF THE VESSEL:

Liability to pay port dues was on master of vessel and consequences for non-payment of said dues were provided for in terms of Ss.44 & 45 of Ports Act, 1908. Master of vessel was punishable under S. 45 of Ports Act, 1098 with fine which could extend five times the amount of sum due.

RESPONSIBILITY OF SHIPPING AGENT:

Responsibility of Shipping Agent was only confined to the obligation and performance of specified duties for which he was personally liable under Customs Act, 1969 alone. Liability of Shipping Agent under S. 55 (d) and subsection (2) of Customs Act, 1969, was confined to the claim of short landing of cargo liability for any penalty imposed under Cl.24 of the Table under subsection (1) of S.156 of Customs Act 1969. Shipping Agent was not made liable to pay the port dues in any of the statute or Acts. Shipping Agent, could, in course of his business, represent the interest of various vessels or owners or principal, and in doing so he was acting as general agent. By representing several Principals (i.e. vessels or owners of vessels), it would not mean that his acts, deeds carried out for one principal, were binding on other principals or the liability of one principal could be foisted or trusted upon other principals represented by same agent. Liability of Shipping Agent in terms of Customs Act, 1969, was confined to the extent of short landing or delivery of goods or cargo. Each liability was for the benefit of cargo owners and not for Port dues and charges. Liability of Shipping Agent was only in respect of damages or short delivery, only when the owner of goods was able to establish same. Liability was assumed by Shipping Agent pursuant to a declaration which was bound to deliver to Customs Authorities in terms of S.55(i) read with subsection (2) of Customs Act, 1969. In terms of S.21 of Ports Act, 1908, it was the master of ship who was liable for the consequences if any blast, rubbish or such other things were so discharged or any oil or waster mixed with oil. Master of the vessel from which same was so cast, thrown or discharged was liable to be punished and expenses were recoverable from the master of the vessel for removing same. Shipping Agent of various vessels, was not responsible for payment of the dues of vessel unless it was otherwise undertaken by such agent. Even if it was presumed that Shipping Agent undertook to pay dues on behalf of any particular principal or vessel, such undertaking on behalf of one principal or vessel, could not be enforced against another principal or vessel owned by different persons.

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MARATOS & CO. V/S. RICE TRADER & OTHERS

DETERMINATION OF CLAIMS & PRIORITIES: (PLD 1989 KHI 94) ..KARACHI HIGH COURT.

Persons entitled to file claims/objections against vessel. In any action in rem against a vessel, any person who claims any amount against or interest in her, could intervene in the proceedings and make his claim or object to the claim of the plaintiff. Admiralty Court would be justified to entertain such claim/objection and if both the claims are found valid and proper, then the Court would have to determine their priority.

BENEFICIAL OWNER OF VESSEL:

To attract the provisions of sections 4(4) of the Ordinance XLII of 1980 some questions of fact have to be determined first. It is control of the ship at the time causes of action arose and whether the same person at the time the proceedings were instituted is the person who beneficially owns majority shares in the other ship against which action has been filed. These questions of fact are to be decided on evidence and in many cases it is difficult to decide on affidavits alone. However, more often such questions are raised at an early stage when defendant seeks to set aside the arrest of the vessel. In such cases the Court must give its decision on the basis of affidavits as it involves question of jurisdiction and cannot be postponed till the final hearing of the case. In cases where beneficial ownership of a vessel is to be determined the Court is competent to investigate it in full and even probe into the facts to find out the person who really is the beneficial owner. Such probing inquiry becomes necessary where it can be shown that by fraudulent and deceitful means the beneficial owner of majority shares is kept behind the scene to defraud the claimants. In such cases the Court can even ‘pierce the Corproate Veil’. Mere possession and control of a vessel as charterer, manager or operator does not fall within the meaning of words “beneficial owner” as regards majority shares therein.

SHIP CONNECTED WITH CLAIMS:

A ship which is not connected with the claim arising under clauses (e) to (h) and (j) to (q) of subsection (2) of section 3 of the Ordinance XLII of 1980 can be subjected to an action in rem if it is established that when the claim under the aforestated provisions arose in connection with a ship, the person who would be liable in an action in personam was the owner or charterer of, or in possession or in control of that ship and further that when the action is brought the same person is beneficial owner of majority shares in the other ship in respect of which writ of arrest is being sought to be issued. Mere possession and control of the other vessel as charterer, manager or operator does not fall within the meaning of words ‘beneficial owner’ as regards majority shares therein. These words cannot a definite meaning conveying an interest of that person in the majority shares of vessels as their owner. The charterer, operator or manager don’t have right of ownership in the shares of the ship. Such ownership of share may be real beneficial. Plaintiff would be entitled to claim in respect of necessaries supplied to defendant vessels and to the other vessels owned by the defendant company. Owners of other vessels being different, plaintiff’s entitlement in respect of those vessels cold not succeed. Plaintiff would be entitled to realize decretal amount from the sale proceeds of arrested defendant vessel subject to priorities.

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CENTRAL INSURANCE CO LTD & OTHERS. V/S. MT TASMIN SPIRIT & OTHERS

CARGO INSURANCE: (2004 CLD 695) ..KARACHI HIGH COURT.

Plaintiff being an insurance company had insured the cargo being carried by one of the defendants. Cargo, due to accident could not be delivered to the consignee. Out of the total value of the cargo and freight, the plaintiff had paid partial claim to the consignee. Two ships were got arrested by the plaintiff for the recovery of the subrogated claim on the ground that both the ships were sister ships. Two different companies having independent legal entities owned both the ships. Plea raised by the plaintiff was that in fact both the companies were, not two different entities. Natural persons own the shares of company whereas the company owns the properties. Even if it was traced out as to who owned both the ships, the legal position would be that two companies were the owners of the two ships and not persons / individuals who owned the shares of the defendant companies. Unveiling of the incorporation would only be required if there was any allegation of fraud and deceit on the part of any of the owner companies. Plaintiff had not made any such allegation. Plaintiff also admitted that both the companies were registered owners of both the ships. In presence of the admission on the part of the plaintiff and the admission on the part of the companies that they were the registered owners of the two ships no further investigation would be required to ascertain the ownership / beneficial ownership of the two ships. High Court refused to discard and ignore the admitted position and relieved upon the common factors of the two ships. Both the ships were not sister ships of each other. Ship arrested due to loss caused by the other ship was vacated. Application was allowed accordingly.

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ATLANTIC STEAMER’S SUPPLY CMPANY. V/S. MV TITISEE & OTHERS

DETERMINATION OF MARITIME LIEN: (PLD 1993 SC 88) ..SUPREME COURTY OF PAKISTAN.

Leave to appeal was granted to consider the questions viz. if necessaries are supplied to a vessel in a foreign port the law of place where the supplies are made or necessaries furnished will determine as to whether such supplies give rise to a maritime lien or not inasmuch under the principles of private international law, the law of place where the transaction took place will determine the substantive nature of the transaction; whether in view of S.38 of the Evidence Act (Article 52 of the Qanun-e-Shahadat) it is necessary to prove foreign law as a point of fact or is it sufficient to prove the same by production of the book published and printed under the authority of the Government of the country and whether a maritime lien created against a vessel in a foreign port on account of supply of necessaries according to the lex loci could be enforced against the same vessel in Pakistan under the Admiralty Jurisdiction of High Court Ordinance, 1980, after the ownership of the vessel had changed. Question whether a particular foreign law in particular foreign country being a question of fact it has to be pleaded expressly as a material question of fact and as the fact constituting cause of action in terms of O.VI, R.2 and O.VII, R.11, CPC. In the absence of any such pleading, it will be open to the Court not to allow a party to lead evidence on the said question and if the evidence on such question is produced, the Court may decline to look into the same. Claim fell within cls. (l) & (m) of S.3(2) namely, “any claim in respect of necessaries supplied to a ship” and “any claim in respect of the construction, repair or equipment of ship or dock charges or dues” respectively. Held, in order to press in service S.4(4), it was incumbent to show that the vessel in question at the time of the commencement of the action was beneficially owned as respects majority shares therein by the persons against whom action in personam could have been maintained. Words “or other charge” appearing in S.4(3) after the words “a maritime lien would not cover a case falling under S.3(2)(1) & (m) of the Ordinance. Items covered by S.3(2)(1)(m) cannot be treated as the items entitling a supplier to claim maritime lien in order to press into service the proviso to S.3(2).

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YOKONG LTD, SOUTH KOREA. V/S. MT EASTERN NAVIGATOR

DISTINCTION BETWEEN REM AND PERSONAM: (PLD 2000 SC 57) ..SUPREME COURT PAKISTAN.

Action in rem primarily is against the property which eventually may be arrested and sold out to satisfy the claim. Such action is resorted to in respect of any claim or question within the admiralty jurisdiction irrespective of the fact that the same is in the nature of a maritime lien or not. such proceedings are in fact, against ship. Action in rem and action in personam are distinct inasmuch as in case of former, proceeding is against ship while in the latter case it is a proceeding inter parts. Arrest of vessel is only obtained for security purposes. Where the security is furnished, the vessel is released. No legal requirement either in the English Law or in Pakistani Law to make prayer for arrest of the vessel in body of the plaint.

MORTGAGE OR CHARGED ON VESSEL:

Plaintiff filed the admiralty suit against the vessel on the basis of its being mortgaged with them. High Court in Admiralty jurisdiction decreed the suit and appeal against the judgment was dismissed by Division Bench of High Court. Admiralty jurisdiction of High Court was to hear and determine the causes, questions or claims enumerated in S.3(2)(a) to (r) of Admiralty jurisdiction of high court ordinance, 1980. Valid jurisdiction included any claim in respect of a mortgage or a charge on ship or any share therein. Present suit was filed on the basis of mortgage and word “mortgage” was repeatedly used in the plaint and in the title of the plaint. In prayer clause there was request for auction and the auction took place on the request of the plaintiffs. Suit of the plaintiffs was covered by Ss. 3(2) & 4(2) of Admiralty Jurisdiction of High Courts Ordinance, 1980 and the same was maintainable. High Court relied upon the cases referred by the plaintiffs in their true perspective and neither enlarged nor narrowed the scope of the dictum laid down therein. Leave to appeal was refused by the Supreme Court.

OWNER AS A PARTY:

Action in rem is against ship without making the same as defendant. Real defendants can be described as owner of or persons interested in ship and writ of arrest may be effected by serving the same on the ship. Where no appearance is entered by the owner, the action remains as an action in rem operating only against ship and if judgment is passed in favour of the plaintiff, the same can be enforced by sale of ship but not against owner personally or any of his property. If the owner or any person interested in the res, enters appearance in consequence of the service and puts his defense, then the person so appearing becomes party to the action and thereby is personally liable for whatever may be decreed against such owner. Owners are the real party in a suit in rem therefore, no objection can be taken for citing the owners as defendants. Such objection is not sustainable in law.

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EDWARD BILYAYEV & OTHERS. V/S. MV FIGARO.

NEW BENEFICIAL OWNER OF VESSEL: (2001 CLD 1180) ..BALOCHISTAN HIGH COURT.

Appellants / plaintiffs sought recovery of outstanding wages from respondent/defendant company on the plea that it was beneficial owner of ship in question. Trial Court rejected plaint filed by appellants / plaintiffs for the reason that the ship had already been sold. Action in rem could be invoked against ship or property against which maritime lien was claimed by plaintiff. Maritime lien was a privileged claim which could be exercised over res (ship). Such claim occurred the moment cause of action had arisen and travelled with the res (ship) secretly and unconditionally and could be enforced by an action in rem. Such right only extinguished when ship was demolished. Action in rem against ship or her sister ship arose subject to condition enumerated in S.4(4) of Admiralty Jurisdiction of High Courts Ordinance, 1980. Purchaser / vendee of ship filed application under O.VII, R.11, CPC along with bill of sale, whereby ship in question was owned / purchased through a leasing company free from all encumbrances. Sale document was not denied specifically by appellants / plaintiffs at the time when suit was filed. Beneficial title in ship in question was passed on to new owner and condition laid down by S.4(4) of Admiralty Jurisdiction of High Courts Ordinance, 1980, was not satisfied. High Court declined to invoke action in rem against the ship, particularly when the ship had been demolished. Appeal was dismissed in circumstances.

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MV SEA SUCCESS 1. V/S. LIVERPOOL & LONDON STEAMSHIP PROTECTION & INDEMNITY ASSOCIATION LTD & OTHERS.

UNPAID INSURANCE: (AIR 2002 BOM 151) ..BOMBAY HIGH COURT.

Unpaid Insurance premia in respect of the ship amounts to “necessaries supplied” within the meaning of S.5 of the Admiralty Courts Act, 1861 so as to constitute, maritime claim. Even otherwise such claim for unpaid insurance premia in respect of a ship is a maritime claim giving rise to admiralty cause. Major Port Trusts have notified that no ship shall be permitted to enter respective port without having protection and indemnity cover to have a maritime adventure and the voyage and the ship is required by many agencies to have P & I cover and therefore, such ship today needs P & I cover before they deal with the ship. The ships which are entered with P & I clubs are operated for commercial purposes and need P & I cover to carry on its normal business and complete commercial operation therefore, it cannot be said that P & I cover is meant for the benefit of the ship owner alone and not for the ship. In growing trade and commerce and the changing requirements of the ship to have P & I cover by various agencies including statutory authorities as well as charterers, shippers, etc., P & I insurance is a must to keep vessel in commerce and, therefore, has to be held as necessary to the ship also and not to the ship owner alone. The law must march ahead and the term “necessary” as understood in maritime law cannot be left stagnant and has to be construed liberally and in a broad manner to meet the present needs and contexts particularly in the country like India where maritime claims are not catalogued.

RIGHT OF LETTERS PATENT:

The letters Patent Appeal attacking order passed by te learned single judge refusing to reject the plaint for want of disclosure of cause of action is maintainable under Cl. 15 of Letters Patent as the impugned order is judgment within the meaning of the said clause. The order refusing to reject plaint for failure to disclose a cause of action can cause grave prejudice and loss to a defendant and if defendant’s objection for rejection of plaint for failure to disclose the cause of action is accepted that would save the defendant from worry and expense of being put to trial. Refusing to reject the plaint which does not disclose cause of action though covered under O.7 R.11(a) and which obligates the trial court to do so definitely affects a very valuable right of the defendant since if such objection is upheld and lis is thrown out at the threshold, the defendant is spared from the agony of delay. Expenses and mental torture. The decision by the trial Judge adversely to the defendant on the application made by him for rejection of plaint for want of disclosure of cause of action decides an important aspect of the trial affecting the very valuable right of the defendant and even though the suit is kept alive, such order has to be construed to be preliminary judgment and, therefore, appealable within the meaning of Cl.15 of Letters Patent.

SISTERSHIP OF AN OFFENDING SHIP:

Where in a suit seeking for arrest of vessel for failure to pay insurance premium, a meaningful analysis of the averments made in the plaint would reveal that according to the plaintiffs, defendant was the owner of the two vessels in respect of which the plaintiffs claim amounts due towards unpaid insurance premium (release calls) as per the plaintiffs indemnity and that the defendant was owner of vessel in question which was sought to be arrested through its 100% wholly owned subsidiary and thus, the vessel was sister ship of said two vessels, the order rejecting the plaint on ground that it did not disclose cause of action was legal. In maritime law worldwide ownership of a ship is denoted by the concept of the owner of the shares in a ship. The shares in the vessel in question were not alleged in the plaint to be owned by defendant. The ownership of the ship by defendant was alleged to be on the basis of the defendant wholly owning subsidiary. Fundamentally each company incorporated in law is a distinct legal entity and mere incorporation of 100% subsidiary company by its parent company cannot lead to the conclusion that the assets of the former belong to and are owned by parent company. It is not that in all cases a subsidiary company must be treated as an asset of the holding company. If that be so, the subsidiary company shall have no independent identity and such subsidiary company will crack not under the pressure of its own uncongenial shareholders, but also of the pressure of the shareholders and creditors of the holding company. Further, a bald statement in the pleading that the ship in question was the sistership of offending ship or the inference that the ship was a sistership for the reasons disclosed which is legally not sustainable cannot be held to be sufficient to disclose a cause of action. Similarly though the law permits the plaintiff to arrest a ship which is beneficially owned by the defendant then the plaintiff was required to plead the material facts which disclosed the beneficial ownership of the defendant over th ship which was to be arrested and an interference drawn by itself in the pleading about beneficial ownership which was legally unsustainable could not be said to disclose a cause of action. Decision of single Judge, Reversed.

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ALEXANDER G. TSAVLIRIS & SONS. V/S. MV RICE TRADERS & OTHERS.

ACTION MEAN: (1985 CLC 1355) ..KARACHI HIGH COURT.

Word ‘action’ means any process by which jurisdiction of Admiralty Court is invoked and process of law is set in motion or interrupted. Word ‘action’ has a wide meaning and has been used in generic sense to include law suit, application, petition or resorting to any proceeding in a Court of law of enforcement of any right or claim entertainable in law. Claim should relate to services rendered for salvage of life on ship, cargo on board or ship itself. Salvor should not necessarily render service on high seas, such service if has been rendered in high seas or in internal waters or territorial waters or in port, salvors, held, would be entitled to maintain a claim under admiralty jurisdiction.

ARBITRATION & ADMIRALTY:

Admiralty jurisdiction of High Court could be invoked by filing action in personam or action in rem. Such actions to be initiated by a suit in respect of subject matter, claims and causes specified in S.3(2) of Ordinance, 1980 –Section 3(2) of Ordinance, 1980, held, does not contemplate initiation of an independent proceeding by filing an application under S.20, Arbitration Act, 1940 or for reference to arbitration any matter which might be covered by any of clauses of subsection (2) of S.3 of Ordinance, 1980. Proceeding for referring matter to arbitration completely different from admiralty action. Plaintiff while filing application under S. 20, Arbitration Act, 1940 filed an application under S.41, Arbitration Act, 1940 read with S.151, CPC. Such application for arrest of ship, held, not maintainable. Action in rem is a peculiar proceeding instituted against the res and is unknown to ordinary civil jurisdiction of the Court.

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ORIANTAL SHIPPING CO. LTD. V/S. PANAGHIA ODIGITRIA & OTHERS.

PRODUCTION OF ORIGINALS: (1991 MLD 148) ..KARACHI HIGH COURT.

Plaintiffs entitlement to claim specified amount for incurring expenses for providing necessities to defendant vessel. Burden to prove that plaintiff had incurred expenses as detailed in plaint and supplied the material shown therein was on the plaintiff, defendant having denied the same. Plaintiff failed to produce original bills and vouchers, instead photo copies of those bills and vouchers were produced. Plaintiff had neither alleged that those documents were lost nor had examined any witness for the loss of same. No satisfactory evidence of the loss of originals thus existed. Defendants having challenged photo state copies, same could not be relied upon. No case had therefore been made out for secondary evidence, and photo state copies were not admissible in evidence. Persons who had signed those bills and vouchers were not examined in evidence. Plaintiff also did not produce his account books to verify correctness of their claim in the suit. Plaintiff had failed to establish payments made by him to defendants.

MARITIME LIEN:

Admiralty suit in rem was competent for recovery of claim for necessities and other disbursements made by agents only, so long as ownership of vessel had not changed. Ownership of vessel having changed before filing of suit, it became property of new purchaser free from all encumbrances and proceedings, in rem for recovery of dues, if any, against previous owners was no longer competent except where there was a maritime lien available, which was not the case in the suit. Suit was thus not competent because ownership of vessel had been changed before the institution of suit and there was no maritime lien.

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GLOBAL SHIPPING CO. V/S. MV SEA ELITE & OTHERS.

ADMIRALTY COURT EXECISE JURISDICTION: (1985 CLC 1509) ..KARACHI HIGH COURT.

Filing a suit for recovery of certain amount against foreign vessel being disbursement made for and on behalf of vessel towards port dues and other accounts. Entire disbursement and expenses made outside Pakistan. Plaintiff’s application for arrest of vessel. Defendant contending that agent of vessel cold not file action in rem in respect of disbursement made on account of ship. Held, legal position under Ordinance was completely different from what it was under Admiralty Courts Act, 1861. Besides claim for necessaries, agent could file action in rem for a claim in respect of disbursement, made on account of the ship. Plaintiff neither carrying on business in Pakistan nor cause of action arising within territorial limits of Court. Plaintiff suing for claim in rem against foreign jurisdiction of Court to try same. Held, Admiralty Court, in exercise of Admiralty jurisdiction which could be invoked by an action in rem, could exercise jurisdiction over all ships whether Pakistani or not, and whether registered or not and wherever the domicile of their owners might be.

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AHMED INVESTMENT LTD. V/S. MV SUNRISE IV & OTHERS.

JOINDER OF SHIP OWNER: (PLD 1980 KHI 229) ..KARACHI HIGH COURT.

Carrier or ship, held, cannot succeed without showing goods being unidentifiable owing to insufficiency of marks and no goods being lost or if lost such being due to some other excepted peril. Condition is Bill of Lading reciting ship being not responsible for correct delivery in case securing or marking being insufficient. Provision contained in Bill of Lading, held, would cover cases of incorrect delivery of cargo on account of lack of identification but not of short landing. Plaintiffs, held further, rightly brought their suit for short landing in circumstances. Ship being an inanimate object not capable of defending itself, action of necessity to be defended by master, owner, or any other interested person irrespective of fact whether or not joined as party to suit. Suit filed in rem in admiralty jurisdiction. Held: Cannot fail merely on account of joinder of owner of vessel as party. Owner of vessel arrested under admiralty jurisdiction coming forward to defend action. Makes himself liable by such voluntary appearance to be proceeded against in personam as well. Occasion for doing so, however, arises only when value of res proceeded against falls short of claim of plaintiff and satisfaction of decree sought from other property of owner of res.

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NORD SEA AND FRECCIA DEL NORD

SEIZED OF ADMIRALTY JURISDICTION: ..QUEEN’S BENCH DIVISION.

(1) In respect of any claim within the Admiralty jurisdiction of the High Court an action in rem may be brought against only one ship; it was permissible to issue a writ naming more than one ship but after service the writ should be amended by deleting all but one of the names upon it; the Court could not be seized of an action in rem until the plaintiffs had not only made up his mind as to which ship he would arrest but also had either served the writ upon the ship or arrested the ship.

(2) Although it was rarely done because a plaintiff was anxious to obtain security for his claim, an action might be brought against a ship by service of the writ and without arrest; if after service of the writ a ship left the jurisdiction this Court could nevertheless give judgment against the ship.

(3). The Court was seized of an action in rem from the moment, whichever was the earlier of service of the writ or arrest of a ship.

(4) When a ship against which proceedings in rem were to be brought was already under arrest and in the custody of the Admiralty Marshal, a writ in rem should be issued against that ship and a caveat against release entered; the Court would be seized of jurisdiction from the moment when the writ was issued because the ship was already in the custody of the Court.

(5) The Court could not have jurisdiction over a ship which did not come within the jurisdiction; if it were held that this Court was seized of jurisdiction as soon as a writ in rem was issued, the Courts of other Contracting States might be required to declare jurisdiction in favour of this Court by virtue of art. 21 even though this Court could not exercise its jurisdiction because the ship had not been arrested or served with a writ; the Court was seized of this action on July 9, 1987 and the action would be stayed.

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BENGAL NASPUR RAILWAY CO. LTD. V/S. BUTTANJI BAMJI & OTHERS.

CONCURRENT FINDING: (AIR 1938 PC 67) ..CALCUTTA PRIVY COUNCIL.

It may be that the Courts below, in arriving at the same result upon the evidence on a question of fact, have not been influenced by precisely the same considerations, but that circumstances would not furnish any ground for disregarding the rule forbidding a fresh examination of facts for disturbing concurrent findings by the Courts below, which has been usually followed by the Board.

THE CONTRACT:

Original rates payable to contractor agreed in contract between Railway and contractor, abandoned by consent of parties. Substituted proposed rates not accepted by contractor. Contract still in operation. Work done by contractor in performance of it and accepted by Railway. Contractor is entitled to fair and reasonable rates. Where the original schedule of rates, payable to the contractor fixed under a contract between the Railway and the contractor was abandoned with the consent of both the parties and the new enhanced rates proposed to be substituted by the Railway for those rates were not accepted by the contractor, but the contract employing the contractor remained in operation and the contractor did the work for the Railway, which the latter accepted, the amount which the contractor is entitled to recover from the Railway for the work done should be determined on the basis of fair and reasonable rates.

INTEREST:

Interest of period prior to the date of the suit may be awarded, if there were the original schedule of rates, or it is payable by the usage of trade having the force of law, or under the provision of any substantive law entitling the plaintiff to recover interest as for instance the Court may award interest at the rate of 6 per cent, per annum, when no rate of interest is specified in a promissory note or bill of exchange under S. 80, Negotiable Instruments Act.

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V. N. LAKHANI & CO. V/S. MV LAKATOI EXPRESS & OTHERS.

BENEFICIAL OWNERS: (PLD 1994 SC 894) ..SUPREME COURT OF PAKISTAN.

Ownership of majority shares may be beneficial or legal, is a condition precedent for invoking jurisdiction under S.4(4)-Charter, be it time charter or charter by demise is excluded from the category of “persons who beneficially own majority shares in the ship” sought to be arrested. In applying section 4(4) of the Admiralty Jurisdiction of High Court Ordinance, 1980 one has to take into consideration the existing facts at the time when cause of action arose in connection with the offending ship. In order to invoke the jurisdiction, the plaintiff has to establish that;

The claim falls in any of the clauses as mentioned in clauses a to (h) and (j) to (q) of subsection (2) of section 3 and arises in connection with a ship.
When the cause of action of action in personam arose.
The person liable in an action in personam at the time when such cause of action arose, was the owner or charterer of or in possession or in control of the offending ship.
The offending ship or any other ship which is sought to be arrested, at the time action is brought is beneficially owned as respect majority shares by the person liable on the claim in action in personam.

The key words in the provision are ‘beneficially owned as resects majority shares’. The person liable for the claim in an action in personam should beneficially own majority shares. It is on compliance with this condition that action in rem for arrest of a sister vessel can be filed.

CHARTERER, CHARTER BY DEMISE:

The charterer, be it time charterer or charterer by demise, is excluded from the category of persons who beneficially own majority shares in the ship sought to be arrest. The pre-condition for invoking jurisdiction under section 4(4) (a) (b) is that the person who would be liable on the claim in an action in personam was; when the cause of action arose, should beneficially own majority shares in the ship only then sister-ship can be arrested. If one takes the view that the words “beneficially owned” may include even a demise charterer then words “as respects majority shares” will be completely redundant. The ownership of majority shares may be beneficial or legal is a condition precedent for invoking the jurisdiction. It is a well-settled principle of interpretation of statute that each and every word of a statute has to be given its meaning and no part of a statute can be treated as redundant or surplus. The legislature intended to give an effective meaning to the words “as respects majority shares” which can only be attributed to the owners.

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GHULAM ABBAS. V/S. TRUSTESS OF PORT OF KARACHI.

INTERPRETATION OF CONTRACT: (PLD 1987 SC 393) ..SUPREME COURT OF PAKISTAN.

Leave to appeal granted to examine the contention that High Court virtually acted as an Appellate Court by substituting its own findings on the various items of the claim which Arbitrator had awarded to the petitioner for valid reasons, and thus the High court acted beyond the scope of powers under S.30, Arbitration Act, 1940. Contention of respondent that arbitrator, though had the power to interpret the contract but his interpretation was not conclusive and was subject to correction by the Court in its exercise of jurisdiction under S.30. Court by not assigning any reasons, for its conclusion that interpretation placed by Arbitrator on a contract clause was erroneous was not justified to hold that such interpretation of clause of contract by arbitrator was wrong. Rejection of item in dispute of the award by Court was not justified without adverting to the reasons assigned by arbitrator in support of its considerations.

RIGHT OF INTEREST:

It is necessary to analysis the nature of right to interest on a money claim before a Court of law and on the same analogy before the domestic form of an Arbitrator. The right to interest, for the period prior to the date of suit or prior to the reference to arbitration is a matter of substantive law, as contrasted with the power given to a Court of law under section 34, CPC or section 29 of the Arbitration Act which is a statutory power within the domain of procedural law. The right to interest, for te period prior to the suit, arises in one of the four following ways:

(i) agreement, express or implied between the parties,

(ii) mercantile usage,

(iii) statutory provisions,

(iv) interest may be also allowed on equitable grounds in proper cases. [p. 407] G

The question however is whether the Court has authority to allow interest for the period prior to the institution of the suit; and the solution of this question depends, not upon the Civil Procedure Code, but upon substantive law. Now, interest for the period prior to the date of the suit may be awarded, if there is an agreement for the payment of interest at a fixed rate, or it is payable by the usage of trade having the force of law, or under the provision of any substantive law entitling the plaintiff to recover interest, as for instance, under section 80, Negotiable Instruments Act, 1881, the Court may award interest at the rate of 6 per cent per annum, when no rate of interest is specified in the promissory note or bill of exchange.

BREACH OF CONTRACT:

Generally in the absence of express or implied contract pay interest or of usage of trade, interest cannot be allowed on damages for breach of contract. Compensation for breach of contract qua the claim accepted by arbitrator as awarded, could not, therefore be subjected to a further liability to pay interest as per dictum laid down in PLD SC 505.

In the present case the claim for interest as incorporated in the statement of claim filed by the appellant before the Arbitrator was couched in the following terms:-

”interest by way of compensation for wrongful retention of money due to the plaintiff….”

Clearly, therefore, in the submission before the Arbitrator the question was whether the appellant was entitled to interest by way of compensation for breach of contract, in that, the respondents who were required by the terms of the contract to make payment for the works executed did not do so at the stipulated time. It was not the case of the appellant what he was entitled to interest by the express or implied terms of the contract or on the basis of mercantile usage or any statutory provisions.

Generally in the absence of express or implied contract to pay interest, or of usage of trade, interest cannot be allowed on damages for breach of contract. The compensation for breach of contract quo the claims accepted by the Arbitrator as awarded could not, therefore, be subjected to a further liability to pay interest according to the dictum laid down in PLD 1965 SC 505.

Interest on the sum awarded as damages cannot be allowed for period prior to the date of award except on grounds already mentioned which are not applicable in the present case. Even on the assumption that interest was recoverable as damages for wrongful detention of money since the claim of the appellant was disputed and required to be determined by adjudication in the arbitration proceedings, it was an unliquidated claim until the passing of the award and in any event interest could only be awarded if there were a debt or sum certain payable at a certain time. Interest on a claim for damages arising out of breach of contract cannot be allowed both on principle and in law.

DISCRETION OF COURT:

Arbitrator can under no circumstances award interest for the period beyond passing of the decree by Court on the award. Only the Court has discretion to order interest from date of the decree at such rate as the Court deemed reasonable, to be paid on the principal sum as adjudged by the award and confirmed by the decree. Future interest with effect from date of decree cannot be awarded by the arbitrator.

As far as the grant of interest from the data of the award until the payment of the principal sum is concerned, the Arbitrator can under no circumstances award interest for the period beyond the reason that the statutory provisions contained in section 29 of the Arbitration Act take over and it is the Court within whose discretion lies the power to order interest from the date of the decree at such rate as the Court deemed reasonable, to be paid on the principal sum as adjudged by the award and confirmed by the decree. Future interest with effect from the date of the decree could not legally be awarded by the Arbitrator. However, the facts were that the award was made the rule of the Court by the Court with the result that the part of the award granting interest beyond the date of the decree until payment was also incorporated in the decree passed by the Court. The Court could set aside this part of the award, it was open to it to exercise its own power under section 29 of the Arbitration Act and grant interest. Therefore, in making this portion of the award a part of the decree the Court must be deemed to have adopted it in the exercise of its own power under section 29. In his statement of claim the appellant had claimed interest only upto 3^rd October, 1973. The issues were framed by the Arbitrator on the pleadings of the parties and therefore, interest beyond 3^rd October, 1973, was not the subject-matter of reference for adjudication before the Arbitrator. The Arbitrator, therefore, exceeded his authority, in any case, to have award future interest for the period between the date of the award and the date of the decree on any basis.

The award on the face of it referred to the statement of the claim in which the contractor claimed interest by way of damages and it is on that basis that the decision of the Arbitrator apparently proceeded. The Arbitrator in the facts of the case could not according to law grant interest as claimed, there would be an error of law apparent on the face of the record. The mere fact that pleadings were filed before the Arbitrator and issues were then settled on the pleadings of the parties incorporating the question fo interest does not necessarily give rise to the inference that the parties had agreed to refer specially the question of grant of interest as a question of law for the decision of the Arbitrator, so as to preclude any party to the arbitration from challenging the award on the ground of error of law on the face of the award. So far as the item of interest in dispute is concerned the Arbitrator committed an illegality in awarding interest except that the interest award from the date of decree onwards has been saved by virtue of section 29 of the Arbitration Act.

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MV GOLOZ. V/S. PACMAR SHIPPING (PVT) LTD & OTHERS.

AGENCY SERVICES: (2010 CLD 660) ..KARACHI HIGH COURT.

Beneficial title in the delinquent vessel had been passed on to the new owner before the writ was issued and served, the action in rem would not be sustainable. Action inpersonam would lie against the owner of the vessel during whose ownership cause of action accrued. Plaintiffs had to show that they had provided agency services, necessaries, disbursement to the delinquent vessel; that the delinquent vessel was owned by one and the same owner when the cause of action accrued and that when the proceedings in rem were brought against her or her sistership. Arrest of the offending ship or her sistership had given plaintiff pre-judgment security, the institution of action in rem started with the issuance of the writ in rem-issuance of the writ in rem, had attached to the ship the statutory lien which would remain equally enforceable against a bona fide purchaser for value without notice, unless the vessel had been judicially sold, that is, if there had been change in ownership between the time the cause of action accrued and the time when the action was brought, statutory right in rem would be lost and the cause in personam would survive.

STATUTORY LIEN:

Owner, despite having learnt that vessel was under arrest during the period of purported provisional patente, had over six months time to avoid the sale, or compel the beneficial owner to clear all the liabilities, did not do the same. Once the owner had chosen to contest the matter without seeking discharge of claim by the owner during whose term of beneficial ownership, cause of action accrued and commenced, statutory lien clinched vessel, such lien prima facie would be inherited y the successive owner, who despite notice had chosen to obtain final patente registration after confirmation of arrest.

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BANGLADESH SHIPPING CORPORATION. V/S. MV NEDON & OTHERS.

AUTHORITY OF VESSEL MASTER: (PLD 1981 KHI 246) ..KARACHI HIGH COURT.

Real defendants described as owner of or persons interested in ship. Writ of arrest may be effected by serving it on ship and such writ may be accepted by master or owner or by nailing or pasting it on mast or other conspicuous part of ship. Owner or person interested in res appearing and putting defense, such person, held, becomes party to action and personally liable for whatever decreed against him. Master as agent of owner of necessity can enter appearance, defend action and protect interest of ship and owner. Authority of master by change of ownership, held, does not cease to exist so long as in command of ship and not removed.

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MONTE ULIA. V/S. THE BANKO & OTHERS.

7 VESSELS ARREST: (1971) VOL.1, PART 2) ..LLOYD’S LAW REPORTS.

Whether plaintiff entitled only to arrest either vessel concerned with claim or any one other vessel in same ownership. Administration of Justice, Act, 1956, sect. 3(4) Practice of naming sister ships in writ in rem considered. Brussels Convention 1952.

Statute – Construction – Statute passed to enact matters agreed at prior convention – Whether Court entitled to look at convention as aid to construction of statute.

Admiralty jurisdiction in rem may only be invoked against one vessel of the defendant, but the practice of issuing a writ against all ships owned by the defendant is correct because the jurisdiction in rem is invoked, not when the writ is issued, but when it is served on the ship and the warrant of arrest is executed.

On July 26, 1970, the plaintiffs’ motor vessel Monte Ulia collided with a jetty in the River Thames causing extensive damage. The plaintiffs alleged that collision was caused by the negligent navigation or management of the defendants’ motor tanker Banco. The plaintiffs issued a writ in rem against the defendants and arrested seven vessels owned by the defendants including the Banco. The defendants contended that under the Administration of Justice Act, 1956, sect. 3(4), the plaintifs only had the right to arrest the Banco or any one other vessel in the same ownership.

On a motion to set aside the writ and discharge from arrest six of the defendants’ vessels:

——- Held, by Lane, J., (1) that in the constructin of a statute such as the Administration of Justice Act, 1956, passed to enact matters agreed at a prior Convention, the Court may, in the event of ambiguity, look at the Convention, even though the statute may have given effect to broader terms of agreement than those of a precise definition;

(2) that, accordingly, referring to the Convention, sect. 3(4) of the Administration of Justice Act meant that the plaintiffs might arrest one ship for the defendants only, which might be the offending ship or alternatively, any other ship in li9ke ownership.

On appeal by plaintiffs:

——– Held, by C.A (Lord Denning, M.R., Megaw and Gairns, L. JJ.), that the meaning of sect. 3(4) was not ambiguous and the defendants’ construction of that section was correct (see p. 53, col. 1; p.5, co0ls. 1 and 2; p. 59, cols. 1 and 2);

Further (Cairns, L. J., dissenting), jurisdiction is invoked in an action in rem, not when the writ is issued but when the writ is served.

Appeal dismissed.

Osmani Law Associates

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Written By: Shahreyar Osmani

Osmani Law Associates.

Admiralty|Maritime|Shipping Law; Actually, What Is It?

Admiralty law, also called maritime law, is a combination of U.S. and international law that covers all contracts, torts, injuries, or offenses that take place on navigable waters. Admiralty law traditionally focused on oceanic issues, but it has expanded to cover any public body of water, including lakes and rivers. These laws largely cover interactions between two or more ships, the ship captain’s obligations to the crew and passengers, and the rights of crew members, as well as other legal issues.

How It Works

In most nations, maritime law follows a separate code and is an independent jurisdiction from national laws. The United Nations(UN), through the International Maritime Organization (IMO), has presented numerous conventions that can be enforced by the navies and coast guards of countries that have signed the treaty outlining these rules. Maritime law regulates many of the insurance claims relating to ships and cargo; civil matters between ship owners, seamen, and passengers; and piracy.

Additionally, maritime law regulates day to day activities of the ships/vessels for example registration, license, and inspection procedures for ships and shipping contracts; maritime insurance; and the carriage of goods and passengers.

The International Maritime Organization (IMO) (established in 1948 as the Inter-Governmental Maritime Consultative Organization, and coming into force in 1958) is accountable for ensuring that existing international maritime conventions are kept up to date, as well as developing new agreements as and when the need arises.

Today, there are dozens of conventions regulating all aspects of maritime commerce and transport. The IMO names three conventions as its core:

The International Convention for the Safety of Life at Sea
The International Convention for the Prevention of Pollution from Ships
The International Convention on Standards of Training, Certification, and Watchkeeping for Seafarers

Admiralty Law In UK

England admiralty courts date to at least the 1360s from the rule of Edward III. At that time there were three courts for admiralty matters which were chosen by the admirals who were responsible for the waters in the north, south, and west of England. In 1483 these local courts were diminished and formed into a single high court of admiralty. The English admiralty courts are common law. Around 1750 the industrial revolution started. The English commerce became stronger, the admiralty courts played an important part in new ideas and innovation.

In England and Wales today admiralty jurisdiction is practiced by the High Court of Justice in England (EWHC). Admiralty law applied in this court is grounded upon the civil law-based Law of the Sea, with statutory law and common law additions. The Admiralty Court is no longer in the Royal Courts of Justice in the Strand, having moved to the Rolls Building.

What Is the Law of The Sea?

Law of the sea also known as the “constitution of the sea” is the ground of the international law which administers different states in the maritime jurisdiction. It handles matters such as navigational rights, sea mineral claims, and coastal water jurisdiction. The United Nations Law of the Sea provides authority to coastal states over the seabed and subsoil of the continental shelf. A country has the right to over 200m EEZ and allows the state to explore and excavate any resource within the territorial limits.

Admiralty law in America

The courts and the government tend to create a uniform body of admiralty law nationally and internationally. The courts handle the admiralty jurisdiction through the Judiciary Act 1789 and from Article III and II of the U.S Constitution. They also regulate it partially through the “Commerce Claus”. American Admiralty Law previously applied only to the American tidal waters. It now extends to the water bodies present within the United States for internal and international commerce and trade. In such water’s admiralty jurisdiction includes maritime matters not involving interstate commerce, including recreational boating. Admiralty Law in the United States formed by the British Admiralty Courts is present in most of the American colonies now.

In the United States, the federal district court has authority over all admiralty and maritime cases. The state court hearing an admiralty case is required to follow the Admiralty maritime law even if it’s against the law of the state. Under the doctrine known as the “reverse-Erie doctrine.” The Erie doctrine derived by“Erie Railroad Co. v. Tompkins” tells the courts to hear state cases to apply state law. However, if a state court is hearing Admiralty cases should apply Admiralty Law. Which in some cases turns crucial.

Cargo Claims

Claims for the damage to cargo shipped by ocean carriers in international commerce and trade in and out of the United States are administered by the Carriage of Goods by Sea Act (COGSA), which is the U.S. enactment of the Hague Rules.

Admiralty Law in Asia

Most of the common law countries (including Pakistan, Singapore, India, and many other Commonwealth of Nations countries) follow English statute and case law. India still follows many Victorian-era British statutes such as the Admiralty Court Act 1861. Whilst Pakistan now has its statute, the Admiralty Jurisdiction of High Courts Ordinance, 1980 (Ordinance XLII of 1980), it also follows English case law.

Singapore

The Admiralty Law in Singapore exclusively covers the areas such as the Carriage of goods by sea, the Admiralty law, and merchant shipping legislation. However, as far as the Carriage of goods by sea is concerned the Admiralty law of Singapore is extremely similar to that of English Law. Common law principles and two decrees. Namely Carriage of goods by sea and the Bills of lading act. The primary Jurisdiction is handled by the High court (Admiralty Jurisdiction) Act of Singapore.

Malaysia

Maritime suits often involve matters of international law. In Malaysia, the importance of having a separate and specialized Admiralty court was extremely important and vital. This all took rise by the setting up of the court in October 2010. This court in Malaysia, Kuala Lumpur practices the same jurisdiction in handling the matters of Admiralty, like that of the High Court of Justice in England under the UK Supreme Court Act 1981. However, the law was a little amended and some things were changed forex the matters which are handled by the court was expanded from the 18 matters listed in the s.24 (b) of UK Supreme Court Act 1981.

Thailand

Vessel Act as part of Admiralty/Maritime laws in Thailand is the frame of law that administers vessels in Thai waters. In terms of nationality, the vessels can be classified as either a Thai registered vessel or a foreign registered vessel. Thailand is not a signatory to any international conventions relating to the carriage of goods by sea i.e., Hague Rules, Hague-Visby Rules, or Hamburg Rules but some principles in those international Conventions were adopted in Thai COGSA particularly, it was mainly influenced by the provisions of Hamburg Rules.

Indonesia

The Indonesian Admiralty Law states a ship should be arrested by its harbormaster at a certain port based on a written court order that is granted if the ship is involved in a criminal or civil case. The Shipping Law further states that a court judgment for a ship arrest in a civil case relating to maritime claims may be issued without initiating civil court proceedings.

Pakistan

The Pakistan Merchant Shipping Ordinance 2001 has replaced the Merchant Shipping Act 1923. This replacement was done in 2001 to handle the constantly upgrading modern shipping industry. The purpose of the Pakistan Merchant Shipping Ordinance 2001 is to provide a strategy and rules under which the Government, Authorities will function in dealing with stuff related to the shipping industry. This law also handles duties internationally required under the ILO (International Labour Organization) conventions as Pakistan is an active member of the ILO.

India

The current Maritime Law in India has been established from Colonel times such as the Territorial Waters Jurisdiction Act, 1878, the Admiralty Offences (Colonial) Act, 1849, the Coasting Vessels Act, 1838; the Inland Steam vessels Act, 1917, the Indian Registration of Ships Act (1841) Amendment Act, etc. India has a very deep history in dealing with sea trading this is why there existed a variety of regulations, rules, and set of laws in this field from time old.

Turkey

The Turkish commercial code includes the Maritime Jurisdiction which is very important for foreign investors who want to start a business in Turkey concerning this field. This law controls major issues, such as buying and selling of ships, the rights of an owner of a vessel, how to use the Turkish flag, the owner’s liabilities, etc. The owner of a ship is permitted to sell shares of it only if the vessel is legally registered. The operator of a ship has some important liabilities and it is responsible in front of third parties. The carrier has certain tasks for loss or damage of the goods that he transports if he didn’t take the obligatory measures for the safety of his mission. The Code of Obligations states what happens in case of losses caused by delays or others that are not a direct responsibility of the carrier. The carrier’s liabilities related to losses and damages are also stated by the Hague Rules.

China

The Maritime Safety Administration of the People’s Republic of China is a government agency that looks after every matter relating to maritime and shipping safety, including the management of maritime traffic safety and security, stoppage of pollution from ships, an inspection of ships and offshore facilities, navigational safety measures (including Search and Rescue, Aids to Navigation and the GMDSS), administrative management of port processes, and law enforcement on matters of maritime safety law. It was also accountable for marine accident investigations. It is headquartered in Dongcheng District, Beijing.

Admiralty Law in Australia

The Admiralty Act of 1988 brought the Australian admiralty jurisdiction in the 20^th century. It was updated from the 19^th century. The law permits the state’s Supreme Court as well as the federal court to handle matters like ship arrest and other actions.

The Act gives the right to arrest the “surrogate ship” which in some laws is known as the sister ship arrest. This only arises when the relevant person was when the cause of action arose. The proceeding has started the ship and the owner of the ship is to be arrested.

The Act does not create any new liens and does not change any common laws of the state

The Act also gives a constitutional right of damages where the property has been arrested or excessive security has been demanded unreasonably and without good cause (section 34). Despite the passage of almost 20 years since the Act’s introduction, section 34 remains untested. There have, however, been a large number of cases testing the limits of the jurisdiction conferred by this legislation and Australia now has a considerable body of its admiralty law. The Federal Circuit Court has jurisdiction under ss.9, 27, and 28 of the Admiralty Act 1988 (Cth) and any matters referred to it by the Federal Court. The jurisdiction allows the Court to hear proceedings commenced as actions in personam on:

maritime claim, or
claim for damage done to a ship

Admiralty Law in Canada

Canadian maritime law is based on the “Navigation and Shipping” entrusted to the Parliament of Canada by the s. 91(10) of the Constitution Act, 1867.

Canada has adopted a modern version of its maritime law, which is the updated version of the “Admiralty Law”. The original English admiralty jurisdiction was called wet because it limited itself with things at sea such as collisions, salvage, the work of mariners, and contracts and torts performed at sea. The Canadian Admiralty law was named as dry because it also concerned itself with matters such as:

stevedoring,
marine insurance,
warehousing and security services,
contracts of agency, and
contracts of carriage.

Admiralty Claims

Personal Injuries to passengers

Shipowners have a huge for the safety and care of passengers. Passengers which are injured at sea consequently file claims against the third party. However, it is their responsibility to file a claim against the shipowner. Personal injury cases are usually pursued within three years. Admiralty suits are to be filed within 1 year due to the terms and conditions at the back of the passenger tickets. Some exceptional cases also only have 6 months. Many U.S cruise lines also have terms to only file suit in either Miami or Seattle.

Maritime Liens and Mortgages

Banks that loan money to purchase ships, vendors who supply ships with necessaries like fuel and stores, seamen who are due wages, and many others have a lien against the ship to guarantee payment. To enforce the lien, the ship must be arrested or seized. In the United States, an action to enforce a lien against a U.S. ship must be brought in federal court and cannot be done in state court, except for under the reverse-Erie doctrine whereby state courts can apply federal law.

Cargo Claims

One of its key features is that a shipowner is liable for cargo damaged from “hook to hook”, meaning from loading to discharge, unless it is exonerated under one of 17 exceptions to liability, such as an “act of God”, the inherent nature of the goods, errors in navigation, and management of the ship. The basis of liability for the shipowner is a bailment and if the carrier is to be liable as a common carrier, it must be established that the goods were placed in the carrier’s possession and control for immediate carriage.

Personal injuries to Seamen

In Admiralty Law, there is a great emphasis on the rights of seamen. Seamen injured on the ship can claim compensation through the following paths: the Jones Act, the Principle of Maintenance and Cure, and the Doctrines of unseaworthiness. The “Jones Act” which is section 27 of the Merchant Marine Act of 1920 states that sailors can file claims and obtain damages from their employers. On the other hand, the Doctrines of unseaworthiness states that a shipowner should maintain its ship properly and make it seaworthy. A ship or vessel that is seaworthy is fit for its intended purpose. If any part of the ship, or equipment on it, is not in fit shape, the vessel is unseaworthy.

Collision Liability

Under Maritime Law responsibility for collision damage is based on the fault. However, a colliding vessel is not held responsible for the accident, Unless the accident is caused by the deficiency of the colliding vehicle or the negligence of its navigator.

The principle of “contributory fault” is when both of the colliding vessels are blamed responsible the expenses are to be shared equally regardless of the respective degree of fault. However, in some countries, this principle is not followed and each owner bears its damages.

Oil spills

The International Convention on Civil Liability for Oil Pollution Damage, 1969, renewed in 1992 and often referred to as the CLC Convention, is an international maritime treaty administered by the International Maritime Organization that was adopted to ensure that adequate compensation would be available where oil pollution damage was caused by maritime casualties involving oil tankers (i.e., ships that carry oil as cargo).

The convention introduces strict liability for shipowners.

In cases when the shipowner is deemed guilty of fault for an instance of oil pollution, the convention does not cap liability.

When the shipowner is not at fault, the convention caps liability at between 3 million special drawing rights (SDR) for a ship of 5,000 GT to 59.7 million SDR for ships over 140,000.

The Admiralty Law dates back to the 1360s and at that time mainly practiced in England and a few other countries. As time passes, now in the modern era almost every country adopting trade and among each other and practicing all the ways of trade, especially through ships/vessels. This arises different nature of problems which can only be handled by Admiralty law, so almost all countries practice this Law. Which leads us to different kinds of conventions, treaties, etc. This all shows us the importance of Admiralty jurisdiction and how it is emerging in our world.

Written By,

Shahryar Osmani

Osmani Law Associates.