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High Court of Kerala on Admiralty Jurisdiction: An opportunity missed?

 V. N. Haridas*

 

The recent judgment by the High Court of Kerala on Admiralty law 1  raisesserious concerns for the shipping community and also for maritime lawyers. High

Court of Kerala through this judgment directs “any person approaching this court

invoking the admiralty jurisdiction of this Court shall institute suit in accordance with

the procedure contemplated under the Code of Civil Procedure, 1908. Such suit shall

 be tried by this Court following the procedure prescribed under the Code of Civil

Procedure”2. Further in the procedural side the judgment provides that the “rules

framed by the Madras High Court in so far as they are not inconsistent with any other 

law for the time being in force and with appropriate modifications shall apply to the

conduct of Admiralty suits until the High Court of Kerala modifies the said Rules or 

the Legislature intervenes in this regard3”. The significance of the judgement is on the

attribution of original civil jurisdiction to the High Court of Kerala which it never  possessed so far. Before examining the implications of this judgment an attempt is

made to analyse the existing admiralty jurisdiction of High Court of Kerala.

The landmark decision in M. V. Elisabeth4 has provided admiralty jurisdiction

to all High Courts in India apart along with the chartered High Courts in India. High

Court of Kerala has exercised several times this special jurisdiction regarding

admiralty. The usual procedure before the High Court of Kerala preceding the

 judgment in M. V. Free Neptune is that, whoever intends to initiate an action in rem  by arresting a foreign vessel has to file a writ petition under Article 226 of the

Constitution of India seeking a direction to the port authorities to detain the foreign

vessel relying on section 443 of the Merchant Shipping Act5. The combined

application of Constitution of India and Merchant Shipping Act along with the ratio in

M. V. Elisabeth in dealing admiralty cases by the High Court of Kerala was

necessitated due to the fact that the Court is not a chartered High Court under 

Colonial Courts of Admiralty Act 1891 and does not possess original civil jurisdiction

as they possess by virtue of Letters of Patent Act 1862. Once the vessel is detained

and the owner has appeared before the court the matter is relegated to the proper 

forum for adjudication by the High Court of Kerala and the proceedings continue in

 personam.

It is often misconstrued and confused with the terms Admiralty ‘suit’6, 

‘Admiralty jurisdiction’, ‘maritime claim’ and ‘arrest of vessel’ and M. V. Free

 Neptune is not free of this difficulty. ‘Admiralty jurisdiction’ implies that the vesselhas a juridical personality- almost corporate capacity, having not only rights but

liabilities (some times distinct from those of the owner) which may be enforced by the

 process and decree against vessel, binding upon all interested in her and conclusive

upon the world. Admiralty jurisdiction in appropriate cases administers remedies in

1* LL.M. Maritime Law (University of Southampton). Advocate, High Court of Kerala.

 M.V.Free Neptune v D.L.F.Southern Towns Private Ltd . 2011(1) KLT 9042 Supra n (1) para 23and 243 Supra n (1) para 24.4 M.V.Elisabeth v Harwan Investment & Trading Pvt. Ltd, Goa AIR 1993 SC 10155 Adv.V.M.Syamkumar, ‘Arrest of Ships for Enforcing Maritime Claims’ Available at

http://admiraltylawkochi.blogspot.com/search/label/Arrest%20of%20Merchant%20vessels%20in%20Cochin [14 July 2011]6 Emphasis added by the author 

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rem, i.e, against the property, as well as remedies in personam i.e., against the party

 personally7. Admiralty jurisdiction 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 a mere procedure to obtain security to satisfy

 judgment. Thus admiralty suit is only a proceeding in rem initiated to arrest a foreign

vessel in order to secure a security if the claimant succeeds to procure a judgment or award in future.

 Now coming to the present judgment, The Hon’ble High Court framed four 

issues. The four issues formulated by the court are as follows;

1. Whether the claim such as the one made by the petitioner is a “maritime

claim” as understood in law in this country?

2. If it is a “maritime claim”, whether this court is the appropriate forum for 

adjudicating such maritime claims?

3. In the absence of any law structuring the admiralty jurisdiction of this Court

[which has been declared to be inherent in this court in M. V. Eisabeth’s case]

what are the limits and contours of the said jurisdiction? And

4. What is the procedure to be followed in exercising such jurisdiction?

The facts of the case provides that along with other prayers the petitioner 

sought an interim prayer for the arrest and detention of the 1st respondent ship which,

at that point of time, was berthed at Chennai port 8. The berthing of M.V. Free

 Neptune in Chennai Port itself would have raised the primary issue that the High

Court of Kerala by exercising its Admiralty jurisdiction can arrest and detain a foreign

vessel which was out of its territorial limits or jurisdiction?

It is a settled position of law that in an action in rem the ship should be within

the jurisdiction of the court at the time proceedings are started 9. In this aspect also see

Section 3(15) of the Merchant Shipping Act, 1958 defines ‘High Court’, in relation to

a vessel, as “the High Court within the limits of whose appellate jurisdiction...” It

would mean a foreign vessel falls within the jurisdiction of the High Court of Kerala

only if the vessel happens to be at the territorial limits of Kerala at the relevant time. It

has been reiterated by the High Court of Kerala itself that High Court of Kerala

cannot detain a foreign vessel if it happens to be out of its territorial limits.10 

Therefore the present decision by Division Bench in M. V. Free Neptune affirming

single bench decision to detain a foreign vessel which was at Chennai port at relevant

 point of time is apparently either wrong or  per incuriam.

In M. V. Free Neptune the Division Bench by overlooking the fundamental

 principle of admiralty jurisdiction, proceeds to consider what could be the procedure

to be followed in exercising such jurisdiction. The Court presumes that disputesfalling within the admiralty jurisdiction arise out of contractual rights and obligation

which normally requires investigation into factual allegations. In such cases, a suit is

the appropriate proceeding and such suit shall be tried by this Court (read High Court

of Kerala) following the procedure prescribed under the Code of Civil Procedure11. 

Here the Court confuses with the legal concepts mainly exercise of admiralty

 jurisdiction and adjudication of maritime claims.

7 Benedict, The Law of American Admiralty Vol.1 (6th Ed).p.3. Quoted in M. V. Elisabeth v Harwan

 Investment & Trading Pvt. Ltd , Goa AIR 1993 SC 10158 Supra n(1) para 6.Emphasis added by the author 9

 Supra n (4) para 56, 78, 89 and 94.10 Ocean Lanka Shipping co (pvt) ltd v MV Janate. 1997(1) KLT 36911 Supra n (1) para 23 and 24.

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Exercising admiralty jurisdiction of a High Court via an ‘Admiralty Suit’ is

having a very limited purpose of securing a security as discussed above. Arrest of a

foreign vessel via admiralty suit is regarded as a mere procedure to obtain security to

satisfy judgment. The petitioner claimant may therefore detain the foreign vessel by

obtaining an order of attachment whenever it is feared that the ship is likely to slip out

of jurisdiction, thus leaving the petitioner claimant without any security. Such anaction is provisional in character which induces the owner to submit to the jurisdiction

of the court, thereby making himself liable to be proceeded against by the plaintiff in

 personam. Once such owner submits to the jurisdiction the matter will be relegated to

the proper forum for the adjudication.12 

As the Court rightly observed that the disputes falling within the admiralty

 jurisdiction arises out of contractual rights and obligation, it is not quite uncommon

that the parties agree themselves with respect to the form and forum of dispute

resolution. It is part of their freedom of contract to choose either to go for arbitration

subject to English law or to go for mediation in Paris. This raises the legal issues that

how High Court of Kerala can deprive of the parties their freedom of contract and

insist them to subject to a protracted ‘civil suit’ at High Court of Kerala? Beforerushing such a conclusion the Court ought to have considered the difference between

‘Admiralty Suit’ and “Adjudication of Maritime Claim’. At present different

Subordinate Courts and Munsiff Courts in Kerala are adjudicating different maritime

claims. Application of the ratio in this Judgment will result in the transferring of all

matters pending before those courts to High Court of Kerala. If maritime claims can

 be resolved only by civil suit in High Court, will it be a ground for appeal to an

unsuccessful party that the dispute has been resolved in wrong forum without having

any jurisdiction?

Moreover this judgment attributes original civil jurisdiction to High Court of 

Kerala which so far neither existed nor exercised. The question arises are whether this

  jurisdiction is exclusively for maritime claims? Also whether a High Court can

assume jurisdiction by itself and thereby oust jurisdiction of its subordinate courts?

The court also ought to have considered the existing procedure for admiralty cases

 before outlining a novel one. The problems with respect to Admiralty Law subsist all

over India which can only be resolved through a comprehensive national legislation.

The issues peculiar to Kerala are that of frivolous arrest13 and it can be effectively

resolved by proper appreciation of law by the judges and allowing ship owners or the

vessel to file a general caveat against the world at large thereby before any motion of 

arrest is issued, notice to be given either to the vessel or to her representative.

High Court of Kerala even though rightly observed admiralty law as a

  peculiar branch of law which demands rather an academic treatment failed tounderstand the fundamental principles behind admiralty jurisdiction. Failure to

appreciate the basic principles and existing procedures for the exercise of admiralty

 jurisdiction unfortunately mark this judgment in the history of admiralty jurisprudence

as an opportunity being missed by an amateurish discourse.

12 Supra n (4) para 46.13 For a detailed discussion pertaining to vessel arrest in kerala, see Adv.V.M.Syamkumar, ‘Arrest of 

Ships for Enforcing Maritime Claims’ Available athttp://admiraltylawkochi.blogspot.com/search/label/Arrest%20of%20Merchant%20vessels%20in

%20Cochin [14 July 2011]