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Arrest, Attaclunent, and Related Maritime

Law Procedures

William Tetley, Q.C:

1895

This Artic le traces the Admiralty action in rem back to its civil ian roots in medieval

Europe and shows how the action in England gradually diverged from the Continental model,

beginning in the sixteenth century. The action in rem and the arrest of ships in the

contemporary law of the United Kingdom, the United States, and Canada are outlined and

compared to the civilian saisie conservatoire and its counterpart, the u . s . maritime attachment.

Two re la ti ve ly new procedure s employed in modem mari time law in the U.K. and Bri ti sh

Commonwealth countries+the Mareva i njunct ion and the Anton Piller order-s-are also

discussed. 1 7 l C author concludes with some incisive comments on salient points in the Arrest of

Ships Convention J 999 and the urgent need for greater international uniformity in this vitally

important area of maritime law.

I. INTRODUCTION 1898

II. THE PURPOSEAND PLAN OF THISARTICLE 1899

III. TH E HISTORY OFARRE ST I NR EM ANDTHE ADMIRALTY

ATTACHMENT-ENGLAND 1900

A. Roman Law and theAdmiralty Action In Rem 1900

B. The Processus Con tra Contumacem 1900

C . Characteristics of theAdmiralty Process to Compel

Appearance in Tudor/Stuart England 1902

D. Gradual Emergence of Contemporary Admiralty

Procedures-England 1903

E. Did the Admiralty Attachment Expire in the

Eighteenth Century? 1905

Iv. ARRE ST I NR EM -UN IT ED K INGDOM , CANADA , AND

UNITED STATES 1905

A. UnitedK ingdom 1905

1. A rrest In R em -th e C ha ra cte ris tic A dm ir alty

Proceeding 1905

2. In Rem Process in a Nutshe1l... 1907

3. C losed L ist o f Maritim e C laim s 1908

4. Arrest to E nforce M aritim e L iens 1909

5 . A rrest to Enforce Statutory Rights In Rem 1910

* Profe ssor of Law, McGil l Univer si ty , Dist ingu ished Visi ting Profe ssor of

Mar it ime and Commercial Law, Tulane Univers ity School of Law, and counsel to Langlois,

Gaudreau, O'Connor of Montreal. The author is indebted to Robert C. Wilkins, B.A.,

B.c.L., for his assistance in the preparation and correction of the text.



1896 TULANE LA W REVIEW [Vol. 73:1895 MARITIME LA W PROCEDURES999]

6. Sister Ship Arrest 1911

7. Beneficial Ownership 1912

8. Demise Charterers May Bind the Ship In Rem 1912

9. Issue of the Writ Gives Rise to Statutory

Rights In Rem in the United Kingdom 1913

10. Release from Arrest 1914

11. Wrongful Arrest...................................................... 1915

12. Arrest and the Protection of Property Rights 1915

13. Conclusion-Arrest-United Kingdom 1916

B. Canada 1917

1. Introduction-"Canadian Maritime Law" 1917

2. Canadian Maritime Jurisdiction 1918

3. Open List of Maritime Claims 1919

4. The Action In Rem-Canada 1920

5. Arrest for Maritime Liens, Statutory Rights In

Rem, and Quasi-Maritime Liens 1920

6. Canadian In Rem Process 1922

7. The Statutory Right In Rem Arises inCanadawith Arrest of the Ship 1923

8. Beneficial Ownership 1923

9. The Demise Charterer Does Not Bind the Ship

In Rem in Canada 1924


11. Release of the Ship 1925

12. Wrongful Arrest. '" 1926

13. Arrest and the Protection of Property Rights 1926

14. Conclusion-Arrest In Rem-Canada 1928

C. The United States 1928

1. Introduction 1928

2. U.S. Maritime Liens and Lien Law 1929

3. Binding the Ship for U.S. Maritime Liens 1932

4. Enforcement In Rem 1932

5. Arrest InRem Under Supplemental Rule C ~ 1933

6 . Maritime Attachment Under Supplemental

RuleB 1934

7. Release of the Ship 1937

8. Wrongful Arrest or Attachment 1938

9. Const itut ional Safeguards of Shipowners'

Property Rights 1938

10. Conclusion-Attachment and Arrest-

America 1939

V. THESAISIECONSERVATOIRE-FRANCE 1940

A. Introduction 1940

B. Attachment of Ships and Other Assets 1940

C. Attachment of Ships- Two Regimes 1941

D. Claims Permitting Maritime Attachment 1942

E. Attachment of Ships and Sister Ships 1943

F . Attachment Procedure and Jurisdiction 1944G. Release from Attachment and Voyage Authorization 1946

H. Wrongful Attachment 1947

I Protection of Private Property Rights of Shipowners 1947

J. Conclusion-France 1947

VI. THE MAREVA INJUNCTION 1948


B. Conditions for the Issuance of a Mareva Injunction 1949

C. "Worldwide" Mareva Injunctions 1950

D. MarevaInjunction Procedures-United Kingdom 1951

E. MarevaInjunctions-Canada 1953

F . The Mareva Injunction, the Action IIIRem, and the

Attachment 1955

G. Conclusion-MarevaInjunction 1957

V ll. THE ANTON PILLER ORDER 1958


B. The Anton Piller Order-United Kingdom 1958

C. Anton Piller Orders-United Kingdom Procedural

Safeguards 1959

D. Anton Piller Orders-Canada 1960

E. Conclusion-Anton Piller Orders 1961

VIIl. THE ARREST OF SHIPS CONVENTION 1999 1962

A. Introduction '" '" 1962

B. General Observations on the Arrest Convention

1999 1963

1. The Definition of"Arrest" 1963

2. A "Closed" List of "Maritime Claims" 1965

3. Some Specific Maritime Claims 1966

4. Arrest of Ships About to Set Sailor Sailing 1967

5. Arrest for Maritime Liens and Statutory Rights

InRem 1967


7. Limitation on Security for Release '" '" 1970

8. Countersecurity and Wrongful Arrest... 1970

9. Application of the Convention 1971

10. Convention Does Not Create Maritime Liens 1972

11. International Uniformity Is Essential... 1972

1897



1898 TULANE LA W REVIEW [Vol. 73:1895 1999] MARITIME LA W PROCEDURES 1899

IX. THE CHALLENGES 1972

X. CONCLUSION , 1973

APPENDIX. INTERNATIONAL CONVENTION OF THE .ARREST OF

SHIPS, 1999 1976

The United States, in a sense, has the best of both worlds,

because U.S. marit ime law affords the creditor both the arrest in rem'

and the maritime attachment.'

England (supposedly) lost the Admiralty attachment in the

eighteenth century, resulting in a serious weakness in its maritime

process compared to that avai lable in civilian countries.' This lacunahas only partially been fil led since 1975 by the Mareva injunction." In

that same year, the Anton Piller order was developed, as a tool for

preserving evidence.' Both procedures are applied today in maritime

and nonmaritime cases alike, not only in England, but throughout the

British Commonwealth.

On the international plane, more than seventy nations are party to

the Arrest Convention 1952.8 The Convention provides a legal regime

covering all aspects of arrest and attachment of seagoing ships before

judgment, but has undergone a major review and has been replaced as

of March 12, 1999 by a new convention (see Appendix).

In consequence, now would seem to be a propitious moment to

take a fresh look at the various procedures of pre-judgment security inthe maritime law of common-law and civilian jurisdictions, as well as

at the proposed new international convention on the arrest of ships.

I. INTRODUCTION

Essential to the practice of maritime law in any country is a

knowledge of the procedures that provide pre-judgment security for

claims, as well as post-judgment execution if a suit is allowed. Pre-

judgment security is of the highest importance to the marit ime creditor,

who always faces the threat of being unable to recover his debt from'

an impecunious or unscrupulous debtor, if the debtor 's ship--the main

asset on which so many maritime creditors depend in extending

credit-should sail away without the debt having been paid. Similarly,

the possibili ty of post- judgment execution, by way of the judicial sale

of the arrested ship, is a key consideration for maritime creditors

concerned about the solvency of their debtors.In common-law countries whose maritime law is primarily

derived from the admiralty law of England, the action in rem is the

bosic procedure on which creditors rely for pre-judgment security and

post-judgment enforcement. The arrest of the ship or other res (for

example, cargo or freight) in the action in rem places the res under

judicial detention pending adjudication of the claim. It usually also

secures the appearance in the action of the defendant shipowner and it

establishes the jurisdiction of the court. If the court subsequently

allows the claim, the judgment is then enforceable against the arrested

res (by judicial sale) or the security given to take its place.

In civil law jurisdictions, where no action in rem exists, the action

in personam may be combined with a "saisie conservatoire," orconservatory attachment. I The saisie permits any property of the

debtor (including ships) to be seized and detained under judicial

authority pending judgment.' The subsequent judgment, if favourable

to the plaintiff, may then be enforced against the attached property or

the security replacing it.

II. THE PURPOSE AND PLAN OF THIS ARTICLE

This Article will first review the historical background of the

action in rem and the Admiralty attachment in England. It will

challenge again, but briefly, the prevalent view that the English

Admiralty attachment is extinct. The main characteristics of the action

in rem in the United Kingdom, Canada, and the United States wil l then

3. Specific rules on arrest in rem in the United States are established by

Supplementa l Rule C ofthe Supplementa l Rules for Certa in Admiral ty and Marit ime Cla ims,

FED,R. ClV.p, [hereinafter Supp. Rules].

4, Specific rules on maritime attachment in the United States ar e es tablished by

Supplemental Rule B of the Supp. Rules, supra note 3. The attachment also exists

independent of those rules, by vir tue of the general marit ime law of the United Sta tes. See

Schiffahartsgesellschaft Leonhardt & Co. v. A. Bottacchi SA de Navegacion, 773 F.2d

1528, 1531-33, 1986 AMC I,4-9 (IIth Cir, 1985),

5. SeeTETLEY,M.LC.,supranote l,at937,973-77, 1029-30, 1032-33.

6. See Mareva Compani a Navi era S ,A. v . Int ernat ional Bulkc ar ri er s, [1975 ] 2

Lloyd's Rep. 509 (C.A,),

7, See Anton Piller KG v. Manufacturing Processes Ltd., 1976 ch. 55 (GA.).

8. See Interna tional Convent ion for the Unifica tion of Certa in Rules Relat ing to the

Arrest of Seagoing Ships, adopted a tBrusse ls, May 10, 1952, and in force as of February 24 ,1956 [he reinaf ter A rres t Conven ti on 1952] . See generally FRANCESCOBERLINGIERI,

BERLINGlERIONARRESTOFSHIPS: A COMMENTARYNTHE 1952 ARRESTCONVENTION2d

ed. 1996) [hereinafter cited as BERLINGIERl,ARRESTOFSHIPS]; TETLEY,M.LC., supra note

I, at 1439-45 (reproducing Arrest Convention 1952).

I. See WILLIAMTETLEY,MARITIMELIENS AND CLAIMS974-75 (2d ed. 1998)

[hereinafter TETLEY,M.L.C.].

2. See id. at 1030,



1900 TULANE LAW REVIEW MARITIME LAW PROCEDURESVol. 73:1895 1999]

be reviewed, with emphasis on the role of arrest in the process. U.S.

maritime attachment will «lso be outlined. The Article will then

examine the civilian sa isie c o n ser va to ire , as practiced in France, after

which the Mareva injunction ofthe United Kingdom and other British

Commonwealth states such as Canada will be studied, as well as the

Anton Piller order. Finally, the Article will treat briefly the attempts atinternational unification of law in respect of the arrest of ships, 1999,

adopted March 12, 1999 in Geneva," at a diplomatic conference

convened by the International Maritime Organization (IMO) and the

United Nations Conference on Trade andDevelopment (UNCTAD).lO

today, from a process of arrest of property to compel appearance of the

defendant, a procedure developed in medieval Europe and firmly

established in England by the fifteenth century. This processus contra

contumacem, in use on the Continent by the fourteenth century, was

described by an anonymous Italian civilian author, an extract from

whose description was transcribed into the Blacke Booke of theA dmiralty'" under the title Ordo Judiciorum" In England, the

procedure was well established in the Admiralty Court by the sixteenth

century and it appears to have been somewhat different from the

Continental model. It is described in the account of the Court's

process written by Francis Clerke, a proctor in the Court during thereign of Queen Elizabeth 1.16

The primary purpose of the process was to counteract the

defendant's contumacious refusal to appear before the court and

contest the suit brought against him. In England, the person and/or the

property of the defendant in the jurisdiction of the Admiral could be

arrested by the Admiralty Marshal or other officer at the same time as

the defendant (or anyone else having an interest in the property) wascited to appear," In a second stage, the defendantreceived a series ofcitations to appear, and after four defaults by him, the plaintiff would

formulate his claim in the form of a draft sentence or article upon first

decree. 18 The Admiralty Court, in the "first decree" (prim urn

decretum), could then award possession of the property arrested to theplaintiff on grounds of the defendant's contumacy."

Ill, THE HISTORY OF ARREST IN REM AND THE ADMIRALTY

ATTACHMENT--ENGLAND

A. Roman Law and the Admiralty Action In Rem

Since at least the early nineteenth century, the ongm of the

English Admiralty action in rem has been traced to the actio in rem of

Roman law. Arthur I .rowne, in his monumental work, ACompendious View of the Civil Law and of the Law of the Admiralty,

wrote: 'This remedy in rem against the ship or goods is founded on

the practice of the civil law,which gives an actio in rem, to recover orobtain the thing itself, the actual specific possession of it. ... "11

More recent legal historians, however, have questioned the

Roman pedigree of the action in rem. They point out that by the

sixteenth century, English Admiralty Courtjudges were hearing in rem

claims of a purely personal nature, having none of the proprietary

character required by the Roman actio in rem." Moreover, they can

find no indication in the case law of the latemedieval or early modem

period that anything resembling a maritime lien or a ship hypothec

was necessary to found the Admiralty in rem action against ships."

14. See I BLAC~ BOOKEOFTHEADMIRALTYLondon, Sir Travers Twiss ed., 1871-

76).

15. See id. a t 178-220. The t it le Ordo Judiciorum was given to the extract by Twiss.

16. See FRANCISCLERKE,PRAXISSUPREMtECURIAlADMIRALITATIS1-69 (1829).

17. In the Ordo Judiciorum, there could be no question of contumacy until the

defendant h ad rece iv ed the c it at ion. In Engl and, by the t ime o f Hen ry VII I, however , t he

ar re st o f t he defendan t' s p roper ty was done cont emporaneous ly w ith the ci ta ti on o f t he

defendant , as a kind of "pre-emptive str ike." This was justi fied (by Bracton , for example) on

the g round that th e fai lu re t o respond to the ci ta ti on was an immediat e contumacy . The

pract ical reason, however, was the ease and speed with which the defendant 's main asset , the

ship, could leave thejurisdiction. See HALE& FLEETWOOD,upra note 12, at xli-xlii.

18. See id. at xliii.

19. See CLERKE,supra note 16, at 61-69,81-86; see also HALE& FLEETWOOD,upra

note 12, a t x li . In the origina l Continental procedure , a second decree (secundum decretum)

was needed in an actio inpersonam, in order to transfer ownership of the arrested property to

the p laint if f a ft er a pe ri od o f t ime. In Engl and , howeve r, t he second decree seems to have

p layed l it tl e p ar t i n Admi ra lt y p rac ti ce and even tu al ly c ea sed to appear i n the ca se l aw ,

because the distinction between the actio in rem (or actio realis) and the actio in personam

(or actio personalis) was not of great s ignificance. Another dis tinction was that the

Continental procedure granted possession of the res sought in an act io in rem, but only

custody ofthe property up to the amount ofthe indebtedness inan actio inpersonam.

B. The Processus Contra Contumacem

Rather than being derived from Roman law,English Admiralty in

rem actions are derived, in the opinion of at least some legal historians

9. See U.N. Doc . No. AlO )NF.188/6 (Mar. 12, 1999).

10. See Draf t Ar ti cl es for a Conven ti on on Ar res t o f Sh ip s, UNCTAD/ IMO Joint

Intergovernmental Group of Experts on Maritime Liens and Mortgages and Related Subjects,

U.N. Doc. No. JIGE(IX)5, TO/BilGE. 1/5, LEGIMLMl42 (Apr. 14, 1997).

I J. ARTHURBROWNE,2 A COMPENDIOUSVIEWOFTHECIVILLAWAND OFTHELAW

OFTHEADMIRALTY9 (1840) [hereinafter BROWNE,CIVILLAW].

12. See HALE& FLEETWOODONADMIRALTYURISDICTIONt xxxix-xl (M.J. Prichard

& D.E.C. Yale eds., 1992).

13. See id.

1901




C. Characteristics of theAdmiralty Process to Compel Appearance

in Tudor/Stuart England

The English Admiralty process by citation, defaults and first

decree, unlike the Continental processus contra contumacem, made

little distinction between the actio inrem (or actio realis) and the actio

in personam (or actio personalist." Its chief characteristics were asfollows:

(1) Arrest of the person of the defendant was the primary mode

in which the process was exercised, with arrest of his property being a

subsidiary mode, although the modes were altemative and could also

be combined."

(2) Any property of the defendant in the jurisdiction (not only

his ship, but also his goods) could be arrested." In fact, arrest appears

to have extended to goods of the defendant in the possession of a third

party, as well as to goods of a party indebted to the defendant and even

to incorporeal rights." Sister ships could also be arrested."

(3) The possibili ty of arresting any goods of the defendant in

the jurisdiction was a particularly useful (and often the only effective)remedy to secure the plaintiff's claim where the defendant himself was

out of the jurisdiction (as frequently happened in the case of claims

against the seafaring foreign merchants of those times ) _ 2 5 This aspect

of the procedure has been seen in retrospect as the origin of the

"Admiralty attachment" (as it later came to be called in the eighteenth

or nineteenth centuries), a pre-judgment security process that could be

added to the action in personam." The civilian judges of the High

Court of Admiralty in the 1500s and 1600s did not distinguish clearly

between actions in rem and in personam, however, there being for

them but a single procedure, or ordo, although one that had two

variants: arrest ofthe person and arrest of his property.(4) The arrest did not depend for its validity on the existence of

any sort of lien against, or hypothecation of, the ship or goods. The

procedure was valid as long as the ship or goods belonged to the

defendant andwere within the Court's jurisdiction."

(5) The claimant, in his draft sentence on first decree, was

required to identify the arrested property."

(6) Execution on the property arrested was limited to the value

of that property, even if that value was insufficient to cover the full

amount of the successful plaintiff's claim."

20. See HALE& FLEETWOOD, upra note 12, at x li i-x li ii . The Admiral ty Court in

Tudor and Stuart days was aware of the Roman (in other words, civil) law distinction

between ac tions in rem and in personam, aswel l as of the Roman actio hypothecaria, but

these d ist inct ions d id not cont rol the originat ing form of procedure , which cou ld take the

form of an action against the person, an action against his property or both. See id. at cxxx,

cxxxiii-cxxxiv.

21. See id. at cxxxiii.22. See ISELECTPLEASINTHECOURTOF ADMIRALTYat lxxi-lxxii (Reginald G.

Marsden ed. , 1982) (U [A[rrest of goods was quite as frequent as arrest of the ship; and it

seems to have been immaterial what the goods were, so long as they were goods of the

defendant and were within the admiral's jurisdiction atthe time of arrest. ").

23. See HALE& FLEETWOOD,upra note 12, at cxxxi n.7 (citing CLERKE,supra note

16, at 75-76).

24. See Thometon v. The Elizabeth Bonaventure & Jobson, owner (1565), reported

in 2 SELECTPLEAS,supra note 22, at 131.

25. See CLERKE,supra note 16, at 61-69. Clerke suggests that, if the defendant was

out of the kingdom or had absconded, h is goods or sh ip could be arr es ted in whomever' s

hands they were . The debtor' s absence was probably not intended as a condi tion of such

arres t, however , but was probably mentioned to stress the utility and (at times) the necessity

of arres ting property in cases of such physical absence f rom the jur isdiction. Warrants of

a rre st from the per iod show clear ly that sh ip and goods could be a rre sted even where the

defendant was available personally .. See 2 SELECTPLEAS,supra note 22, at 9 -11, 79-80, 83-

84,88-89,124-125, 197-198; see also HALE& FLEETWOOD,upra note 12, at cxxxiii-cxxxiv.

D. Gradual Emergence of Contemporary Admiralty Procedures-

EnglandAfter the Restoration in 1660, a number of interrelated factors

continued to shape English Admiralty process, slowly giving it a form

and content more closely resembling its characteristics today:

(1) The need, under the Admiralty procedure of the

Tudor/Stuart period, to identify the arrested res, and the fact that

enforcement was limited to its value; contributed to the concept that

the ship itself, as opposed to its owner, and was liable for certain

claims, such as seamen's wages and salvage. Arrest of the

"wrongdoing" res qame to be seen as the exclusive mode in which

Admiralty process was exercisable in respect of such claims." The

late seventeenth and eighteenth centuries consequently saw the

26. See, e.g., TETLEY,M.L.e. supra note I,at 974, 1030; F.L. WISWALL,JR., THE

DEVELOPMENTFADMIRALTYURISDICTIONNDPRACTICESINCE1800, at 165 (1970).

27. See 1 SELECTPLEAS,supra note 22, at lxxi-lxxii; see also HALE& FLEETWOOD,

supra note 12, at xlvi.

28. By contras t, the Continental procedure descr ibed inthe Ordo Judiciorum required

the a rres ted property to be desc ribed on ly in the case of an actio in rem (or actio realis), in

which the plaintiff was claiming that he owned the arrested property. Itwas not necessary to

identify the property in an actio in personam (or actio personalis), where the plaintiff sought

merely to recover a debt owed him by the defendant. See HALE& FLEETWOOD, upra note

12, at xlii-xliii.

29. See id. at x li , x li ii . On the Continent, by comparison, the sentence on first decree

in an actio personalis (to recove r a debt ) put the p la in ti ff in pos sess ion up to the amount of

indebtedness, first of the defendant's movable property, if it sufficed to satisfy the claim, and,

ifnot, then of his immovable property as well, with insolvency as a final recourse.

30. See id. at xlvi.



1904 TULANE LA W REVIEW

thus wrote that "at present the Admiralty acts only in reml'" The

withering away of the Admiralty action in personam necessarily

caused the slow decline, and eventually the virtual disappearance in

England, of the Admiralty attachment as we11.3?

The in personam jurisdiction of the Admiralty Court experienced

a brief renaissance in the nineteenth century, thanks to the AdmiraltyCourt Acts of 184038 and 1861,39prior to and just after the dissolution

of Doctors' Commons in 1858.40 The Admiralty attachment remained

unused in England, however, resulting in the view that i thad ceased to

exist as a legal procedure. Fortunately, i t survived in the United States,

where the American Revolution (1775-1783) predated the alleged

demise of the attachment in England and where it continues to

flourish.

[Vol. 73:1895 1999] MARITIME LA WPROCEDURES

beginnings of a sharp distinction between the action in rem and the

action in personam as we now know them.

(2) The common-law courts, which had been locked in combat

with the High Court of Admiralty for centuries," seized upon the idea

that Admiralty jurisdiction was limited, not only to geographical areas

within the ebb and flow of the tide, but also to causes of actioninvolving the liabili ty of the vessel, as opposed to the personal liabili ty

of the owner," The Court of King's Bench lost no time in issuing

writs of prohibition to impose this new subject-matter restriction on

the civilian Admiralty judges sitting at Doctors' Commons."

(3) The increased use of writs of prohibition against the

Admiral ty Court resulted in a significant decline in the in personam

practice of the Court, especially after the Glorious Revolution of

1689.34 Mercantile lit igants began to insti tute their personal actions in

the common-law courts, where they were sure that their sui ts would at

least come to trial, leaving the Admiralty judges wi th pract ically no

jurisdiction other than the action in rem." In 1802, Arthur Browne

E. Did the Admiralty Attachment Expire in the Eighteenth Century?

Despite the general opinion," there is a strong argument

supporting the view that the Admiralty attachment did not become

extinct in England at the end of the eighteenth century. Fry's speech inThe Heinrich Bjorn" suggests that the procedure continued to exist

after 1800, and his contention to that effect has never been clearly

addressed in subsequent English decisions."3I . The confl ic t between Admira lty and common-law court s may be t raced a t l ea st as

far back as 1296. Formal res tr ictions on Admiralty jur isdiction to matters arising at sea and

in t idal wa te rs were imposed by the Admiral ty Juri sd ic tion Acts, 1389, 13 Rich . 2 , ch. 5

(Eng.); 1391, 15Rich. 2, ch . 3 (Eng. ); 14002 Hen. 4, ch . 11 (Eng.). See generally I SELECT

PLEAS, supra note 22, at xi; TETLEY,M.L.C., supra note I , at 32-33; WISWALL,supra note

26, at4-5.

32. See HALE& FLEETWOOD,upra note 12, atxlvii, lxxiii.

33. See, e.g., Johnson v. Shippen, 92 Eng. Rep. 154, 154-55 (K.8. 1703)

(hypothecating par t of the ship for necessaries supplied in Boston, Massachusetts). S ir John

Holt, Chief Justice of King's Bench, issued prohibition to block the suit against the

shipowners personally, while permitt ing it to procee. l against the vessel. See id. ; see a lso

Clay v . Snelgrave,91 Eng . Rep . 1285 (K.8. 1700); HALE& FLEETWOOD,upra note 12, at

xlvii n.3, lxiii-lxiv.

34 . The number of inpe rsonam ac tions heard in the Admiral ty Court d ropped fr om

27 out of a total of 162 in 1683 to only 7 out of 61 in 1725. See HALE& FLEETWOOD,upra

note 12, atcxxxv n.1 (citing statist ics f rom the warrant books of the High Court of Admiralty

showing the breakdown between the numbers of in rem and in personam suits heard in 1683,

1685,1695,1705,1715, and 1725).

35 . The wri t in r em was the procedure by which the Admiral ty Court sur vived during

the oppression by the court s of common law. See Edward F. Ryan, Admiralty Jurisdiction

and the Maritime Lien: An Historical Perspective, 7 W. ONT.L. REv. 173 (1968); see also

The Indian Grace (No.2), [1998] I Lloyd's Rep. 1,6 (H.L. 1997) ("Admiralty practit ioners

and Judges used the concept that the sh ip i s a defendant in an act ion in rem, as a means of

defending and extending the jur isdiction of the High Court of Admiralty.") . Another factor

cont ribu ting to the abandonment of the Admira lty Court by Engl ish merchan ts may have

been that the common- law courts, par ticularly in such areas asbills of exchange, began after

1689 to be able to offer commercial l it igants a better service than could the Admiralty Court .

See DANIELR. COQIJILLETTE, HE CIVILIANWRITERSOFDOCTORS'COMMONS,LONDON:

THREE CENTURIES OF JURISTIC INNOVATIONIN COMPARATIVECOMMERCIAL AND

INTERNATIONALAW(1988), cited in HALE& FLEETWOOD,upra note 12, at cxxviii.

IV. ARREST INREM-UNITED KINGDOM, CANADA, AND UNITED

STATES

A. UnitedK ingdom

1. Arrest InRem-the Characteristic Admiralty Proceedingf

In the United Kingdom, the action in rem is the characteristic

Admiralty proceeding to enforce all types of maritime claims. It

36. Browne, Civil Law, supra note II, at 72, IDO;see a/so The Clara, 166 Eng. Rep.

986,986-87 (1855) (stating that the las t action in personam occurred in the 1780s); HALE&

FLEETWOOD,upra note 12,at cxxxiv-cxxxv n.5; TETLEY,M.L.C., supra note I , at 1029-30.

37. See TETLEY,M.L.C., supra note I , at937, 973-75.

38. The Admira lty Court Ac t, 1840,3 & 4 Viet., ch. 65 (Eng.).

39. The Admira lty Court Ac t, 1861,24 &25 Viet., ch. 10(Eng.).

40. On the h istory of Doctors ' Commons and i ts even tua l di sso lu tion , s ee WISWALL,

supra note 26, at 73-95; s ee a lso GD. SQUIBB,DOCTORS' COMMONS: A HISTORYOFTHE

COLLEGEOFADVOCATESANDDOCTORSOFLAW(1977).

41. See, e.g., TETLEY,M.L.C., supra note I , at 1029, 1032-33; Browne, Civil Law,

supra note II, a t435 .

42. 10P .D. 44, 53-54 (C.A. 1885).

43. See TETLEY,M.L.C., supra note I , a t 935-37, 1032-33 (s tat ing tha t nei ther the

House of Lords in The Henrich Bjorn, II App. Cas. 270 (H.L. 1886), nor the Court of

Appeal in The Beldis, 1936 P 51, 69-70 (C.A.), clearly contradicted Fry L.J.'s holding).

1905



1906 TULANE LAW REVIEW [Vol. 73:1895 1999] MARITIME LAW PROCEDURES

tends to be regarded primarily as a procedural device to secure the

defendant's personal appearance in the suit, rather than as an action

against the "wrongdoing ship" seen as a person." It differs from an

action in personam, in that the ship (and, in some cases, the cargo,

bunkers and freight, or the proceeds of the judicial sale)" is the

defendant, together with the shipowner," The availability of the

action in rem to enforce marit ime liens, statutory rights in rem, and

other maritime claims in England is governed by the Supreme Court

Act, 1981,47at sections 21(2)-(4), providing for the exercise in rem of

the Admiralty jurisdiction of the Queen's Bench Division ofthe High

Court of Justice against the ship or property concerned by the claim,

or, in some cases, against a sister ship." The action in rem provides

pre-judgment security for the claim, founds the jurisdiction of the

court, and usually secures the appearance of the shipowner," It

typically is enforced by the arrest of the res.

Arrest in rem is not permitted, however, in respect of Crown

ships" or a ship belonging to a foreign State, unless it was in use or

intended for use for commercial purposes when the cause of action

arose." Ingeneral, however, the flag, registry, ship ownership, or the

place where the claim arose do not restrict Admiralty jurisdiction. 52

2. In Rem Process in a Nutshell

The procedures regulating both the action in rem and the arrest

are provided for principally in Order 75 of the Rules of the Supreme

COurt.53 In brief, the action begins with the issuance of the writ in

rem by the Admiralty and Commercial Registry in London or one of

the District Registries elsewhere in the United Kingdom." The arrest

warrant, obtained on motion to the High Court supported by the

"affidavit to lead warrant" of the claimant, is valid for twelve

months. 55 Itis ordinarily served with the writ in rem," and may onlybe served where the ship or other res is within the jurisdiction."

When the action is served or where service is deemed to have

occurred by virtue of the shipowner's acknowledgment of the issue

of the writ before service (the modem equivalent of the appearance

in the action by the defendant), the proceeding continues as a joint

action in rem and in personam, so that the eventual judgment is

enforceable against both the arrested res and the debtor's other

44. See D.e. JACKSON,ENFORCEMENTOFMARITIMECLAIMS379-80 (2d ed. 1996)

[hereinafter JACKSON,ENFORCEMENT];. HILL, MARITIMELAW 114 (4th ed. 1995). The

"personif ication theory" of the action in rem ismore popular in the United States than in the

United Kingdom. See JACKSON,ENFORCEMENT,upra, at 380; see also The Indian Grace

(No.2), [1998] 1 Lloyd's Rep. I, 6-7 (H.L. 1998) (attributing the decline in the

personification theory and the predominance of the "procedural theory" of the action in remin England after the Judicature Acts of 1873-1875 to four factors : (1) the availabil ity of the

ac tion in rem to enforce claims o the r than mari time l ien c laims; (2 ) the f orm of the wri t in

rem, which changed in 1883 so as to provide for the naming of the de fendant shipowner;

(3 ) the deci sion in The Dictator, 1892 P. 304, which held that the appearance of the

sh ipowner in the ac tion in r em caused the act ion to proceed as a joint act ion in r em and in

personam; and (4) the hosti li ty of common- law judges to the concept of the ship as a person

and thus to the personification theory, which had prevailed among the civil ian judges of the

former High Court of Admiralty); TETLEY,M.L.e. supra note 1,at 53, 1030, 1036.

45. See HILL, supra note 44, at 113-14; NIGELMEESON,ADMIRALTYURISDICTION

ANDPRACTICE69 (1993).

46. Older decis ions held that the ship, rather than the shipowner , is the true defendant

in an act ion in r em. See, e.g., The Johannis Vatis , 1922 P.213, 219-20; The Bums, 1907 P.

137, 149 ( e.A. ); The Longford , 14 P.O. 34 (e .A. 1889) ; HILL, supra note 44, a t 125-26;

MEESON,supra note 45, a t 64-66. In 1997, however , the House of Lords he ld tha t, a t l eas t

for the purposes ofsection 34 of the Civil Jur isdiction and Judgments Act, 1982, ch. 27, § 34

(Eng.) (prohibiting suit again in England or Wales after ajudgment has already been renderedby an overseas court on the same cause of action in a suit between the "same parties"), a

sh ipowner i s the t rue defendan t in an act ion in r em f rom the t ime the Admira lty Court i s

seized with jur isdiction (specif ically, f rom the time the writ in rem is served or is deemed to

be served as a result of the shipowner 's acknowledgment of issue of the writ before service).

See The Indian Grace (No.2), [1998]1 Lloyd's Rep. I , 10(H.L.) ; see also Nigel Teare, The

Admiralty action in rem and the House o f Lords, [1998] LLOYD'SMAR.& COM.L.Q. 33,

The decis ion is arguably consistent, however , with the traditional view that the action in rem

proceeds as a combined ac tion in r em and ac tion inpersonam from the t ime the def endan t

shipowner f iles an appearance. Lord Steyn noted that acknowledgment of issue of the writ is

the "modem phraseology" for appearance by the defendant. See Indian Grace, [ 1998] I

Lloyd's Rep. at7.

47. See The Supreme Court Act, 1981, ch. 54, § 21(2) -(4) (Eng.); TETLEY,M.L.C.,

supra note 1, at 1466-73 (reproducing relevant provisions).

48. Only the sh ip concer ned may be a rre sted for a c laim unde r s ec tions 20(2)(a ), (c )

or (s) (claims of ownership or possession, mortgage claims, and forfeitures) and for questions

unde r sect ion 20(2) (b ) 3f ising between co-owner s of the ship re lat ing to i ts posse ss ion ,

employment, or eamings. See Supreme Court Act 1981, § 21(2) .

49. See HILL,supra note 44, at 126.

50. See Crown Proceed ings Act , 1947 , I I & 12 Geo. 6, ch. 44, § 29(1) (Eng.);

Supreme Court Act 1981, § 24(2)(c); see also JACKSON,ENFORCEMENT, upra note 44, at261,326; TETLEY,M.L.e., supra note I,at 981,1189-1193.

51. See State Immunity Act, 1978, ch. 33, §§ 1(1), 3(1)(a) and (3) , 10(2) (a) (Eng.);

see also The ICongreso del Par tido, [1981] 2 Lloyd's Rep. 367, 373, 375 (H.L.); TETLEY,

M.L.e., supra note I,at 981,1167-1172.

52. See Supreme Court Act, 1981, § 20(7)(a)-(b).

53. See S.1. 1965/1776 as amended. Order 6 and Order 12also have some application

to wri ts and act ions in r em. See R.S.C. Order 75, rule 3(4). See generally TH E SUPREME

COURTPRACTICE: 1991,1212-55 (Jacob et al. eds., 1990 & 4th Cumul. Supp . 1992 a t 140-

44).

54. See generally TETLEY,M.L.e., supra note I, at 977-80.

55. R.S.C. Order 6, rule 8(1)(a). The court, may, however, extend the time for

service for good reason. See TETLEY,M.L.e., supra note I , at 881-82.

56 . As an al te rnat ive to serv ice, the defendant may acknowledge the i ssue or se rv ice

of the writ. See R.S.e. Order 75, rules 3(5),3(6) , and 8(2), refer ring to Order 10, rules 1(4)-

(5).

57. See R.S.e. Order 75, rule 4(3).

1907



1908 TULANE LA W REVIEW [Vol. 73:18951999] MARITIME LA W PROCEDURES 1909

property. 58 The ship is usually released from arrest (or its arres~is

prevented) by the issuance of a bail bond or a letter of undertakmg

from the protection and indemnity club of the shipoWl_ler:59

Following the trial of the suit, if the claim is allowed and the ~laI~t~ff

remains unpaid, the ship or other arrested res may be sold byjudicial

sale or the judgment may be executed against the security that hasbeen given to prevent the arrest or to release the res following its

arrest." Judicial sale conveys a title free and clear of liens." The

proceeds are then distributed to the plaintiff and any other claimants

who may have intervened in the action, according to the order of

priorities established by law, with equity also playing an important

role in the ranking."

types of claims, however, under sections 20(3)-(5) of the Act, but no

general head of maritime jurisdiction.

The maritime claims listed in section 20(2) of the Supreme Court

Act, 198165 may generally be enforced in personam, under section

21(l). Under section 20(2), in rem enforcement is permitted with

respect to claims relating to ownership and possession of a ship or anyof its shares;" claims and questions relating to possession,

employment, or earnings of a ship;" claims in respect of mortgages or

charges on a ship or any share in it;68and claims for the forfeiture and

condemnation of a ship or goods." A great many maritime claims

enforceable in rem, however, fall under either of two other categories:

Maritime liens and statutory rights in rem.

4. Arrest toEnforce Maritime Liens

Jurisdiction to bring an action inrem to enforce a maritime lien

is vested in the High Court of Justice by section 21(3) of the United

Kingdom's Supreme Court Act, 1981.70 A maritime lien is a secured

claim against the ship (and in some cases against cargo, freight,

and/or bunkers) for a service done to the ship or damage done by it .71

It is a true "privilege," derived from the civil law and the lex

maritima of medieval Europe." As such, it constitutes a substantive

right in the property of another, an ius in re alienaP and should not

be regarded as a mere matter of procedure." Maritime liens arise

3. Closed List ofMarit ime Claims

The Supreme Court Act, 1981, at section 20(2), presents a

closed list of maritime claims, which fall within the Admiralty

jurisdiction of the High Court under section 20(1)(a) and which

permit of enforcement by in personam and in rem proceedings. ~helist reflects the provisions of article 1(1) of the Arrest Convention

1952,63which, in tum, reproduced the list of maritime claims enacted

by the United Kingdom in its Supreme Court of Judicat~e

(Consolidation) Act, 1925.64 There are also a few other specific

58. Tradi tional ly , i twas the appea rance of the def endant in the act ion in r em, which

caused the action to proceed as a joint action in rem and action in personam. See The

Kherson, [1992] 2 Lloyd's Rep. 261, 267; The Nordglimt, [1987] 2 LLOYD'SREp. 470, 482;

Monte Ulia (owners) v. The Banco, [1971] I Lloyd's Rep. 49, 51-52 (C.A. 1970); The

Dupleix, 1912 P. 8 ; The Gemma, 1899 P. 285 (C .A. ); The Dic tator, 1892 .P.304 ; TETLEY,

M.L.C., supra note I , at 1030, 1036. I f the defendant did not appear, the action proceeded In

rem, but the eventual judgment was enforceable only against the arrested res or the

substituted secur ity. Under the House of Lords ' 1997 decis ion in Th e Indian Grace (No.2),

[1998] I Lloyd's Rep. 1,7, 10 (H.L.), from the time the ~dmiralty Court is seized with

jur isdiction over the action by either the service of the action inrem or I ts deemed service by

the acknowledgment of issue of the writ before service (this acknowledgment bemg

descr ibed by Lord Steyn as the "modem phraseology" for the shipowner 's appearance in the

action) , the action in rem is an action against the shipowner . Presumably, however , absent

service of the writ or the acknowledgment of its issue, the action in rem would still proceed

as agains t the re s or the subs ti tu ted securi ty and an eventual judgment in the claimant' s

favour would remain enforceable only against that property.

59. See HILL, supra note 44, at 141; MEESON,supra note 45, at 128; TETLEY,M.L.C.,

supra note I, at 981,1111.

60. See TETLEY,M.L.C., supra note 1,at 1091-1119.

61. See The Tremont, 166 Eng. Rep. 534, 534 (1841); TETLEY,M.L.C., supra note I,

at 1098-1101.


63. Ar re st Conven tion 1952 , supra note 8,ar t. 1(1).

64. Supreme Court o f Jud ica tu re (Consol idat ion) Act , 1925, 15& 16Geo . 5 , ch . 49,

§ 22 (Eng.); 13FRIINlill:RI,ARRESTOFSHIPS,supra note 8, at39-40; see also Gatoil Int'llnc.

v . Arkwrigh t-Boston Mfrs. Mut. I ns . Co . (The Sandrina ), [1985] I Lloyd' s Rep . 181, 183

(H.L.); The River Rima, [1988]2 Lloyd's Rep. 193,197 (H.L.); TETLEY,M.L.C., supra note

I , at 958 n.96. f65. See Supreme Court Act, 1981, ch. 54 (Eng.).

66. See id. § 20(2)(a).

67. See id. § 20(2)(b).68 . See id. § 20(2)(c).

69. See id. § 20(2)(s).

70. Seeid.§21(3).

71. See The Ripon City, 1897 P . 226, 242.

72. See TETLEY,M.L.C., supra note I, at 7, 12-13,22-23,27-29,55-56,59,477

(discussing the lex maritima and its origins in the medieval lex mercatoria, or "Law

Merchant,"); see also Gordon W . Paulsen, An Historica l Overview of the Deve lopment o f

Uniformity in International Maritime Law, 57 TuL. L. REV. 1065 (1983); William Tetley, The

General Marit ime Law-TIle Lex Marit ima, 20 SYRACUSE1. INT'L L. & COM. 105 (1994);

Leon E. Trakman, TIleEvolution of the Law Merchant: Our Commercial Heritage, Part 1:

Ancient and Medieval Law Merchant, 121. MAR. L. & COM. I (1980); Leon E. Trakman,

The Evolut ion o f the Law Merchan t: Our Commercial Heri tage , Part I I: TIl eModern Law

Merchant, 121. MAR.L.& COM.153 (1980).

73. See Ripon, 1897 P.at 242-430.

74. See WILLIAMTETLEY,INTERNATIONAl.ONFLICTOF LAWS:COMMON,CIVIL AND

MARITIME570--73 (1994) [hereinafter TETLEY,INTERNATIONALONFI.ICT](criticizing thedecision of the Privy Counci l in Banker s Trus t Int ' l L td . v. Todd Shipyards Corp . (The



TULANE LAW REVIEW [Vol. 73:1895 1999] MARITIME LA W PROCEDURES

with the claims that they secure without any registration, notification,

If other formal ities; they are independent of possession and follow

he ship into whoever's hands it passes (therefore surviving a sale of

the ship by mutual agreement, al though not a judicial sale); and they

rank immediately after special legislative rights, the costs of arrest

and judicial sale and custodia legis expenses and prior possessoryliens." They therefore take precedence over ship mortgages and

hypothecs in the distribution of the proceeds of the judicial sale of

the arrested res. Under English maritime law, maritime liens are

limited to salvage, damage, seamen's and master's wages, master's

disbursements, bottomry, and respondentia (the last two being

virtually obsolete)."

(r) of the Act, many of which are statutory right in rem claims, only

one ship may be served or arrested."

The statutory right of action in rem-also sometimes inaccurately

termed a "statutory lien"-differs from a maritime lien in a least three

major ways. First, the right arises only from the time of the issue of

the writ in rem in the United Kingdom, whereas the maritime lienari ses when the services are provided to, or the damage is done by, the

ship concerned." Secondly, the claim secured by a statutory right in

rem, unlike a maritime lien claim, does not follow the ship into

whoever's hands it passes; so the ship may not be arrested if it is sold

by mutual consent before the issue of the writ. Legislative expression

of this point is found in section 21(4)(b)(i) of the Supreme Court Act,

1981.82 The rule requires that the action in rem for claims mentioned

in sections 20(2)(e)-(r) of the Act (including the statutory right in rem

claims) may only be brought against a ship if the person who would be

liable on the claim in an action in personam (the "relevant person")

was the owner, charterer, or person in possession or control of the ship

when the cause of action arose. Additional, the "relevant person" mustbe, at the time the action in rem is brought, either the ''beneficial

owner" as respects all the shares in the ship or the vessel's demise

charterer. 83 Finally, the statutory right in rem claimant has a much

lower priority than the maritime lienholder in the dist ribution of the

proceeds of the judicial sale, ranking after, rather than before, the

vessel's mortgagee. 84

80. See id. § 21(8) ; The Nord Sea & Freccia del Nord, [1989]1 LLOYD'S REp . 388,

391; see also HILL, supra note 44, at 128; MEESON,supra note 45, at 109; TETLEY,M.L.C.,

supra note I,at 978 , 1037-1038. The wri t naming more than one sh ip must be amended to

st rike out the names of al l the ships o ther than the one arr es ted . The one-ship r es tri ct ion

applies only within England and Wales , however . See Th e Kommunar (No.2), [1997] ILloyd's Rep. 8,19-21 (1996).

81. See The Monica S. , [1967] 2 Lloyd' s Rep. 113 ; see also TETLEY,M.L.C., supra

note 1,at 557, 559, 888, 917, 1020, 1136, 1037, 1400.

82. See Supreme Court Act, 1981, § 21(4)(b)(i).

83. See R.S.C. Order 75, rule 5«9)(b); see also The Guiseppe di Vittorio, [1998]1

Lloyd's Rep. 136, 151-52 (C.A. 1997) , leave to appeal to House of Lords refused, [1998] ILloyd's Rep. 136, 161 (C.A. 1997) ; The Kommunar, [1997]1 Lloyd's Rep. at 11-12.

84. TETLEY,M.L.C., supra note I,at 888-90, 1400-0 I.

5. Arrest to Enforce Statutory Rights InRem

A statutory right in rem, on the other hand, is a pure procedure,

the function of which is to confer on a claimant having a certain type

of maritime claim the right to arrest the vessel in an action in rem as

security for that claim." Such claims include supplies, repairs,

shipbuilding, and other "necessaries," as well as claims for breach of

charterparty, cargo loss or damage, towage, pilotage, and general

average." The High Court may exercise its jurisdiction over such

claims by virtue of section 21(4) of the Supreme Court Act, 1981,

but only if the specific conditions prescribed by that provision are

met, as outl ined below," For claims fall ing under sections 20(2)(e)-

6. Sister Ship Arrest

Sister ship arrest is also permi tted under sect ion 21(b)( 4 )(ii ) of

the Supreme Court Act, 1981, but subject to the condition that the

''beneficial owner" of the sister vessel, at the time the action in rem is

"Halcyon Isle"), [1980]2 LLOYD'SREp . 325 (P.c.), which held that a mar it ime lien is merely

a procedure, and not a substantive right, under U.K. law).75. See generally TETLEY,M.L.C., supra note I,at 59-60 (defining maritime liens);

id. at 886-88 (ranking maritime liens in the United Kingdom).

76. See Ripon, 1897 P.at 242 n.61; see also TETLEY,M.L.C., supra note I,at 65 n.l ,

460 n .15, 729, 894-95, 1401 . Juri sd ict ion to ad judicate these c laims i s provided by the

Supreme Court Act, 1981, ch. 54, § 20(2)(j) (Eng.) (including salvage claims), id. § 20(2)(e)

(including damage claims) & (f) (includes loss of life, personal injury claims); id. § 20(2)(0)

( including wage claims); § 20(2) (p) ( including master 's disbursement claims) ; § 20(2) (r )

(including bottomry claims).

77. See TETLEY,M.L.C., supra note 1,at 558.78 . Ju ri sdict ion over s tatutory r ight in r em c la ims i s pr ovided by the Supreme Court

Act, 1981, § 20(2) (g) ( relating to loss of ordamage to goods car ried in a ship) ; id. § 20(2)(h)

(re la ting to agreements fo r the carr iage of goods in a ship or the use or h ire of a ship); id.

§ 20(2)(k ) (r elat ing to towage c la ims); id. § 20(2) (1) ( relating to pilotage claims) ; td.

§ 2 0(2)(m) (relating to goods or materials supplied to a ship for her operation or

maintenance); id. § 20(2) (n) ( relating to construction, repair or equipment of a ship, dock

charges or dues); id. § 20(2)(q) (relating general average claims).79. See i d. § 21(4).

1911



1912 TULANE LA WREVIEW [Vol. 73:1895 1999] MARITIME LA W PROCEDURES 1913

brought against it, is the "relevant person" who was liable personally

on the claim when the cause of action arose."

shipping agent to bind the ship in rem, in the absence of proof that

the time charterer, voyage charterer, or the shipping agent had some

actual authority to bind the credit of the owner or demise charterer on

the claim when it arose, or the owner or demise charterer "held out"

the time charterer, voyage charterer, or shipping agent as being

authorized to bind the owner's or the demise charterer's credit whenthe claim arose."

7. Beneficial Ownership

"Beneficial ownership" is therefore a key concept in the United

Kingdom's law of arrest. It has been held to refer to "such

ownership asis vested in a person who, whether or not he is the legal

owner of the vessel, is in any case the equitable owner.?"

Ascertaining where beneficial ownership truly lies has sometimes

involved courts in the United Kingdom and Commonwealth

jurisdictions in "lifting the corporate veil," particularly where

evidence has been adduced to show that the corporate facade has

been manipulated as part of a sham calculated to confuse or defraud

creditors."

8. Demise Charterers May Bind the Ship InRem

In addition to beneficial owners, a demise charterer may bindthe ship for maritime claims contemplated by sections 20(2)(e)-(r) of

the Supreme Court Act, 1981, if he was (1) the charterer or party in

possession and control of the ship, (2) personally liable on the claim

when the cause of action arose, and (3) he is the demise charterer

when the action in rem is commenced." By comparison, in Canada

the demise charterer may not bind the ship, this right being restricted

only to "beneficial owners," a term that excludes demise charterers,

despite their complete possession and control of the vessel." On the

other hand, U'K, law is less liberal than U.S. law in this regard. U'K.

law does not authorize a time charterer, a voyage charterer, or a

9. Issue ofthe Writ Gives Rise toStatutory Rights In Rem intheUnited Kingdom

In the United Kingdom, the statutory right in rem arises on the

issue of the writ, not the arrest of the ship." In consequence, the

statutory right in rem can defeat the claim of a bona fide third-party

purchaser of the vessel, who acquires the ship between the issuance

of the writ in rem and the arrest, even if he is then unaware of the

existence of the statutory right." This appears inequitable as well as

fundamentally incompatible with the true nature of the statutory right

in rem as a mere procedure of arrest to provide pre-judgment

security, because it turns the statutory right in rem into an inchoate

maritime lien-a substantive right-which it was never intended tobe."

The British insistence on the statutory right arising with the writ

has also entailed jurisdictional complications in maritime suits

instituted against defendants domiciled in other member-States of the

European Union." Such a defendant may ordinarily be sued only in

the other European country in which he is domiciled, as required by

the Brussels Convention on Jurisdiction and the Recognition and

85. See id. at 1027, 1032-41.

86. The I Congreso del Partido, [1977] I Lloyd's Rep. 536, 561; s ee a lso The

l ermina 3001 , [1979 ] I L loyd 's Rep . 327 ,329 (Singapore CA. 1977 ) (def in ing benef ici al

( . .vnership o fa ll t he shares i n the ship a s the owne rship o fa "per son who has the r ight t o sel l,

6 ;spose ofor a lienate a ll the shares in that ship").

87. See The Tjas kemolen, [1997] 2 Lloyd's Rep. 465, 468- 71, 474 (1996); The

Avent icum, [1978 ]1 L loyd' s Rep. 184 , 187 ; The Saudi P ri nc e, [1982] 2 L loyd' s Rep. 255,

260. But see The Evpo Agnic, [1988] 2 Lloyd's Rep. 411 (CA.); The Neptune, [1986]

H .K .L .R . 345 (Hong Kong High Ct. ); T Il e Mar it ime Trade r, [1981] 2 L loyd' s Rep . 153;

TETLEY, INTERNATIONALONFLICT,supra not e 74, at 41, 159, 219-24 ; TETLEY,M.L.C. ,

supra note I , a t 573-74, 1039-41; see also The Gui seppe d i V it tor io , [1998] I L loyd' s Rep .

136, 152-56 (CA.); 17JeKommunar, [1997]1 Lloyd 's Rep. a t 12-19; The Nazym Khikmet ,

[1996] 2 Lloyd's Rep. 362 (CA.) (involving state-owned corporations).

88. See Supreme Court Act, 1981, ch. 54, § 21(4)(b)(i) (Eng.); Th e Guiseppe di

Vittorio, [1998]1 Lloyd 's Rep. a t 156-59.

89. See Mount Royal lWalsh Inc . v .The Jensen Star [1990] I F.C. 199, 208-11, 215;

see also TETLEY,M.L.C supra note I , a t581-83.

90. See TETLEY,M.L.C supra note I , a t 571-72; see also The Yuta Bondarovskaya,

[1998] 2 Lloyd 's Rep. 357, 365 (finding tha t the t ime charterer had nei ther "implied actua l

authori ty" nor "apparent or ostensible authori ty" to make bunkering contrac ts on behalf of

the demise charterer).

91 . The U .K. cour ts never th el ess ho ld that al though the ac ti on in rem "commences"

with the issue of the wri t, the Admiral ty Court 's in rem jurisdict ion is only ful ly "invoked"

when the writ is served or when the ship is arrested, whichever happens first. See The

Frec ci a del Nord, [1989 ] I L loyd 's Rep. 388, 392; The Berny , [1977 ] 2 L loyd' s Rep. 533 ,

543; The Banco, [1971]1 Lloyd 's Rep. 49, 53, 57 (CA. 1971); JACKSON,ENFORCEMENT,

supra not e 44, a t 197; MEESON,supra note 45, at 117; TETLEY,M.L.C supra not e I , at 917 .

The House of Lords has held tha t the jurisdict ion isinvoked when the wri t is served or where

it is "deemed to be s erved" as a r es ult of the acknowledgment of issue of the writ before

service. See The Indian Grace (No.2), [1998]1 Lloyd 's Rep. I , 10(H.L.).

92. See also HILL, supra note 44, at 146; JACKSON,ENFORCEMENT,upra not e 44, a t

197,430; MEESON,supra note 45, a t III .

93. See TETLEY,M.L.C., supra note I , a t 559-60, 1038.94. See id. at 560-62.



1914 TULANE LA W REVIEW [Vol. 73:1895

100. See The Chr is tiansborg, 10 P.O. 141, 155-56 (CA. 1815) ; MEESON,supra note

45, at 129-30; TETLEY,M.L.C, supra note I, a t 981 ,1112 . Re- arr es t may be permissible in

exceptional circumstances , however , such as a mistake in the amount of the bail requested or

insolvency of the security. See The Tjaskemolen (No.2), [1997J 2 L loyd 's Rep. 476 , 479

(1996).

101 . The Tjaskemolen , [1997] 2 Lloyd' s Rep . 465, 474 ; The Moschan thy , [ 1971] I

Lloyd's Rep. 37,44; The Tribels , [1985]1 Lloyd's Rep. 128, 130; see also TETLEY,M.L.C,

supra note I, at 1116.

102. See The Tjaskemolen (No.2), [1997] 2 Lloyd's Rep. at476, 484.

103. See Admiralty Act, 1988, ch. 34, § 34(1)(a)(i) (Austl.); see also TETLEY,M.L.C.,

supra note I, at 1064.

104. See The Evangelismos, 166 Eng. Rep. 1174 (1858); see also TETLEY,M.L.e.,

supra note I , at 1065-70; see also Admiralty Act, 1988, §§ 34(1)(a)(ii), 34(1)(b) (expressly

permi tt ing an award of damages for wrongfu l a rre st a t s ec tion 34(1)(a )(i i) , a s we ll a s fo r

failing to consent to release f rom arres t of the ship or other property without good cause).

105 . See , e.g. , The Eudora, 4 P.O. 208 (1879).

1999] MARITIME LA W PROCEDURES

Enforcement of Judgments in Civil and Commercial Matters 196895

and the similar provisions of the Lugano Convention 1988 on

Jurisdiction and the Enforcement of Judgments in Civil and

Commercial Matters." By its article 57, however, the Brussels

Convention 1968 does not affect any other conventions on jurisdiction

or the recognition and enforcement of judgments that bind contractingStates in relation to "particular matters." One such convention is the

Arrest Convention 1952.97 But because article 7 of the Arrest

Convention 1952 makes jurisdiction dependent on the actual arrest of

the ship, UK. courts have sometimes been held to have lost

jurisdiction in actions in rem to enforce statutory rights in rem where

the defendant ship has not actually been arrested." Such

complicat ions would not ari se if the United Kingdom recognized, as

does Canada, that the statutory right in rem procedure arises only with

arrest of the ship. United Kingdom courts appear to be backt racking

on the matter, in recognizing that they are only finally "seized" of

jurisdiction in rem when the writ is served or the ship is arrested (or if

the defendant submits to the jurisdiction of the COurt).99 There isreason to hope that the United Kingdom may change its position on

this matter.

security is seen as replacing the arrested res, thereby precluding re-

arrest in most cases.'?" The amount of the security is set by the court

in its discretion, but the general principle is a sum sufficient to cover

the claimant 's "reasonably arguable best case," together with interest

and costs, not exceeding the value of the arrested vessel.'?' A final

judgment in the claimant's favour may be enforced against thesubstituted security, just as it could have been against the arrested

ship.

Although the arrest of his ship may have grave effects on the

shipowner's business, it is not usual for the courts to impose any

requirement on the claimant to put up countersecurity to guarantee the

defendant against losses that the latter may incur as a result of the

arrest, although countersecurity is somet imes ordered in the court' s

discretion. 102 Defendants can, however, be held liable in damages for

having demanded excessive security, this rule having even been

codified by statute in Australia.'?'

11. Wrongful Arrest

Wrongful arrest in the United Kingdom may result in a

condemnation of the claimant for damages only where the court is

satisfied that the arrest was motivated by mala fides (bad faith) or

crassa negligentia (gross negligence). 104 Merely unjustif ied (in other

words, erroneous) arrest would not normally entitle the defendant to

claim damages, although he might then be able to recover costs. lOS

10. Release from Arrest

Following it s arrest, the ship is usually released from arrest after

security has been provided by the shipowner for the claim. The

security may be in the form of a bail bond, a payment of money into

court, a bank guarantee or a letter of undertaking from the

shipowner's protection and indemnity club (P & I club). The

12. Arrest and the Protection of Property Rights

Less concern is voiced in the United Kingdom than in the

United States about the safeguarding of private property rights when95. The Convent ion provides uni fo rm ru le s on jur isd ic tion and the recogn it ion and

enforcement of civil and commercial judgments as between member-states of the European

Uni on. The United Kingdom gave effect to the Brussels Convention 1968 by the Civil

Jurisdiction and Judgments Act, 1982, ch. 27 (Eng.). See generally TETLEY,INTERNATIONAL

CONFLICT,supra note 74, at 805-08, 848-56.

96. This Conven tion provides uni fo rm ru le s on juri sd ic tion and the recogni tion and

enforcement of judgments in civil and commercial matters as between courts of member-

- tates of the European Union and those of the European Free Trade Association (EFTA). It

has the force oflaw inthe United Kingdom by vir tue of the Civil Jur isdiction and Judgments

Act, 1991, ch. 12(Eng.). See generally TETLEY,INTERNATIONALONFLICT,supra note 74, at

809, 856-58.

97. See Arrest Convention 1952, supra note 8.

98. See, e.g., The Dei chland, [1989] 2 Lloyd's Rep. 113, 126 (e.A.); see a lso

TETLEY, INTERNATIONALONFLICT,supra note 74, at 810; TETLEY,M.L.e. supra note I, at

561.

99. See The Deichland, [1989]2 Lloyd's Rep. at 126; The Prinsengracht, [1993]1

Lloyd' s Rep . 41, 45, 46 ( 1992); The Anna H, [1995] I Lloyd' s Rep . 11(CA. ); HILL, supra

note 44, at 152-59; TETLEY,M.L.C supra note I , a t 889 .

1915




112. On the British tradition in Canadian mar it ime law, see Theodore L. McDorman,

The History 0/ Shipping Law in Canada: Th e British Dominance, 7 DALHOUSIEL.J. 620

(1983); ER. Scott , Admiralty Jurisdict ion and Canadian Courts, 10 CAN. 8. REv. 779

(1928).

113. ITO--Int'l Terminal Operat ors Ltd. v. Miida Elccs. Inc. (The Buenos Aires

Maru) [1986]1 S.e.R. 752.

114. See generally TETLEY,M.L.e., supra note I, a t41-53 (describing the h is to ry of

Canadian maritime law and its two main "limbs," as well as of Canadian maritime

jurisdiction); William Tetley, A Definit ion a/Canadian Marit ime Law, 30 U. BRIT. COLUM.

L. REV. 137 (1996) [hereinafter Tetley, Canadian Maritime Law].

115. But see Chartwe ll Shipping L td . v .Q.N.S. Pape r Co. Ltd. [1989] 2 S.C.R. 683 ,

717-31 (recognizing that civil-law principles, applied by the former High Court of Admiralty

in England, also form an integral part of Canadian maritime law).

116. The true date ofreception of English Admiralty law into Canadian law, however ,

i s a rguably 1891, when Canada adopted The Admira lty Act , 1891 , 54 & 55 Vict., ch. 29

(Can.), giving effect to the United Kingdom's Colonial Courts of Admiralty Act, 1890,53 &

54 Viet. , ch. 27 (Eng.), rather than 1934, when Canada adopted its Admiralty Act, 1934,24

& 25 Geo. 5, ch. 31 (Can.). See TETLEY,M.L.e., supra note I, at 48; Tetley, Canadian

Maritime Law, supra note 114, at 148-49.

117. See The Buenos Aires Maru [1986]1 S.e.R. at 752, 771, 776, 779.

1999] MARITIME LA WPROCEDURES

ships or other assets are arrested in rem by the Admiralty Court!"

There is no general requirement in the United Kingdom for a post-

seizure hearing following the arrest, as there now is in the United

States because of the U.S. Constitutional principle of "due process."

Nevertheless, some safeguards of ownership rights are bui lt into the

British system of ship arrest. For example, a party wishing to

prevent the arrest of property in an action in rem may, by filing a

praecipe in the prescribed form, obtain the entry of a caveat against

arrest in the caveat book kept in the Admiralty and Commercial

Registry in London."? Although the entry of the caveat does not

prevent arrest of the res, the caveator, on a subsequent motion after

arrest, may obtain the discharge of the arrest warrant and the

condemnat ion of the arresting party in damages, if the latter is unable

to show "good and sufficient reason" for having arrested. Is

Where a foreign ship registered in a port of a state having a

consulate in London is to be arrested in the United Kingdom in an

action in rem for wages, prior notice of the arrest must be given to the

consul concerned.l '" Similar notif ication rules exist where the UnitedKingdom has undertaken by treaty or convention to minimize the

possibili ty of arrest of ships of another state . I 10

Admiralty Practice Direction No. 3 provides procedures to

protect the rights of owners of arrested cargo to secure its discharge

from a ship not under arrest, as well as the rights of owners of cargo

not under arrest to secure its discharge from a ship that is under

arrest.'!'

Such procedures provide significant protections for private

property rights, although a general rule would appear desirable.

13. Conclusion-Arrest-United Kingdom

The action in rem and the arrest of ships, as developed over the

centuries by English Admiralty judges, provide an effective means of

enforcing marit ime claims fall ing within the categories enumerated

today in the United Kingdom's Supreme Court Act, 1981. England,

through its ancient admiralty law, has also provided the basis for the

arrest in rem in other common-law countries, particularly

Commonwealth countries such as Canada. It is particularly

important that the right to arrest in the United Kingdom is limited to

a "closed list" of marit ime claims.

B. Canada

1. Introduction-"Canadian Maritime Law"

The central fact of Canadian history is that Canada did not join

the American Revolution in 1776, but rather remained within the

British Empire, now the British Commonwealth of Nations.

Canadian law, including Canadian maritime law,"" therefore

traditionally adhered closely to English law, except in Quebec,

Canada's sole civil-law province, where the civilian legal t radition of

France developed independently, although influenced by the

common law of the neighbouring Canadian and U.S. jurisdictions.

The Supreme Court of Canada, inITO-International TerminalOperators Ltd. v . Miida Electronics Inc. (The Buenos Aires Maru),113

held that Canadian maritime law'" consists of two major components:

1) a body of federal law encompassing the (English) common law

principles!" of tort , cont ract and bailment, received from England as

of 1934,116 as subsequently developed in Canada by statute and

judicial precedent;"? and 2) a wider category of law that the fomier

Exchequer Court of Canada (now the Federal Court of Canada) would

have administered if it had had, on its Admiralty side, an unlimited

106. D.e. JACKSON,TH E ENFORCEMENTFMARITIMECLAIMS157 (1985) (referring to

the constitutional question sur rounding seizure of property without hearing in the United

States, but making no reference to the United Kingdom, and even the United States reference

appears tohave been dropped from the second edition of 1996) .


108 . R.S.e. Order 75, ru le 7 .


110 . R.S.e. Order 75, ru le 5(7).

Ill. See The Supreme Court Practice, 1993, vol . 2 a t 361 , reproduced in MEESON,supra note 45, at496. See generally TETLEY,M.L.e., supra note I , at981-82.

1917



1918 TULANE LAW REVIEW [Vol. 73:1895 1999] MARITIME LA WPROCEDURES 1919

jurisdiction in relation to marit ime and admiralty matters. II8

The

words "maritime" and "admiralty" were to be interpreted "within the

modem context of commerce and shipping.'?" They were not to be

limited by the historical confmes of English admiralty jurisdiction, but

only by the division of legislative powers between the federal

Parliament and the provincial legislatures, under Canada'sConstitution Act, 1867.120 To fall under the second branch of

"Canadian maritime law," the court must determine that "the subject-

matter [of the claim] under consideration ... is so integrally connected

to maritime matters as to be legitimate Canadian maritime law withinfd 11

. 1 . ,,121e era egis atrvecompetence.Both branches of the definition of "Canadian maritime law" are

reflected in the statutory definition of the term at section 2(1) of

Canada's Federal Court Act.122

latter of which there is an appeal to the Supreme Court of Canada by

leave of that Court.

The Supreme Court has clearly established that the FederalCourt's admiralty jurisdiction depends upon three criteria.!" (1) "a

statutory grant of jurisdiction by the federal Parliament"; (2) "an

existing body of federal law" that "is essential to the disposition of thecase and that nourishes the statutory grant of jurisdiction" ("Canadian

maritime law" being such an existing body of federal law); and (3) the

applicable law being a "law of Canada" as the phrase is understood in

section 101 of the Constitution Act, 1867.125

118. Seeid.at774.119. Id. ; see a lso The Monk Corp. v. I sland Fer ti lizers Ltd. [1991]1 S.e.R. 779, 800-

3. Open List of Maritime Claims

Under the Federal Court Act, the jurisdiction of the Trial

Division of the Federal Court extends generally to

allcasesinwhicha claimforreliefismadeor a remedyis soughtunderor by virtue of Canadianmaritimelaw or any other law of Canadarelatingto anymatter comingwithinthe class of subjectof navigation

and shipping,exce~tto the extent thatjurisdictionhas been otherwisespeciallyassigned. 6

Section 22(2) then sets forth nineteen specific heads of jurisdiction

(sections 22(2)(a)-(s) inclusive), closely resembling the enumerated

heads of English Admiralty jurisdiction found in the United

Kingdom's Supreme Court Act, 1981.127 Section 22(2) begins with

the words "[w]ithout limiting the generality of subsection (1)"128 and

declares that the listing that follows is "for greater certainty.,,129 It

therefore would appear that the list of maritime claims in section

22(2) is not a "closed list," but rather an "open list," the claims

enumerated there being merely examples of the categories of claim

subject to the Trial Division's original, general jurisdiction under

section 22(1) over claims arising under "Canadian maritime law,"!"

2. Canadian Maritime Jurisdiction

Admiralty jurisdiction in Canada is exercised today by the

Federal Court of Canada, concurrently with the courts of the

provinces and terri tories, under section 22(1) of the Federal Court

Act.123 Most maritime law cases are heard and decided in the Federal

Court, rather than in the provincial/territorial courts, however,

because the Federal Court provides lit igants with the action in rem

and the Court's process runs throughout Canada (section 55(1). The

Federal Court has a Trial Division and an Appeal Division, from the

01. 120. Formerly known as the Bri ti sh North America Act , 1867, 30 & 31 Vict., ch. 3

(Eng.), and renamed the "Consti tution Act, 1867" pursuant to the Canada Act 1982, ch. II(Eng.). The Constitution Act, 1867, isnow cited asConsti tutional Act, 1982, R.s .e ., App. II,

No.5 (1985) (Can.).121. The Buenos Aires Maru [1986] IS.C.R. at 774; see also Bow Valley Husky

(Bermuda) Ltd. v.Saint John Shipbuilding Ltd. [1997]3 S.e.R. 1210, 1257-59; Monk Corp.

[1991]1 S.e.R. at 797,800; Pakis tan Nat 'l Shipping Corp. v.Canada [1997]3 F.e. 601,616,

624; Corcovado Yacht Charters Ltd. v.Foreshore Projects Ltd. [1998]144 F.T.R. 126, 130-33

(Fed. Ct.); Bomstein Seafoods Canada Ltd. v. Hutcheon [1997] 140 F.T.R. 241, 251 (Fed.

Ct.); Ferguson v. Arctic Transp. Ltd. [1997]135 F.T.R. 243, 251-52 (Fed. Ct.).

122 . Federa l Cour t Act , R.S.e. , ch. F- 7, § 2(1) ( 1985) (Can. ) ("'Canad ian mari time

law' means the law that was administered by the Exchequer Court of Canada on its

Admiralty s ide by vir tue of the Admiralty Act, chapter A-I of the Revised Statutes of Canada,

1970, or any other s tatute , or that would have been so adminis tered if that Court had had, on

its Admiralty side, unlimited jurisdiction in relation to maritime and admiralty matters, as that

law has been altered by this Act or an y other Act of Par liament . .. . " ).123. See id. § 22(1).

124. See The Buenos Aires Maru [1986] IS.e.R. 752 at 766; s ee a lso TETLEY,

M.L.e., supra note I,at 46-47.

125 . The Buenos Aire s Maru [1986]1 S.e.R. at766.

126. Federal Court Act, § 22(1).

127. Compare id. § 20(2)(a)-(s), with Supreme Court Act, 1981, ch.54, § 21(2) -(4)

(Eng.).

128. Federal Court Act, § 22(2) .

129. Id.

130. See The Robert Simpson Montreal Ltd. v. Hamburg-Amerika Linie

Norddeutscher [1973] F.e. 1356, 1367; Kuhr v.The Ship Friedrich Busse [1982]2 F.C. 709,

716 ,717 ; Balod is v . The Ship Prince George [1985] IF.e. 890, 896 (holding that "as

specifically s tated in the opening words of subsection 22(2) , the enumeration of illus trative

jurisdictional claims does not exclude, or inhibit, the general jurisdiction given by subsection



1920 TULANE LAW REVIEW

~4.0.. See id .. § 22(2)(j ) (provid ing jurisdict ion over salvage); id. § 22(2) (e) , (g)

(prov~dmgJunsdlctlOn over damage and loss ofhfe/personal injury); id. § 22(2)(0) (providing

jurisdiction over wages);. id.. § 22(2)(P) (providing jurisdiction over master's disbursements);

id. § 22(2)(c) (providing jurisdiction over bottomry and respondentia).

141. See id. .§ ~2(2)(f), (h) , ( i) (provid ing jurisdict ion over carriage of goods); id.

22(2)(1) (~rovldmg jurisdietion over charterparties); id. 22(2)(k) (providing jurisdiction over

to,:,"age); id. 22(2)(m) ~r?viding jurisdict ion over goods, materia ls or services suppl ied to a

ship); id. 22(2)(n) (providing jurisdiction over construction, repair and equipping ofa ship).

142. See id. §§ 22(2), 43(2)-(3).143. See Supreme Court Act , 1981, ch. 54, § 20(2)(m) (Eng.).

144. See TETLEY,M.L.e. supra not e 1 , a t 578 -80 ( id en ti fy ing the b road scope of theCanadian understanding of "necessaries").

145. See id. at 575-76, 680-81.

146. See Federal Court Act, §§ 22(2)(r), 43(3).

147. See TETLEY,M.L.e., supra note 1 ,a t 837.

148 . Federal Cou rt Act , §§43(2)-(3),22(2)(1), (q), (s).

149. Se e id. § 22(2)(s); see also TETLEY,M.L.e., supra note 1, at 94. Such claims

may also.g ive nse to "spec ia l legisla tive rights" of seizure , detention and (sometimes) of sale

of the ship. See TETLEY,M.L.e., supra note 1,at 94-98.

150' . See Federal C~urt Act , § 22(2)(1); see also TETLEY,M.L.e., supra note 1 ,a t 457-

?8. Certain Canadian deCISIOnshave e.ven held that there i~.a full maritime lien for pilotage

IIICanada, although the most recent ruhng on the question, Ostgota Enskilda Bank v. Starway

Shipping LId. [1994] 73 F.T.R. 304, 306 (Fed. Ct. ), i s inconclusive. See TETLEY,M.L.C.supra note 1, at 462-64. '

151. See Federal Court Act, § 22(2)(q); see also TETLEY,M.L.e., supra note 1 ,a t452-53.

[Vol. 73:1895 1999] MARITIME LA WPROCEDURES

4. The Action InRem=-Canada

As in the United Kingdom, the action in rem; focused on arrest

of the res, is the principal method of enforcing maritime claims inCanada, although in personam enforcement is also permitted by

section 43(1) of the Federal Court ACt.131In general, neither the flag,

registry nor ownership of the vessel, nor the place where the claimarose, restricts Admiralty jurisdiction. 132

Nevertheless, as in the United Kingdom, Canada's Crown

Liability Ad33 prohibits proceedings in rem against Crown ships or

cargoes. The Federal Court Act also expressly exempts warships,

coast-guard ships, police vessels, as well as ships owned or operatedIy Canada or a province, and their cargoes, from in rem actions.' :"

t -oreign sovereign immunity is also granted under the State ImmunityAd35 and the Federal Court Ad36 to ships and cargoes owned by

foreign states and their agencies, but does not extend to foreign state-

owned vessels or cargoes used or intended for use in commercial

activity.

Both traditional maritime liens (salvage, damage, seamen's and

master's wages, master's disbursements, bottomry, and

resp?ndentiaY40 and statutory rights in rem (for example, supplies

repairs and other "necessaries," breach of charterparty cargo claims'd 141 "an towage) are also enforceable in rem.142

''Necessaries'' is a somewhat wider concept in Canada than in theUnited Kingdom, in that section 22(2)(m) of the Federal Court Act

confe~s jurisdiction over claims, not only for "goods or materials"

supphed to a ship for its operation or maintenance 143but also over

claims for "services,"!" including claims for 'stevedoring and

lighterage.145 Marine insurance claims are also in rem claims in

Cana?a,146:vvh~reasit is doubtful that any right against the ship forunpaid manne insurance premiums exists in England."?

. !he Fe?eral Court Act also features three peculiar types ofmantime claims that are best termed "quasi maritime liens," in that

the~ .follow ~e. ShiP.' even if it is sold by mutual consent (as do

~adItIo?al mantime hens), and yet they rank as if they were statutory

n~ts in rem, after (rather than before) ship mortgages. ':" Theseclaims are for dock charges, harbour dues and canal tolls' 1 49pilotage; 150and general average contributions. 151 '

5. Arrest for Maritime Liens, Statutory Rights InRem, and Quasi-

Maritime Liens

Arrest in rem is possible under the Federal Court Act for claims

respecting title, possession or ownership of a ship or share or

proceeds of sale of a ship; 137 questions between co-owners

concerning possession, employment or earnings of a ship.!" and

claims arising from ship mortgages, hypothecation or charges. 139

22(1) and the defin it ion in sec tion 2"); see also Ferguson v. Arctic Transp. Ltd. [1997]135

F.T.R. 243, 250 (Fed. Ct.).

131. See Federal Court Act , § 43( 1) .

132. See Federal Court Act, § 22(3)(a), (c); see also Tropwood A.G. v .Sivaco Wire &Nail Co. [1979] 2 S.e.R. 157, 161; Ferguson [1997] 135 F.T.R. at 250-51, 253. The

jurisdict ion conferred by § 22(3)(a ) and (c) does not extend to foreigners general ly . See

Federal Court Act , § 22(3)(a ), (c) . But see Oy Nokia Ab v. The Martha Russ [ 1973] EC.

394, 402 (conc luding tha t sec tions 22(3) and (c) do not assert jur isdict ion over foreigners

generally).

133. See Crown Liabi li ty Act , R.S.e ., ch. C-50, § 2 (1985) (Can.) (defining "Crown

ship"); id. § 14 (prohibiting in rem enforcement); see also Canada Shipping Act , R.S.C., ch.

S-9, § 2 (1985) (Can.) (defining "government ship" and "ships belonging to Her Majesty").

134. Federal Court Act , § 43(7)(a )-(b). See generally TETLEY,M.L.C., supra not e 1 ,

at 1193-98.

135. S tat e Immun ity Ac t, c h, S -18, §§3 ,7 (1985) (Can.) ; see also Sarafi v . The Iran

AfzaI [1996]2 Ee. 954, 964 ; see generally TETLEY,M.L.e., supra note I , a t 1180-84.

136. Federal Court Act , §43(7)(c) .

137. See id. §§ 22(2)(a), 43(2).

138. See it! §§ 22(2)(b), 43(2).

139. See id. §§ 22(2)(c), 43(2).

1921




161. See TETLEY,M.L.e., supra note 1 ,a t557-58,577-78, 1037.

162 . Federal Cour t Ac t, R .S .e. , c h. F -7 , §§43 (3 ), 22 (2 )( e) -( i) , ( k) , (m) -(n) , (p) , ( r)

(1985) (Can.).

163 . See, e.g. , Fibreco Pulp v. Sta r Shipping NS [1998) 145 F .T .R . 125 , 137 (Fed .

Ct.).

164. Compare Supreme Court Act, 1981, ch , 54, § 21(4)(b)(Eng.), with Federal Court

Act, § 43(3).

165. See TETLEY,M.L.e., supra note I , a t583 n.149; see also Pegasus Lines Ltd . SA.

v .Devil Shipping Ltd . [1996) 120 F.T.R 241, 253-56.

166. Mount Royal lWalsh Inc . v .The Jensen Star [1990)1 F.e . 199,210 (Fed. Ct. ).

167. Id. at 209; see also Pegasus Lines Ltd. [1996)120 F.T.R. at 256.


7. The Statutory Right In Rem Arises in Canada with Arrest of the

Ship

Contrary to the position in the United Kingdom, statutory rights

in rem in Canada do not make their holders secured creditors and

such rights arise only when the ship or other res is actually arrested in

the action in rem. 161 This solution is consistent wi th the true nature

of the statutory right as a mere procedure, rather than a substantive

property right or inchoate maritime lien, and i t is also more equitable

to third parties who acquire ships before their arrest without

knowledge of the right of the in rem claimant.

6. Canadian In Rem Process

Arrest in rem in Canada fol lows procedures generally similar to

those of the United Kingdom and is now governed by the Federal

Court Rules, 1998.152 The statement of claim is served by a sheriff,

together with the warrant of arrest issued by a "designated officer" of

the Federal Court and the claimant 's "affidavit to lead warrant."!"

Service on a vessel is effected by attaching these documents to a

"conspicuous part of the ship."!" Service in rem may only be

effected on a ship in the jurisdiction.!" and must occur within sixty

days of the issuance of the statement of claim.!" The defendant

shipowner's appearance in the action causes it to proceed as a joint in

rem and in personam sui!

The ship is usually released from arrest upon the giving of

security. '" Following trial , if the claim has been allowed, the arrested

vessel may be sold in a judicial sale to pay the debt or execution may

be levied on the security that replaces it.158 Property sold in a judicial

sale i s free of any liens.!" Distribution of the proceeds is according to

a ranking system generaily identical to that of the United Kingdom,

subject to variation to take account of the demands of equity. 160

8. Beneficial Ownership

Under section 43(3) of the Federal Court Act, in order for the

jurisdiction over various statutory right in rem claims to be exercised

in rem.!" the ship, which is the subject of the action, must be

beneficially owned at the t ime of the commencement of the action by

the person who was the vessel's beneficial owner at the time whenthe cause of action arose.l" The statutory right therefore does not

travel with the ship, but is defeated by a sale of the vessel by mutual

consent prior to the service of the arrest warrant. Moreover,

beneficial ownership in Canada is considered with respect to the

vessel itself, rather than with respect to the shares in it as in the

United Kingdom. 164

Although section 43(3) does not so expressly state, the beneficial

owner can only bind the ship in rem ifhe was personally liable on the

claim at the time w~en the cause of action arose.!"

The "beneficial owner" in Canada has been defined as including

someone ' 'who stands behind the registered owner in situations where

the latter functions merely as an intermediary, like a trustee, a legalrepresentative or an agent."!" The title of the beneficial owner has

been described as one "characterized essentially by the right to dispose

of the res.?"? It could therefore include a parent corporation or a

152 . The Federal Cour t Rul es 1998, SOR 98/106, came into force on April 25,1998

and replaced the former Federal Court Rules, e .R.e . 1978, ch. 663 as amended. Particula r

p rov is ions on "Admi ra lt y Act ions" are found in Par t 13, wh ich compri ses o f Rul es 475 to

500 inclusive. See FED.CT.R, Rules 475-500.

153 . FED .CT.R, Rul e 482 (1 ). No te, however , t hat t he Fede ra l Cou rt of Canada i snot

bound by the str ic t rules of English Admiral ty pract ice. See Elde rs Grain Co. v. The Ralph

Misener [1997] 125 F.T .R . 209, 1997 AMC 1329 (Fed. Ct.) (upholding s ervice of the

s tat emen t o f c laim inan a ct ion in rem on the mas te r aboard the ship- ra th er t han by pos ti ng

th e s ta tement on the mas t or some o ther c on sp ic uous pa rt o f t he vesse l, a s would have been

required inEngland-as val id).

154. FED.CT. R, Rules , j79(1)(a ), 481, & 482(1). Alterna te service on a person who

appears to be incharge of the property is permissib le , under Rule 479(2), i f access cannot be

obtained to the property in question. See, e.g., 458093 B.e . L td . v . Hi ll s [1998 ] 144 F .T .R .

236 (Fed. Ct. ) (deciding under the former, but similar , Rule 1002(6) , where "substi tu tional

service" on the vesse l owner was authorized because the vesse l was occupied by the owner 's

aggressive Rottweiler).

155. Arrest does not require possession or responsib il ity for the property; i t remains

vested in the person in possession immedia te ly before the arrest. See FED. CT. R., Rul e

483(1).

156. See id. Rule 203(I) . The former Rule 306 provided for service within 12months

from filing.

157. See id. Rules 485-489.

158. See id. Rule 490.

159. See id. Rule 490(3).

160. See TETLEY,M.L.C., supra no te I , a t 890 -97; see also Sco tt S tee l L td . v . The

Alarissa [1996] 2 r.c 883, 893-94, 896-901.

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1924 TULANE LAW REVIEW

175. See Supreme Court Act 1981, § 21(4)(b)(ii) .

176. A ship owned by the parent corporation of the company that owns the "offending

sh ip" i s no t a s ist er vesse l o f the "offending sh ip" because "owner " under § 43(8) means

"registered owner." See Hollandsche Aannaming Maatschappij, b.v. v.The Ryan Leet [1997]

135 F.T.R. 67,69 (Fed. Ct.).

177. See Noranda Sales Corp. v.The British Tay [1994] 77 F.T.R. 8 (Fed. Ct.).

178. See TETLEY,M.L.C., supra note I, a t 1041-42 (comparing U.K. and Canad ian

law on sister ship arrest).

179. See Amican Navigation Inc. v.Densan Shipping Co. [1997)143 F.T.R. 284, 290

(Fed. Ct.), modified on other grounds, [1997)137 F.T.R. 132 (Fed. Ct.); Atlantic Shipping

(London) Ltd. v.The Captain Forever [1995] 97 F.T.R. 32, 34 (Fed. Ct.); Taiyo Gyogyo K.K.

v. The Tuo Hai [1992) 48 F.T.R. 59 (Fed. Ct .); Argosy Seafoods Ltd. v . Atlan ti c Bounty

[1992] 45 F.T.R. 114,120 (Fed. Ct.); see also TETLEY,M.L.C., supra note 1,at 1000.

180. See N.M. Paterson & Sons Ltd. v. The Birchglen [1990) 3 r.c. 301, 306-08;

Freighters (Steamship) Agents Co. v.The Number Four [1983) I F .c . 852, 855-57.

[Vol. 73:1895 1999] MARITIME LA W PROCEDURES

21(4)(b)(ii) of the Supreme Court Act, 1981, is limited to claims

under sections 20(2)(e)-(r) of that Act, and section 21(8) restricts

arrest to one ship per claim.!" On the other hand, the U.K. statute

permits sister ship arrest of a vessel beneficially owned by a charterer

(including a time or voyage charterer) or a person who was in

possession or control of the "offending ship" if that party was

personally liable on the claim when it arose. In Canada, however,

only ships beneficially owned by the owner of the "offending ship"

may be arrested.'76 Also, in Canada, any change in the "beneficial

ownership" of the "offending ship" occurring after the cause of

action arises and before the action in rem is brought causes the court

to lack jurisdiction over the sister ship,177which is arguably not the

case in the United Kingdom.!"

holding company of the registered shipowner, provided that party had

some legal or equitable interest in the vessel, including a right to

dispose of it.'68 This is generally similar to English law. A mere

"beneficial interest" (for example, management) does not qualify as

"beneficial ownership.t'l"

Canadian courts, like those of the United Kingdom, are preparedto "lift the corporate veil" to determine where true beneficial

ownership lies, but will generally do so only where they have evidence

that the corporate structure is being manipulated to create a sham or

fraud designed to avoid arrest and in rem liability!"

9. The Demise Charterer Does Not Bind the Ship InRem in Canada

Whereas in the United Kingdom, the demise charterer of a ship

may bind the ship in rem,17Iin Canada only the beneficial owner of

~e vessel may bind the ship in rem.!" As in the United Kingdom,

time and voyage charterers do not ordinarily bind the ship in Canada,

unless they act as agents of the beneficial owner.173

11. Release of the Ship

An arrested ship may be released in Canada, as in the United

Kingdom, on the giving of security, whether in the form of a bail

bond, a payment into court, a bank guarantee or a P & I club letter ofundertaking. The quantum is at the court's discretion, but generally

the amount must be sufficient to cover the plaintiff 's "reasonably

arguable best case," together with interest and costs, without

exceeding the value of the vessel.!" The security replaces the res180

and usually prevents its re-arrest for the same claim.

The claimant is generally not required to give countersecurity,

although the Federal Court Rules, 1998 do authorize the court to order

a plaintiff to give "security for costs" of the defendant in the action, in

a number of specific situations (for example, where the plaintiff is

ordinarily resident outside Canada, where he has not provided an

address or has provided an incorrect address, and where there is reason


Sister ship arrest has been permitted in Canada since 1992

under section 43(8) of the Federal Court Act.174 In Canada, sister

ship arrest is permitted for any marit ime claim under section 22 of

the Act; and more than one ship may be arrested on a claim. By

comparison, in the United Kingdom, sister ship arrest, under section

168. See TETLEY,M.L.C., supra note I, at 581-82.

169. The Looiersgracht, [1995)2 Lloyd's Rep. 411, 414-15 (Fed. Ct. 1994) .

170. See , e.g. , Fibreco Pulp v. Star Shipping NS [1998] 145 F.T.R. 125, 136-37 (Fed.

Ct.); Pegasus Lines [199?] ~20 F.T.R. at 265-66; The Looiersgracht, [1995] 2 Lloyd's Rep. at

414-15; Med Coast Shipping v. Cuba, 1993 AMC 2530 (Que. C.S.); see also TETLEY,

M.L.C., supra note I, at 586,1044.

171. See Supreme Court Act, 1981, ch. 54, § 21(4)(b)(i)(Eng.).

172. See Federal Court Act, R.S .c ., ch. F-7, § 43(3) (1985) (Can.); see also Pegasus

Lines [1996~.120 F.T.R. at256; Mount RoyalfWalsh Inc. v. The Jensen Star [1990] I F .C.

199,209 (c it ing The Pe rmma 3001, [ 1979] I Lloyd' s Rep. 327 ,328-29 (Singapor e C.A. );

The I Congreso del Par tido, [ I977] I Lloyd's Rep. 536, 560».

173. See TETLEY,M.L.C., supra note I, a t583 , 1043; see also Viktor Overseas Ltd. v.

Deiulemar Compagnia Di Navigazione S.P.A. [1997] 138 F.T.R. 316 (Fed. Ct.) (upholding an

a rre st in rem for sh ip repai rs, on the grounds tha t the terms of the con tr ac t and the demise

charterer 's s ignature of it, on behalf of the shipowner , indicated that the charterer was acting

as the owner's agent).

174. See Federal Court Act, § 43(8) , amended by S.c. ch. 8, § 12 (1990) (Can.) (in

force Feb. I , 1992) . The specific rules governing sis ter ship arres t in Canada are not overly

ngorous. See Elecnor S.A. v. The Soren Toubro [1996] 3 F.C. 422, 423 (holding that there

was no need to name any or a ll si st er sh ips in the statement of claim or toa rre st the fi rst oneto enter thejurisdiction).

1925




186. Par t I of the Constitution Act, 1982, which is itself Schedule B to the Canada Act,

1982, ch. I I (Eng.), by which the Canadian Constitution was "repatr iated" f rom England.

See Canada Act, 1982, R.S.C., App. I I, No. 44 (1985) (Can.).

187 . Var ious Chat te r p rovi sions were invoked to challenge the seizure and

confiscation of a tug (or suspected drug offences in Paquette v. European Marine

Transporters [1993] RJ .Q. 108 (Que. e.A. ), bu t the su it was d ismiss ed on juri sdict iona l

grounds. See generally TETLEY,M.L.e., supra note I, at 1014-15. In Jose Pereira E Hijos ,

S.A. v. Canada [1997] 2 Ee. 84, 108-09, sect ion 8 of the Charter was invoked to chal lengethe "ar rest" by Canadian authorities of a Spanish f ishing vessel on the high seas for f isheries

offenses under Canadian law dur ing the 1995 "turbot war" between Canada and Spain. The

Court held that the claim as stated r elated to the per ce ived d is cr imina to ry t rea tment by

Canada of Spanish and Por tuguese f ishing vessels , and as such was concemed with equality

rights under section 15of the Charter, rather than with unreasonable search and seizure under

section 8.

188 . See Jose Pere ira E Hijos, [1996] 2 F.e. a t 107-08 (ho ld ing tha t sect ion 15of the

Charter, concerning equality before the law, was inapplicable to corporations, and therefore

could not be invoked by the corporate vessel owner . Counsel for both par ties agreed that the

corporate plaintiff could not claim r ights under section 7 of the Charter , which guarantees the

r ight to " life , l iber ty and secur ity of the person and the r ight not tobe deprived thereof except

in accordance with the principles of fundamental justice").

189. See generally TETLEY,M.L.e., supra note I , at 1011-16.

190. Certain case law of the Supreme Court of Canada now holds that "Charter

values, " as we ll a s i ts r ules , may be appea led to. These "values" migh t . lend support to any

eventual Charter challenge of the validity of an arrest in rem.


to believe that the action is fiivolous and vexatious and that the

plaintiff would have insufficient assets in Canada available to pay the

costs of the defendant if ordered to do SO).181

Unlike the Bill of Rights, the Canadian Charter of Rights and

Freedoms!" of 1982 is entrenched in the constitution; it applies to

provincial as well as federal matters and is executory. Nevertheless,

the Charter does not expressly protect private property rights, and i t i s

unclear to what degree, if at all, the freedom from "unreasonable

search and seizure" under section 8 could be invoked successfully by a

shipowner to contest the arrest of his vessel without prior notice or

hearing."? In addition, certain Charter provisions apply only to

individuals, not to corporations, and are therefore ineffective in

protecting the rights of most shipowners.!" The possibility of

alternative relief, through an action in damages for wrongful arrest, the

importance of preventing the vessel leaving the jurisdict ion, and the

general principle of section 1 of the Charter, by which the rights and

freedoms guaranteed are declared to be "subject to such reasonable

limits prescribed by law as can be demonstrably justified in a free and

democratic society," could well render the Charter ineffective in

challenging arrest in rem on section 8 grounds.!" Nevertheless, such a

challenge remains to be taken in Canada and, if pleaded skillfully,might result in a decision favouring the shipowner!"

Canada, like the United Kingdom, permits a party wishing to

prevent arrest of the res to enter a caveat warrant against arrest, by

which he undertakes to give bail in respect of any action in rem within

12. Wrongful Arrest

Canada follows English admiralty law in condemning thearresting party in damages for wrongful arrest of a ship or other res

only where the court decides that the arrest was prompted by bad

faith (mala fides) or gross negligence (crassa negligentia ).182

l3. Arrest and the Protection of Property Rights

Canada has no entrenched constitutional principle of "due

process of law" comparable to' the due process concept of the Fifth

and Fourteenth Amendments to the United States Const itut ion. Both

"due process" and the "enjoyment of property" are mentioned in

Canada's 1960 Bill of Rights.!" but the bill was never entrenched in

the Canadian Constitution and so can be amended like any other

statute. Furthermore, it applies only to matters fall ing under federal

(not provincial) legislative jurisdiction in Canada and is purely

declaratory, rather than executory in nature, having no "teeth"

permitting incompatible legislation to be struck down for violat ion of

the rights that it declares.!" In addition, "due process of law" under

the Bill of Rights of 1960 has been held to require only compliance

wi th the legal processes recognized by Parliament and the courts.!"

The Bill of Rights is therefore of doubtful utility in challenging the

validity of any arrest in rem that has been effected in compliance

with the applicable statute and regulations.

181. See FED. CT. R., Rule 416(l)(aHh); see also Ferguson v. Arctic Transp. Ltd.

[1996] 118 ET.R. 154 (Fed. Ct.) (decided under former Rule 446(I )(a) on secur ity for costs).

Such secur ity isgiven by a payment into court or the f il ing of a bond. See FED.CT.R., Rule

418.

182. See Armada Lines Ltd. v. Chaleur Fertilizers Ltd [1997] 2 S.e.R. 617 , 628 ; see

also TETLEY,M.L.C., supra note I, a t 1058-62; Robert Margol is, Note , Damages for the

Wrongful Arrest of a Vessel: The Venerable Rule Confirmed, [1998] LLOYDSMAR.& COM.

L.Q. I I.

183. See Canadian Bill of Rights, S .e ., 8&9 Eliz. 2,ch. 44, § I (a) (1960) (Can.).

184. See TETLEY,M.L.e., supra note I, a t 1007.

185. See CUff v .The Queen [1972] S .C .R. 889, 916 ; Regina v . Appleby (No.2), 76

D.L.R. (3d) 110, 118 (N.B. Supr. Ct. App. Div. 1977) ; see also TETLEY,M.L.e., supra note

I, at 1008-11.

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1928

196. See William Tetley, The General Maritime Law=The Lex Maritima, 20 SYRACUSE

J. INT'L. L. & COMM.105, 121-28 (1994).

197. 46 U.S.c. §§30101, 31301-31304, 31321-31330,31341-31343 (1997); TETLEY,

M.L.C., supra note 1 ,a t 1449-65 (reproduc ing tex t o f Ac t). Th is s ta tu te i s some times a lso

called the Mar it ime Co~ercial Ins truments and Liens Act or, using older tit les, the Federal

Mar it ime Liens Act or the "Ship Mortgage Act of 1920 as amended." See TETLEY,M.L.C.,

supra note 1, at 40-41. The Act supersedes any U.S. st ate statutes purporting to create

maritime liens enforceable by civil actions in rem. See 46 U.s. c. § 31307; see also Silva v.

MN First Lady, 28 F. Supp. 2d 581, 584, 1998 AMC 1649, 1651 (S.D. Cal. 1998). Longbefore thei r cod ifi cat ion in the former Federa l Mari time Liens Act , mari time l iens Were

recognized and enforced as substantive rights in America. See, e.g., The Bird of Paradise, 72

U.S. (5 Wall .) 545, 555 (1866) (mari time l ien on cargo); The Nestor , 18 F. Cas . 9 (C.C.D.

Me. 1831) (No. 10,126); The Rebecca, 20 F. Cas. 373 (D. Me. 1831) (No. 11,619); The

Young Mechanic, 30 F.Cas. 873 (C.C.D. Me. 1855) (No. 18,180) (maritime lien ownership).

See also GILMORE& BLACK,THELAWOFADMIRALTY115 (2d ed. 1975).

198. See Heidmar , Inc. v . Anomina Ravennate d i Armamento S.P.A. , 993 F. Supp .

990,993, 1998 AMC 47,50 (S.D. Tex. 1997) (citing Trinidad Foundry & Fabricating Ltd. v.

MN K.A.S. Cami ll a, 966 F.2d 613, 615 ,1992 AMC 2636, 2638 (11th Ci r. 1992»; Gar cia v .

MN Kubbar, 4 F.Supp. 2d 99,103,1998 AMC 893, 896 (N.D.N.Y. 1998) .

199. See 46 U.S.C. § 3 I326(b).

200. On the "personification" and "procedural" theories of maritime liens, see TETLEY,

M.L.C., supra not e I, at 53-55; see also Boston Bermuda Cruising, Ltd. v. MN Royal

Majesty, No. Civ. A. 97-1 I 276-GAO, 1997 WL 882597, *3,1998 AMC 1179, 1182 (D.

Mass. Sept. 10, 1997) ("The theoretical basis of the lien res ts on the f iction that the ship is the

actual wrongdoer and thus should be held liable for the alleged loss. ").

TULANE LA W REVIEW [Vol. 73:1895 1999] MARITIME LA W PROCEDURES

three days of being required to do SO.191The caveat warrant then

enables him to recover costs and damages if the party at whose

instance the arrest warrant is issued is unable subsequently to satisfy

the Court that he should not be so liable.!" This procedure, however,

is a far less effective safeguard against unreasonable arrest than a

general and constitutionally entrenched principle of "due process."

however, It IS first necessary to note the particularities of U.S.

maritime law as regards maritime liens.

2. U.S. Maritime Liens and Lien Law

Because of the United States' civilian maritime law heritage, 196

maritime liens in the United States have long been regarded assubstantive rights, rather than as procedural remedies referred to in

jurisdiction statutes, as they are in the United Kingdom and most

British Commonwealth countries. Moreover, they have been

codified (except for a definition of the term "maritime lien" itself), in

the Commercial Instruments and Maritime Liens Act,197and its

predecessor statutes, which further confirms their substantive

character as established prior to codification.!" The statute also

provides rules on ranking. 199The "personification" of maritime liens,

whereby the vessel is conceived of as a person responsible for the

claim against it, contributes to this substantive understanding of liens

in the United States.?"

Secondly, there are no statutory rights in rem in U.S. marit imelaw. All maritime claims codified in the Act are secured by maritime

liens, which arise with the claims, follow the ship and (frequently

although not always) outrank ship mortgages. Claims for

"necessaries" (supplies, repairs, bunkers, etc.) , general average

14. Conclusion-Arrest InRem-Canada

While ftmdamentally similar to in rem proceedings under

English law, the action in rem and arrest in Canada do have certain

distinguishing features that result in important differences. Much

more distinct from English law than Canadian maritime law,

however, is the admiralty law of the United States. Itis of particular

importance to note that marit ime claims that provide rights of ship

arrest in Canada are not restricted, but form part of an open list.

C. The United States

1. Introduction

Because the United States broke away from the British Empire

at the end of the eighteenth century, it retained the Admiralty

attachment, as well as arrest in rem, as procedures for the

enforcement of marit ime claims. Today, the specific rules on both

procedures are found in the Supplemental Rules for Certain

Admiralty and Maritime Claims of the Federal Rules of Civil

Procedure, at Supplemental Rules B (attachment) 193nd C (arrestj.!"

In consequence, a maritime claimant in the United States may choose

to take: (1) an action in personam, (2) an action in personam with

attachment under Supplemental Rule B, or (3) an action in rem, with

arrest under Supplemental Rule C.195

Another hallmark of U.S.marit ime procedures is that both maritime attachment and arrest in

rem are subject to certain constitutional safeguards rooted in the "due

process" clauses of the Fifth and Fourteenth Amendments of the

United States Constitution. Before examining those matters,

191. See FED.Cr.R. , 1998, Rule 493(1), Form 493A.

192. See id. Rule 494(1).

193. See FED. R. CIV.P. Supp. Rule B. The attachment also exists under the "general

maritime law" of the U.S., even if the prerequisites of Rule "8" are not fulfilled. See

Schiffahartsgesellschaft Leonhardt & Co. v. A. Bottacchi S.A. de Navegacion, 773 F.2d

1528, 1531-33, 1986 AMC 1,4-9 (11th Cir . 1985) .

194. See FED.R. CIY.P.Supp. Rule C.

195. See TETLEY,M.L.C., supra note I, at 938.

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1930

209. See TETLEY,INTERNATIONALONFLICT,supra note 74, at 540; TETLEY,M.L.C.,

supra note 1,at 874-75. Note, however , that when guaranteed under Title Xl of the Merchant

Mar ine Act, 1936, 46 U.~.c. App. §§ 1101, 1271-1295, foreign preferred-ship mor tgages

enjoy the same ranking as U.S. preferred-ship mortgages. See TETLEY,M.L.C., supra note I ,

at 514,874.

210. See 46 U.S.c. § 3 I326(b)(2); TETLEY,INTERNATIONALONFLICT,supra note 74,

at 540; TETLEY,M.L.C., supranote I , at 874-75.211. See 46 U.S.c. § 31342(a) (3). Where the necessaries claim relates to the supply

of container s, however, i t i s necess ary to prove that the containe rs were earmarked for or

delivered to specific ships and loaded aboard them. See TETLEY,M.L.C., supra note I , at610-12.

212. See TETLEY,M.L.C., supranote I , at 598-600, 604-06. This impor tant provision

dates f rom 1971, when itwas added to the former U.S. Mar it ime Liens Act.

213. See TETLEY,M.L.C., supranote I, at 566,570,572.

214. Seeid .at 590.215. See id. at 596-613 . The "executory con trac t doc trine, " pr ec luding l iens f or

unexecuted contracts, also applies in the United States to contract maritime liens for seamen's

wages. See id. at 298. It also applies to cargo damage. See id. a t722 . Fina lly, i t app li es to

breach of charterparty. See id. at 726-27; see also Navieros Inter-Americanos, S.A. v. MNVasilia Express , 120 F.3d 304, 313-14,1997 AMC 2845, 2856-57 (1st Cir . 1997) ; E.A.S.T.,

Inc. v. MN Alaia, 876 F.2d 1168, 1174, 1989 AMC 2024, 2032-33 (5th Cir . 1989) ; Boston

Bermuda Cru ising , Ltd. v . MN Royal Majesty, No. C iv . A. 97-11276-GAO, 1997 WL

882597, *3, 1998 AMC 1179, 1182-84 (D. Mass. Sept. 10, 1997) .

1999] MARITIME LA WPROCEDURESULANE LA W REVIEW [Vol. 73:1895

contributions, towage, and marine insurance premiums, for example,

all give rise to maritime liens under U.S. law. Moreover, "necessaries"

is defined more widely in the United States than in the United

Kingdom or any Commonwealth country, so that maritime liens are

recognized for virtually any goods or services of benefit to the

navigation, management, business or purpose of the ship?"Third, marit ime liens in the United States are of two types, the

distinction relating to ranking. "Preferred maritime liens,,202include

wages of the crew and master.'" salvage (including contract

salvagejr'" damages arising from maritime torts;205wages of a

stevedore (in other words, a longshoreman) when employed directly

by the shipowner, master, manager or certain agentsr'" and contract

marit ime liens.?" which mise before preferred ship mortgages.i"

Preferred maritime liens outrank preferred ship mortgages. Other

(nonpreferred) maritime liens are contract maritime liens accruing

after the filing of preferred ship mortgages, which generally rank aftersuch mortgages.

Fourth, U.S. maritime lien law contains two chauvinistic ranking

rules, one of which subordinates foreign preferred ship mortgages that

have not been guaranteed under title Xl of the Merchant Marine Act,

1936, to U.S. preferred ship mortgages.i" The other rule subordinates

foreign preferred ship mortgages that have not been guaranteed under

tit le XI of the Merchant Marine Act, 1936, to liens for necessaries

supplied in the United States.i'"

Fifth, maritime liens for necessaries, if ordered by a party

authorized or presumed authorized to order necessaries for a vessel,

arise without the supplier having to prove that credit was given to the

ship."' A necessaries lien may therefore arise, even where a

prohibition of lien clause in the charterparty forbids the charterer from

incurring liens on the vessel, unless the vessel owner can prove that the

supplier had actual knowledge of the prohibition when the lien

arose.i" This is also significantly more liberal than English and

Canadian law, where the necessariesman continues to have a duty to

inquire, which, if not fulfilled, can cause him to lose his statutory right

in rem.i" The contract underlying the necessaries claim must,

however, be a "maritime" contract falling within U.S. admiralty

jurisdiction.i" The contract must also have been performed, at least inpart, in order to give rise tothe lien.215

201. See TETLEY,M.L.c., supra note 1 , a t 588-89, 592-94. The Uni ted States, fo r

example, was quick to recognize a maritime lien for container leasing. Seeid. at 609-13.202. See 46 U.S.c. §§ 31301(5), 31326(b)(I) (1997); see also Calogeras Marine, Inc.

v. MN Ocean Leader, Nos. Civ. A. 96-3614,96-3616,97-3626,96-3658, 1997 WL 658984,

*2-3,1998 AMC 872, 875 (E.D. La. Oct. 21,1997).

203. See 46 U.S.C. § 31301(5)(0) (including maintenance and cure claims).

204. Seeid. § 31301 (5)(F).

205. See id. § 31301(5)(8) ( including personal injury and death claims, property

damage claims and cargo tort liens).

206. Seeid. §§31301(5)(C),31341.207. See id. § 3 1301(4) (listing contract maritime liens secure claims for

"necess ar ies ," inc lud ing, f or example , suppl ie s, r epai rs, towage, the use of a dry dock or

marine railway, pilotage, stevedoring, cargo damage liens in contract, and contract charterers'

liens); TETLEY,M.L.C., supra note I , a t874-75. U.S. mar it ime law isa l so very gene rous inthe claims it accepts as "necessaries." See. e.g., Cummins Fin. , Inc. v . The Vessel Rose of

Rock Rive r, 771 F. Supp . 234, 236, 1994 AMC 1519 (AMC reporter summarizing case )

(N.D. I I I . 1991) (holding overland transportation of a vessel was held to be "necessary,"

giving r ise to a mar it ime lien for the transport costs). The United States, to its credit, a lso led

the wor ld in recognizing claims for container leasing as legit imate claims for necessaries

although such claiming gives rise to maritime liens only where the containers are earmarked

for or delivered to a ship and loaded aboard. See TETLEY,M.L.C., supra note I , at 609-13;

see also Silver Star Enters., Inc. v. Saramacca MN, 82 F.3d 666,668-69, 1996 AMC 1715,1717-19 (5th Cir. 1996).

208. See 46 U.S.C. §31301(5)(A). "Preferred ship mortgages" are primarily

mor tgages on U.S. documented vessels , duly executed and f iled under 46 U.S.c. §§ 31321-

31322, although foreign ship mor tgages and hypothecations, duly executed and regis tered

outside the Uni ted States, a lso qual if y as pre fer red sh ip mortgages. See 46 U.S.c.

§§ 313?1(6)(A)-(B), 31321-31322; see also Calogeras Mar ine, Inc. v. MN Ocean Leader,

Nos. CIV.A. 96-3614, 96-3616, 97-3626, 96-3658, 1997 WL 658984, *2, 1998 AMC 872,

874 (E.D. La Oct. 21,1997).

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I1932

223. See 28 U.S.c. ~ 1610(e) .

224. See Navieros Inter-Americanos v.MN Vasilia Express, 120 F.3d 304, 313,1997

AMC 2845, 2856 (1st C ir. 1997); Sembawang Shipyar d, Ltd. v. Cha rger , Inc. & MN

Charge r, 955 F.2d 983 , 987 , 1993 AMC 1341, 1345 (5 th Cir. 1992); Ra inbow Line , Inc. v .

MN Tequila, 480 F.2d 1024, 1028 , 1973 AMC 1431 , 1436 (2d Ci r. 1973); Gar cia v . MNKubbar,4 F . Supp . 2d 99, 103 , 1998 AMC 893, 896 (N.D.N.Y. 1998). Supplemental Rule

C( I ) a lso authorizes an ac tion in rem wheneve r a statute of the United States provides f or a

mar it ime action in rem. Rule C arres t is not available to enforce foreign statutory r ights in

rem, however. See Trinidad Foundry & Fabricating Ltd. v. MN K.A.S. Camilla , 962 F.2d

613,616-17,1992 AMC 2636, 2641 (11th Cir . 1992) ; Heidmar , Inc. v. Anomina Ravennate

di Armanento S.P .A., 993 F.Supp. 990, 994-95,1998 AMC 47, 52 (S.D. Tex. 1997) , vacated

on other grounds, 132 F.3d264,1998 AMC 982 (5th Cir . 1998) .

225. See Republic Na t' l Bank v. United States, 506 U.S. 80, 84, 88-89, 1993 AMC

2010,2013,2015-16 (1992).

226. See Alyeska Pipeline ServoCo. v.The Vessel Bay Ridge, 703 F.2d 381, 384,1983

AMC 2719, 2721 (9th Cir . 1983) .

227. See Supp. Rule C(3), supra note 4.

228. See Supp. Rule C(2), (3) , supra note 3; see also U.S. DEPARTMENTOF JUSTICE,

MANUALFORUNITEDSTATESMARSHALS'll6.3 (1986), reproduced in 1987 AMC 1041-67.

229. See Bay Casino, LLC. V. MN Roya l Empres s, No. 98 CV 2333 (SJ ), 1998 WL

566772, *2,1998 AMC 2226, 2233 (E.D.N.Y. Aug. 21, 1998) .

TULANE LA W REVIEW 1999] MARITIME LA W PROCEDURESVol. 73:1895

3. Binding the Ship for U.S. Marit ime Liens

U.S. law is more liberal than U.K. or Canadian law in defining

who may bind the vessel inrem for marit ime liens. This power isnot

restricted to owners and demise charterers. Rather, necessaries may

be procured for the vessel by the owner, the master, a person

entrusted with the management of the vessel at the port of supply, orby an officer or agent appointed by the owner, a (time or voyage)

charterer, an owner pro hac vice (in other words, a demise, or

bareboat, charterer) or an agreed buyer in possession ofthe vessel?"

U.S. maritime lien law, unlike Anglo-Canadian law, does not

distinguish between "legal" (registered) shipowners and ''beneficial''

owners of ships or their shares. "Owner" means registered owner ofthe vessel itself.

Nevertheless, arrest is permitted, even against a state-owned foreign

ship, to enforce a preferred ship mortgage.f"

5. Arrest In Rem Under Supplemental Rule C

The action in rem in the United States, under Supplemental

Rule C, permits the arrest of any ship or other marit ime property toenforce a maritime lien,224provided that the res is within the

territorial jurisdiction of the federal district court concerned at the

time the suit is filed or during the pendency of the action.?" Arrest

perfects the lien, obtains jurisdiction, and procures pre-judgment

security for the claim.i" Under Rule C, arrest is obtained by the

filing of a complaint, verified on oath or solemn affirmation,

accompanied by an affidavit. Judicial review is required before a

warrant of arrest may issue (Rule C(3», unless "exigent

circumstances" make the review "impracticable."?" The warrant of

arrest, accompanied by a summons to the defendant, are issued by

the clerk, on the order of the court, and the Marshal arrests the vessel

by posting the notice of arrest aboard the ship and serving a copy ofthe complaint and warrant upon the master or person in charge.f"

Any person claiming an interest in the property arrested is entitled to

a prompt post-arrest hearing, also compulsory under Rule E(4)(f).

The vessel may be sold to satisfy the lien claim, but if the sale

proceeds are insufficient to cover the claim, the owner is not liable

for the balance, because the action in rem is directed exclusivelyagainst the ship or other res that has been arrested.F'

4. Enforcement In Rem

Both the preferred ship mortgagee and the maritime lienor,

under U.S. law, have a lien enforceable by a civil action in rem.!"

Enforcement in rem is possible against both U.S. and foreign

ships. As in most other countries, however, no lien may be asserted in

the United States against a "public vessel.'?" Arrest or seizure of any

vessel owned, demise chartered, or operated by the U.S. government,

a'i well as the creation of any lien against a public vessel, are

prohibited by the Public Vessels Acr'" and the Suits in Admiralty

Act.220 Ships owned and operated by foreign states or their "agencies

or instrumentali ties" are also exempt from pre-judgment arrest or

seizure, under the Foreign Sovereign Immunities Act,221but only in

respect of their governmental, noncommercial activities.f"

216. See 46 U.S.c. § 31341(a); TETLEY,M.L.C., supra note I , at 600-03; see also

Integral Control Sys . Corp. v. Conso!. Edison Co., 990 F.Supp. 295,298, 1998 AMC 1905,1908-09 (S.D.N.Y. 1998).

217. See 46 U.S.C. § 31325(a), (b) (I ) ( regarding the preferred mor tgage lien) ; id.

§§ 31301(5), 31326(b)( I) ( regarding preferred mar it ime liens); id. § 31342(a)(IH2)

(regarding maritime liens for necessaries); see a lso Supp. Rule C(1)(a) , supra note 3

(permitting an action in rem to enforce any maritime lien).

218. See 46 U.S.c. §§ 30101(3),3 1342(b).

219. Id. app. § 788.

220. Id. §§ 742-752; see also TETLEY,M.L.C., supra note 1, at 597-98 943 1199-1205. ' ,

221. 28 U.S.c. §§ 1330, 1332(a) , 1391(f) , 1441(d) , 1602-1611 (1997).

222. See id. §§ 1604, 1605(a)(2), 1605(b); Coastal Cargo Co. v.MN Gustav Sule, 942

F. Supp . 1082, 1084-87, 1997 AMC 193, 196-201 (E.D. La 1996). See generally TETLEY,

M.L.C., supra note I , at943, 1172-80.

1933




235. See id. at 940.

236. See id. at 939.

237. See id. at 1047.

238. See id. at 939-40; see also Navieros Inter -Americanos v. MN Vasilia Express ,

120 F.3d 304 ,314-15 , 1997 AMC 2845, 2858 (1st C ir. 1997); Seawind Compania , SA v.

Cr escent Line , Inc. , 320 F.2d 580 , 582 , 1964 AMC 617, 620 (2d Ci r. 1963); Bay Casino,

1998 WL 566772 a t*5 , 1998AMC at 2238.

239 . The "minimum contac ts" cr it erion re flec ts the case law f lowing fr om the U.S.

Supreme Court 's decis ion in International Shoe Co. v. Washing/on, 326 U.S. 310 (1945).

Minimum contacts may arise f rom the forum's "general personal jur isdiction" (where the

defendant's general business contacts with the district are both "continuous and systematic")

o r f rom "speci fi c persona l jur isd ic tion" (wher e the re i s a causal connec tion between thedefendant's activities within the district and the plaintiff 's cause of action). See Helicopteros

Nac ionales de Colombia , S.A. v . Ha ll , 466 U.S. 408 , 414 !1n.8-9 (1984); Ocean Chern .

Transp., Inc. v. Cotton, 702 So. 2d 1272, 1998 AMC 38, 39 (Fla. Dist. Ct. App. 1997).

Under Rule 4(k)(2) of the Federal Rules Civil Procedure, minimum contacts, in respect of

claims arising under federal law ( including federal admiralty law), may also be found in the

defendant 's "nationwide" contacts with the United States, even where there are insuf ficient

con tact s to sa ti sfy the due process conce rns of the long- arm s ta tu te of any part icular U.S.

state. See World Tanker Carriers Corp. v. MN Ya Mawlaya, 99 F.3d 717, 723-24, 1997

AMC 307, 311-13 (5th Cir . 1996) ; Pacif ic Employers Ins . Co. v.MIT Iver Champion, Civ. A.

No. 91-0911, 1995 WL 295293, ·5 , 1995 AMC 2280, 2286-87 (E.D. La. May II, 1995).

240. See TETLEY,M.L.e., supra note I, a t 940 . The r elevan t t ime for determining i f

the defendant ispresent in the dis tr ict is the time the complaint is f iled. See Heidmar, Inc. v.

Anomina Ravennate di Armamento S.P .A., 132 F.3d 264, 267-68, 1998 AMC 982, 985-87

(5th Cir. 1998).241. See West of England Ship Owners Mut. Ins. Assn v . McAl li st er Bros. , 829 F.

Supp. 122, 124, 1993 AMC 2559, 2561-63 (E.D. Pa. 1993) .


United States federal district courts also have taken a kind of

"constructive in rem" jurisdiction over shipwrecks, including wrecks

lying on the seabed in intemational waters, in order to protect the

rights of wreck salvors. This jurisdiction is defended on the somewhat

questionable ground that the district court has jurisdiction where

artifacts from the wreck are brought into the distr ict by the salvors.i"

as the credi ts or effects of the defendant in the hands of third parties.i"

Hence, i t is used to seize both tangible and intangible assets, including,

notably, bank accounts.i"

Because the Uni ted States has the attachment, si ster ship arrest in

rem is unnecessary. A sister vessel may be at tached as security for the

claim in the same way as any other goods or chattel s of the defendant,

ifit i s within the district and the defendant cannot be found there."?For the purposes of determining when a defendant cannot be

"found within the district" within the meaning of Supplemental Rule

B, a two-pronged test applies, based upon jur isdict ion and the service

of process.i" Attachment under Rule B is thus proper: (a) when the

defendant lacks "minimum contacts" with the district sufficient to

found in personam jurisdiction'" or (b) when he is not available for

service of process within the district, because he has no office or

authorized agent in the dist rict where or through whom legal process

may be served upon him.i" The plaintiff bears the burden of proving

that the defendant cannot be found within the district under Rule B,

and must make reasonable, but not necessarily exhaustive, efforts to

locate the defendant."!

6. Maritime Attachment Under Supplemental Rule B

Supplemental Rule B(l) permits a claimant having an in

personam claim against a defendant that is cognizable in admiralty to

attach the goods or chattels of the defendant, or the latter's credits or

effects in the hands of garnishees, within the district, when the

defendant cannot be found in the district. The attachment thus

permits the assertion of jurisdiction over a defendant's property

located within the district even though the court has no in personam

jurisdiction over the defendant.?" Derived from the general marit ime

law, with its civi lian antecedents, mari time attachment in the United

States resembles the satste conservatoire, or conservatoryattachment, of the civil law.232 The attachment ensures the

defendant's appearance and satisfaction in the event the suit

succeeds.i"

At tachment is not dependent, as is arrest in rem, on the existence

of a maritime l ien or preferred mortgage lien, but necessitates merely

an in personam claim against the defendant that falls within U.S.

admiralty jurisdiction.i" The attachment is not restr icted, as is arrest

in rem, to maritime property (ships, cargo, freight, bunkers), but may

be taken against any goods or chat tels of the defendant located within

the jurisdiction of the federal district court seized of the claim, as wel l

230. See Treasure Salvors , Inc. v. The Unidentif ied Wrecked & Abandoned Sailing

Vessel, 640 F.2d 560, 566,1981 AMC 1857, 1864(5th Cir . 1981) ; R.M.S. Titanic, Inc. v.The

Wrecked & Abandoned Vessel Believed to be the R.M.S. Titanic, 9 F.Supp. 2d 624, 632-34,

1998 AMC 2421, 2432-35 (E.D. Va. 1998); Marex Int'l, Inc. v.The Unidentified, Wrecked &

Abandoned Vessel, 952 F.Supp. 825, 828, 1998 AMC 484, 487-488 (S.D. Ga 1997); Moyer

v. The Wrecked & Abandoned Vessel Known asThe Andrea Dor ia , 836 F.Supp. 1099, 1104,

1994 AMC 1021, 1025-26 (D.NJ. 1993) .

231. See Transamer ica Leasing Inc. v. Frota Oceanica E. Amazonica, S .A., No. 97-

0556-CB-5 , 1997 WL 834554, *2, 1998 AMC 254, 256 (S.D. Ala. June 26, 1997) ; Western

Bulk Carriers (Aust . I. ), Pty. Ltd. v .P .S. In t' l, L td ., 762 F. Supp . 1302 , 1305, 1991 AMC

2828, 2831 (S.D. Ohio 1991) .

232. See TETLEY,M.L.e., supra note I , at 938-39.

233. See Swift & Co. Packers v . Compania Colombiana Del Caribe , S.A. , 339 U.S.

684 ,693 , 1950 AMC 1089 , 1096-97 (1950); Bay Casino, 1998 WL 566772, at *4, 1998

AMCat2237.

234. See TETLEY,M.L.e., supra note I , at939-40.

1935




247. See TETLEY,M.L.C., supra note I, a t l iB.

248. See id.

249. See 20th Century Fox Film Corp. v.MN Ship Agencies, Inc., 992 F.Supp. 1429,

1429 (M.D. Fla. 1997); Lion de Mer , S.A. v .MN Loretta 0, NO. Civ. L-98-921, 1998 WL

307077, at *2,1998 AMC 1410, 1412 (D. Md. Apr . 3, 1998) .

250. See Supp. Rule E(5)(b), supra note 3.

251. See id. Rule E(5)(c).

252. See id. Rule E(7).

253. See Techem Chern . Co . v . MfT Choyo Maru , 416 F. Supp. 960, 967-70, 972,

1976 AMC 1954, 1964-69, 1972 (D. Md. 1976) .

254. See 46 U.S.c. § 3I326(a) (1997).

255. See id. § 3 I326(b); see also TETLEY,M.L.C., supra note I , at 872-76.


Because Rule B jurisdiction is in personam, if the defendant

appears in the action and the plaintiff's claim is allowed, the judgment

is enforceable against all of the defendant 's property, and not only

against the property seized as in the action in rem.r" If the defendant

fails to appear, however, the plaintiff's judgment is enforceable only

against the value ofthe property attached.r"

The attachment may be combined with the action in rem, the

advantage of such joinder being that if the value of the ship or other

arrested property is insufficient to satisfy the judgment, the balance of

the damages awarded may be recovered from the defendant found

personally liable on the claim.i" Joinder of arrest and attachment is

also useful if the claimant is uncertain whether he has a valid maritime

lien to assert in rem.

Procedurally, Supplemental Rule B requires the plaintiff to file a

detailed complaint, accompanied by an affidavit. The plaintiff must

show: (1) that he has an in personam claim against the defendant;

(2)that the defendant cannot be found within the district where the

action is commenced; (3) that property belonging to the defendant ispresent, or soon will be present, in the district; and (4) there is no

statutory or general maritime lawproscription to the attachment.i" An

ex parte application for issuance of the attachment must also be filed,

owing to the pre-seizure hearing required since 1985. The clerk of the

court, on the court's order, issues the writ of attachment to the Marshal,

as well as a summons addressed to the defendant, which the Marshal

serves with the writ.i" A prompt post-seizure hearing is also

mandatory under Rule E(4)(f).

7. Release of the Ship

The vessel may be released from arrest or attachment on the

fil ing of sufficient security, under Supplemental Rule E(5). The

security then replaces the res'" and normally precludes re-arrest for

the same claim?" In the United States, security may take the form of

a "special bond" (Rule E(5)(a)), which releases the res from arrest orattachment in the plaintiff's suit. The special bond is in an amount

determined by the parties or, failing such agreement, in an amount set

by the court, which is sufficient to cover the plaintiff's .claim "fairly

stated" together with interest and costs, but not exceedmg the lesser, . fh 1'249of the value of the property or twice the amount 0 t e Cairn.

Security may also take the form of a "general bond,'?" which

releases the res from arrest or attachment in respect of all actions that

may be brought in the district. Itmust be maintained ~t dou~le the

aggregate amount claimed in actions begun and pending. Finally,

security may consist of a "stipulation," which is usually a P & I club

letter of undertaking, or in some cases, a letter of credit or an escrow

deposit."!In addition, the claimant may be ordered to give countersecurity

in respect of counterclaims arising out of the same transaction, where

the defendant has given security in the claimant's action, unless the

court directs otherwise for "cause shown".252Countersecurity has also

been required of the plaintiff where the claim and the defendant 's

posted security greatly exceeded the amount of the actual loss.i"

If the claim succeeds, the res may be sold in ajudicial sale or the

judgment may be enforced against the substituted security. The

judicial sale terminates all claims existing on the date it occurs, and the

vessel is then sold free of all such claims.i" The proceeds are then

distributed according to theU.S. order of ranking.i"

242 . See Bay CaSino, 1998 WL 566772, at *2,1998 AMC at2232-33.

243. See TETLEY,M.L.C., supra note I, at 940 . For thi s reason, Rule Bjur isd ic tion i s

sometimes termed "quasi in rem" jurisdiction. See Navieros Inter-Americanos, 120 FJd at

315 , 1997 AMC at 2858; Limonium Mari time, S.A. v. Mizushima Mariner a, S.A. , 961 F.

Supp. 600, 605, 1997 AMC 2938,2944 (S.D.N.Y. 1997) .

244. See Supp. Rule C(1)(b), supra note 3; Navieros, 120 FJd at 314-15 ,1997 AMC

at 2858; Bay Casino, 1998WL 566772 , at *2, 1998 AMC at 2233; see also TETLEY,M.L.C.,

supra note I , at943. Where the conditions of arres t under Supplemental Rule C are not met,

the courts will sometimes allow the action to proceed as if i t had originally been insti tuted

with attachment under Rule B. See Heidmar, 132 F.3d at268, 1998 AMC at987-88.

245. See Transamer ica Leasing Inc. v. Frota Oceanica E. Amazonica, S .A., No. 97-

0556-CB-5, 1997 WL 834554, at *2, 1998 AMC 254, 256 (S.D. Ala. June 26, 1997); 7A

JAMESWM. MOORE,MOORE'SFEDERALPRACTICE11 B.03 (2d ed. 1996).

246. See Supp. Rule B(I), supra note 3; U.S. DEPARTMENTFJUSTICE,supra note 228,

at 1041-67.

1937



I1938 TULANE LA W REVIEW

263. See Supp. Rul~s B(I), C(I), E(4)(f), supra note 3. Pre-seizure and post-seizure

notices are now used even in respect of t he seizure of vessels at municipal docks. See

Higgins v.Por t ofNewpor t, 121 F.3d 1281, 1282-83, 1998 AMC 573, 575 (9th Cir . 1997) .

264. See Supp. Rule E(4)(F), supra note 3 . The cons ti tu tional ity of the ar res t and

attachment procedures in the maritime context was upheld in decisions such as PolarShipping Ltd. v. Oriental Shipping Corp., 680 F.2d 627 (9 th Cir. 1982) (Rule B mari time

attachment and garnishment procedures) ; Amstar Corp. v. SIS Alexandros I , 664 F.2d 1338

(5th Cir. 1981) (Rule C arrest procedure). But see Alyeska Pipeline Servo CO. V. Bay Ridge,

509 F. Supp . 1115, 1981 AMC 1086 (D. Alaska 1981) (Rule C arre st p rocedure) . Wi th the

1985 changes to Rules B, C, and E(4)(F) to provide for a prompt post- seizure hearing at the

request of any person claiming an interes t in the property seized, the issue has been resolved.

See 20th Century Fox Film Corp. v.MN Ship Agencies, Inc., 992 F.Supp. 1423, 1427, 1998

AMC 2514,2518 (M.D. Fla 1997) ; Newport News Shipbuilding & Dry Dock CO. V. S.S.

Independence, 872 F.Supp. 262, 265,1995 AMC 1644, 1646-48 (E.D. Va. 1994) .

265. See generally TETLEY,M.L.C., supra note I, at 945-48, 956-58.

266. See Commercial Instruments &Maritime Liens Act, 46 U.S.c. § 31325(d)(I)(A),

(B) , (C) (1997) . Such not ice i snot requ ired i f the per son en ti tl ed to i thas no t been found in

the United States after "search satisfactory to the court." Id. § 31325(d)(2). Failure to notify

does not affect the jur isdiction of the court to hear the action inrem, but the unnotif ied par ty

may sue for damages in the amount of his interes t inthe vessel terminated by the action. See

id. § 3 I325(d)(3); see also TETLEY,M.L.C., supra note I , at 946-47.

[Vol. 73:1895 1999] MARITIME LA W PROCEDURES

8. Wrongful Arrest orAttachment

United States courts have not hesitated to grant damages for

wrongful arrest or attachment in marit ime cases. As in England and

Canada, however, damages are only granted where the arrest or

attachment is found to have been motivated by bad faith, malice or

gross negligence. The analogy to malicious prosecution is frequentlydrawn.256Where the arrest or attachment is merely erroneous, costs

may sometimes be awarded, but not damages.i" U.S. courts may

also condemn a party in damages for demanding excessivesecurity.i"

arrest or attachment, more detailed complaints (especially in

attachment cases) and speedy post-seizure hearings.?" At the post-

seizure hearing, the onus is on the arresting or attaching party to showthat he had "probable cause" for arresting or attaching the vessel.i"

Supplemental Rule C(4) also requires public notice of the action in

rem and the arrest, in a newspaper, if the property has not been

released within ten days after execution ofprocess ..;165

Further safeguards were enacted in the Commercial Instruments

and Maritime Liens Act in 1988, requiring "actual notice" of a civil

action in rem that has been brought to enforce a preferred mortgage

lien or a maritime lien. Notice must be given, in the manner directed

by the federal district court, to: (1) the master or individual in charge

of the vessel; (2) any person who recorded a notice of claim of an

undischarged lien on the vessel under 46 U.S.C. § 31343(a) or (d); and

(3) a mortgagee of an undischarged mortgage file or recorded under 46U.S.c. § 31321?66

9. Constitutional Safeguards of Shipowners' Property Rights

The Fifth Amendment of the United States Constitution,

adopted in 1791, prohibits depriving any person of life, l iberty or

property without due process of law in federal matters?" The

Fourteenth Amendment applies a similar prohibition in respect of

state matters.i" As a result of certain United States Supreme Court

decisions on civil (nonmarit ime) matters, such as garnishments,rendered in the 1960s and 1970s, the door was opened to

constitutional challenges of both maritime attachment and arrest in

rem, on grounds of due process, particularly regarding the question

whether these maritime enforcement procedures should be required

to provide for prior notice and hearing of the defendant shipowners

directly affected by them."? Various contradictory decisions were

rendered by U.S. courts on the issue, and legal academics engaged in

a vigorous debate on the matter in the law reviews.i"

Finally, in 1985, Supplemental Rules B and C were amended to

provide for the procedural safeguards considered compatible with due

process. The new rules provided for judicial authorization prior to

10. Conclusion-Attachment and Arrest-America

In addition to recognizing a larger number of marit ime liens

than any other nation, U.S. maritime law is uniquely rich in affording

admiralty claimants both the attachment and arrest in rem as

mechanisms for asserting their claims and obtaining pre-judgment

256. See TETLEY,M.L.C., supra note I, at 1071-76 (citi ng Frontera Fruit CO. V.

Dowling, 91 F.2d 293, 297,1937 AMC 1259, 1266 (5th Cir . 1937».

257. See Zak Marine CO. V. Exportkhleb, Nos. 92-0860, 92-0870, 1993 WL 323131, at

*3, 1993 AMC 1794, 1796-97 (E.D. La. 1992) .

258. See Wertman V. Mar del Sud, Ltd., 1995 AMC 1130, 1136 (D. Alaska 1995) .

259. See U.S. CONST.arnend. V.

260. See id. arnend. XlV.

261. See generally Shaffer V. Heitner , 433 U.S. 186 (1977) (boldingjur isdiction over

parties based on statutory presence violative of due process); Fuentes V. Shevin, 407 U.S. 67

(1972) (bolding Florida and Pennsylvania replevin provisions invalid under the fourteenth

Amendment); Sniadach v. Farnily Fin. Corp. , 395 U.S. 337 (1969) (bolding Wisconsin's

prejudgment garnishment of wages procedure violated due process); s ee a lso TETLEY,

M.L.C., supra note I, at 952-54.

262. See TETLEY,M.L.C., supra note I, at 954-56 nn.83-84.

1939




security,"? The United States has also led the world in developing

and implementing effective constitutional protections of the private

property rights of shipowners with respect to both attachment and

arrest. In that domain in particular, U.S. maritime law can well serve

as a model for other nations.

Effectively, because of the broad interpretation of the

Commercial Instruments and Maritime Liens Act and, in particular, of

"necessaries," the claims permitting ship arrest and attachment in the

United States are contained in an "open list."

V. TH E SAISIE CONSERVATOIRE-FRANCE

A. Introduction

Civilian countries such as France never experienced the conflict

between admiralty and common-law courts that plagued the English

judiciary for centuries. Pre-judgment seizure of any property of a

debtor therefore was never "lost ," as it supposedly was in England.

Nor was there ever in civilian jurisdictions a separate in rem

proceeding, with the ship a notional defendant. Rather, c ivilian

countries to this day have but a single action, the action in personam,

which may, however, be combined with a saisie conservatoire, or

conservatory attachment, in order to give the claimant security for his

claim before judgment. In addition, France at least appears to have

been untroubled by the risk of marit ime attachment without prior

notice or hearing infringing on "due process" rights of defendants./"

B. Attachment of Ships and Other Assets

Ship attachment in France, as provided by Law No. 67-5 of

January 3, 1967,169 is governed by special regulatory provisions. The

procedures are found in Decree No. 67-967 of October 27, 1967,170as amended by Decree No. 71-161 of February 24, 1971.271

Procedures regulating the attachment of cargo.?" freight.i" and other

267. See generally Keith B. Letourneau, A Practical Guide toAdmiralty Supplemental

Rules A Through E (with Special Emphasis on the Southern Dis tr ic t of Texas), 22 TuL. MAR.

LJ. 417 (explaining arrest and attachment in U.S. maritime law).

268. See TETLEY,M.L.C., supra note I,at 962-63.

269 . Law No. 67-5 of J an . 3 , 1967 , J.O. , J an . 4 , 1967 , at 106 .

270. See Decree No. 67-967 ofOct. 27,1967, J .O., Nov. 4,1967, p. 10836.

271. See Decree No. 71-161 of Feb . 24, 1971, i .o., Mar. 2 , 1971, p . 2064. Re levan t

pr ovi sions of Dec ree No. 67-967, a s amended by Decree No. 71-161, are reproduced in

TETLEY,M.L.C., supra note I,at 1483-86.

272 . See , e.g. , Courde Cassation, Casso Com., Oct. 5,1993,1993 D.M.F., 722, note R.

Le Brun; C .A. Rouen , Dec. 23, 1992 , 1993 D.M.F. , 645 , note Y. Tassel; TETLEY,ML.C.,

supra note I,at 1483-86.

1999] MARITIME LAW PROCEDURES 1941

assets, such as bank accounts and insurance proceeds.i" on the other

hand, are subject to the general law of France on civil procedures of

execution, found in Law No. 91-650 of July 9,1991,275completed by

Decree No. 92-755 of July 31, 1992.276 In 1998, the Cour de

Cassation, reversing some previous case law of various courts of

appeal, held that, because bunkers were a "component of the ship"("element du navire"), their attachment, like that of the vessel itself,

was to be governed by maritime law (specifically, the 1967 Decree),

rather than by the general legislation of 1991/1992 on execution on

movable property?"

C. Attachment of Ships-Two Regimes

There are two regimes of ship attachment in France: the

"international" regime, based on the Arrest Convention 1952 to

which France is party?" and the "domestic," or "residuary," regime

governed by the 1967/1971 Decrees. The international regime

governs the attachment of seagoing ships'?' flying the flag of a state

that is party to the Arrest Convention 1952, as required by article8(1) of the Convention. The domestic regime applies to the

attachment of French vessels in French ports by French residents.i"

Under article 8(2) of the Arrest Convention 1952, where the ship

attached is not a French vessel and does not fly the flag of any other

state party to the Convention, it may be attached for a maritime claim

recognized under artic le 1(1) of the Convention or for any claim

permitting attachment under the law of the contracting state concerned

273. See Courde Cassation, CassoCom., Jan. 13, 1998, 1998 D.M.F. 823.

274. See, e.g., c.A. Par is , Oct. 21,1994,1995 D.M.F. 833, note P.Bonassies ; Trib. de

commerce Par is , Sept. 13,1994, 1995 D.M.F. 548, note Y. Tassel, cornmentaire P.Bonassies,1998 D.M.F., 119-120; TETLEY,M.L.C., supra note I,at 964.

275. See Law No. 91-650 of July 9, 1991, i.o., July 14, 1991, p. 9228.

276. See Decree No. 92-755 of July 31,1992, J.O:, Aug. 5,1992, p. 10530.

277. See Cour de Cassation, Casso Com., Jan. 13, 1998, 1998 D.M.F. 823; see also M.

Ndende, La problemat ique de la sa is ie des sautes: La res taura tion de l 'autori te du Dro it

maritime, 1998 D.M.F. 77 I. As a result of this decis ion, bunker attachment in France must

be au thorized by the pre sident o f the tribunal de commerce, ra the r than by a regu la r civi l

judge.

278. France ratif ied the Arres t Convention 1952, supra note 8, on May 25, 1957 and

published itby Decree No. 58-14 of January 4, 1958.

279 . The term "a rre st " i sused asa t ranslat ion of the French term "saisie" in the Arrest

Convention 1952, supra note 8, indicating that the Convention applies toboth arres t in rem in

common-law jurisdictions and conservatory attachment in civil-law jurisdictions. Moreover,

the French t it le o f the Conven tion i s: "Convention Internationale Pour l 'unification de

Certaines Regles sur laSaisie Conservatoire des Navires de Mer."

280. See Arrest Convention 1952, supra note 8, art . 8(4); see also MARTINEREMOND-GOUILLOUD,DROITMARITIME 288 (2d ed. 1993).



1942 TULANE LA WREVIEW [Vol. 73:1895

287. See Law No. 67-5 of Jan. 3, 1967, lO., Jan. 4, 1967, p. 106, art. 31; TETLEY,

M.L.C., supra note I,at 1479-83 (identifying relevant provisions of Law No. 67-5); see also

id. at 902-05 (ranking maritime liens in France).

288. See Arrest Convention 1952, supra note 8, art. 1(1).

289. See, e.g., C.A. Montpe ll ie r, J uly 31, 1996, 1997 D.M.F. 31, note A. Arnaud,

commentaire P.Bonassies , 1997 D.M.F. Hors Ser ie No.2, 1998, No. 67; c.A. Aix , May 15,

1996,1997 D.M.F. 598, note Y. Tassel.

290. See Arrest Convention 1952, supra note 8, art. 3(1); TETLEY,M.L.C., supra note

I, at 966 n. 131;REMOND-GOUILLOUD,supra note 280, ~~ 291-292, 293(b); VIALARD,supra

note 282, ~ 371.

291. See Arrest Convention 1952, supra note 8, art. 3(1), (4).

1999] MARITIME LA WPROCEDURES

(France, in this casej.?" France's domestic regime may be applied in

this case, because article 8(3) permits a state party like France to

exclude from the benefit s of the Convention any noncont racting state

or any person who, at the time of the arrest or attachment, has no

habitual residence or principal place of business in a contracting

state.

282

In consequence, neither regime restr icts attachment to claims

giving rise to a maritime lien (a "privilege maritime"). France

nevertheless recognizes marit ime l iens on ships for: (1) law costs and

costs of judicial sale; (2) tonnage and port charges, pilotage, and costs

of preservation of the vessel since its entry into the last port (the port

where the attachment occurs); (3) claims resulting from the contract of

employment of the master, crew, and other persons engaged for on-

board work; (4) remuneration for salvage and assistance and general

average contributions; (5) damages for collis ions and other accidents

of navigation, damages to port installations or waterways, damages for

bodi ly injury to passengers and crew and compensat ion for loss of, or

damage to cargo or baggage; (6) claims arising from contracts

concluded or operations carr ied out by the master away from the ship's

home port, under his legal powers, for the real needs of preservation of

the ship or the continuation of the voyage (including both what are

deemed "master 's disbursements" and "necessaries" in common-law

jurisdictionsj.r" Most of these maritime lien claims, although

di fferently worded in some cases, are included, as "maritime claims"under article 1(1) of the Arrest Convention 1952.288 They would

therefore permit attachment under either regime in France. The

Convention is not to be construed, however, as creating marit ime liens

not recognized under the law of the court seized of the case or under

the Marit ime Liens and Mortgages Convention 1926.289

D. Claims Permitting Maritime Attachment

Ships under the international regime may be attached in France

only for "maritime claims" listed in article 1(1) of the Arrest

Convention 1952, that "closed list" being interpreted restr ic tively.'"

The judge merely verifies that the claim alleged falls into one of the

categories on the list.i"Under France's residuary regime, ships may be at tached for any

claim whatsoever, whether maritime or not, provided that the claim

appears "founded in principle.v'" The judge must, however, be

sati sfied that the claim is "certain and serious" before authorizing the

vessel's attachment.i"

281. See, e.g., C.A. Aix, May 22, 1997, 1998 D.M.F. 692, notes P.Delebecque & c.Bourayne.

282. See REMOND-GOUILLOUD,upra note 280, ~ 288, 294; RENE RomERE &

EMMANUELDUPONTAVICE,DROITMARITIME~ 178 (12th ed. 1997); TETLEY,M.L.C., supra

note I,at 964-65; ANTOINEVIALARD,DROITMARITIME 366 (1997).283. See REMOND-GOUILLOUD,upra note 280, ~ 289; RomERE & DUPONTAVICE,

supra note 282, ~ 178; TETLEY,M.L.C., supra note I,at 965; VIALARD,supra note 282,

~ 367. See, e.g., C.A. Aix , May 22, 1997, 1998 D.M.F. , 692 , notes P. Delebecque & c.Bourayne; C.A. Douai, Sept. 12, 1996, 1997 D.M.F. 36, note Gilles Gautier , commentaire P.

Bonassies , DMF Hors Ser ie No.2, 1998, No. 62. It has been held that attachment under the

Convention ispossible , even where the claim isa "maritime claim" only in part. See Cour de

Cassation, Casso Com. Feb. 3,1998,1998 D.M.F 260, note P.Bonassies.

284. See, e.g., CA. Aix , Dec. 6 ,1995,1997 D.M.F. 591 , note Y. Tassel, commentaireP. Bonass ie s, DMF Hors Se rie No.2 , 1998, No. 63; Cour de Cassa tion , Cas so Com., Feb . 3,

1998, 1998 D.M.F. 255. See also RomERE & DUPONTAVICE,upra note 282, ~ 178 n.6;

TETLEY,M.L.C., supra note I,a t 965-66. Some French judges, however, seem inten t on

determining whether the claim is in fact a "maritime claim." See, e.g., C.A. Aix , Nov. 14,

1996, 1997 D.M.F. 606, note Y . Tassel, commentaire P.Bonassies.

285. See Decree No. 67-967 of Oct. 27, 1967, J.O., Nov. 4, 1967, p. 10836, as

amended by Decr ee No. 71-161 , Feb . 24,1971 , J.O. , Mar. 2 , 1971, p. 2064, a rt . 29; see also

REMOND-GOUILLOUD,upra note 280 , ~ 289; RomERE & DUPONTAVICE,upra note 282,

~~ 176, 178. This "founded in principle" criterion has been assimilated to the concept of the

"good arguable case" in English law. See Y. Tassel, Note, c.A. Rouen, 1996 D.M.F. 377,

380. It isconsis tent with the basic principle ofcivil law that all of the debtor's property is the

pledge of his creditors. See CODECIVIL[C o CIV.]art. 2092 (Fr.); VIALARD,supra note 282,

~ 367.286. See, e.g., Cour de Cassation, Casso Com., Mar . 19, 1996, DMF 1996,503,504;

C.A. Aix, Sept. 12,1996,1997 D.M.F. 36, note G. Gautier , commentaire P.Bonassies , DMF

HOTSSerie No.2, 1998, no. 64; REMOND-GOUILLOUD,upra note 280, ~ 289.

E. Attachment of Ships andSister Ships

The ship concerned by the claim may be attached under both

the internal regime and article 3(1) and (4) of the Convention. Both

regimes also permit sister ship attachment where the owner is liable

on the claim.?" Where a charterer is liable on the claim, article 3(4)

of the Convention permits the attachment of either the "offending

ship" or another ship owned by the charterer. Only one ship may be

seized."! Under the domestic regime, there is authority for the view

1943




that only a ship owned by the charterer may be seized, although a

privilege maritime (maritime lien) will enable a chartered ship to be

attached.?"

French courts have applied the theorie de l'apparence ( theory of

appearance) to "lift the corporate veil," so as to determine true

ownership, where a "community of interests" has been found betweenthe legal entities concerned, where they lack genuine operational

autonomy and particularly where the reality of related shipowners and

ships has been concealed behind the mask of "one-ship companies.t'""

The Cour de Cassation, France's Supreme Court, however, has more

recent ly taken a more conservative position on the applicat ion of this

theory, stressing the importance of respecting the integrity of corporate

personality.i" Increasingly, the corporate veil will only be lifted or

pierced where there is clear evidence that the corporate facade is being

manipulated as part of a sham in order to perpetrate a fraud on

creditors.?"

F . Attachment Procedure and JurisdictionUnder both the domestic and the international regimes in

France, the legal procedures for the attachment of ships are those of

articles 29 and 30 of Decree No. 67-967 as amended by Decree No.

71_161.296 Application for the saisie conservatoire is made by

motion to the president of the Tribunal de commerce or, if he is

unavailable, to a judge of the Cour d'instance (a lower court). The

order of seizure is served on the debtor by a bailiff, generally in the

292. See TETLEY,M.L.e., supra note 1,at 966-67.

293. See id. a t966 n.131, 1046; see also REMOND-GOUILLOUD,upra note 280, 'I] 292;

VIALARD,supra note 282, '1]'1]371,372; Antoine Via1ard, Les Societes Ecrans: Apparence ou

Transparence?, 503 D.M.F. 179 (1991); Jean-Serge Rohart, La saisie conservatoire desnavires apparentes, 1994 D.M.F. 339.

294 . Cou r de Cassa ti on , Casso Com., 1996 D .M.F ., Mar . 19, 1996, 1996 D .M.F . 503 ,

commentaire A. Vialard, Personnalite Morale des Societes D 'armement et Apparentement

Abusif des Navires Saisis, 1996 D .M.F . 467 ; P .Bona ss ies , DMF Hors Ser ie No.1 , 1997, no

31; Cour de Cass ation, Cas so Com., Jan. 21, 1997, 1997 D.M.F. 612, note A. Vialard,

commen tai re P .Bonassi es , DMF Hors Ser ie No.2, 1998, No . 65 ; C .A . A ix, May 22 , 1997 ,

1998 D.M.F. 692, notes, P.Delebecque & e. Bourayne.

295. See, e.g., C.A. Rennes, Jan. 15, 1997, 1997 D.M.F. 584, note I. Corbier,

commentaire P.Bonassies, DMF Hors Serie No.2, 1998, No. 65.

296. French domestic law governs a ttachment procedure under the Arrest Convent ion

1952, because art ic le 6 , second paragraph, of the Convent ion makes the rules ofprocedure

relat ing to the arrest of a ship, the obtaining ofjudicial authori ty to arrest and a ll mat te rs of

procedure subject to the law of the contrac ting sta te where the arrest was made or applied for .

For a comprehensive article on maritime attachment procedures in France, see Helene Cadiet

& Guillaume Brajeux, La Procedure de saisie conservatoire de navires entre droit commun et

regles speciales, 1998 D.M.F. 995.

1999] MARITIME LAWPROCEDURES 1945

presence of the master of the vessel. The bailiff appoints a

guardian."? The ship may be attached even where it is preparing to

set sail.i" Attachment prohibits the ship from leaving port.i" but

does not otherwise affect the rights of the owner. '?"

As a result of a 1995 decision of the Cour de Cassationr" it is

now uncertain whether attachment in France in itself suffices to foundthe international jurisdiction of the French court to adjudicate the

claim. The decision reversed what had been thought of as a settled

rule supporting the international jurisdiction of the forum arresti. The

Cour de Cassation now requires some connecting factor recognized

by French rules of private international law, apart from the place of

seizure, in order to confer jurisdiction over the merits of the claim.i'"

France, in common with other countries, does not permit the

attachment of ships belonging to the French Government, because

French law absolutely prohibits all measures of execution and all

forms of seizure against any property of "public persons.,,303

Similarly, France subscribes to the principle of restrictive foreign

sovereign immunity enshrined in the Immunity of State-Owned ShipsConvention 1926 and its Addit ional Protocol 1934/04 under which

irnmunity from seizure, arrest and detention of foreign state-owned

and state-operated vessels is recognized, but only in respect of such

vessels engaged exclusively in governmental, noncommercial service

297. See VIALARD,supra note 283, '1]374.

298. REMOND-GOUILLOUD,upra note 280, 'I] 297 bis; RODIERE& DUPONTAVICE,

supra note 282, '1]'1]176,180; TETLEY,M.L.e., supra note 1 , a t 969; VIALARD,supra note283, '1]375.

299. See Decr ee Np. 67-967 of Oct. 27, 1967, 10., Nov. 4, 1967, p. 10836. In

pract ice, the port service , on being not if ied of the a ttachment, refuses outwards c learance to

the vessel.

300. See id.; see also REMOND-GOUILLOuD,upra note 280, '1]297 bis; RODIERE&

DUPONTAVICE,upra note 282, '1]177; TETLEY,M.e.L., supra note I , a t969; VIALARD,supranote 283, '1]375.

301. See Cour de Cassation, Casso Corn., Jan. 17, 1995, 1996 D.M.F. 815,

commentaires Remond-Gouilloud, Forum Arresti: Le Jusant, DMF 1996, 787 & P.

Bonassi es , DMF 1997 , Hors Ser ie No . I , 1997 ,No . 36; see also TETLEY,M.L.e., supra note

l,at968.

302. But see Cou r de Cassa ti on , Casso com. , Feb . I I, 1997 , 1997 D.M.F. 616, not e P .

Bonassies & commentaire , DMF Hors Serie No.2, 1998, No. 72 (upholding the jurisdict ion

of the French forum arresti i n r espec t o f mat te rs r el at ing , not t o the me ri ts o f t he di sput e

itself, but rather to the execution of a foreign judgment that had been recognized and

rendered executory in France).

303. See TETLEY,M.L.C ., supra not e I , a t 1205-10 ; see also REMOND-GOUILLOUD,

supra note 280, '1]'1]76-77;RODIERE& DUPONTAVICE,upra note 282, '1]'1]248-253,462.

304. The Interna tional Convent ion for the Unifica tion of Certa in Rules concerning the

Immun ity o f S ta te-owned Ships , adop ted at Bru ssel s, Apr il 10 , 1926, and the Add it ional

Protocol, adopted a tBrusse ls on May 24, 1934. France rat if ied both instruments on July 27,

1955.



1946 TULANE LA WREVIEW [Vol. 73:1895

when the cause of action arises.?" Because many vessels today that in

fact belong to states are formally owned and operated by state agencies

or state corporations, French courts, applying the "theorie de

I 'emanation" (theory of emanation), have at times denied immunity

where foreign governments, operating through such allegedly

"independent" bodies, have attempted to avoid their debts.?" As with

the theorie de I 'apparence in sister ship attachment, however, a more

conservative approach to the "emanation" doctrine is now being taken

by Frenchjudges and legal scholars.?"

G. Releasefrom Attachment and VoyageAuthorization

French law provides two modes of lifting the saiste

conservatoire. The shipowner may seek release of the ship, by

motion to the Tribunal de grande instance. If release is granted, the

seizing creditor loses all preference for his claim and wil l normally

be condemned to pay damages occasioned by the seizure, notably,

the costs of the release.?" Because release procedures in France tend

to be prot racted, however, shipowners often prefer the second optionfor lifting the saisie, which is a motion to the president of the

Tribunal de grande instance seeking an order authorizing the vessel

to leave the port of attachment for one or more determined voyages,

in return for the giving of adequate security by the shipowner.f" The

president must set a deadline for the vessel's return to the port of

seizure. Should the deadline be missed, the creditors are entitled to

the security. The security generally takes the form of a letter of

undertaking from the shipowner's P & I club, although a bank

guarantee may also be given. The security is regarded as taking the

place of the vessel."?

305. Immuni ty of St ate-owned Shi ps Convention 1926 art. 3; see al so TETLEY,

M.L.C., supra note I , at970-71.

306. See TETLEY,M.L.C., supra note I, at 1166.

307. See, e.g., C.A. Rauen , 1985, 1986 D.M.F. 349 ; see also Remond-Gouilloud,

L i :mana tion Mari time ' au Comment Fa ir e Ceder L 'ecran de la Per sonnal it e Mora le d 'un

Armement d'Etat, 1986 D.M.F. 333; Daniel Guyot, Immunite des Navires d'Etat: Les Theses

en Presence 1987 D.M.F. 405; M. Remond-Gouilloud, L'emanation Marit ime: Pour Sortir

de la Clandestinite 1992 D.M.F. 451; VIALARD,supra note 283, ~ 373; TETLEY,M.L.C.,

supra note I, a t 1166 n .25; see also Cour de Cassation, Casso Com., Jan. 4,1995, Bulletin

civil I ,no. 6; Cour de Cassation, Cass. Com., Oct. I , 1997, note P.Delebecque.

308. TETLEY,M.L.C., supra note I , at969-70.

309. See Decr ee No. 67-967 of Oct . 27,1967, J.O. , Nov . 4 ,1967, p . 10836; see also

REMOND-GOUILLOUD,upra note 280, ~ 300; RODIERE& DUPONTAVICE,upra note 282,

~ 177 n.3; VIALARD,supra note 283, ~ 377.

310. See Decree No. 67-967; TETLEY,M.L.C., supra note I, at 970.

1999] MARITIME LA WPROCEDURES 1947

As in other countries, judicial sale of the ship remains the fmal

mode of exercise of marit ime enforcement jurisdiction. I t is governed

in France by provisions of the Decree of 1967 on "saisie-execution"

(attachment in execution of the finaljudgment)."!

H WrongfulAttachment

Article 6, first paragraph, of the Arrest Convention 1952 leaves

to national law of the contracting state where the arrest was made or

applied for the question of liability for damages for arrest of ships.

There is no specif ic maritime legislat ion on this matter in France.?"

Nevertheless, jurisprudence shows that at least some French courts

are prepared to grant damages for the wrongful seizure of ships,

where it appears to have been motivated by malice or gross

negligence.l" Where the attachment is merely unfounded in law (in

other words, erroneous, as opposed to malicious), the seizing creditor

has been held liable to compensate the shipowner for the expenses of

maintaining the vessel during its period of attachment.?"

I Protection ofPrivate Property Rights ofShipowners

The Declaration of the Rights of Man and of the Citizen, 1789,

at article 2, declares the right to liberty, property, security and

resistance to oppression. Article 17 declares that property is an

inviolable and sacred right, of which no one may be deprived except

when public necessity, lawfully established, so requires, and on

condition of a 'just and prior indemnity." These lofty principles

were invoked successfully to challenge the attempted nationalization

of French banks in 1981.315 They have yet to be raised to contest the

constitutional validity of a ship attachment in France, however.

Nevertheless, the possibility of such a challenge cannot be

discounted.

J. Conclusion-France

Although France has no writ in rem, its maritime enforcement

procedures are clear and unified because France never permit ted the

311. See Decree No. 67-967, arts. 31-58.

312. See VIALARD,supra note 283, ~ 378.

313. See REMOND-GOUILLOUD,upra note 280, at ~ 300; TETLEY,M.L.C., supra note

1, at 1077-79.

314. See Cour de Cassation, Casso Com., Mar. 3, 1998, 1998 D.M.F. 699, note R.

Rezenthel.




1948 TULANE LAW REVIEW [Vol. 73:1895 1999] MARITIME LAW PROCEDURES 1949

attachment and the action in rem to separate. The historic saisie

conservatoire, inheri ted from the general civil ian lex maritima of

Continental Europe, cont inues to flourish in civilian jurisdictions,

and in France has been adapted to the demands of international

shipping in the twentieth century. It provides ~ ~ogical an~ effecti_ve

procedural tool for providing modem mantIm~ creditors with

prejudgment security against the main asset .on .which they r~~y, the

ship. It remains to be hoped that France, with It~ noble tradition ?f

concern for fundamental rights and freedoms, will further refine Its

maritime legislation, as the United States has done, so as to provide

additional, constitutionally-grounded protection to shipowners' rights

of property in their vessels. .

It is noteworthy that, as a party to the Arrest Convention 1952,

France operates under a "closed list" of marit ime claims.

The power of the High Court under subsection (I) to grant an

interlocutory injunction restraining a party to any proceedings from

removing from the jurisdiction of the High Court, or otherwise dealing

with, assets located within that jurisdiction shall be exercisable in cases

where that party is, as well as in cases where he is not , domiciled,

resident or present within that jurisdiction.F"

In 1994, a "Practice Direction" was issued governing variousdetails of Mareva practice in the United Kingdom."!

VI. THEMAREVA INJUNCTION

A. Introduction

The reputed loss of the Admiralty attachment in England has

been partially mitigated by the inventi~n ofth~,"Mareva inj~ction."

Considered by its creator, Lord Denmng, as the greatest piece of

judicial law reform in my time,'?" the Mareva injunction draws its

name from the second decision granting the remedy that Lord

Denning rendered while Master of the Rolls in the English Court of

Appeal, Mareva Compania Naviera S.A. v... Inte,:nat~onalBulkcarriers S.A.317 The purpose of the Mareva injunction IS to

prohibit the defendant, before or during a suit, from re~~vil_lg .assets

(real or personal, movable or immovable) from the jUTIsdictI?n or

from dealing with them.l" where it appears to the court that WIthout

such an order the plaintiff's recovery on his claim will bejeopardized."? .. . .

Explicit authority for the issuance of Mareva Injunctions ISnow

conferred on the High Court of Justice in the United Kingdom by

section 37(3) of the Supreme Court Act, 1981, which provides:

B. ConditionsJor theIssuance oj a Mareva Injunction

The main conditions for the granting of a Mareva injunction

were determined very early on in some of the first Mareva decisions

in England, most of which were marit ime law judgments.f" InThird

Chandris Shipping Corp. v . Unimarine S.A., Lord Denning M.R. set

out five guidelines to ensure that the Mareva would not be granted

indiscriminately.'" The guidelines related to the contents of the

affidavit of the applicant for the injunction. They require: (1) full

and frank disclosure of all matters known to the applicant that arematerial for the judge to know; (2) disclosure of particulars of the

applicant's claim, including its grounds and amount, and a fair

statement of the points made against it by the defendant; (3) the

applicant's grounds for believing that the defendants have assets in

the jurisdict ion; (4) the appl icant' s grounds for bel ieving that there is

a risk of the assets being removed before the judgment or arbitral

award is satisfied; (5) the giving by the applicant of an undertaking in

damages to indemnify the defendant for his losses should the claim

fail or the injunction prove to be unjustified.l" A sixth condition or

guideline emerges from London's central position as a place for

foreigners to l itigate or arbitrate disputes efficiently before judges of

unquestioned learning and impartiality. As described in NinemiaMaritime Corp. v . Trave SchifJahrtsgesellschafl & Co. (TheNiedersachsenii" the plaintiff must show some evidence of a

320 . The Supreme Court Act , 1981, ch. 54, § 37(3) (Eng .).

321. See The Practice Direction of July 28, 1994, reproduced in [1994] 4 All E .R. 52.

Note that a new standard form of Mareva injunction was issued by t he High Court in its

Practice Direction of October 28, 1996. See [1996]1 w.L.R. 1552 (1997).

322. See. e.g., Third Chandris Shipping Corp. v. Unimarine S.A. (The Genie), [1979]

2 Lloyd's Rep. 184, 189;The Assios, [1979]1 Lloyd's Rep. 331, 333-34 (C.A.); The Siskina,

[1978]1 Lloyd's Rep. 1,4-7 (H.L. 1997) ; Rasu Mar it ima S.A. v.Per tamina, [1977]2 Lloyd's

Rep. 397, 402-03 (1977).

323 . [1979]2 L loyd' s Rep . a t 184 .

324. See TETLEY, M.L.C., supra note I , at987-88.

325 . [1983]2 L loyd' s Rep . 600 , 606-07.

3I6. [d. (c it at ion omi tt ed). Note, however, tha t c redi t f or the Mareva injunct ion

should also go to Geoff rey Brice, Q.c. , and M.N. Howard , who prepared, int roduced and

pled the motion for the injunction.317 . [1975] 2 Lloyd' s Rep. 509 , [ 1980]1 All E.R. 213 Note (C.A. ). The fi .rs tMar eva

injunction (as itwas later called) was issued in Nippon Yusen Kaisha v . Karageorgis, [1975]2

Lloyd's Rep. 137 (Lord Denning, M.R).318. See AlS DIS Svendborg & Another Eston ian Shipping Co. v . Wansa , [1996] 2

Lloyd's Rep. 559, 575-76.319. See TETLEY, M.L.C., supra note I, at 983-84, 988-89, 990-91.



1950 TILANE LAW REVIEW [Vol. 73:1895

serious risk, not mere I that the assets in the jurisdiction will be

removed or dissipated, :iut that, without the injunction, there will be

no means in or outside the jurisdiction available to enforce the

judgment when rendered.?"

The basic criteria governing the grant of Ma r eva injunctions in

the United Kingdom today requi re the plaintiff to show: (1) a cause ofaction against the defendant in the jurisdiction at the time of the

appl ication.f" (2) a "good arguable case,'?" (3) that the defendant has

assets within the jurisdiction (tangible, nontangible, real or personal,

including, inter alia, ships, cargoes, bunkers, proceeds of sale, bank

accounts, etc.),329(4) that the defendant is likely to frustrate judgment

by removing his assets from the jurisdiction or dissipating them.l" and

(5) the balance of convenience favouring issue of the injunction."!

C. "Worldwide" Mareva Injunctions

The Mareva injunction was applied originally to prevent both

British and foreign defendants who had assets within England or

Wales from transferring or dissipating those assets. Since 1988,however, English courts have begun to issue so-called "worldwide"

Mareva injunctions, in order to restrain defendants subject to English

jurisdiction from dealing with or dissipating their assets situated

326. See TETLEY,M.L.C., supra note 1 , a t 988-89; see also AlS DIS Svendborg v.

Wansa, [1996] 2 Lloyd's Rep. 559,567-68.

327. The applicant must be asserting some legal or equitable r ight enforceable within

the jurisdiction. See Mercedes-Benz A.G. v . Leiduck, [1995] 2 Lloyd 's Rep. 417, 423-25

(P. c. ); Sou th Carol in a Ins . Co. v. Assu ran ti e Maat schappi j "De Zeven Provinci en" N .V. ,

[1986] 2 L loyd's Rep. 317, 324 (H.L.); T he Sis kina, [1978] 1 Lloyd's Rep. 1, 6 (H.L.);

TETLEY,M.L.C., supra note 1 ,a t 985-86. But see Mercedes-Benz, [1995 ] 2 L loyd' s Rep . at

430-31 (L.Nicholls, dissenting) (holding that the existence of a substantive cause of action in

t he jur isdi ct ion should not be an essent ia l cond it ion o f t he cou rt 's j ur isdi ct ion to g rant aMareva injunction).

328. See The Nieder sachsen , [1983 ] 2 L loyd 's Rep . 600 , 605 (ho ld ing tha t a "good

arguable case" meant "a case which ismore than barely capable of serious argument, and yet

not n ece ssar il y one which the Judge be li eves to have a bet ter t han 50 per cent . ch anc e o f

suc cess" ); Rasu Mar it ima S .A. v . The Pe rt amina , [1977] 2 L loyd 's Rep . 397 ,404 (C.A.) .

The "good arguable case" criterion replaced the "strong prima facie cas e" test f irst

propounded by Lord Denning inNippon Yusen Kaisha v. Karageorgis, [1975] 2 Lloyd 's Rep.

137, 138 (C.A.). See TETLEY,M.L.C., supra not e 1 , a t 986 , n. 251; see also Svendborg,

[1996] 2 Lloyd 's Rep. a t567.

329. See TETLEY,M.L.C., supra not e I , a t 987 .

330. See The Niedersa. hsen, [1983] 2 Lloyd 's Rep. a t 617; Barclay-Johnson v.Yuil l,

[1980] 1 W.L.R. 1259, 1265 {Ch.) ; Third Chandris Shipping Corp. v . Unimarine S.A. (The

Genie), [1979] 2 Lloyd's Rep. 184,189 (C.A.); TETLEY,M.L.C., supra note I , a t987 n.253.

331. See Fe1ixstowe Dock & Ry. Co. v .U .S . L ines Inc ., [ 1987 ] 2 L loyd' s Rep . 76, 93-

95 ; Ame ri can Cyanamid Co. v . E th icon Ltd ., [ 1975] 1 Al l E .R . 504 , 511 (H.L. ); TETLEY,

M.L.C., supra note 1 ,a t987 n.254.


outside of England and Wales.?" An order pursuant to a Mareva

injunction may also be issued requiring that assets outside the

jurisdiction be transferred to a jurisdiction where the Mareva remedy

will be recognized.l" Apart from the various matters that must be

proven in Mareva injunction applications generally, worldwide

Marevas also require the appl icant to satisfy the court that the partyenjoined lacks sufficient assets within the jurisdiction to satisfy the

claim and that the circumstances of the case "cry out" for the Marevaorder.?"

The issuance of worldwide Marevas continues to cause

consternation among many jurists, to whom the extra-territorial impact

of such injunctive relief suggests overreaching by U'K. courts,

particularly where the assets in question and those in possession of

them (for example, foreign banks) are located far from the BritishIsles.l"

D. Mareva Injunction Procedures-United Kingdom

Procedures relating to Mareva injunctions in the United

Kingdom are now largely codified in the Practice Direction 1994.336

Mareva procedures pay signi ficantly more heed to the protection of

the property rights of the party to be enjoined than do the procedures

applicable to the issuance of the writ in rem.

332. See, e.g., Derby & Co. v. Weldon (Nos . 3 & 4) , [1989] 2 w .L .R . 412 (C.A.) ;

Derby & Co. v .Weldon (No. I), [1989] 2 w.L.R. 276 (C.A.); Republic of Hai ti v .Duvalier ,

[1989 ] 2 w .L .R . 261 (C. '; .) ; Babana ft i nt 'I Co. S .A. v .Bassatne, [1988] 2 L loyd' s Rep. 435

(C.A.); TETLEY,M.L.C., supra no te I , a t 992 . For a more recent examp le in a mar it ime c ase

see Svendborg v. Wansa, [1996] 2 Lloyd's Rep. 559,575. '

333. See Derby & Co. Ltd . v .Weldon (No.6), [1990]1 W.L.R. 1139 (C.A.).

334. See TETLEY,M.L.C., supra note 1 ,a t 992.

335. See , . e.g ., i d. a t 992 n.280; David Capper , The Trans-Jurisdictional Effects of

Mareva Injunctions, 15 C tv. JUST. Q. 211 (1996); David Capper, Worldwide Mareva

Injunctions, 54 MOD.L. REv. 329 (1991); David Capper, The World wide Mareva Marches

On [1991] LLOYD'SMAR.& COM.L.Q. 26; Robert Crawford, 11,e Extra-Territorial Effect of

Mareva Injunc~ions-The Sleeping Giant in Fairyland, 18 AUSTL.Bus. L. REv. 28 (1990);

Peter Devonshire, The Impl icat ions o f Thi rd Part ie s Holding Asset s Subject to a Mareva

Injunction, [1996] LLOYD'SMAR. & COM.L.Q. 268; Paul D. Friedman, Worldwide Mareva

Injunctions-Assumption of Jurisdiction, 144 NEW L.J . 932 (1994 ); S teven Gee, Mercedes

and Mareva, 139 SOLIe. 1. 1076(2) n.41 (1995); Richard Harrison, Controlling the Mareva,

142 NEWL.J. 1511 (1992); Peter Kaye, Extraterritorial Mareva Orders and the Relevance of

Enforceability, 9 CIv. JUST.Q. 12(1990); Ali Malek & Caroline Lewis, Worldwide Mareva

Injunctions: The Position of International Banks, [1990] LLOYD'SMAR. & COM.L.Q. 88;

Campbell McLachlan, Transnational Applications of Mareva Injunctions and Anton Piller

Orders, 36 INT'L& COMPoL.Q. 669 (1987); Andrew Rogers, The Extra-Territorial Reach ofthe Mareva Injunction, [1991] LLOYD'SMAR.& COM. L.Q. 231.

336. See Practice Direction 1994, supra note 321.



1952 TULANE LAW REVIEW [Vol. 73:1895

A Mareva injunction may issue before or after the start of the

trial. Where granted before trial, the injunction is customarily issued

after the writ , although it may be issued even before the writ is taken

out, provided that the applicant undertakes to issue the writ "forthwith"

or "as soon as practicable.Y'" A Mareva injunction may also be

sought by the defendant to the suit, in support of a counterclaim.l"

The applicant typically seeks the injunction at an ex parte hearing

before a judge in chambers, after submitting to the judge's clerk the

writ (where it is already out), the affidavit setting forth the relevant

facts and reasons for the application, and a draft minute of the order

sought.l" The applicant must also give a "cross-undertaking in

damages" to indemnify the defendant for losses resulting to himshould the claim be unsuccessful, as well as to compensate third

parties for any expenses that they may reasonably incur in complying

with the order or losses that the order may cause them.i"The Mareva injunction takes effect as soon as it is granted, but

the order must be served on the defendant as well as upon third parties

contemplated by its provisions.?" The Mareva may also be combined

with one or more "ancillary orders.'?" In particular, it may be

combined with an action in rem.?"

337. [d.Annex 2, Sched. 1(2), Annex 3,Sched. 1(2).

338. I n such cases, however , the counter claim must be se rved e ither immediately or

wi thin the t ime a llowed by the judge . See Fakih Bros. v. A.P. Muller (Copenhagen) Ltd.

Moller, [1994] I Lloyd's Rep. 103, 110(1993). .339. Paragraph A(I) of the Practice Direction 1994, supra note 321 , r equi re s the

application t o be lodged with the judge at l east two hours before the hearing "[w]here

practicable." In cases ofgreat urgency, however , the application may be made by telephone,

even if the documents are not submitted beforehand. See Allen v . J ambo Holdmgs Ltd. ,

[1980]1 w.L.R. 1252 (CA. 1979) .340. Paragraph A(2) of the Practice Direction 1994, supra note 321, provides that the

app lican t should be requ ir ed , in an appropriate case , to support h is c ross -under tak ing indamages by a payment into court or by an insurance company bond. Alternatively, the Judge

may order a payment by way of such securi ty to the app licant 's so li ci to r, which the lat ter

would hold as an off ice r o f the court . See id. Annex 2, Sched . 1( 6), Annex 3 , Sched . 1( 6)

(regarding cross-undertaking in respect of third parties).

341. See id. Annexes 2, 3, "Notice to the Defendant," ~ ( I) , and "Effect of this Order ,"

~~ (1)-(2). See id. Annex 2, Sched. 1(2), 1(5) & Annex 3, Sched. 1(2), 1(5); see also Baltic

Shipping Co. v.Translink Shipping Ltd., [1995]1 Lloyd's Rep. 673 ( invoking as one reason

to vary a Mareva order the failure to serve a worldwide Mareva order on a foreign bank

affected by the injunction was among the reasons invoked by the court in varying the order );

TETLEY,M.L.C, supra note I, at 990,1084.342. Ancillary orders could include, for example, orders for discovery or

interrogatories, orders for the cross-examination of the defendant on his affidavit declaring

his assets, orders for the investigation or the delivery of assets to a court-appointed receiver

or to the plaintiff 's solicitors, orders preventing the defendant from leaving the jurisdiction or

Anton Piller orders. See generally TETLEY,M.L.C, supra note I, a t991; see also Svendborg

v. Wansa [1996] 2 Lloyd's Rep. 559, 568-74; Gidrxslme Shipping Co. v. Tantomar

1999] MARITIME LA W PROCEDURES 1953

Worldwide Marevas today normally include a provision

requiring that the injunction be declared enforceable or that it actually

be enforced by a court in the relevant foreign jurisdiction, as a

condition of the effectiveness of the injunction against third parties

there who are not subject to the High Court's jurisdiction.l"

United Kingdom courts also discharge or vary Mareva

injunctions, particularly where they adversely affect the rights of

innocent third parties?" In some cases, the injunction is also varied or

discharged to benefit the defendant, provided that the purpose for

which the Mareva was originally issued IS not thereby

compromised.?"

E. Mareva Injunctions-Canada

Following the United Kingdom, Canada lost little time in

accepting the Mareva injunction, as early as 1979.347 The Supreme

Court of Canada, in Aetna Financial Services v. Feigelman,recognized the Mareva order, but warned that the English rules

regarding its use could not simply be transplanted into a federal statesuch as Canada without some adaptation.l" The court further held

that in Canada, a "strong prima facie" case, rather than merely a

"good arguable case," would have to be shown by the Mareva

applicant in order to obtain the injunction.l" Mareva injunctions

were also approved by the Federal Court of Canada.l" Canadian

Transportes Mar it imos LOA., [1994]2 Lloyd's Rep. 392, 393 (Q.B.) (combining wor ldwide

disclosure order with Mareva injunction affecting intra-jurisdictional assets).

343. See The Rena K, [1978]1 Lloyd's Rep. 545, 562-63.

344. See Practice Direction 1994, supra note 321 , Annex 2 ,~ 2 .

345. See Oceanica Castel a na Arrnadora S.A. v. Mineralimportexport Alaka

Navigation Inc. (The Theotakos), [1983]2 Lloyd's Rep. 204, 204; see also TETLEY,M.L.C.,

supra note I,at 993-94.346. See Iraqi Mini st ry of Defense v . Arcepey Shipping Co. S.A. (The Angel Bel l),

[1980] ILloyd's Rep. 632, 637 (1979); see also Comdel Commodities Ltd. v. Siporex Trade

S.A. , [ 1997] I L loyd' s Rep . 424 , 435 (CA. ) (d is charg ing a Mareva injunct ion due to the

c la imant' s unexp lained delay to prosecu te the c la im for some 19 months ); Svendborg v .

Wansa, [1996]2 Lloyd's Rep. 559,575,576 (CA.) ; TETLEY,M.L.C., supra note I, at 994-

96.

347. See TETLEY, M.L.C, supra note I, at 1002 (citing early Canadi an Mareva

decisions). Other British Commonwealth countries have also embraced the Mareva remedy.

See, e.g., Jackson v.Sterling Indus. Ltd. (1987) 61 A.L.J.R. 332 (Austl.).

348. [1985]1 S.CR. 2,4,34-37. The Supreme Court pointed out, for exampl e, that

the grant of Mareva injunction to prohibit the transfer of assets between Canadian provinces

might be unwarranted, in view of the possibility of interprovincial enforcement of

judgements throughout Canada See id. at 34-37.

349. See id. at 27; see also Pegasus Lines Ltd. S .A. v.Devil Shipping Ltd. [1996] 120

F.T.R. 241,268-69 (Fed. Ct.); TETLEY,M.L.C, supra note I, at 1004, 1083 .

350. See TETLEY,M.L.C, supra note I , at 1004-06.




courts have also followed the British lead in issuing "worldwide"

Mareva injunctions."!

Mareva process in the Federal Court of Canada (where most

maritime law disputes are tried) is·governed by the general rules on

interlocutory and interim injunctions in the Federal Court Rules,

1998.352 The injunction is granted by the judge on motion. l" The

moving party for an interlocutory injunction is required to "undertake

to abide by any order concerning. damages caused by the granting or

extension of the injunction," unless a judge orders otherwise.l" This

is, in effect, the "cross-undertaking in damages" of the United

Kingdom, and the applicant may be required to put up security in case

the injunction proves to have been unjustified. An interim injunction

may be issued, on an ex parte motion, for a period not exceeding

fourteen days, when the judge is satisfied, in a case of urgency, that no

notice ispossible or that to give notice would defeat the purpose of the

motion."? As in the United Kingdom, the Mareva injunction in

Canada may be taken at the same time as the action in rem and

arrest?"

Although the matter has yet to be decided, it is by no means

certain that the issuance of a Mareva injunction ex parte could be

successfully challenged in Canada on grounds relating to the Bill of

Rights of 1960357 or the Canadian Charter of Rights and Freedoms of

1982,358 particularly because of the possibili ty of the defendant:

(1) obtaining the discharge or variance of the injunction, (2) giving

351. See, e.g., Community Ass 'n of S. Indian Lake, Inc. v. MacIver [1996]1 WWR

168,170 (Man. Ct. App.) ; Mooney v. Orr [1994]98 B.C.L.R. (2d) 318 (B.C. S.C); TETLEY,

M.L.C., supra note I, at 1004 n .344 ; John Arnold Epp , World-wide Mareva Injunctions in

Common Law Canada, 59 MOD. L. REv. 460 (1996); see also Vaughan Black & Edward

B~bin, Mareva Injunctions in Canada: Territorial Aspects, 28 CAN.Bus. LJ. 430 (1997);

Ehzabeth Edinger, Comments on Black and Babin, 'Mareva Injunctions in Canada:Territorial Aspects " 28 CAN.Bus. L.J . 477 (1997); Paul Michell , The Mareva Injunction in

Aid of Foreign Proceedings, 34 OSGOODEHALLL.J. 741 (1996); Michael Andrew Skene,

Commerc ia l L it igat ion Beyond the Pale: A Compar ison o f Ext ra te rr itorial An ti su it and

Mareva Jurisdiction Exercised by the Courts of England and British Columbia in

Commercial Disputes, 30 U. BRIT.COLUM.L. REV. 1 (1996). .

352. SOR 98 /106 , in fo rce Apri l 25, 1998. The Fede ra l Court 's juri sd ic tion to i ssue

Mareva injunct ions has been held to be derived from i ts power to pro tect and prese rve i ts

own process. SeeStandal Estate v, Swecan lnt 'l Ltd. [1990]1 F.C. 115,117.

353. Federal Court Rules , 1998, Rule 373(1).

354. Id . Rule 373(2).

355. See id. Rule 374(1).

356. See Parmar Fisheries Ltd. v. Parceria Maritima, [1982]141 D.L.R. (3d) 498,503-

05 (N.S. Supr. Ct.); TETLEY,M.L.C., supra note I, a t 1006.

357. See Canadian Bill ofRights , S .C., 8 & 9 Eliz. 2, ch. 44 (1960) (Can.).

358 . Pa rt I o f the Const itut ion Act , 1982, i sSchedu le B to the Canada Act , 1982, ch.

II (Eng.).

1999] MARITIME LAWPROCEDURES 1955

security to obtain release of the assets, (3) securing the enforcement of

the plaintiff's cross-undertaking in damages, or (4) suing for damages

for bad faith by the plaintiff in issuing the injunction wrongfully.'?

F . TheMareva Injunction, theAction In Rem, and theAttachment

Because the Mareva injunction is purely a court order freezingassets, it does not in itself found the jurisdiction of the court over the

merits of the underlying claim, nor does it place the "frozen" assets

under the court's authority so as to permit their judicial sale in

satisfaction of an eventual judgment allowing the claim. For these

reasons, the Mareva injunction is a less effective mechanism for

assisting the claimant in quest of pre-judgment security than the

civilian saisie conservatoire, the old English Admiralty attachment or

the modern U.S. maritime attachment.l'" Nevertheless, the Mareva

injunction also has certain advantages in comparison with those more

traditional maritime enforcement procedures.

The saisie conservatoire can immobilize either the defendant's

property or, in some cases, that of a third party, whereas the Marevaorder is limited to the defendant 's property?" On the other hand, the

Mareva injunction can "freeze" any or all of the defendant's assets in

our out of the jurisdiction and can be used in aid of any type of

claim.?" By comparison, the saisie conservatoire under the Arrest

Co~vention 1952 permits only the attachment of one ship by anyone

clannant. for an~ one "maritime claim" listed in article 1(1) of theConvention. Neither the Mareva nor the saisie conservatoire foundsjurisdiction.l"

The action in tern is more effective than the Mareva injunction in

that:

(1) Itgives the court jurisdiction to adjudicate the claim on its

merits and p.uts the ship or other res in the court's custody. TheMareva applicant, on the other hand, must establish the court's in

personam jurisdiction over the claim, and the injunction merely

3?9. See gener~lly TETLEY,M.L.C., supra note I, at 1014-15, 1085-86; see a lso

Canadian Charter of RIghts and Freedoms § I (permitting certain restrictions on basic rights

which are "demonstrably justified in a free and democratic society."),

" 360. See. Mercedes Benz A.G. v. Leiduck , [ 1995] 2 Lloyd' s Rep . 417,424 (P.C. )

( Moreover, I tISnow quite clear that Mareva relief takes effect inpersonam alone ' i t is not an

attachment; i t gives the claimant no propr ietary r ights in the assets seized and no advantage

over other creditors of the defendant. "). '

361. See id.

362. See id.

363. See TETLEY,M.L.C., supra note I , at 1017-18.




prohibits the removal or dissipation of the assets affected, on pain of

contempt of court.(2) The action in rem plaintiffhas been held entitled to an arrest

warrant as of right, whereas the Mareva injunction petitioner must

depend onjudicial discretion.(3) The action in rem, asserting maritime liens or statutory

rights in rem, enforces those claims according to their respective

ranking, while theMareva injunction confers no special priority on the

underlying claim.(4) Moreover, under U.K. law, where the "offending ship" is

chartered, either it or a sister ship belonging to the charterer may be

arrested in rem if the charterer would have been personally liable on

the claim when it arose. By comparison, the Mareva injunction

permits only the property of the defendant (the charterer, in this

example) to be "frozen."(5) Arrest in rem claimants are rarely condemned in damages,

unless their arres t was ' 'wrongful'' (in other words, motivated by

malice or gross negligence). On the other hand, Mareva petitionersare more frequently found liable in damages, where their injunctions

are held to be either unjustified or abusive.

(6) Finally, third parties may assert certain well-defined

procedures where they are affected by an arrest in rem (for example, a

caveat against arrest) , whereas third parties prejudiced by Mareva

injunctions must take substantive proceedings to protect their rights.l"

Among the advantages of the Mareva injunction over the action

in rem are the following:(1) The action in rem permits only the arrest of the ship (or in

some cases, cargo, freight, bunkers or judicial sale proceeds) in the

jurisdiction. Mareva injunctions, on the contrary, may affect all types

of property of the defendant, located both inside the jurisdiction andabroad.

(2) Mareva injunctions may affect more than one ship, whereas

only one ship may be arrested for anyone marit ime claim under the

Arrest Convention 1952.

(3) The Mareva injunction leaves the "frozen" property in the

hands of the defendant, thus minimizing costs pending trial of the

claim. Arrest in rem, by comparison, entails significant costs of arrest

and expenses in custodia legis.

364. See id .at 1020-21.


(4) Mareva injunction applicants furnish undertakings to pay

damages if so ordered, while action in rem plaintiffs must furnish

security for the Marshal's expenses of arrest and custody.

(5) Mareva injunctions are obtainable when the judge is

available. On the other hand, actions in rem may be filed only when

the appropriate court offices are open.

(6) Mareva petitioners in the United Kingdom need onlyundertake to issue proceedings and file an affidavit . Action in rem

plaintiffs , however, must actually issue proceedings and file an

affidavit.

(7) Assets subject to a Mareva order may, with the court' s

permission, be used to pay ordinary trade debts or to carry on business

or personal life, whereas use of assets arrested in rem is inconsistent

with their custody by theAdmiralty Marshal.?"

G. Conclusion-Mareva Injunction

The Mareva injunction has become an entrenched part of legal

process, including maritime law process, in England and otherBrit ish Commonwealth countries, since its inception in 1975. It

compensates partially for the alleged extinction by non-user of the

old Admiralty attachment. One may well ask, however, whether

Lord Denning would not have been on more solid legal ground in

reviving the moribund attachment than in creating a wholly new

species of injunction with particular rules of its own. Had he

resuscitated the Admiralty attachment, Lord Denning would have

provided judges with a more useful pre-judgment security device,

which would have confirmed the court's jurisdiction and would also

have enabled the United Kingdom to comply more fully with the

essentially civilian regime of the Arrest Convention 1952 in respect

of seizures for any maritime claim.l"Civilian countries such as France, which never lost the saisie

conservatoire, and the United States, which preserved the attachment

after its presumed demise in England, are fortunate to. possess that

most useful weapon in the arsenal of their pre-judgment admiralty

procedures.

365. Seeid. at 1018-20.

366. See id. at 996-97.




VII. THE ANTON PILLER ORDER

A. Introduction

At almost the same time that the English Court of Appeal

created the Mareva injunction, it also approved another type of

injunction, now known as the "Anton Piller order," the name being

attributable to the Court's 1975 decision in Anton Piller KG v .Manufacturing Processes Ltd.367 The House of Lords, in Rank Film

Distributors Ltd. v . Video Information Centrei" upheld the High

Court 's jurisdiction to grant Anton Piller orders, either as part of the

Court's inherent jurisdiction or under its power to issue injunctions,

now provided for in section 37(1) of the Supreme Court Act, 1981.369

The Anton Piller order is an ex parte injunction, enjoining the

party to whom it is addressed to consent, on pain of contempt of cour t,

to the applicant's entry into and search of premises controlled by the

defendant, as well as to the examination, removal and/or copying of

documents and/or other property found there and specified in the

order, for use in connection with actual or intended legal

proceedings.F" This type of court order has proven to be a valuableprocedure for securing and preserving evidence, particularly in

intellectual property lit igat ion, although it i s used in all types of suits,

including maritime cases.

B. The Anton Piller Order-United Kingdom

The applicant for an Anton Piller order must show evidence of:

(1) a strong prima facie case favouring issuance of the injunction,

(2) serious damage (actual or potent ial) to himself if the injunct ion is

refused, (3) possession by the defendant of incriminating documents

or things, and (4) the possibili ty that such evidence may be destroyed

before any application inter partes can be made.!" The balance of

convenience must also favour issuance of the order."? The

procedure requires a motion, ei ther before or after trial , supported by

an affidavit, in which the applicant must make "full and frank

367 . [1976] Ch. 55 (C.A. ). The fi rs t reported deci sion grant ing such an order was the

1974judgment ofTempleman J. inE.Ml Ltd. v. Pandit, [1975]1 W.L.R. 302 (Ch.).

368 . [1981]2 WL.R. 668 ,672-73 (H.L. ).

369. See The Supreme Court Act, 1981, ch. 54, § 37(1)(Eng.).370 . See genera ll y MARTINDOCKRAY,ANTONPILLERORDERS2; TETLEY,M.L.C.,

supra note I , at 1022-25.

371. See Anton Piller KG v.Manufacturing Processes Ltd., [1976] Ch. 55, 62 (C.A.).

372. See Columbia Picture Indus. Inc. v.Robinson, [1987] Ch. 38, 76; Lock Int 'l PLC.

v .Beswick , [1989]1 WL.R. 1268, 1281 (Ch .); Coca -Cola Co. v .Gi lbey , [1995] 4 All E.R.

711,715 (Ch.); DOCKRAY,upra note 370, at 19-20.

1999] MARITIME LAW PROCEDURES 1959

disclosure" of all relevant facts and the specific provisions he is

seeking.l"

C. Anton Piller Orders-United Kingdom Procedural Safeguards

Anton Piller orders gave rise to an understandable concern over

the civil rights of defendants, particular ly in respect of the privi lege

against sel f-incrimination.l" As a result, quite elaborate procedural

safeguards were established in the United Kingdom in an effort to

prevent any potential abuse of the injunction. These safeguards are

included in the same Practice Direction of July 28, 1994, that

regulates Mareva injunction process in the United Kingdom.?"

Among the most important procedural controls on Anton Piller

orders are: (1) applications for such an order are no longer heard by

judges in chambers; (2) the order is served by a "supervising solicitor ,"

independent of the law firm representing the applicant, who must

explain the order to the defendant fairly and in "everyday language,"

inform him of his right to seek legal advice and to apply for the

variance or discharge of the order, and report in writing to theplaint iff's solici tor on the carrying out of the order; (3) the defendant

may insist that nobody be present who could gain commercially from

anything he might read or see on the premises; (4) the defendant may

refuse entry to the premises to be searched before 9:30 a.m. or after

5:30 p.m. and al l day Saturday and Sunday; (5) the premises may only

be searched in the presence of the defendant or a person appearing to

be his responsible employee; (6) the items removed from the premises

must be listed before removal, with a copy of the list to be remitted to

the defendant; and (7) the defendant may seek to have the order varied

or discharged?"

The plaintiff applying for an Anton Piller order must undertake,

inter alia: (1) to compensate the defendant in damages for lossescaused by the order or it s carrying out; (2) to issue and serve a writ on

the defendant (if not al ready done) ; (3) to serve the defendant wi th the

affidavits and a notice of motion/summons, as well as with a copy of

the supervising solicitor's report on the carrying out of the order;

(4) not to use any information or documents obtained as a result of the

carrying out of the order, except for the legal proceedings concerned;

373. See DOCKRAY,upra note 370, at 26-32.

374. See id. at 1-2,20-25.

375. See Practice Direction 1994, supra note 321 , a t '1 1 (8) & Annex 1 ( the standard

form of Anton Piller order ). Note that the standard form of Anton Piller order was changed

by the Practice Direction of October 28, 1996. See [1996]1 WL.R. 1552.

376. See Universal Thermosensors Ltd. v.Hibben, [1992]1 W.L.R. 840, 859-60 (Ch.).




and (5) not to inform anyone else of the proceedings until after the

return date."? Additional procedural obligat ions are imposed on the

plaintiff's solicitor, particularly regarding return of the items

removed.?"

Among the main grounds for discharging an Anton Piller order

are: (1) the applicant's bad faith or material nondisclosure in obtaining

the order, (2) the unfounded issuance or improper execution of the

order, and (3) the risk of incrimination of the party to whom the order

is addressed.?" Anton Piller orders have also been issued in the

United Kingdom with respect to foreign premises and foreign

proceedings.!"

D. Anton Piller Orders-Canada

The Canadian judiciary adopted the Anton Piller order in the

early 1980s, so that it is now an integral part of the legal process

available in both the superior courts of Canada's provinces and

territories and the Federal Court of Canada."! Nor has the injunction

escaped the attention of commentators on Canadian law.382As a result of the Supreme Court of Canada's decision in

Canadian Broadcasting Corp. v . Dagenaisl" discretionary court

orders are now subject to judicial review under the Canadian Charter

of Rights and Freedoms.?" Accordingly, in 1996, Judge Reed of the

Federal Court of Canada, in Fila Canada Inc. v . Doe, held that Anton

Piller orders were subject to section 8 of the Charter, prohibiting

unreasonable search and seizure.?" She took the opportunity to

suggest a few specific practices, resembling those of the United

377. See Practice Direction 1994, supra note 321, Annex I , Sched. 3.378. See id. Annex I , Sched. 4.

379. See DocKRAY, supra note 370, at69-74 (citing decisions).

380. See id. at 62-65.

381. See TETLEY,M.L.C., supra note I , at 1024n.448.

382. See, e.g., TETLEY,M.L.e., supra note I, a t 1024, n .448 ; J . Berryman, Anton

Piller Orders: A Canadian Common La w Approach, 34 U. TORONTOL.J. I (1984); Jeffrey

Berryman, Anton Piller Injunctions: An Update, 2 INTELL.PROP.1. 49 (1986); Mitchell P.

Mcinnes, The Righ t to S il ence in the Presence of Anton Piller: A Question of Self-Incrimination, 26 ALTA.L. REv. 332 (1988); Allan M. Rock, The "Anton Pi ll er" Order: An

Examination of i ts Nature, Development and Present Posit ion in Canada, 5 Anv. Q. 191

(1984-85); George Takach, Exploring the Outer Limits: The Anton Piller Order in Canada,

23 ALTA.L. REv. 310 (1985).

383. [1994] 3 S.C.R. 835, 836-37.

384 . Pa rt I o f the Const itut ion Act , 1982, i s Schedule B to the Canada Ac t, 1982, ch.

II (Eng.).

385. [1996]3 F.e. 493, 494.


Kingdom, which she believed should be adopted by the Federal Court

in respect of such orders, in the interests of civil rights of Canadians.!"

Canadian judges are showing caut ion in granting Anton Piller

orders, following English precedent. InProfekta International Inc. v .

Aun Lav Mai, for example, i t was held that Anton Piller orders should

be granted in only "the rarest of circumstances," because they confer

on the moving party a search and seizure power that runs contrary to

the principles of private property and trespass."? To obtain such an

order, as in England, the moving party must demonstrate to the

Canadian court: (1) "an ext remely st rong prima facie case," (2) the

potential for very serious damage, and (3) "clear evidence that the

other party has in it s possession incriminat ing documents or things,

and that there is a real possibili ty that the other party may destroy such

material before any application interpartes can be made.'?" After the

action has commenced, the court must also be convinced that it is

appropriate to proceed in the absence of the other party.389 The judge

in Profekta was loathe to grant the order ex parte, particularly as the

other party was represented by counsel, but did so because the plaintiff

had shown "compelling reasons" for believing that if notice of the

motion were given to the defendant, the evidence sought would

disappear, thus justi fying a derogat ion from the audi alteram partem

rule."? There was also ' ''compelling evidence that the defendant [was]

bent on flouting the process of the court by refusing to abide by the

ordinary procedure of discovery. ",391

E. Conclusion-Anton Piller Orders

Anton Piller orders ensure that vi tal evidence will be available

at trial, before it call be destroyed or spirited away by unscrupulous

386. See id. at499-500 (recommending, among other procedures were the f il ing of theapplication in the Federal Court at least two clear days before the hearing of the motion; the

requirement that the applicant show a "very strong prima facie case"; the requirement for the

presence of a supervising solicitor to observe and repor t on the service and execution of the

order ). J udge Reed al so recommended a number of pract ice s r elat ing to the mot ion for

review of the order 's execution and the development of a model Anton Piller order . See id. at

503-04; see also TETLEY,M.L.e., supra note I , at 1025n.454.

387 . [ 1997]1 EC. 223 , 227-28.

388. Id. at 228.

389. See id.

390. See id. at 229-34 (citing EMI Ltd. v.Pandit, [1975]1 W.L.R. 302 (Ch.) ; Yousifv.

Sa lama, [1980] I W.L.R. 1540 (e .A.); s ee a lso ROBERT1. SHARPE, INJUNCTIONSAND

SPECIFICPERFORMANCE-66 (2d ed. 1992).

391. Id. at 233 (quoting SHARPE,supra note 390). But cf Ultramar Canada Inc. v.

Soconav Inc. [1988]2 Ee. D-7 ( refusing where an order permitt ing the general inspection of

a ship and the production ofdocuments because evidence of the accident inquestion could be

obtained by the normal discovery process).




defendants. The procedure must be closely regulated, however, to

safeguard basic property rights of honest individuals and

oorporations.l"

VIII. THEARRESTOF SHIPSCONVENTION999

A. IntroductionA Draft Revision of the Arrest Convention 1952 was adopted

by the Comite Maritime International (CMI) at its conference in

Lisbon in 1985.393 This "Lisbon Draft" was submitted by the CMI,

together with a draft revision of the Maritime Liens and Mortgages

Convention 1967,394to the International Maritime Organization

(IMO) and the United Nations Conference on Trade and

Development (UNCTAD). The Joint Intergovernmental Group of

Experts on Maritime Liens and Mortgages and Related Subjects

(JIGE), established by IMO and UNCTAD to review the marit ime

liens and mortgages conventions and related enforcement

procedures, recommended in 1989 that further work on revising the

Arrest Convention 1952 be postponed, pending the adoption of a

new Maritime Liens and Mortgages Convention?"

Following the adoption of the Maritime Mortgages and Liens

Convention 1993/96 work resumed within the JIGE on revising the

Arrest Convention 1952.

The JIGE completed its consideration of revisions to the Arrest

Convention at its ninth session, held in Geneva from December 2 to

December 6, 1996,397and requested the Secretariats of IMO and

UNCTAD, in consultation with the JIGE Chairman, to prepare a set of

draft articles on the basis of the decisions taken by the Group.!" The

"Draft Articles for a Convention on Arrest of Ships," dated April 14,

392. See generally Ronald Craigen, Anton Piller: Valuable Remedy or Oppress ive

Tool?, Anvoc. Soc. 1., Oct 1995, at II; Paul D. Godin, Anton Piller Orders in an Age of

Skepticism: Charter Application and Other Safeguards for Judicially-Ordered Searches, 54

U. TORONTO FAC. L. REv. 107 (1996) (discussing the practical safeguards available when

carrying out the order).

393. See BERLINGIERI,ARRESTOF SHIPS,supra note 8,at 186-90.

.394. ! he In te rnat iona l Conven tion for the Uni fi cat ion of Certain Rule s Re la ting to

Mari time LI ens and Mortgages, adop ted at Brussel s, May 27, 1967, but not in fo rce. See

TETLEY,M.L.C., supra note I, at 1421-28.

395. See BERLINGIERI,ARRESTOF SHIPS,supra note 8 ,a t 159 .

396. The International Convention on Mar it ime Liens and Mortgages , 1993, adopted

at Geneva, May 6, 1993 [hereinaf ter Mar it ime Liens and Mortgages Convention 1993] . See

TETLEY,M.L.C., supra note I, at 1429-38.

397. See JIGE(lX)/2, TDIB/IGE.I12, LEGIMLM/39.

398. See JIGE(lX)/4, IDIB/IGE.I/4, LEGIMLM/41, ~ 9.


1997, were accordingly prepared.?" for submission to a diplomatic

conference requested by the JIGE,400 which was subsequently

scheduled for March 1 to March 12, 1999, in Geneva. The final text

of the International Convention on the Arrest of Ships, 1999, was

adopted at Geneva onMarch 12, 1999.401The Convention will remain

open for signature from September 1, 1999, to August 31,2000, and

thereafter for accession.f" Itwill come into force six months after thedatewhen ten States have expressed their consent to be bound by it.403

B. General Observations on the Arrest Convention 1999

1. The Definition of"Arrest"

The new Convention defines "arrest" at article 1(2) as any

detention or restriction on removal of a ship by order of a Court to

secure a maritime claim, but does not include the seizure of a ship in

execution or satisfaction of a judgment or other enforceable

instrument. The main change from 1952, apart from the reference to

arbitral awards or "other enforceable instrument," is the inclusion of

the words "restriction on removal of a ship," which would seem toinclude Mareva injunctions issued in respect of vessels. The new

definition, l ike its predecessor, would also include civilian saisie

conservatoire, and the U.S. marit ime attachment, as well as arrest in

an action in rem. That the new Convention encompasses the two

styles of arrest, being the common-law arrest in rem and the civilian

saisie conservatoire, or attachment, is one of its strengths, just as it is

ofthe 1952 Convention.

It would also appear that the new Arrest Convention would

recognize many, but seemingly not all, "special legislative rightS.'>404

Special legislative rights are rights permitting governments and certain

other public bodies to seize, detain and, in some cases, sell or

confiscate ships, in order to guarantee certain claims (for example,

399. JIGE(IX)/5, IDIB/lGE.1/5, LEGIMLM/42.

400 . The JIGE , in Annex I of i ts report on i ts ninth ses sion , supra note 397, requested

the IMO Counci l and UNCTAD's Trade and Development Board to consider proposing to

the UN General Assembly the convening of a diplomatic conference to consider and adopt a

conven tion on the a rre st of s eago ing sh ips on the bas is o f the dra ft art icl es prepar ed by the

JIGE.

401. See U.N. Doc. No. NCONF/188.6 (Mar. 12, 1999). The final text of the

International Convention on the Arres t of Ships , 1999, is reprinted in the Appendix, infra

[hereinafter Arrest Convention, 1999].

402. See Arrest Convention, 1999, infra App., art. 12(1).

403. See id. art. 14(1).

404. On "special legislative rights" generally, see TETLEY,M.L.C., supra note I, at 63-

71,73-99,101-25,127-68,169-215.

-------__- ------




harbour dues, wreck removal costs , pollution expenses, or damages),

or as sanctions for certain offenses (for example, narcotics trafficking,

fisher ies violations, or il legal inunigrat ion). Governmental rights of

this type abound today, under both international conventions and

national legislation, in virtually all countries of the world, and they are

frequent ly accorded precedence by national law over marit ime liens

and ship mortgages. The failure to take account of them in theMaritime Liens and Mortgages Convention 1993 is a lacuna that

threatens to prevent many countries, especially major marit ime states

such as the United Kingdom and the United States, from becoming

parties to that Convent ion.t" The new Arrest Convention, for its part,

rightly provides at article 8(3):

This Convention does not affect any rights or powers vested in any

Govenunent or its departments, or in any public authority, or in any

dock or harbour authority, under any international convention or under

any domestic law or regulation, to detain or otherwise prevent from

sailing any ship within their jurisdiction.f" .

This provision is quite similar to the second phrase of article 2 of

the 1952 Convention, except that i t recognizes governmental rights of

detention of ships ar ising under international conventions, as well as

under national laws and regulations. This is an important addition,

because today many international conventions confer rights of ship

detention (or even confiscation) on governments, notably with respect

to drug trafficking?" and pollution.t"

Although many special legislative rights would be covered by

this rule, it unfortunately is limited to detention and thus does not

cover special legislative rights that empower publ ic bodies, without

court intervention, to sell the detained vessel, and to bepaid in

405. See id. at 76-77,175,214. The Mar it ime Liens and Mortgages Convention 1993,

a t a rt ic le 12(3), does permi t s tates to enact a spec ial l eg is la tive righ t aga inst jud icial sa le

proceeds ( rank ing before al l o ther mar it ime l ien c la ims on a ves se l) f or wr eck removal

expenses incur red by public authorities , but only where the removal has been effected in the

interes t of safe navigation or the protection of the mar ine environment. This r ight does not

extend to pollution damage, however. See id. at 68, 144 and 168.

406. Arres t Convention, 1999, infra App., art. 8(3).

407. See, e.g., U.N. Convention Against I ll ic it Drugs and Psychotropic Substances

1988, adopted at Vienna , Dec. 20, 1988, and in force Nov . II, 1990,28 I.L.M. 497 (1989),

art. 5(1)(a),(b); s e e a l so TETLEY,M.L.C., at 176.

408. See, e.g., Law of the Sea Convention 1982, adopted at Montego Bay, Jamaica, on

Dec . 10, 1982, and in force Nov . 16, 1994, 21 I .L.M. 1261 (1982), a rt . 220(2), (6 ); s e e a l so

TETLEY,M.L.C., at 141.

---------- -- ----------- ---


preference to most, if not all, other claimants out of the proceeds of

that sale.?"

2. A "Closed" List of "Maritime Claims"

The new Convention begins, as does the 1952 Convent ion, with

a lis t of "marit ime claims." Iti s important , of course, not to confuse

"maritime claims" with "maritime liens." In the 1952 and 1999

Arrest Conventions, "maritime claims" refers merely to claims

permitting the arrest of a ship. Some "maritime claims" are

"maritime liens" and some are not. Whether specific types of

"mari time claims" constitute "maritime liens," which follow the ship

and rank before ship mortgages, or merely statutory rights in rem,

which do not follow the ship and rank after the mortgage, depends on

other international conventions (governing maritime liens and

mortgages) and on national law.

The nGE could not reach agreement on whether the list of

"mari time claims" should be "closed" (in other words, exhaust ive), as

under the 1952 Convention, or "open-ended," to take account of new

types of maritime claims that may emerge with the passage of time.

Accordingly, ar ticle 1(1) of the Draft Art icles 1997 sets forth a list of

twenty-two specific "maritime claims.?"" but the preamble, or

"chapeau.?'" includes wording in brackets (in other words, wording

for decision by the diplomatic conference), which would have made

"maritime claims" an "open-ended" concept?"

The diplomatic conference appears to have opted for a "closed"

list of "maritime claims," as found in the Arrest Convention 1952.

Article 1(1) of the {\rrest Convention 1999 begins with the words:

'''Maritime Claim' means a claim arising out of one or more of the

following"; there follows the list of twenty-two categories of

409. See, e.g., the Canada Marine Act, S.c. 1998, ch. 10, § 122 (I), which gran ts a

por t authority, the Minis ter of Transport of Canada, or a person operating the St. Lawrence

Seaway under an agreement with the Government, a lien on the ship and proceeds of its

disposition for fees and interes t in respect of the ship or goods car ried on it and for damage to

prope rty caused by the ship or cr ew, which l ien takes precedence ove r " al l o ther righ ts ,

intere st s, claims and demands, o ther than claims for wages of s eamen unde r the Canada

Shipping Act."

410. See Arrest Convention, 1999, infra App., art. 1(1)(a)-(v).

411. See id. art. 1(1).

412. Article I of the Draft Articles 1997 began as follows: (I) 'Maritime claim'

means any [c la im concern ing or a ri sing out of the ownership, cons truct ion, pos se ssion ,

management, operation or trading of any ship, or concerning or arising out of a mor tgage or

an 'hypo theque' o r a r eg is trable charge of the same nature on any sh ip , such asany] claim in

respect of ....



1966 TULANE LA WREVIEW [Vol. 73:1895 1999] MARITIME LA WPROCEDURES 1967

"maritime claims" that permit the arrest of a ship."? Inmy view, it is

regrettable that an "open-ended" list was rejected, because it would

have provided greater flexibility to courts applying the Arrest

Convention 1999 in future years.

4. Arrest of Ships About to SetSail or Sailing

The JIGE was unable to resolve whether article 2(3) permitting

the arrest of a ship about to set sail (as per article 3(1) of the 1952

Convention) should also permit the arrest of a ship after it has begun

to sail (as proposed in the Lisbon Draft 1985). The whole provision

was therefore bracketed for further discussion at the diplomaticconference. Although many expected that the final Convention text

would permit arrest in both situations,"? thereby facilitating the arrest

of ships just after they leave berth and while still within the

jurisdiction of the arresting court, there is no express reference to the

matter in the Convention as adopted. Itwould seem that the issue

has been left to national law, inasmuch as the Convention provides

that: "Subject to the provisions of this Convention, the procedure

relating to the arrest of a ship or its release shall be governed by the

law of the State in which the arrest was effected or applied for.'>418

3. Some Specific Maritime Claims

The Arrest Convention 1999 includes some new maritime

claims not contemplated in the 1952 Convention, notably costs of

repatriation of masters, officers and seamen, and social insurance

contributions payable on their behalf (specifically, the employee's

share payable by source deductions from wagesj.i" Other new

maritime claims are claims for insurance premiums (including

mutual insurance calls) in respect of the ship, payable by or on behalf

of the shipowner or demise charterer'" and claims for commissions

brokerages or agency fees payable in respect of the ship by or on

behalf of the shipowner or demise charteren?"

It would have been useful to add to article 1(1)(0) insurance

premiums payable in respect of the master and seamen, although sucha claim should not have marit ime lien status. No such addition was

made, however, so there is no right of arrest for life insurance

premiums under the Arrest Convention 1999.

Article 1(1)(n) of the Draft Articles 1997 concerning "port, canal

and other waterways dues and charges," was amended, however, to

include express mention of "dock charges" in the final text of that

provision. Dock charges were expressly referred to in article 1(1)(1)

of the Arrest Convention 1952and in the Lisbon Draft 1985. Such an

express mention better protects the interests of terminal operators in

particular.

Another amendment to the 1997 Draft Articles was made in

adding the word "reconstruction," so that artic le 1(I)(m) reads:"construction, reconstruction, repair, converting or equipping of the

ship" in the final text. The addition is important, because

reconstruction differs from conversion and because theMaritime Liens

and Mortgages Convention 1993, at article 7(1)(b), recognizes the ship

repairer's right of retention of the vessel for repair, including

reconstruction.

5. Arrest for Maritime Liens and Statutory Rights InRem

Article 3(1)(a)(i)-(v) of the Draft Articles 1997 expresslyprovided for arrest for marit ime liens recognized under article 4 of

the Maritime Liens and Mortgages Convention 1993. The final text

of the new Arrest Convention does not include any equivalent

provision. Rather, the Arrest Convention 1999 permits arrest of any

ship in respect of which a marit ime claim is asserted if "(e) the claim

is against the owner, demise charterer, manager or operator of the

ship and is secured by a marit ime lien that is granted or arises underthe law of the State where the arrest is applied for,"?" This could

presumably include ~aritime lien claims contemplated by article 4 of

the Liens and Mortgages Convention 1993 (if the State where the

arrest is applied for is a party to that Convention), as well as any

other maritime liens granted by or arising under that country's

national law.?"


414. See id. art. 1(1)(0).

415. See id. art. I(I)(q).

416. See id. art.II)(r).

417. It is notewor thy that art ic le 28(3) of the United Nations Convention on the Law

of the Sea , adop ted in Montego Bay, Dec. 10, 1982 and in force Nov. 16 , 1994, expr es sly

permits arres t of a foreign ship by a coastal s tate in its ter ri torial sea or while passing through

the ter ri torial sea after leaving its internal waters, in accordance with its law, for purposes of

any civil proceeding.418. See Arrest Convention, 1999, infra App., art. 2(4).

419. See id. art. 3(1)(e)(emphasis added).

420 . "Nat iona l" mari time l iens, under a rt . 6 (b) and ( c) of the Liens and Mortgages

Conven tion 1993, ar e ex tingui shed s ix months af ter the claims which they secur e a ri se or

s ixty days after the "bona f ide" sale of the ship, whichever happens f ir st , and these mar it ime

l iens rank a fter, ra ther than be fore, ship mortgages . There a re no provi sions in the Arre st




The Draft Articles 1997 had a bracketed provision, article

3(1)(b), which would have permitted arrest for maritime lines, other

than those under article 4 of the Maritime Liens and Mortgages

Convention 1993, which are recognized under the law of the State

where the arrest was requested. By using "recognized," the bracketed

provision would have permitted the arrest of a ship for foreign

maritime liens recognized by a state according to its conflict of lawsrules, even where equivalent maritime liens did not exist under its own

national law.?' The replacement of "recognized" by "grants or arises"

in article 3(1)(e) of the Arrest Convention 1999 in effect means that

the arrest of a ship is permitted only for foreign marit ime lien claims

that correspond to maritime liens existing under the law of the

arresting State (the United Kingdom positionj'" and not (as in the

United States?' and Canada'") for marit ime liens existing under the

properly applicable foreign law even if the equivalent claim is not

secured by a maritime lien in the arresting State. If so, such a decision,

providing for arrest for only those foreign maritime liens that are the

same as maritime liens granted under the law of the forum, is

regrettable, because it fails to take account of the true nature of amaritime lien as a substantive right, it encourages forum shopping and

is an unfortunate rejection of basic principles of private international

law.425

Arrest for claims under ship mortgages, hypothecs, and charges

of the same nature is permitted by article 3(1)(c), as is arrest for claims

related to ownership or possession of the ship at article 3(1)(d).426

Article 3(1)(a)-(b) appears to cover arrest for claims secured by

statutory rights in rem as understood in the maritime law of England

and most other British Commonwealth countries, including Canada.

These provisions permit arrest of any ship in respect of which a

maritime claim is asserted if:

(a) [Tlhe person who owned the ship at the time when the maritime

claim arose is liable for the claim and is owner of the ship when the

arrest is effected; or

(b) the demise charterer of the ship at the time when the marit ime

claim arose is liable for the claim and is demise charterer or owner ofthe ship when the arrest is effected .... 427

It is noteworthy that the relevant time for the arising of the

statutory right is properly identified as the time of arrest of the ship

(as under Canadian law), rather than the time of issue of the writ in

rem (as in the United Kingdom at present). The provision would

also encourage countries such as Canada to amend its law so as to

permit demise charterers to bind the ship in rem.


The Arrest Convention 1999 permits sister ship arrest at article

3(2), which reads as follows:Arrest is also permissible of any other ship or ships which, when the

arrest is effected, is or are owned by the person who is liable for the

maritime claim and who was, when the claim arose:

(a) owner of the shipin respect ofwhich the marit ime claim arose; or

(b) demise charterer, time charterer orvoyage charterer of that ship.

This provision does not apply to claims in respect of ownership or

possession of a ship.428

Article 3(2) is useful, in authorizing the arrest of ships belonging

to all categories of charterers for marit ime claims on which they are

liable in respect of the "offending ship," as well as of sister ships

belonging to the owner of the "offending ship" who is personally

liable on such claims. The provision, like article 3(1) on arrest of the"offending ship" itself, also quite properly identifies the time of the

arrest, rather than the time ofthe issue of the writ inrem or the time of

the filing of the statement of claim, as the relevant moment for

determining when the right of arrest arises.

Article 3(2) may well prove to have a "fatal flaw," however, in

that it restricts sister-ship arrest to ships in the same legal ownership as

the "offending ship," rather than extending the right of arrest to all

sister ships legally or beneficially owned at the time of the arrest by

the owner of the "offending ship" who is personally liable on the

427. See id. art . 3(1)(a)-(b).

428. See id. art . 3(2).

Convention 1999, however , concerning the duration or extinction or ranking of mar it imeliens granted or arising under national law.

421. See the JlGE's report of its ninth session, JIGE(IX)4, TDIBIIGE.1I4,

LEGIMLMl41, at 'V 51.

422. See The Halcyon Is le , [ 1981] App . Cas. 221 , [1980] 2 Lloyd' s Rep . 325 , 1980

AMC 1221 (P.C).

423. See Ocean Ship Supply v. The Leah, 729 F.2d 971, 1984 AMC 2089 (4th Cir.

1984).

424. See The loannis Daskalelis [1974] S.C.R. 1248, [1974]1 Lloyd's Rep. 174,1973AMC 176 (Can.).

425. See TETLEY, INTERNATIONALONFLICT,supra note 74, at 533-87 (cr it ic izing the

United Kingdom posit ion on the nonrecognition of foreign mar it ime liens dif fering f rom

English ones, as set for th in The Halcyon Isle, [1981] App. Cas. 221, [1980]2 Lloyd's Rep.

325 , 1980 AMC 1221 (P.c.) and id. at 552-564, 564-70, supporting the recognition by United

States and Canadian courts respectively of foreign mar it ime liens under the proper law, even

ifdifferent from those recognized under the lexfori).

426. See Arrest Convention, 1999, infra App., art . 3(1)(c)-(d).




maritime claim concerned. "Beneficial ownership" of ships in

marit ime law normally refers to the ownership of a party who is not

the legal (in other words, registered) owner of the vessel, but who

stands behind that legal owner and has rights over the vessel

(including notably the right to dispose of it) . A "beneficial owner"

would normally include, for example, a parent corporation or a

holding company. Today, many fleets of ships operate within largeshipowning groups, owned and controlled by the same parent

corporation or holding company, but with each vessel in the fleet or

group legally owned by (in other words, registered in the name of) a

separate, one-ship company. None of these companies is the

registered owner of any ofthe other vessels inthe fleet, but all of them

have the same "beneficial" owner, being the parent corporation or

holding company. The fact that article 3(2) of the new Convention

permits sister-ship arrest only of ships in the same legal ownership,

and not of vessels in the same beneficial ownership, fails to take

account of the reality of shipowning in contemporary maritime

commerce.

7. Limitation on Security for Release

The Arrest Convention 1999 limits the amount of security to be

required for the release of a ship from arrest, to the value of the

arrested ship.?" A similar limitation has been inserted into article

5(1)(a) with respect to the right ofre-arrest and multiple arrest.

8. Countersecurity and Wrongful Arrest

Article 6(1) of the new Convention authorizes the arresting

court to impose on the claimant the obligation to give countersecurity

for losses that may be incurred by the defendant as a result of the

arrest and for which the claimant may be found liable. These losseswould include, but not be restric ted to, losses resulting from the

arrest having been ' 'wrongful '' or "unjustified" or from excessive

security having been demanded and provided.

Article 6(2) will also enable the arresting court to grant damages

for ' 'wrongful '' or "unjustified" arrest, or for "excessive security"

having been demanded and provided, the claimant's liability in this

regard to be determined according to the law of the State where the

arrest was effected.t"

429. See id. arts. 4(2), 4(5)(b).

430. See id. art. 6(3).


These provisions are an important recognition of the need to

sanction arrests inspired by bad faith, malice or gross negligence on

the part of the claimant (in other words, "wrongful" arrests, as

understood in the United Kingdom, United States, Canada and other

countries of common law tradition). The Convention goes further,

however, in also permitting damages to be assessed and

countersecurity to be imposed, in respect of "unjustified" arrest (inother words, arrest effected erroneously, without proper legal

foundation, but not motivated by bad faith or gross negligence). This

position is taken by many civilian jurisdictions . Common-law

jurisdictions, on the other hand, have tended to award costs (at most)

for bonafide arrest effected by simple mistake of law. The fmal text

appears to have enshrined the civilian rule.

In America, where damages are usually very generous in

comparison to other jurisdictions, the giving of discretion to a judge to

award damages for ''wrongful'' or "unjustified" arrest or for

demanding and obtaining excessive security may seem like the

opening of the "floodgates" to "liability in an indeterminate

amount."?" This fear has proven to be unsubstantiated in civiljurisdictions, however.

9. Application ofthe Convention

Article 8(1) makes the new Convention apply to "any seagoing

ship within the jurisdiction of any State party, whether or not that

ship is flying the flag of a State Party.'r'" Itwould seem advisable to

modify this provision, so as to reintroduce the rule of article 8(2) of

the 1952 Convention, whereby a ship flying the flag of a non-

Contracting State could be arrested in a Contracting State either for a

maritime claim under article I of that Convention or for any other

claim under the law of the State of arrest. No such addition wasmade in the final text however. Rather, it appears that the

Convention will govern the arrest of all ships in States party to the

new Convention, regardless of their flags. This rule makes the

"maritime claims" enumerated in article 1(1) the sole basis on which

States party to the Convention may arrest ships of any flag orregistry.

431. See Judge Cardozo's famous dictum in Ultramares Corp. v.Touche, Niven & Co.,

255 N.Y 170 , 174 (N.Yc.A. 1931) , with re spec t to the recove rabi li ty in tort o f damages f or"pure economic loss."

432. Arres t Convention, 1999, infra App., art. 8(1).



1972 [Vol. 73:1895ULANE LA W REVIEW

10. Convention Does Not Create Maritime Liens

Article 9 of the new Convention specifies that nothing in the

Convention shall be construed as creating a maritime lien. This

provision was originally included in article 8(3) of the Draft Articles

1997, where it did not really fit. It has been given greater

prominence in article 9. It is similar to article 9 of the 1952 ArrestConvention.

11. International Uniformity Is Essential

States must now decide whether or not to ratify or accede to the

Arrest Convention 1999 or to give effect to its provisions in their

national legislation. Because the new Convention marks a

significant advance over the 1952 text, it is to be hoped that

ratification, accession, and adherence will be forthcoming quickly

from many countries, particularly from the major shipping nations.

It is imperative that States respond positively to the challenge of

fostering greater uniformity in this vita lly important domain of

maritime law. Such an international outlook is especially necessarynow, because of the regrettable tendency of many countries, in recent

years, to "go it alone" in certain other sectors of maritime law,

notably the carriage of goods by sea. The benefits of legal

uniformity in the area of the arrest of ships, and the countervailing

disadvantages of legal disharmony in this field, are impossible to

exaggerate, from the standpoint of all partners in the maritime

community (shipowners, underwriters, claimants, judges, lawyers

and governments). But achieving the desirable goal of international

harmonization comes at a price to national law, while the desired

new international convention must not be encumbered with majordefects.?"

IX . THE CHALLENGES

In maritime law, as in all law generally, there can be no right

without some effective procedure to enforce it. Western countries,

ever conscious of the mobility of ships and the resulting risk on

433. The United States has unfor tunately never become a par ty to most international

co?ventions on private maritime law (for example, on ship collision, limitation of

shipowners' l iabili ty, and oil pollution). While itdid give effect, with some modif ications , to

the Hague Rules 1924 in its Carriage of Goods by Sea Act of 1936 (COGSA), 46 U.S.C. app.

§§ 1300-1315 (1997), the United States, unlike most other major shipping nations , has not

become a party to either the Visby Protocol of February 23, 1968, or the Visby S.D.R.

Protocol of December 21,1979, amending the Hague Rules ( the Hague/Visby Rules) or to

the Hamburg Rules 1978, on the car riage ofgoods by sea.


nonrecovery of marit ime claims by creditors, have been creative in

developing prejudgment security procedures suited to the demands of

justice and of international seagoing commerce. The general lex

maritima of medieval Europe gave birth to a form of enforcement

process for maritime claims, which slowly took on distinct features

in England and on the Continent. Continental countries maintainedtheir saisie conservatoire, or conservatory attachment, for use in

conjunction with the action in personam, their single form of action

for any claim. England, by comparison, under the pressure of

changing legal concepts and the conflict between the civilian

Admiralty Court and the common-law bench, was making an ever

sharper distinction, by the late seventeenth century, between the

action in rem and the action in personam and was restricting the

Admiralty judges almost exclusively to in rem enforcement. The

decli~e of in personam litigation led to the "withering" of the

~dmiraity attachment as well , which (supposedly) expired in the

eighteenth century, only to be replaced, rather imperfectly, in the

1970s by the Mareva injunction. Meanwhile, the United States,breaking its political ties with England before 1800, retained both the

att~chment and the action in rem in a uniquely rich maritime law,

while Commonwealth countries such as Canada inherited and

adapted English admiralty law and procedure. Procedures governing

arrest, attachment, saisie conservatoire, and Mareva injunctions are

now subject to detailed rules and regulations in every country, while

related procedures, such as the Anton Piller order, contribute to the

jud.icial "toolbox" available to courts in protecting the rights ofclaimants. \

There are at least two major challenges in the procedural law of

maritime claims enforcement today. At the national level the

increased regard for civil rights and their entrenchment in constitutionscan .~e expected to result sooner or later in the questioning of the

traditional legal process of ship arrest and attachment on grounds of

due p~ocess. T~e Unit~d ~tates has already responded creatively and

effectively to this questioning, At the international level, the adoption

of the Arrest Convention 1999 will challenge all countries to decide

whether the new Arrest Convention 1999 is a sufficient advance over

theArrest Convention 1952 tomerit their ratification or accession.

X. CONCLUSION

The new Arrest Convention 1999 contains changes that will be

of minor or major importance, depending on the present national law




of a nation contemplating the Convention's ratification. There are

improvements and some steps backwards, which this Article has

briefly outlined above, whilst it bridges the civilian concept of saisie

conservatoire (attachment) and the common-law concept of arrest in

rem, as did the 1952 Convention.

Among the advances that the 1999 Convention marks over the1952 Convention are the following:

(1) The definition of "arrest" includes the detention of a ship

under a Ma r eva injunction.'"

(2) special legislative rights of detention of ships by

govemments, docklharbour and other public authorities are recognized

under the international conventions, rather than merely under domestic

laws and regulations.?"

(3) the definition of "maritime claims" includes important new

claims permitt ing ship arrest, notably repatriat ion costs and social

insurance contributions for crewmembers.?" insurance premiums and

P. & I. club calls relating to the ship;"? commissions and

brokerage/agency fees payable in respect of the ship?" and shipreconstruction claims.?"

(4) statutory rights in rem are more clearly recognized as

authorizing ship arrest, in respect of maritime claims created by both

owners and demise charterers.'"

(5) security for the release of ships from arrest and re-arrest is

properly limited to the value of the ship.?"

(6) countersecurity may be ordered and damages may be

awarded for all improper arrest, whether it be ''wrongful'' (in other

words, grossly negligent or ill bad faith) or "unjustified" (in other

words, erroneous), as well as where "excessive security" for the

release of the vessel is demanded and provided. (The extension of

damages and countersecurity to "unjustified" arrests is probably anatural evolution of the law in respect of ''wrongful '' arrest, and fears

about potentially unl imited liabil ity flowing from this change seem

exaggerated, especially in the light of the experience of civilian

countries, where damages have long been recoverable for both

"unjustified" and ''wrongful' ' conservatory attachments); and


435. See id. art. 8(3).

436. See id. art. 1(1)(0).

437. See id. art. 1(1)(q).

438. See id. art. 1(1)(r).

439. See id. a rt . 1(J )(m).

440. See id. art. 3(J)(a)-(b).

441. See id. arts. 4(2), 4(5)(b), 5(1)(a).


(7) there are also interesting provisions on forum non

conveniens and on the recognition of foreign judgments at articles 7(2)

and 7(5) respectively.

On the other hand, the 1999 Arrest Convention contains some

disappointments and gaps, which may well cause many States,

including major shipping nations, to refuse ratif ication or accession.The following weaknesses in the new instrument are particularlyapparent:

(1) the list of "maritime claims" in article 1(1) is unfortunately

a "closed," rather than an "open-ended" list, thus, depriving the new

Convention of an important element of flexibility that an "open" l ist

would have afforded;

(2) special legislative rights of sale and of priority on the

?rocee~s. (as opposed to rights of mere detention) in respect of ships

immobi lized by orders of governments and public authori ties are not

mentioned in the Convention (although some measure of recognition

of these rights is afforded under the Liens and Mortgages Convention

1993);(3) the arrest of ships for foreign maritime liens differing from

those existing under the lex fori will not be permitted (article 3(1)(e)

permi ts arrest only for a mari time lien that is "granted or arises" under

the law of the State where the arrest is applied for, rather than for any

maritime lien "recognized" under that law); and

(4) the sister ship arrest provisions'? permit only the arrest of

vessels in the same legal ownership, and not of those in the same

beneficial ownership, as the "offending ship."

One therefore-wonders whether the new Convention has made

significant useful changes, changes that are sufficient to convince

those nations that are not party to the 1952 Convention to join in? And

are the changes sufficiently useful to convince the over seventy nationsthat are parties to the 1952 Convent ion to denounce that Convention

and to ratify or accede to the 1999 Convention?

442. See id. art. 3(2).

----------------



1976 TULANE LAWREVIEW [Vol. 73:1895 1999] MARITIME LA WPROCEDURES 1977

Article 1

Definitions

For the purposes of this Convention:

1. "Maritime Claim" means a claim arising out of one or more of

the following:(a) loss or damage caused by the operation of the ship;

(b) loss of life or personal injury occurring, whether on land or

on water in direct connection with the operation of the ship;

(c)' salvage operat ions or any salvage agreement, including, .if

applicable, special compensat ion relat ing to salvage operations m

respect of a ship which by itself or its cargo threatened damage to the

environment;(d) damage or threat of damage caused by the ship to the

environment, coastline or related interests; measures taken to prevent,minimize or remove such damage; compensation for such damage;

costs of reasonable measures of reinstatement of the environment

actually undertaken or to be undertaken; loss incurred or likely to be

incurred by third parties in connection with such damage; and damage,

costs , or loss of a similar nature to those identif ied in this subparagraph

(d);(e) costs or expenses relat ing to the raising, removal, recovery,

destruction or the rendering harmless of a ship which is sunk, wrecked,

stranded or abandoned, including anything that is or has been on board

such ship, and costs or expenses relating to the preservation of an

abandoned ship and maintenance of its crew;

(f) any agreement relating to the use or hire of the ship,

whether contained in a charter party or otherwise;

(g) any agreement relating to the carriage of goods or

passengers on board the ship, whether contained in a charter party or

otherwise;(h) loss of or damage to or in connection with goods (including

luggage) carried on board the ship;

(i) general average;

G ) towage;

(k) pi lotage;

(1) goods, materials , provisions, bunkers, equipment (including

containers) supplied or services rendered to the ship for its operation,

management, preservation or maintenance;

(m) construction, reconstruction, repair, converting or equipping

of the ship;

(n) port, canal, dock, harbour and other waterway dues and

charges;(0) wages and other sums due to the master, officers and other

members of the ship's complement in respect of their employment on

the ship, including costs of repatriation and social insurance

contributions payable on their behalf;

(P) disbursements incurred on behalf of the ship or its owners;

(q) insurance premiums (including mutual insurance calls) in

respect ofthe ship, payable by or on behalf of the shipowner or demise

charterer;

(r) any commissions, brokerages or agency fees payable in

respect of the ship by or on behalf of the shipowner or demise

charterer;

(s) any dispute as to ownership or possession of the ship;

(t) any dispute between co-owners of the ship as to the

employment or earnings of the ship;

(u) a mortgage or a 'hypotheque' or a charge of the same

nature on the ship;

(v) any dispute arising out of a contract for the sale ofthe ship.

2. "Arrest" means any detention or restriction on removal of a ship

by order of a Court to secure a maritime claim, but does not include

the seizure of a ship in execution or sat isfact ion of a judgment or other

enforceable instrument.~

3. "Person" means any individual or partnership or any public or

private body, whether corporate or not, including a State or any of its

constituent subdivisions.

4. "Claimant" means any person asserting a maritime claim.

5. "Court" means any competent judicial authority of a State.

APPENDIX

INTERNATIONAL CONVENTION ON THE ARREST OF SHIPS, 1999

Article 2

Powers of Arrest

1. A ship may be arrested or released from arrest only under the

author ity ofa Court of the State Party inwhich the arrest is effected.

2. A ship may only be arrested in respect of a maritime claim and

no other claim.




the arrest is applied for, a judgment in respect of that claim can be

enforced against that ship byjudicial or forced sale ofthat ship.

1999] MARITIME LAW PROCEDURES

3. A ship may be arrested for the purpose of obtaining s.ecm:ity

notwithstanding that, by virtue of a jurisdiction claus~ ?r arbl~atI~n

clause in any relevant contract or otherwise, the. m~tIme. claim mrespect of which the arrest is effected is to be ad}udicated I? a State

other than the State where the arrest is effected, or IS to be arbitrated, or

is to be adjudicated subject to the law of another State.

4. Subject to the provisions of this Convention, the procedure

relating to the arrest of a ship or its release shall be g?vemed by the

law of the State inwhich the arrestwas effected or apphed for.

Article 4

Release From Arrest

I. A ship that has been arrested shall be released when sufficientsecurity has been provided in a satisfactory form, save in cases in

which a ship has been arrested inrespect of any of the maritime claims

enumerated in article 1, paragraphs l(s) and (t). In such cases, the

Court may permit the person in possession of the ship to continue

trading the ship, upon such person providing sufficient security, or

may otherwise deal with the operation of the ship during the period of

the arrest.

2. In the absence of agreement between the parties as to the

sufficiency and form of the security, the Court shall determine its

nature and the amount thereof, not exceeding the value of the arrested

ship.3. Any request for the ship to be released upon security being

provided shall not be construed as an acknowledgement ofliability nor

as a waiver ofany defense or any right to limit liability.

4. Ifa ship has been arrested ina non-party State and isnot released

although security in respect of that ship has been provided in a State

Party in respect of the same claim, that security shall be ordered to be

released on application to the Court in the State Party.

5. If in a nonparty State the ship is released upon satisfactory

security in respect of that ship being provided, any security provided in

a State Party in respect of the same claim shall be ordered to be

released to the extent that the total amount of security provided in the

two States exceeds:

(a) the claim for which the shiphas been arrested, or

(b) the value of the ship,

whichever is the lower. Such release shall , however, not be ordered

unless the security provided in the nonparty State will actually be

available to the claimant andwill be freely transferable.

6. Where, pursuant to paragraph 1 of this article security has been

provided, the person providing such security may at any time apply to

the Court to have that security reduced, modified, or cancelled.

Article 3

Exercise of Right of Arrest

1. Arrest is permissible of any ship in respect of which a maritime

claim is asserted if:

(a) the person who owned the ~hip at .the time when t~e

maritime claim arose is liable for the claim and IS owner of the ship

when the arrest is effected; or(b) the demise charterer of the .ship at. the t~me when the

maritime claim arose is liable for the claim and IS denuse charterer or

owner ofthe shipwhen the arrest is effected; or(c) the claim is based upon a mortgage or a 'hypotheque' or a

charge of the same nature on the ship; or . .(d) the claim relates to the ownership or possession of the ship;

or(e) the claim is against the owner,d~se c~artere~,manager or

operator of the ship and is secured by a mantime h~n whi~h IS granted

or arises under the law of the State where the arrest IS apphed for.

2. Arrest is also permissible of any other ship or ships which, when

the arrest is effected, is or are owned by the person who is liable forthe maritime claim and who was, when the claim arose:

(a) owner of the ship in respect of which the maritime claim

arose; or(b) demise charterer, time charterer or voyage charterer of that

ship. . . .This provision does not apply to claims m respect of ownership

or possession of a ship.

3. Notwithstanding the provisions of paragraphs 1 and 2. of this

article, the arrest of a ship which is not owned by the person liable for

the claim shall be perrnissible only if, under the law of the State where

1979




Article 5

Right ofRe-arrest and Multiple Arrest

1. Where in any State a ship has already been arrested and released

or security in respect of that ship has already been provided to secure a

maritime claim, that ship shall not thereafter be rearrested or arrested

in respect of the same marit ime claim unless:

(a) the nature or amount of the security !n r~sp~ct of that ship

already provided in respect of the same claim IS inadequate, on

condition that the aggregate amount of security may not exceed the

value of the ship; or

(b) the person who has already provided the sec~ty i~ n~t, or

is unlikely to be, able to ful fil some or all of that person s obligations;

or

(c) the ship arrested or the security previously provided was

released either:

(i) upon the application or with the consent of the claimant

acting on reasonable grounds, or

(ii) because the claimant could not by taking reasonable steps

prevent the release.

2. Any other ship that would otherwise be subject to arrest in

respect ofthe same marit ime claim shall not be arrested unless:

(a) the nature or amount of the security already provided in

respect of the same claim is inadequate; or ..

(b) the provisions of paragraph 1 (b) or (c) of this article are

applicable.

3. "Release" for the purpose of this article shall not include any

unlawful release or escape from arrest .

Artic le 6

Protection of Owners and Demise Charterers of Arrested Ships

1. The Court may as a condition of the arrest of a ship, or of

permitting an arrest already effected to be maintained, impose upon

the claimant who seeks to arrest or who has procured the arrest of the

ship the obligat ion to provide security of a kind and for an amount, and

upon such terms, as may be determined by that Court for any loss

which may be incurred by the defendant as a result of the arrest, and

for which the claimant may be found liable, including but not

restricted to such loss or damage as may be incurred by that defendant

in consequence of:


(a) the arrest having been wrongful or unjusti fied; or

(b) excessive security having been demanded and provided.

2. The Courts of the State in which an arrest has been effected shall

have jurisdiction to determine the extent of the liabi lity, if any, of the

claimant for loss or damage caused by the arrest of a ship, including

but not restricted to such loss or damage as may be caused inconsequence of:

(a) the arrest having been wrongful or unjustified, or

(b) excessive security having been demanded and provided.

3. The liabili ty, ifany, of the claimant in accordance with paragraph

2 of this article shall be determined by application of the law of theState where the arrest was effected.

4. If a Court in another State or an arbitral tribunal is to determine

the merits of the case in accordance with the provisions of article 7,

then proceedings relating to the liabil ity of the claimant in accordance

with paragraph 2 of this artic le may be stayed pending that decision.

5. Where pursuant to paragraph 1 of this article security has beenprovided, the person providing such security may at any time apply to

the Court to have that security reduced, modified or cancelled.

Article 7

Jurisdiction on the Merits of the Case

1. The Courts of the State in which an arrest has been effected or

security provided to obtain the release of the ship shall have

jurisdiction to determine the case upon its merits, unless the parties

validly agree or have validly agreed to submit the dispute to a Court of

another State that accepts jurisdiction, or to arbitration.

2. Notwithstanding the provisions of paragraph 1 of this article, theCom;ts of the St~te in which an arrest has been effected, or security

provided to obtam the release of the ship, may refuse to exercise that

jurisdict ion where that refusal is permitted by the law of that State and

a Court of another State accepts jurisdiction.

3. In cases where a Court of the State where an arrest has been

effected or security provided to obtain the release of the ship:

(a) does not have jurisdiction to determine the case upon itsmerits; or

(b) has refused to exercise jurisdiction in accordance with the

provisions of paragraph 2 of this article, such Court may, and upon




request shall, order a period of time within whic~ the ~laimant shall

bring proceedings before a competent Court or arbitral tnbunal.

4. If proceedings are not brought within the period of time ordered

in accordance with paragraph 3 of this article then the ship arrested or

the security provided shall , upon request, be ordered to be released.

5. Ifproceedings are brought within the period of time ordered inaccordance with paragraph 3 of this art icle, or if proceedings before a

competent Court or arbitral tribunal in another State are brought in the

absence of such order, any final decision resulting therefrom shall be

recognized and given effect with respect to the arreste~. ship or to the

security provided in order to obtain its release, on condition that:

(a) the defendant has been given reasonable notice of such

proceedings and a reasonable opportunity to present the case for the

defense; and

(b) such recognition is not against public policy (ordre public).

6. Nothing contained in the provisions of paragraph 5 of this article

shall restrict any further effect given to a foreign judgment or arbitral

award under the law of the State where the arrest of the ship was

effected or security provided to obtain its release.

Article 8

Application

1. This Convention shall apply to any ship within the jurisdiction of

any State Party, whether or not that ship is flying the flag of a State

Party.

2. This Convention shall not apply to any warship, naval auxiliary

or other ships owned or operated by a State and used, for the time

being, only on government noncommercial service.

3. This Convention does not affect any rights or powers vested in

any Government or its departments, or in any public authority, or in

any dock or harbour authority, under any international convention or

under any domestic law or regulation, to detain or otherwise prevent

from sailing any ship within their jurisdiction.

4. This Convention shall not affect the power of any State or Court

to make orders affecting the totality of a debtor 's assets.

5. Nothing in this Convention shall affect the application of

international conventions providing for limitation of liability, or

domestic law giving effect thereto, in the State where an arrest is

effected.


6. Nothing in this Convention shall modify or affect the rules of law

in.fo~ce in ~e ~t~te~ Parties relating to the arrest of any ship physically

WIthin the jurisdiction of the State of its flag procured by a person

whose habitual residence or principal place of business is in that State

or by an~ other person who has acquired a claim from such person by

subrogation, assignment or otherwise.

Article 9

Non-Creation of Maritime Liens

Nothing in this Convention shall be construed as creating amaritime lien.

Article 10

Reservations

1. Any State may, at the time of signature, ratification, acceptance,

approval, or accession, or at any time thereafter, reserve the right toexclude the application of this Convention to any or all of thefollowing:

(a) ships which are not seagoing;

(b) ships not flying the flag of a State Party;

(c) claims under article 1, paragraph 1(s).

2. . A .State m~y, when it is also a State Party to a specified treaty on

navigauon on l~and waterways, declare when signing, ratifying,

acceptmg, approvmg or acceding to this Convention that rules on

jurisdiction, .recognition ~d execution of court decisio~s provided for

m such treaties shall prevai l over the rules contained in article 7 of thisConvention.

Article 11

Depositary

This Convention shall be deposited with the Secretary-General ofthe United Nations.

Article 12

Signature, Ratification, Acceptance, Approval and Accession

1. This Convention shall be open for signature by any State at the

Headquarters of The United Nations, New York, from 1 September



1984 TULANE LAW REVIEW [Vol. 73:1895 1999] MARITIME LAW PROCEDURES 1985

1999 to 31 August 2000 and shall thereafter remain open for

accession.

2. States may express their consent to be bound by this Convention

by:

(a) signature without reservation as to ratification, acceptance

or approval; or(b) signature subject to ratification, acceptance or approval,

followed by ratification, acceptance or approval; or

(c) accession.

3. Ratification, acceptance, approval or accession shall be effected

by the deposit of an instrument to that effect with the depositary.

Article 15

Revision and Amendment

1. A conference of States Parties for the purpose of revising or

amending this Convention shall be convened by the Secretary-General

of the United Nations at the request of one-third of the States Parties.

2. Any consent tobe bound by this Convention, expressed after the

date of entry into force of an amendment to this Convention, shall be

deemed to apply to the Convention, as amended.

Article 16

Article 13

States with More than One System of Law

1. If a State has two or more territorial units in which different

systems of law are applicable in relation to matters dealt with in this

Convention, it may at the time of signature, ratification, acceptance,approval or accession declare that this Convention shall extend to all

its territorial units or only to one or more of them and may modify this

declaration by submitting another declaration at any time.

2. Any such declaration shall be notified to the depositary and shall

state expressly the territorial units to which the Convention applies.

3. In relation to a State Party which has two or more systems oflaw

with regard to arrest of ships applicable in different territorial units,

references in this Convention to the Court of a State and the law of a

State shall be respectively construed as referring to the Court of the

relevant terri torial unit within that State and the law of the relevant

territorial unit of that State.

Denunciation

1. This Convention may be denounced by any State Party at any

time after the date on which this Convention enters into force for that

State.

2. Denunciation shall be effected by deposit of an instrument of

denunciation with the depositary.3. A denunciation shall take effect one year, or such longer period

as may be specified in the instrument of denunciation, after the receipt

of the instrument of denunciation by the depositary.

Article 14

Entry Into Force

1. This Convention shall enter into force six months following the

date on which ten States have expressed their consent to be bound by

it.

2. For a State that expresses its consent to be bound by this

Convention after the conditions for entry into force thereof have been

met, such consent shall take effect three months after the date of

expression of such consent.

Article 17

Languages

This Convention is established in a single original in the Arabic,

Chinese, English; French, Russian and Spanish languages, each text

being equally authentic.

DONE ATGeneva this twelfth day of March, one thousand nine

hundred and ninety-nine.

IN WITNESS WHEREOF the undersigned being duly

authorized by their respective Governments for that purpose have

signed this Convention.

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