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Admirality Act, 2017 and Arrest of Vessel

It might sound strange to an Idle person at first that a ship can be arrested because all we have heard is that a person is arrested for some unlawful act. Although anomolous to normal individual a ship can be indeed arrested and be detained at a port by the order of the court.

Arrest defined
"Arrest" as defined under Section 2 (c) the Admirality Act, 2017 means "detention or restriction for removal of a vessel by order of a High Court to secure a maritime claim including seizure of a vessel in execution or satisfaction of a judgment or order"

The arrest of ships is a topic that overlaps with public international law and its principles, hence there are numerous conventions that deal with the laws of arrest of ship. Some of the Major Conventions that deal with arrest of ship are:
  1. Arrest Convention, 1952
  2. Arrest Convention, 1999

Recognition of the Convention
However it is to be noted that India has not ratified any of the above convention and has not enacted the same. However, Supreme Court in the M.V Elizabeth vs Harwan Investment & Trading Pvt Ltd [1992] INSC 62 held that since India is a common law country, the International Convention of the arrest of Seagoing Ships, Brussels,1952 would be applicable to Indian admirality and its jurisdction.

Another landmark judgement was in the M.V. "Sea Success I" v. Liverpool And London Steamship Protection And Indemnity Association Ltd. And Anr 2002 BOMCR 2 537. Where the supreme court laid down the principle that Geneva Arrest Convention 1999 will should be applicable to Indian Admirality Jurisdiction.

Earlier only Bombay and Kolkata High Court had the jurisdiction over arrest of vessel, but over time the same jurisdiction was then extended to other coastal states such as Gujarat, Andhra Pradesh, Orrissa, Kerala, Madras, Karnataka etc as provided in Section 2(e) of the Admirality Act, 2017.

Maritime Claim
A ship can be arrested by the court in order to provide security against the maritime claims as laid in the Section 4 of the Admirality Act, 2017:
  1. Disputes regarding vessel possession or ownership.
  2. Disputes between co-owners about vessel employment or earnings.
  3. Mortgages or similar charges on a vessel.
  4. Loss or damage caused by vessel operation.
  5. Loss of life or personal injury connected to vessel operation.
  6. Loss or damage to goods in connection with a vessel.
  7. Agreements related to carriage of goods or passengers on a vessel.
  8. Agreements for vessel use or hire.
  9. Salvage services, including special compensation for environmental threats.
  10. Towage services.
  11. Pilotage services.
  12. Supplies or services for vessel operation, management, or maintenance.
  13. Construction, reconstruction, repair, or equipping of a vessel.
  14. Port, harbour, canal, dock, or toll dues.
  15. Claims by crew members for wages or related payments.
  16. Disbursements on behalf of the vessel or owners.
  17. Particular or general average.
  18. Disputes from vessel sale contracts.
  19. Insurance premiums for the vessel.
  20. Commission, brokerage, or agency fees for the vessel.
  21. Environmental damage or threats caused by the vessel.
  22. Costs for raising, removal, or destruction of a sunken or abandoned vessel.
  23. Maritime liens.
In Praxis Energy Agents Sa v. M.T. Pratibha Neera 2018 SCC ONLINE BOM 957 very Interesting question before the Bombay Highcourt was the put forth "Whether a sister vessel of a vessel against whom a liability exists can be arrested or not?", the Court referred to the article 3 (1) and 3(2) of the Arrest convention of 1952 where in it ruled that Maritime Claim could be ascertained only against the offending ship, but any other ship could be arrested only for the purpose of securing the Claimants claim.

Arrest of Vessel in Rem:
The order of arrest of a ship can be given by respective high court exercising its territorial jurisdiction a vessel or a person as well. Prior to hearing any claims mmentioned above the court has to make sure that it has settled any outstanding accounts between the parties, and then it may direct the vessel, or any share thereof to be sold and determine the title of te proceeds of the sale. Any vessel ordered to be arrested is to be held as a security against any claim under the admirality proceeding.

A High Court can order for arrest of any vessel within its jurisdiction for the purpose of providing security against maritime if it believes that:
  • The owner of the vessel or the demise charterer is liable for the maritime claim.
  • The Demise charterer is liable for the maritime claim.
  • The claim is based on a mortgage or a charge on the vessel.
  • Claim relates to the ownership or possession of the vessel.
  • The claim is against the owner, demise charterer, manager of the vessel and is secured by a maritime lien.

Arrest of Vessel in Personam:

High Court can exercise its admiralty jurisdiction against a person when any of the claims under Section 4 of the act are claimed. However, such power is subject to exceptions where any maritime claim arises out of:
  • Collision of vessels
  • The carrying out of or omission to carry out, a manoeuvre
  • Non-compliance, on the part of one or more vessels, with regulations under section 285 of the Merchant Shipping Act, 1958
The Highcourt can in the above specified conditions can order sale of a vessel provided that such vessel shall be free from all encumbrances, liens, attachments or mortgages.

Conclusion
The Admirality act, 2017 which is not enacted but could be enacted soon provides a structure and implements the International Convention on arrest of ship and its rules. It provides grounds and the jurisdiction and the power of the court to not only arrest the vessel but to sell her and pay of the owners liabilities.

Sources:
  • https://www.aironline.in/legalarticles/A+Note+on+M.+V.+Elisabeth+v.+Harwan+Investment++and+Trading+Company+Limited%2C+Air+1993+SC+1014
  • https://cmlcmidatabase.org/mv-elisabeth-v-harwan-investment-trading-pvt-ltd
  • M.V. "Sea Success I" v. Liverpool And London Steamship Protection And Indemnity Association Ltd. And Anr. 2002 BOMCR 2 537
  • Praxis Energy Agents Sa v. M.T. Pratibha Neera 2018 SCC ONLINE BOM 957
  • https://www.indiacode.nic.in/handle/123456789/2256

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