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Handytankers Ks v The Owners And/or Demise Charterers Of The Ship Or Vessel M/v “Alas” Subsequently Renamed As “Kombos” And Those Other Vessels Named In Schedule “A” Annexed Hereto

Judgment Cited authorities 5 Cited in Precedent Map Related
Vincent
Judgment Date09 July 2015
Year2015
Judgement NumberHCMP2315/2014
Subject MatterMiscellaneous Proceedings
CourtHigh Court (Hong Kong)
HCMP2315/2014 HANDYTANKERS KS v. THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL M/V “ALAS” SUBSEQUENTLY RENAMED AS “KOMBOS” AND THOSE OTHER VESSELS NAMED IN SCHEDULE “A” ANNEXED HERETO

HCMP 2315/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 2315 OF 2014

(ON AN INTENDED APPEAL FROM

ADMIRALTY ACTION NO HCAJ 241 OF 2009)

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Admiralty action in Rem against the M/V “ALAS”, subsequently renamed as “Kombos” and the four ships or vessels named in Schedule “A” annexed hereto

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BETWEEN
HANDYTANKERS KS Plaintiff
and
THE OWNERS AND/OR DEMISE CHARTERERS
OF THE SHIP OR VESSEL M/V “ALAS”
SUBSEQUENTLY RENAMED AS “KOMBOS”
AND THOSE OTHER VESSELS NAMED IN
SCHEDULE “A” ANNEXED HERETO		 Defendant

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Before: Hon Cheung CJHC and Barma JA in Court
Date of Hearing: 22 October 2014
Date of Decision: 22 October 2014
Date of Handing Down Reasons for Decision: 9 July 2015

__________________________

REASONS FOR DECISION
__________________________

Hon Barma JA (giving the Reasons for Decision of the Court):

1. This was an application by the defendant shipowners seeking leave to appeal against the order of Ng J dated 21 July 2014, by which he dismissed their application to set aside the arrest of their vessel, the “DEWI UMAYI”, and the service of the in rem writ upon them. That application was made on the grounds that the court had no Admiralty jurisdiction in respect of the claim, and, alternatively, on the basis that the proceedings were an abuse of process.

2. At the end of the hearing, we dismissed the application with an order for costs in favour of the plaintiff, with reasons to be handed down later. These are our reasons for doing so.

3. The factual background can be briefly stated. The plaintiff chartered its vessel “BETH” to PT Arpeni Pratama Ocean Line Tbk (“APOL”) for a period of five years by a charterparty dated 9 January 2008. According to the plaintiff, APOL repeatedly failed to pay the charter hire on time or in full. In the result, the plaintiff commenced an arbitration against APOL pursuant to an arbitration clause in the charterparty, obtaining a substantial final award in its favour on 1 March 2013. That award has gone unpaid. Faced with that situation, the plaintiff (which had earlier issued an in rem writ in December 2012), applied for and executed a warrant of arrest in respect of the defendant’s vessel. In its supporting affidavit, the plaintiff made it clear that the arrest of the vessel was not for the purpose of enforcing the award in its favour, but in order to provide security for the judgment it expected to obtain in these proceedings.

4. In the court below, Mr Alder, appearing for the defendant, submitted that the proceedings and arrest of the vessel were an abuse of process as they were in the nature of an attempt to enforce the arbitration award, which is not something which falls within the recognised heads of Admiralty jurisidiction. Ng J rejected this argument, holding that it was clear from the writ that the plaintiff’s claim was brought on the basis of the original cause of action which led to the arbitration (i.e. the claim for unpaid hire) and not on the award itself.

5. Ng J went on to hold that although that original cause of action might ordinarily have merged in the arbitral award so as to bar a fresh action upon it, it did not do so here as a result of the “no bar rule” recognised in The Rena K [1979] QB 337, by which a cause of action in rem does not merge in a judgment in personam, so long...

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