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International Transportation Service Inc. v The Owners And/or Demise Charterers Of The Ship Or Vessel "Convenience Container

Judgment Cited authorities 19 Cited in Precedent Map Related
Vincent
Judgment Date05 June 2006
Citation[2006] 3 HKLRD 610
Judgement NumberHCAJ150/2003
Subject MatterAdmiralty Action
CourtHigh Court (Hong Kong)
HCAJ000150/2003 INTERNATIONAL TRANSPORTATION SERVICE INC. v. THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL "CONVENIENCE CONTAINER"

HCAJ150, 151, 153, 268
and 270-272/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO. 150 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“CONVENIENCE CONTAINER” (Singapore Flag)

BETWEEN

　 INTERNATIONAL TRANSPORTATION SERVICE INC. Plaintiff
　 and 　
　 THE OWNERS AND/OR Defendants
　 DEMISE CHARTERERS OF THE SHIP
OR VESSEL“convenience container” 		　
and
FLORENS CONTAINER INC. Intervener

---------------------------------------

AND

ADMIRALTY ACTION NO. 151 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“KINGDOM CONTAINER” (Singapore Flag)

BETWEEN

　 INTERNATIONAL TRANSPORTATION SERVICE INC. Plaintiff
　 and 　
　 THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL“KINGDOM container” Defendants
and
FLORENS CONTAINER INC. Intervener

---------------------------------------

AND

ADMIRALTY ACTION NO. 153 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“LIBERTY CONTAINER” (Singapore Flag)

BETWEEN

　 INTERNATIONAL TRANSPORTATION SERVICE INC. Plaintiff
　 and 　
　 THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “LIBERTY container” Defendants
and
FLORENS CONTAINER INC. Intervener

---------------------------------------

AND

ADMIRALTY ACTION NO. 268 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“CONVENIENCE CONTAINER” (Singapore Flag)

BETWEEN

　 RUDOLF A. OETKER KG Plaintiff
　 and 　
　 THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “CONVENIENCE container” Defendants

---------------------------------------

AND

ADMIRALTY ACTION NO. 270 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“KINGDOM CONTAINER” (Singapore Flag)

BETWEEN

　 RUDOLF A. OETKER KG Plaintiff
　 and 　
　 THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “KINGDOM container” Defendants

---------------------------------------

AND

ADMIRALTY ACTION NO. 271 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“LIBERTY CONTAINER” (Singapore Flag)

BETWEEN

　 RUDOLF A. OETKER KG Plaintiff
　 and 　
　 THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “LIBERTY container” Defendants

---------------------------------------

AND

ADMIRALTY ACTION NO. 272 OF 2003

----------------------------

Admiralty action in rem against the ship or vessel
“MANDARIN CONTAINER” (Singapore Flag)

BETWEEN

　 RUDOLF A. OETKER KG

Plaintiff
　 and 　
　 　THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “MANDARIN container” Defendants

---------------------------------------

(HEARD TOGETHER)

Before : Hon Waung J in Court

Dates of Hearing : 13 to 17 and 20 to 22 September 2004 and 18 November 2005

Date of Judgment : 5 June 2006

-----------------------

J U D G M E N T

-----------------------

1. There are 7 Motions before the Court. This judgment, on the 7 Motions is concerned with the inter-action between the jurisdiction of the Admiralty Court in Hong Kong (in particular assets under its control) and the Singapore voluntary winding up of companies owning the various ships.

2. There are four ships in question :

(1) Convenience Container (“Container C”);

(2) Kingdom Container (“Kingdom C”);

(3) Liberty Container (“Liberty C”); and

(4) Mandarin Container (“Mandarin C”).

All four of the above vessels were owned by Powick Marine (S) Ptd Ltd, a Singapore company (hereinafter referred to as “Powick”). As result of the collapse of Powick these four ships were arrested in Hong Kong and sold by the Admiralty Court. The four ships above will be called collectively as “the Vessels”.

3. This Judgment is concerned with 2 sets of plaintiffs :

(1) International Transportation Services Ltd (“ITS”), stevedores and

(2) Rudolf Oetker (“Oetker”), charterers of the Vessels.

4. There are 7 Admiralty Actions in rem, namely :

(1) HCAJ 150 of 2003 (“AJ150”), HCAJ 151 of 2003 (“AJ151”) and HCAJ 153 of 2003 (“AJ153”). In each of these 3 Actions, ITS was the plaintiff and the claim was made against respectively the three vessels, Convenience C (HCAJ 150), Kingdom C (AJ151) and Liberty C (AJ153);

(2) In each of the 4 Actions (HCAJ 268 of 2003 (“AJ268”):, HCAJ 270 of 2003 (“AJ270”), HCAJ 271 of 2003 (“AJ271”) and HCAJ 272 of 2003 (“AJ272”) Oetker was the plaintiff and the claim was made against respectively the Vessels, Convenience C (AJ268), Kingdom C (AJ270), Liberty C (AJ271) and Mandarin C (AJ272).

5. The dates of the issue of the Writ in each AJ Action are as follows :

(1) AJ150 — 16 May 2003;

(2) AJ151 — 16 May 2003;

(3) AJ153 — 16 May 2003;

(4) AJ268 — 18 September 2003;

(5) AJ270 — 18 September 2003;

(6) AJ271 — 18 September 2003; and

(7) AJ272 — 18 September 2003.

For ease of convenience I will hereinafter refer to AJ150, AJ151 and AJ153 actions issued by IFS collectively as the “IFS Actions” and AJ268, AJ270, AJ271 and AJ272 actions issued by Oetker collectively as the “Oetker Actions”.

6. The dates of the arrest of each vessel are as follows :

(1) Convenience C — 16 May 2003;

(2) Kingdom C — 24 May 2003;

(3) Freedom C — 27 May 2003; and

(4) Mandarin C — 2 June 2003

The Vessels were not arrested by either of the plaintiffs ITS or Oetker. Other claimants had effected the arrests of these Vessels.

7. The date of the Voluntary Winding Up in Singapore of the Defendant Company was 14 May 2003, being the date of lodgment with the Court Registrar of the declaration made on the 13 May 2003 by the directors of Powick that Powick was unable to continue its business and Powick on that day appointed a provisional liquidator.

8. These Vessels were all sold (individually and not as a block) by the Admiralty Court of Hong Kong on 7 July 2003. The Orders for Sale pendente lite were made in respect of each ship on 13 June 2003.

9. By Motions dated 2 January 2004, Powick (in Liquidation) sought the setting aside of the Writs in each of the 3 ITS Actions. By Motions dated 5 January 2004, Powick (in Liquidation) sought the setting aside of the Writs in each of the 4 Oetker Actions.

10. The objection to the admiralty in rem jurisdiction of the 7 Actions was based on the contention that the requirement of section 12B(4)(i) of the High Court Ordinance was not satisfied.

11. Section 12B of the High Court Ordinance provides :

“(4) In the case of any such claim as is mentioned in section 12A(2)(e) to (q), where-

(a) the claim arises in connection with a ship; and

(b) the person who would be liable on the claim in an action in personam (‘the relevant person’) was, when the cause of action, the owner or charterer of, or in possession or in control of, the ship, an action in rem may (whether or not the claim gives rise to a maritime lien on that ship) be brought in the Court of First Instance against–

(i) that ship, if at the time when the action is brought the relevant person is either the beneficial owner of that ship as respects all the shares in it or the charterer of it under a charter by demise; or

(ii) any other ship of which, at the time when the action is brought, the relevant person is the beneficial owner as respects all the shares in it.”

12. A claim in rem can be brought under section 12B of the Ordinance against each of the 4 Vessels provided that Powick (being the person who would be liable on the claim in personam [not disputed] and who was the owner of the Vessel when the cause of action arose [not disputed]) was, at the time when the action was brought, the beneficial owner of all the shares in the relevant Vessel. The words beneficial owner is underlined because the construction of those two words beneficial owner lies at the heart of the dispute between the parties.

13. Mr Sussex for Powick (in Liquidation) has raised three objections to the jurisdiction in rem of the claims. The Issues for determination under the Motions are :

(I) The winding up in Singapore does it have the effect of divesting Powick of the beneficial ownership of the Vessels, so that Powick was no longer the beneficial owner of the Vessels at the time when the Writs were issued against the Vessels. I will call this the “Liquidation Point”.

(II) Upon the sale of the Vessels by the Court, the beneficial ownership of the Vessels passed to the purchasers from the Court sale, so that Powick was no longer the beneficial owner of the Vessels at the time when the Writs were issued against the Vessels. I will call this the “Court Sale Point”.

(III) The Writs in the 4 Oetker Actions were amended so that instead of each Writ in these Oeter Actions being identical and against all four Ships (therefore creating a situation of 4 writs each making identical claim against all four Vessels), the amended Writs limited each Action to a claim against one Vessel and a different Vessel. The amendment took place after the Writs were served and after the Vessels were sold by the Court. The argument is that such service of 4 identical Writs was not permissible and that subsequent amendment could not cure it. I will call this “the Service Point”.

14. It should be noted that whereas the Liquidation Point has been argued in respect of all 7 Actions against both ITS and Oetker, the Court Sale Point has been made only against Oetker (because the...

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