Owners of the Ship 'Shin Kobe Maru' v Empire Shipping Company Inc

[1994] HCATrans 219

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S76 of 1993

B e t w e e n -

THE OWNERS OF THE SHIP "SHIN

KOBE MARU"

Appellants

and

EMPIRE SHIPPING COMPANY INC

Respondent

MASON CJ
BRENNAN J
DEANE J

DAWSON J

TOOHEY J

GAUDRON J

MCHUGH J

Ship(2) 86 2/3/94

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 2 MARCH 1994, AT 10.27 AM

(Continued from 1/..3/94)

Copyright in the High Court of Australia

MASON CJ:	Mr Jackson.
MR JACKSON:	Your Honours, just before my learned friends

commence, may I mention two things which have

appeared from the transcript of argument in

relation to which I would seek to make some

corrections. The first, Your Honours, is something

that appears at page 9 in my learned friend

Mr Callaway's argument, and Your Honours will see

at about point 2 on the page he said:

Here, of course, no unconditional

appearance has ever been entered. So that if

my client never did enter an unconditional

appearance the matter would proceed solely in

rem.

The position, Your Honours, is that a conditional

appearance has been entered, and the effect of

Order 9 rule 6(2) of the Federal Court Rules is that it has effect as an unconditional appearance

unless the Court otherwise orders or unless the
present application to strike out the proceedings

for want of jurisdiction succeeds. That is the

first matter, Your Honours.

The second matter is this, that at page 77 in the second paragraph I made a reference to:

the New South Wales Limitation Act of 1969,

section 14 -

that is not the right provision. The relevant

provision of that Act was section 22(1). That has

the effect of excluding actions of this kind from

limitation periods provided for by that Act. The

consequence of that is that the three-year period

provided for by section 37(l)(b) of the

Admiralty Act would apply and, Your Honours, the	question which would then arise is whether there
was a different maritime claim, and what we would
simply say in relation to that is that there is the
same claim, the same cause of action, a different
basis of jurisdiction being asserted.

MASON CJ: Thank you, Mr Jackson,

Mr Solicitor, before you commence I should

indicate that the Court is in a position to deal

with the application made by Mr Jackson to present

argument in support of the notice of contention, and it would be appropriate if I dealt with that

matter now.

Ship(2) 87 2/3/94

The respondent seeks leave to present argument

in support of a notice of contention given at or

about the time when the hearing of this appeal

commenced, well outside the time prescribed by O.70

r.6(5) of the High Court Rules, namely, within 14

days of service of the notice of appeal. The

appellant opposes the grant of leave on a number of

grounds, two of which should be mentioned. One

ground is that the appellant wishes to meet the new

contention with an argument based on an

interpretation of s.76(iii) of the Constitution and
that the existing notice under s.78B of the

Judiciary Act 1903 (Cth) naturally does not mention

this constitutional question or at least this

aspect of it. The second ground is that, as the

new contention does not fall within the
respondent's case as pleaded in its amended
statement of claim, the respondent requires further
leave to amend and that the grant of further leave
to amend is or may be barred by the expiration of

the relevant limitation period.

The notice of contention states that the

respondent will seek to contend that the decision

in the courts below can be supported on the

following additional ground:

"That the Court has jurisdiction pursuant to

Sect.4(3)(f) and Sect.17 of the Admiralty Act

1988 [ (Cth) ( 'the Act')]."

The respondent invoked the admiralty

jurisdiction of the Federal Court by commencing the
proceeding as an action in rem against the
appellant, the owners of the ship Shin Kobe Maru.

By its amended statement of claim, the respondent pleaded a claim for relief arising out of a joint

venture agreement between the parties relating to the ship. The essence of the claim so pleaded is

that the appellant has failed to re-transfer the

ownership of the ship to Seven Seas Transport

Incorporated ("SST") or to another joint venture

company equally owned by Van Shipping Co. Ltd. for

and on behalf of the respondent and the appellant
and that the appellant's failure to re-transfer the

ship was in breach of an implied term of the joint

venture agreement. By par.14 of its amended

statement of claim the respondent alleged that:

"the claim made herein is a proprietary
maritime claim by reason of Section 4(2)(a)

and/or (b) of [the Act] in respect of which

jurisdiction is conferred on this ... Court by

reason of Section 10 and Section 16 of the

said Act".

Ship(2) 88 2/3/94

In its particulars of this paragraph, the

respondent stated. that the proceedings are a claim

relating to possession of the ship and/or title or

ownership of a ship or of a share in the ship.

Alternatively, the respondent stated that the

proceedings are between co-owners of a ship

relating to the possession, ownership, operation

and earnings of the ship.

The appellant sought orders that the

originating process be set aside or, in the

alternative, that service on the appellant be set

aside on the ground that the claim pleaded was not

a proprietary maritime claim and that the action

was not correctly instituted as an action in rem.

Gummow J. dismissed the motion with costs, holding

that the respondent's claim fell within s.4(2)(a)

and (b) of the Act. On appeal, the Full Court of

the Federal Court upheld the decision of Gummow J.

In this Court, the appellant challenges, inter

alia, the correctness of the conclusion reached by

the courts below that the respondent's claim falls

within s.4(2)(a) and (b). The appellant's argument

on this aspect of the case is based partly on an

interpretation of the statutory provisions

independently of the Constitution and partly on a

suggested reading down, pursuant to s.13, of

s.4(2), so that it does not confer jurisdiction in

a matter that is not of a kind mentioned in

s.76(iii) of the Constitution.

In connection with the last-mentioned aspect of the argument, the appellant has given a notice

under s.78B of the Judiciary Act. Paragraphs 6 and

7 of that notice are in these terms:

"6.	The Respondent contends that its claim is a proprietary maritime claim within the
meaning of Section 4(2)(a) and (b) of
[the Act] in respect of which
jurisdiction is conferred on the Federal
Court by Sections S, 10 and 16. The
Appellant contends that the Respondent's claim is not a proprietary maritime claim within the meaning of either of those provisions and that the Federal Court
does not have jurisdiction to entertain
it.
7.	The Appellant further contends that, if
upon its proper construction (apart from
Section 13) the Act does confer
jurisdiction to entertain the
Respondent's claim, Sections 4(2)(a) and
(b), 5, 10 and 16 would be invalid but

Ship(2) 89 2/3/94

for Secticn 13 and are invalid if they

cannot be read down."

Paragraph 8 goes on to state (a) that the

controversy between the parties is not a matter of
admiralty and maritime jurisdiction within
s.76(iii) of the Constitution and (b) that, if the

Act did confer jurisdiction to entertain the

appellant's claim, ss.4(2)(a) and (b), 5, 10 and 16

of the Act would operate in a way that is not

authorized by s.76(iii).

It follows that the s.78B notice is inadequate

to give notice of the respondent's new contention

and the precise constitutional question which will

be raised by the appellant in response to that

contention. The consequence is that, if the

respondent is permitted to present an argument in

support of the notice of contention, the hearing

must be adjourned. We do not consider that this is

a desirable course and that it should be avoided.

Of greater significance for present purposes

is the fact that the new contention falls outside
the case as pleaded in the amended statement of
claim. That case was confined to the claim that

the action was an action in rem because the claim

was a proprietary maritime claim under s.4(2).	The
pleading contains no hint of an alternative case

based on a general maritime claim under s.4(3)(f).

Leave to further amend the amended statement of

consideration of the limitation question. In our view, in the circumstances of this case, the question of further amendment is a matter for the	claim would be required and that could entail a if the outcome of the present appeal is adverse to the respondent, it can then make an application to
the primary judge, if it so chooses.

In conclusion, it remains for us to say that,

but for the inadequacies of the s.78B notice and

the pleading, we would have been disposed to think

that the respondent would have been entitled to

present an argument in support of the notice of

contention. As a general rule a respondent to an

appeal is entitled to support a judgment by an

argument not presented below so long as the

argument does not depend upon an issue of fact not

litigated in the courts below and so long as the

argument is open to the respondent on the pleadings

and having regard to the way in which the case was
conducted below. Whether O.70 r.6(5) applies to

such a situation may be doubted but, having regard

to what we have just said, if the rule does apply to such a situation, leave to present an argument

Ship(2) 90 2/3/94

in support of a notice of contention filed and

served out of time would ordinarily be granted.

Here, however, there are substantial reasons

for the Court's refusing to hear argument in

support of the notice of contention and leaving the

respondent to make application to the Federal Court

to further amend its pleading should the occasion

arise.

Yes, Mr Solicitor for the Commonwealth?

MR GRIFFITH:  I hand the Court our contentions.

MASON CJ: Yes, Mr Griffith?

MR GRIFFITH: If the Court pleases, this is the fourth

intervention by the Attorney in the shifting tides

of this case. We have had three silks,

Your Honour, on four occasions - each time have

somewhat changed the applicant's case in respect of

which the Attorney sought to intervene, and

Your Honours have now dealt with my learned friend,

Mr Jackson's application to amend the respondent's

case. But throughout the Attorney have sought to

confine his intervention to issues of power if they

arise, and it is our submission, Your Honour, that

for the reasons which really were implicit in the terms of Your Honour's ruling just read, no issue of the Act being beyond power here arises.

There is an issue of construction, the reach

of the relevant sections of the Admiralty Act, and matters of constitutional reach of section 76(iii)

we would agree are germane to defining the ultimate

ambit of section 76(iii) although, in our

submission, in this case there is no occasion for

the Court to seek exhaustively to define what would

be the constitutional reach of section 76(iii). At

the issue of the level of satisfaction to establish	no time and we do not seek now to get involved with	jurisdiction.
It is our understanding from the submissions for the applicant as formulated before this Court
that the matters covered firstly by the judgments
of Justice Gummow and the Full Court and, secondly,
by our contentions as far as paragraph 7, do not
seem to be substantially put in issue by the
applicant, save that we would observe that although
there seems not to be specific reliance upon an
argument based on jurisdiction as frozen by
reference to English practice at 1900 or at 1890,
we would submit that in essence the submissions
made by my learned friend, Mr Callaway, seek,
particularly by reference to paragraphs 5 and 12 of
his contentions, to, in effect, support a back-door

Ship(2) 91 2/3/94

submission to th~ same result: namely that there is

a overweening limited meaning of "general maritime

claim" which infects the definition of section 4(2)

of the Admiralty Act.

Referring to section 13 of the Admiralty Act,

our submission is that that section does not in any

way govern the primary meaning to be given to the

provisions of section 4 and other provisions of the

Act. It merely cuts down primary meaning when what

otherwise would be the construed reach of those

provisions would exceed power. So at the

construction stage - and we submit that is the
first stage of inquiry by this Court - the issue is

to give the words of the jurisdiction granted by

section 4 their ordinary wide meaning. The second

stage application of section 13 is reached only

where that wide meaning would result in a

construction which would exceed legislative power,

in that case meaning is pro tanto read down. This

intended operation is amply shown by the

explanatory memorandum which is in page 10 of our

materials.

So that it may well be that the full reach of

section 76(iii) will ultimately be termed by

reference to the view of the ambit of

constitutional power, but our submission is that

this claim falls comfortably within it.

Your Honour Justice Dawson yesterday in the

transcript page 73/74 inquired whether the Act may

validly extend to an unrecognized class of claim

and our answer to that inquiry is to say, yes, it

could. So, for example, just as there may be a

claim in respect of construction or alteration of a

ship which may proceed we would suppose either

under section 4(3)(o), or alternatively could

proceed depending on what were the circumstances,

the claim is a claim under section 4(2), it would

be possible to provide by statutory provision, for

example, that there could be a maritime claim which

could be commenced in an action in rem arising

from, say, a claim for breaking up of a ship on the

ship-breaker's contract.

That is not something that is specifically

provided for by the terms of the Act as now

drafted. But, in our submission, there is no

inhibition by reference of the power of the

Commonwealth under section 76(iii) so to provide a

procedure involving an action in rem in an action

of a contract, for example, for a breaking contract

rather than a construction contract.

We do agree with my learned friend,

Mr Callaway's submission to the Court that it is

not necessary here to determine whether the

Ship(2) 92 2/3/94

constitutional power under section 76(iii) enables

Parliament to alter the substantive law. Obviously
there would be other routes of sources of power to
the Commonwealth other than section 76(iii) were it
desired to exhaustively rely on aspects and heads

of Commonwealth power to deal with issues which

could involve admiralty jurisdiction. The trade

and commerce power is an obvious power. There are

others, but perhaps it is sufficient to refer
merely to the external affairs power because that
would in many cases enable a specific exercise of

jurisdiction by reference to matters of substantive

as well as procedural law.

By reference to the differences between

substantive and procedural in respect of admiralty

jurisdiction, this of course always has been an

area somewhat blurred. May we refer the Court to

the Law Reform Commission report at paras 116 on

page 85. I have had an attempt to discuss with

Professor Crawford, who is the author of this

report, whether he would object to a submission

that this report should be submitted to the Court as being of pre-posthumous authority, but whether
that be the case or not having regard to the

authority of Professor Crawford, it is the case, in

our submission, that the Court is particularly

helped by the historical compilation and discussion

of the issues by this report which was under

Professor Crawford when he was a commissioner of the Commission. At page 85 in paragraph 116 the point is made:

the distinction between substantive admiralty

law and admiralty jurisdiction is very

difficult to make with any clarity. In effect

the whole history of admiralty has been one of altering substantive rights by decreasing, or, since the early 19th century, increasing, the

jurisdiction of admiralty courts.

There is a further note in paragraph 126 at page 96

where Crawford says:

It has always been a characteristic of

admiralty jurisdiction that it affected or was

capable of affecting third parties.

Thus, the extent to which Parliament's power under

section 76(iii), and putting on one side other

powers, particularly by reference to section 51,

but merely under section 76(iii) to confer

jurisdiction may affect substantive law is, we

submit, a matter for another day. Suffice here to

say, and this is clear both from the Act, the

explanatory memorandum, the second reading speech

and also from the report, and if I could indicate

Ship(2) 93 2/3/94

to the Court that the draft bill and indeed the

draft explanatory memorandum which are attach8d to

this report, are in the terms of the Act as it came

to be enacted.

None of this material has purported to create

any new causes of action, as distinct, we submit,

from creating in some cases new procedures by which

existing causes of action may be enforced. It is

concerned with procedure in jurisdiction, except

arguably for the issue of wrongful arrest dealt

with by section 64, and not with substantive

rights. This is confirmed when one goes to the

paragraph 16 to i7·, 80 to 81 and 126 of the

Law Reform Commission report.

Your Honour Justice Deane yesterday raised the

issue of the difference between maritime liens and

proprietary maritime claims. It is our

understanding that proprietary maritime claims may

be regarded as statutory in their origins. If I

may refer the Court to the useful discussion in the

Law Reform Commission report, particularly

paragraphs 9 to 17 and chapters 8 and 9.

Our general submission on this issue is that

as proprietary maritime claims are statutory, they

are, of course, capable of statutory extension.
May I refer the Court to the remarks of

Their Honours the Chief Justice,

Justices McTiernan, Fullagar and Kitto in the

Boilermakers' case, 94 CLR 278, where Their Honours

said:

The judicial power, like all other constitutional powers, extends to every

authority or capacity which is necessary or

proper to render it effective. The judicial

power of which s 71 speaks is not to be

defined or limited in any narrow or pedantic

manner. With respect to the matters comprised

within ss 76, 77, 78 and 79, it rests with the

Parliament to make laws affecting its content

or exercise.

The question was raised also in discussion

yesterday as to whether there is an overlap between section 4(2)(a) and (b). Clearly there is overlap,

and if I may refer the Court to the Law Reform

Commission report, paragraphs 149 and 150 at

pages 112 and 113, one sees that that is very much

in the minds of the commission in making its report

on these issues.

At pages 18 to 19 of the transcript, my

learned friend, Mr Callaway, submitted to the Court

that any issue arising from contract must be

Ship(2) 94 2/3/94

excluded from the ambit of proprietary maritime

claim. It is our submission on the other hand that

it is often the essence of a claim in respect of
ownership or possession of a ship that that
ownership or possession may be made out by
reference to issues of contract. My learned friend
submitted at page 38 of the transcript that Antares
decision, the Canadian decision, is correct and

that a claim on the contract for the sale of a ship

is a maritime claim.

If my learned friend, Mr Callaway, does not

rely on the American distinctions, and he has

chosen not to whereby under American authority it

is regarded at the moment with eroding authority or force in America that a claim for a construction of

a ship or a claim on a contract for the sale of a

ship is not regarded as an admiralty or maritime

claim within the reach of the American

constitutional power. If that distinction is not

relied upon by my learned friend, and he disclaimed

that he did intend to rely on that, it is our

submission that the claim in this case is one which

would fall within the approach such as is

illustrated by the decision of the Supreme Court in

Antares. The distinction sought to be made by my

learned friend by reference to the claim being not
an order for possession of the ship into the

plaintiff, but by way of transfer to a third party

is not a relevant distinction at all from the point

of view of determining whether or not the claim

falls within the reach of section 4(2).

In the Law Reform Commission report at

page 14, paragraph 17, it is noted that:

there is no single theory which is capable of

explaining all the features of the action in

rem. In this admiralty resembles the common

law which is in many areas equally

atheoretical.

The 19th century English decisions of course do

seem to suggest that the statutory right of action

in rem is a procedural right while the maritime

lien is a substantive right. It is the case, as

the report indicates in paragraph 126 at page 95,

that:

Compared with maritime liens, statutory rights

of action in rem have always been regarded as

"procedural" rather than substantive rights.

If I may then take the Court quickly past our contentions to paragraph 7, for the reason that, as

I have indicated to the Court, we do not regard the

basic submissions which are vindicated both by the

Ship(2) 95 2/3/94

judgments down below and also by the references

which we ,give in our summary as being essentially

challenged by my learned friend, Mr Callaway,

appearing for the applicant.

In John Sharp & Sons Ltd v The "Katherine Mackall", Justice Isaacs referred to the ambulatory

nature of the admiralty jurisdiction viewed by
reference to the time of the enactment of the

Constitution, or indeed in 1924 when His Honour

gave judgment. His Honour said at page 428 in

34 CLR:

It is not, therefore, to be supposed the

constitutional power to confer jurisdiction on

this Court in matters of admiralty and

maritime law is a power in respect of merely a

stereotyped common law admiralty jurisdiction,

which at the date of the Constitution had

already been extended for more than forty

years in England.

Of course, as Chief Justice Barwick observed, it

was somewhat unsatisfactory that until the passing

of the 1988 Act, to some extent the admiralty law

in Australia was frozen by reference to the

Colonial Courts of Admiralty Act 1890 restrictions, notwithstanding the fact that the United Kingdom

statutory law had made substantial advances,

admiralty under the 1890 Act in 1911.

including advances before the New South Wales and

Your Honours will recall that in argument in

The "Katherine Mackall" at page 424 in 34 CLR,

Sir Owen Dixon said:

The use of the words "admiralty and maritime

jurisdiction" in sec 76(iii) was intended to

prevent argument that the power was restricted

to the common law jurisdiction of the Courts

of Admiralty. It was intended to give power	to confer jurisdiction with respect to all
matters which were known among English-speaking lawyers as matters pertaining
to admiralty or to maritime law.

This is an aspect of course dealt with sufficiently

extensively in the judgments of both Justice Gurnmow

and the two justices who gave judgments with which

Justice French concurred with Justice Lockhart in

the Full Court.

The concept of admiralty was not in 1900, and

remains not, a static concept. We always have

occasion when we think of these issues, of course,

to go back to what Your Honour Justice Dawson said

Ship(2) 96 2/3/94

in Street's case, 168 CLR 537 and 538 on the

correct use of denotation and connotation. But, it

is our submission that the denotations of the

concepts of admiralty and maritime may change, both

as a matter of reference to the English admiralty law and also to the obvious foreign analogues for our purposes, and we take the Court no further than

reference to the United States and to the Supreme

Court of Canada.

In relation to Article 3 section 2 clause 1 of the United States Constitution it was said by the

Supreme Court in Detroit Trust Co v The Barll111l,

293 us 52:

The Authority of the Congress to enact

legislation of this nature was not limited by
previous decisions as to the extent of the
admiralty jurisdiction. We have had abundant
reason to realize that our experience and new

conditions give rise to new conceptions of

maritime concerns. These may require that

former criteria of jurisdiction be abandoned,

as, for example, they were abandoned in

discarding the doctrine that the admiralty

jurisdiction was limited to tidewaters.

And, it is not only in the Antares that the Supreme

Court of Canada has taken an enlarging view as to

the ambit of maritime and admiralty jurisdiction.

If I might take the Court briefly to the judgment

of Justice McIntyre in ITO Ltd v Miida Electronics

Incorporated, (1986) 28 DLR (4th) 656. This

extract appears by reference to the Canadian

Federal Court Act section 2, the text of which

appears in page 294 of our thick volume of

materials. Perhaps I should indicate to the Court

that we have in our written submissions of

contentions handed to the Court, in the left-hand

margin in square brackets given references where

the material appears in our large volume of

materials, and in the right-hand side in italicized

brackets given page references to citations which

refer to materials reproduced in our supplemental

bundle of materials. But, in 28 DLR 656 Justice

McIntyre said:

I would agree that the historical

jurisdiction of the admiralty courts is

significant in determining whether a

particular claim is a maritime matter within
the definition of Canadian maritime law ins 2

of the Federal Court Act. I do not go so far,

however, as to restrict the definition of

maritime and admiralty matters only to those

claims which fit within such historical

limits. An historical approach may serve to

Ship(2) 97 2/3/94

enlighten, but it must not be permitted to

confine. In my view the second part of the

s 2 definition of Canadian maritime law was

adopted for the purpose of assuring that
Canadian maritime law would include an

unlimited jurisdiction in relation to maritime

and admiralty matters. As such, it

constitutes a statutory recognition of

Canadian maritime law as a body of federal law

dealing with all claims in respect of maritime

and admiralty matters. Those matters are not to be considered as having been frozen by the

Admiralty Act of 1934. On the contrary, the

words "maritime" and "admiralty" should be

interpreted within the modern context of
commerce and shipping. In realty, the ambit
of Canadian maritime law is limited only by
the constitutional division of powers in the

Constitution Act, 1867.

And, there was a similar and supporting statement

by Justice Iacobucci in Monk Corporation v Island

Fertilizers Ltd (1991) 80 DLR (4th) 58, in

particular at page 95, where in a judgment with

which seven of the justices concurred His Honour

said:

I should also like to add that the

approach I have taken in this matter

corresponds with McIntyre J.'s urging that the

terms "maritime" and "admiralty" should be

interpreted within the modern context of

commerce and shipping and should not be static

or frozen. Such terms should rather be

capable of adjusting to evolving circumstances

unencumbered by rigid doctrinal categorization

and historical strait-jackets.

We submit that there is no reason to depart

from established principles of constitutional

interpretation in relation to the construction of

section 76(iii). The Court will remember that in

Lansell v Lansell, 110 CLR at page 370

Justice Windeyer said:

"The usage of 1900 gives us the central type;

it does not give us the circumference of the

power" -

and similarly Justice Zelling, in his article

"Constitutional Problems of Admiralty Jurisdiction"

which is reproduced in the large volume of our

materials at page 14, expressed the view:

It is therefore reasonable to think that the

words should be given a wide connotation

similar to that in America in their use in

Ship(2) 98 2/3/94

s.76(iii) of our Constitution ..... The

High Court should interpret the word

"Admiralty" today in terms of the perceived

needs of Australia as a great maritime and

trading nation with twelve thousa~d miles of

sea coast and an interlocking and growing web

of international connections, treaties and

conventions.

Your Honour the Chief Justice, in

Kirmani v Captain Cook Cruises Pty Ltd, 159 CLR, in

particular at page 379, referred to the extent to

which the influence of imperial legislation which

may have influenced concepts of Parliaments's power

at the time of Federation should be regarded as

outmoded or eliminated and, "the question must be

considered in a new light".

In our submission, that approach which

Your Honour took in Kirmani is appropriate when

dealing with section 76(iii). It is really

something demeaning, in looking at the interstices

of 19th century United Kingdom or Imperial

legislation, in our submission particularly

legislation which could be reformed and developed

in the United Kingdom but was frozen and incapable

of further development in Australia after 1890, to

ascertain the scope of Parliament's powers under

the Australian Constitution.

So our primary submission is that it is

unnecessary to consider at all whether at the time

of Federation or by reference to United Kingdom

practice then or in subsequent years, the

High Court in England or a Colonial Court in

Admiralty could have entertained these specific

proceedings. However, having made that submission,

it is our submission that in any event when one

does refer to these United Kingdom laws, both by

reference to the frozen 1890 position under

Colonial Courts of Admiralty Act or subsequently as

it is has developed under English laws and

practice - and Your Honours have been taken to the

various terms of the legislation from 1840 on which
are included in our large volume of materials -
that that material does support an interpretation
of section 76(iii) which does comfortably enable
the actions of this sort where there is a claim by
reference to a contract for an interest in a ship
to be vindicated, in this case by a claim for an

order that the ship be vested in third parties.

Of course, in this case although

Justice Gummow did refer to the alternative claim

for damages it is the case here that on the arrest

of the ship a bond has been lodged. So that

Ship(2) 99 2/3/94

although it may be that the action proceeds as a
claim for specific perfoi-mance of the agreement, it

may well be that the ultimate remedy, if there is

one granted at the plaintiff's suit, will be one

expressed by reference to an order for a payment of

a sum of money out of the bond, or whatever

security was lodged in court to obtain the release

of the ship after its arrest.

The provisions of the 1840 Act appear in our

materials at page 228, the Court have already been

taken to that. But if I could refer to the extract

of Williams and Bruce which is replicated in our

supplementary materials, that is the thin volume,

page 33, it is there stated, and this is the 1886

edition of Williams and Bruce after the Judicature

Acts, that:

A suit to recover possession must before the

Judicature Acts have been instituted by the

legal owners. It was not the practice of the

Court of Admiralty to put its procedure in motion to protect merely equitable interests.

With respect, that is appropriate

qualification to refer to the position before the

Judicature Acts, because after the Judicature Acts

the position was different. The division of the

High Court exercising admiralty jurisdiction could, we submit, at the suit of an equitable owner,

protect that person's interest. Of course, we

would say it is beside the point for this Court to inquire whether or not the High Court when sitting

in its admiralty jurisdiction seek to imply a

limitation by reference to the previous existing

admiralty court jurisdiction and not look at the
concurrent power of that court after the Judicature

Acts to grant full remedies in equity.

So that, prior to Federation, here is at least

one commentator taking the view that the English

court exercising admiralty jurisdiction could

protect equitable interests in a ship and the 1902

edition of Williams' and Bruce's Admiralty

Practice, which is extracted at page 37, repeats

the same view without amendment. That is our

supplementary volume page 37.

This view has been followed in England

throughout this century, and could we take the

Court to the extract of Meeson's Admiralty

Jurisdiction and Practice, 1993, which we

reproduced in our supplementary materials, in

particular at page 42 to 43, the frontispiece

appears at page 39 of our supplemental materials.

But under the heading "Ownership" on page 42,

having made the point that there was no

Ship(2) 100 2/3/94

jurisdiction over questions of ownership until the

statutory extension to 1840, the author concludes:

Today the jurisdiction extends to all

questions relating to the possession of a ship
whatever the nationality of the ship, or the
domicile or residence of the owner ..... Thus

the court will enforce a purchase money

resulting trust where a person has provided

funds for the purchase of a ship, and he will

be presumed to have acquired an ownership

interest in the ship proportionate to the

amount provided.

If I could add that pages 44 and 45 of the

materials follow an extract from the precedents

appearing on page 283 to 284 of Meeson, whereby

there is a draft statement of claim claiming a declaration that the plaintiff is a beneficial owner, in this case the thirty-two sixty-fourth

share of a vessel, and a draft defence also as an

example of an endorsement on a writ to be pleaded

claiming what we would say would be a bare

equitable interest very analogous to that which is

here claimed.

Meeson refers at page 45 of our materials to

The "Venture", (1908) Pat page 218, a decision of

the Court of Appeal where there was enforcement by
the court of a purchase money resulting trust,

where a person had provided funds for the purchase

of the ship. That case of course was a case
decided by reference to the 19th century

legislation, not by reference to the 1981 Act.

My learned friend, Mr Callaway, referred to

Foong Tai & Co v Buchheister, (1908) AC 458, in

particular page 468 in the opinion of the Privy

Council. There, the Privy Council said that as between co-owners, issues touching ownership or

possession of a ship registered in any port in

England or Wales, the Act conferred on the High

Court of Admiralty:

jurisdiction wide enough to enable it to deal

with such a suit between co-owners

beneficially interested -

and one of course picks up throughout the

references in -

DEANE J:  I am sorry, Mr Solicitor, what were you just

reading from?

MR GRIFFITH:  Your Honour, Foong Tai & Co v Buchheister,

(1908) AC at page 468. So although we do not see

that as the central leg of our submissions, we do

Ship(2) 101 2/3/94

submit that it does appear after 1873 and to a
continuing extent, as have been statutory reforms

of the United Kingdom, statutory jurisdiction in admiralty jurisdiction, that there has been easy assumption of the capacity to decide questions

concerning equitable interest in ships. Indeed, of
the very nature of having divided interests in
respect of ships, of which the plaintiff's

pleadings in this case is perhaps something that

may be regarded as a typical contemporary example,

of their nature interests in respect to ownership

or possession of ships will be based on agreements,

on contracts, which provide for various provisions

of division of beneficial interest in those ships.

It is not an exceptional claim which this

pleading arises. It would on its face seem to be a

normal sort of contemporary commercial arrangement

to deal with the disposition of the operations and

divisions of income and responsibility for

liabilities in respect of a construction and use of

a ship during its entire working life. Of its

nature such a contract must give rise to interests of a sort which must be regarded as arising out of

a contract. Whether one then construes the

interest as being a legal one arising from a

contract or a claim to a beneficial interest to a

ship either where legal ownership is vested in
another entity by reference to a contract of

construction or registration or some other matter,

in each case, in our submission, the concept of

disputes between those parties comfortably falls

within the ambit of admiralty jurisdiction.

We would submit that without the Court having

to determine this question conclusively, at the

very least at Federation there was significant
opinion that an admiralty court exercising

admiralty jurisdiction or a court of admiralty,

could determine equitable ownership particularly
after the Judicature Acts.	We would submit that if

this was possible by reference to mere admiralty

jurisdiction, the more so it must be regarded

within the ambit of the jurisdiction expressed by

reference to admiralty or maritime jurisdiction.

My learned friend, Mr Callaway, did refer to

"The Conoco Britannia", (1972) 2 QB 543, in

particular at page 544, as another decision where

it would seem there was a recognized capacity of

the Court to grant equitable remedy such as

specific performance. My learned friend also

referred to "The Bineta", (1966) 3 All ER 1007

where it appears the court did - in very short
terms, Justice Brandon granted declaration that the

plaintiff was the lawful owner of the ship.

Ship(2) 102 2/3/94

My learned friend says the distinctions made

between when there is an order made that the res is

granted to possession of the plaintiff, which he

would seem to concede, is within the juris~iction,

and when an order is made for the ship to be vested

in a third party entity we submit that that is not

a distinction which goes to the reach of

jurisdiction, it is merely an analysis which goes

to the content of the particular remedy, and I will

say more about that when I refer to paragraph 10,

our last paragraph of our contentions.

In essence, it would seem that the contention

we make in paragraph 8 is the point where we see

the applicant before the Court and the Commonwealth

as intervener parting company. Of course,

reference to international practice can only be

taken so far. My learned friend, Mr Callaway,

makes a loose submission that it is necessary not

to go beyond the ambit of asserting jurisdiction

which would be recognized by other jurisdictions.

It is clear enough, and one has to go no further

than the Law Reform Commission report to see that
the author of the report was very cognizant of not

breaking significant new ground in this issue and

sought to place the jurisdiction as expressed by

the draft of the Act which has now been enacted,
within the mainstream of references to foreign
practices. The Brussels Convention, of course, is
source itself from the English Act of 1825 and the

expressions in the Australian Act are similarly

reflected by the Brussels Convention and similarly
reflect the provisions of the English Act and other

Admiralty Acts of other jurisdictions.

The convention is discussed in the Law Reform

Commission report in paragraph 94 at pages 65 to 67 where it is noted at pages 66 and 67 that -

there are difficulties with relying on the

1952 Arrest Convention as a satisfactory guide

to what is internationally acceptable -

particularly since, for instance, there are claims

which give rise to the maritime liens in the

municipal law of some States which are not included

in the arrest definition list of "maritime claims".

Australia is not a party to this convention, but there are some 60 States which are parties to it.

I refer Your Honours to our large volume of

materials at pages 317 to 319. That list of

parties is not entirely up to date, and I think at

least Lichtenstein has become an inherent since that date, although the utility of Lichtenstein being a party to the convention is perhaps somewhat

elusive. But a significant number of States are

parties to this convention and it was ratified by

Ship(2) 103 2/3/94

the United Kingdom in 1959 and that appears in our

volume of materials at page 318; and the

Administration of Justice Act 1956 which appears at

page 250 of our materials, was passed for the
purposes, amongst others, of enabling the United

Kingdom to ratify and comply with its obligations

under the convention. If I could refer in that

regard to the judgment of Lord Diplock in "The

Escherheim", (1976) 1 WLR 430, in particular at page 434.

As I just mentioned it is a bit circular here

with the United :K:i·ngdom because Article 1 of the

convention has a list which, in essence, is based

upon the admiralty jurisdiction in the High Court

of Justice under the Supreme Court of Judicature

Consolidation Act 1925, which is set out at

page 246 of our volume of materials. The similar

wording has been replicated in the 1981 United

Kingdom Act, sections 21 and 22, which are

reproduced at pages 265 and 266 of our materials.

So whether it is by reference to the

convention which picks up United Kingdom law or

United Kingdom law which picked up the text of the

convention, it seems clear enough that certainly

prior to 1925, but certainly post-1981, the High

Court, when exercising admiralty jurisdiction could determine all questions relating to ownership both

legal and equitable, as was said by the extract of

Meeson which we have referred the Court to.

Where one has references in the convention to

title and ownership, although those words do have a

common law source, of course one is dealing here

with international legislation which applies in

jurisdictions where legal and equitable ownership

is not known. As we know, although the civil law

has an understanding of a concept such as ordre

publique, the concept of natural justice is not a
concept which civil lawyers understand.	Now, with

reference to issues of equitable ownership, it

could be said as generality that civil law

countries do not have a system of property law

which recognizes that difference.

Now, the convention is equally authoritative in its English or French text. One would suppose

that there would be no difficulty about a civil law

country accepting that a common law country might,

in respect of issues dealing with a proprietary

claim in respect of a ship, apply its doctrines

including equitable doctrines to resolve those

proprietary interests. It cannot be supposed for a

moment that there would be any difficulty in a

civil law jurisdiction in recognizing only

applications of common law dealing with concepts of

Ship(2) 104 2/3/94

legal ownership, .but not equitable ownership. In

each case one would expect the foreign jurisdiction

would say, "Well, we recognize the capacity of the

common law country with jurisdiction to deal with

issues of ownership." Just as that civil law

country would be able to deal with issues of

ownership by reference to equity which is a concept

they do not accept.

On this issue of approach on the convention

may I give the Court two references, again to the

House of Lords. The first is Lord Wilberforce in

James Buchanan & Co Ltd v Babco Forwarding &

Shipping (UK) Ltd, (1978) AC 141, at page 152.	I
will not read that to Your Honours.	A second

reference to Fothergill v Monarch Airlines, (1981)

AC 251, particularly at page 282, Lord Diplock;

285, Lord Fraser, and 293, Lord Scarman.

Now, the wording of the convention and of the

1956 and 1981 United Kingdom Acts, they have been

followed in the legislation of other countries

which are not parties to the convention. Australia is one of example, but could I also refer the Court to the Singapore law which appears at page 279 of

our materials, the High Court Admiralty

Jurisdiction Act, and also the New Zealand Act, the

Admiralty Act (1973) which appears at pages 287 to

288, and the Federal Court Act of Canada, which the

Court has already referred to in connection with

the Antares, which appears at page 297, all in

similar terms.

So that there is no reason to suppose that

provision such as these, which are in really common terms, would operate so that States would, one must

suppose, recognize the determination of beneficial

ownership by reference to property law principles

of the common law country as falling within the

concept of admiralty or maritime jurisdiction.

There is no reason to suppose, as we have

submitted, that any non-common law jurisdiction

would have difficulty with that, we submit that no

common law jurisdiction would either. It is

comfortably within the mainstream of property law.

Of course, one only has to look to the extent

to which this Court, in the last 10 or 15 years,

has developed the concept of equitable remedies to

see the extent to which principles of law which, we
submit, could readily be applied to issues arising
out of claims in admiralty as much to issues which

do not have an admiralty origin, could be relevant

to determine property interests which may be in

dispute between parties properly before the Court.

Ship(2) 105 2/3/94

May I make some reference to the distinction

which has been made between, particularly sourced

to the American authorities but also by reference

to other legislation, between construction of a

ship and contracts for the sale of a ship.

Now, it has really always been the case in our submission and certainly as a contemporary

position, that almost universally contracts in

respect of the construction of the ship are

included within the definition of maritime lien.

That is included in the 1952 Arrest Convention

which I have referred to, and of course a source

back to the 1861 United Kingdom Act which appears

in page 231 of the materials where, in that case,

issues concerning the construction of a ship were within jurisdiction if at the time of institution of the cause the ship or the proceeds were under

arrest of the court.

These provisions were traced through the

English 1925 Act, which appears in our materials page 248; the 1956 Act, page 252; to the 1981 Act,

268, and they also appear in similar terms in the

Singapore Act, page 280; the New Zealand Act,

page 288; the Canadian Act, page 299.	I should
mention the convention references at page 305.	And
similarly appears in section 43 paragraph (n) of
our 1988 Act.

So that it would seem that there is no

difficulty by reference to foreign practice that a

claim on a contract for construction of a ship

would be recognised in international practices

falling within the concept of admiralty or maritime

jurisdiction.

Now, if it is the case that contracts for construction of a ship are considered to be

maritime, in our submission there is every reason

for considering contracts for the sale of a ship

also to be maritime. Now, if I may stop for a

moment there and refer briefly to the American

position. Of course the American position remains,

the contracts of the construction of a ship have

been held not to fall within the reach of the

American constitutional provision, and it is taken

that as much as contracts for the construction of a

ship do not fall within jurisdiction, neither do

contracts for the sale of a ship.

Now, that approach has been very much

criticized by contemporary literature in America,

and I understood my learned friend, Mr Callaway, to

accept the thrust of much of that criticism and I

think at page 38 of the transcript make it clear

that he did not intend to rely upon the present

Ship(2) 106 2/3/94

state of American authority because, it would seem

from his concession, he regarded the tide of

authority as moving against it.

We would submit that really in 1815

Justice Story got it right in De Lovio v Boit, that

is extracted at page 209 of our materials and I do

not intend to read that well-known part of

Justice Story's judgment to the Court. But by way

of criticism of the subsequent develops of

United States law to exclude claims based on

contracts to construct a ship or for the sale of a

ship, could I refer the Court to pages 54 and 55 of

our supplementary·materials; that is an extract

from Baer, Admiralty Law of the Supreme Court

(3rd edn) at 465-466, where the author concludes:

In brief, admiralty jurisdiction will attach

if a majority of the Court chooses to classify

the contract as maritime.

Now, that is very strong criticism of the attempts in America to make a distinction and

perhaps it is strong criticism which is superseded

in its strength by the assenting, but really

dissenting, judgment of Justice Scalia in

Sisson v Ruby, 497 US 358, 111 L Ed 2d 292, in

particular, at page 305-306.

The judgment of Justice Scalia was referred to

by Justice Gummow in his judgment at first

instance, and at page 305 of the Law Ed report at

page 372 of US report Justice Scalia, in his usual

trenchant way, particularly when exercising the

privilege of dissent, criticized the majority view

which is expressed at page 300 in the Law Ed by

saying that:

That body of law has long been the object of

criticism. The impossibility of drawing a

principled line with respect to what, in

addition to the fact that the contract relates
to a vessel (which is by nature maritime) is

needed in order to make the contract itself

"maritime," has brought ridicule upon the

enterprise.

Then, His Honour goes on after referring to, "one

scholar" saying:

the rules as to building and repairing

vessels" - the former having been deemed

nonmaritime ..... and the latter maritime -

and then he goes on:

Ship(2) 107 2/3/94

"and the results obtained therefrom, are so

humerous that they deserve insertion in the

laws of Gerolstein."

MASON CJ:  What are the laws of Gerolstein?

MR GRIFFITH: Well, fortunately there is a footnote,

Your Honour. Footnote 3 tells us. We have to be a

music lover to know what this is about.

Your Honour, really, we say, Justice Scalia, in his direct style - I think when he was here last time

he lectured on the discipline which a majority

should exercise in his court but the luxury of the

dissenter who could express more forcibly

idiosyncratic and individual views - but with

respect, His Honour, when we look at it from our

point of view of not been trammelled by the

authority of the majority has the right approach

that, we submit, that one should - I hesitate to

use the term and in fact I will not. Your Honour,

to get back to issues of essential meaning rather

than putting a gloss which however one analyses my

learned friend Mr Callaway's submissions, we see

what he is doing is attempting to route back which

merely is, as my learned friend Mr Jackson points

out, a defined expression, "proprietary maritime

claim", by reference to sanctions derived from what

we say is arcane, and for the purposes of our

constitutional power, irrelevant authority. My

learned friend, Mr Callaway, of course, finds it

necessary to go to the extent of saying, "Well, if

there is something that is otherwise a proprietary

maritime claim, if it requires a contract for its

support, it falls outside the ambit of power".

That is how we understand his submission.

In our submission, it really is of the essence

or the usual nature of claims that fall within

paragraph (2)(a) or (b) that there would be a

contract involved. That is the usual way in which

one establishes a right.

So the approach that one gets from

Antares Shipping case, in our submission, is the appropriate one and is not to be distinguished on

the basis, "Oh, yes but there the plaintiff itself

was claiming the order for possession for ownership

rather than a third party vehicle." For that

reason we make the broad submission which we have

made in paragraph 8 and support it, Your Honour,

without taking Your Honours to the terms of
paragraph 9 of our submission which picks up the

general effect of the broad meaning of the

jurisdiction by being defined by reference to

claims relating to, rather than some narrower

expression.

Ship(2) 108 2/3/94

In essence, Your Honour, we see my learned

friend Mr Callaway's submissions as not accepting

the distinction which we seek to make in paragraph

10 of our contentions and that is we submit the

has once that jurisdiction is exercised. In our submission, is a matter of separate inquiry once

inquiry is merely one as to whether or not the

the Court is exercising that jurisdiction. If
there is jurisdiction in rem, well then, the Court

has jurisdiction and, of course, although it is

only the ship which is served in an action in rem,

one has to go no further than the title of this

action to see that what one has in essence is the

debate on the personification theory, but that is also something which is discussed usefully in

owners of the ship who are defending the claim and

Crawford's report.

Your Honour, once the ship is there, if there

is no appearance, well then there is a res by

reference to which the Court, in our submission,

can exercise such powers as the Court is vested in.

If there is an appearance, and submission have been

made as to the nature of the entry of a conditional

appearance in this case, well similarly the Court

is in the position, in our submission, to exercise

such powers as it has, and Your Honour

Justice Toohey as we refer to in St Justin's

Properties Pty Ltd v Rule Holdings Pty Ltd, (1980)

40 FLR, particularly at page 284, page 285, made

this distinction as did various members of the

Court in Phillip Morris Inc v Adam P Brown Male

Fashions Pty Ltd, (1981) 148 CLR 457 and we give

the citations in our paragraph 10.

So that, in our submission, it is not a matter of relevant inquiry to consider whether or not

there would be power by reference to principles of

admiralty law as determined under United Kingdom
legislation to order specific performance.	The

plain fact is that as soon as the Federal Court has

jurisdiction in this matter, in our submission, it

has such of its normal powers which are available.

In this case they are specific under sections 22

and 23 of the Federal Court Act and other

provisions and inherent powers are available to be

exercised. Really that position is not much

different from the position which obtained under

the 1890 Act.

We extract, in our contention 10 and refer to

page 234 of our materials, section 2(1) of the Act

which seems to confirm that very principle.	I also
refer to The "Conoco Britannia" which we have
already referred to.	So that, in our submission,

Ship(2) 109 2/3/94

this Court need not be concerned with the

particular form of the remedy which is sought

which, on the pleading itself, seems to be an order

for transfer of the ship to a corporate vehicle to

be formed to be held in joint ownership. Whether

or not ultimately, if the plaintiff's claim is

successful, that is the order made, one cannot be
sure.

Although the applicant, if this objection to

jurisdiction is set aside, might be regarded as
having entered an unconditional appearance, it is
obvious there would be very limited powers of

sanction for the Federal Court to in fact enforce

an order for specific performance by transfer to a

third party to be incorporated because the

applicant would be represented in Australia by no

more than the instructions it gave to those

representing to appear for it in court unless there

is some other mechanism for the court to enforce

it. But of course there is because if the ship is

not here, there is a bond. So that the order for

specific performance, if unenforceable, would be

one which would be subject to be made effective in
other means, one would suppose eventually by some

form of assessment of monetary payment to be

garnisheed from the bond.

In our submission, they are matters not for

inquiry before this Court when it considers the
reach of jurisdiction. They are matters to be

determined at some later stage. We are already

five years into the action. Perhaps some time in

this millennium when the case goes through

pleadings and gets to the question of whether or

not, if the plaintiff is successful, an order for

specific performance is effective, but it is our

submission that the fact that one refers to that as

the remedy does not in any way touch upon the reach

of constitutional power. If the Court pleases.

MASON CJ: Thank you, Mr Solicitor. Mr Callaway?
MR CALLAWAY:	Your Honours, there is nothing more that I am

authorized to say in relation to our constitutional

submission because, really, my learned friends have

chosen, with respect, not to come to grips with it,

so I cannot reply. I should correct something I

said on the transcript under that heading. At

page 38, line 5, I said that I was content to put

the argument the way I had in paragraph 11. It is

a very good transcript, no doubt I did say that.

It is paragraph 12, and I suppose 11.1 which summarize our constitutional submission. In other words, the argument which is explained at pages 35

to 36 of the transcript.

Ship(2) 110 2/3/94

Your Honours, while I am in the transcript,

might I mention that there is a whole page

accidentally repeated. It is confusi~g when you

read tne transcript unless you are told about it.

Pages 23, ·line 5, to 24, line 19 accidentally

repeat the text of pages 21, line 44, to 23,

line 4. Also, just to avoid confusion, at page 6,

point 8, I was giving a hypothetical example based
on the Navigation Act in support of our submissions

about the right way to approach the definition of

proprietary maritime claim, and I gave the example

of a penalty imposed on an equitable owner and said

such a claim would be a claim relating to

ownership. It will, I trust, have been apparent to

the Court that that was on the hypothesis that

ownership included equitable ownership, it is not

intended as a concession. Not that our case

depends on ownership excluding equitable ownership,

that is, as the outline makes clear, a very small

part of our submission.

Turning briefly to just a few of the points

made by my learned friends Mr Jackson and the

Solicitor-General for the Commonwealth. A major

part of my learned friend Mr Jackson's response to

our principal argument in paragraphs 2, 3, 4 was

reliance on the decision of this Court in Wacal

Developments. In regard to that we make these submissions: first, that case does not and could

not announce an inflexible rule for the

interpretation of statutory definitions. It always

depends on the context and the kind of statute and

the role that the definition plays. Here there is

a definition of maritime claim in section 4(1)

which subdivides into proprietary and general

maritime claims.

It is not to be supposed that the words were

chosen at random.	The draftsman could have said
class A claims and class B claims.	The draftsman
has not done that. Moreover, it is part of a

larger scheme related to surrogate ship arrest, and

I do not want to fall into the trap of repeating

what I said in-chief, but that larger scheme and

the overseas provisions and the relevance of
"Talabot" and the explanatory memorandum are all in
the transcript at pages 4.1 to 8.2, and 29.2 to

30.2.

Your Honours, a simple example is if one had a

statute which had a definition of Aboriginal land

and assume it were a complicated definition and

someone managed to work out that one branch of the

definition included land which on no view at all

had any connection with Aborigines. Surely it

would be proper to take into account what was being

defined and one would not, in a context like that,

Ship(2) 111 2/3/94

apply the Wacal Developments case to say that one could not take account of what was being defined. That is the first point.

My learned friend made a related but more

general submission, and perhaps my learned friend

the Solicitor-General endorsed it in so many words,

that we were inviting the Court to read down the

words of section 4(2)(a)(b). We would respectfully

submit that it is not so much a matter of reading

them down as reading them conformably with the

scheme of the Act and the Law Reform Commission

report.

My learned friend, Mr Jackson, placed some

reliance on the proposed revision of the Arrest

Convention, the CMI revised draft. We simply refer

Your Honours to the Law Reform Commission report

paragraph 94 note 47, which explains the status, or

more correctly, the lack of status of that CMI

draft.

My learned friend, Mr Jackson, also placed

some reliance on section 5, and I took that to be

mainly section S(l)(b) which says that the Act

applies in relation to -

all maritime claims, wherever arising.

But one has to remember that "maritime claims" is a

defined expression; it is defined in section 2. So

it adds nothing to the argument on either side.

The last matter of reply in relation to my

learned friend, Mr Jackson, is the point made this

morning about the conditional appearance. It is

true that the Federal Court Rules provide that that

becomes unconditional unless the court otherwise

orders. There are two things I would say about

matter for the Federal Court if that is the way the that. The first is that that will ultimately be a	case develops, and no doubt would be the subject of
quite extensive submission. The second thing is
why it would be the subject of extensive
submission.

I am going to ask the Court to rule on this,

but this is the kind of submission that would have

to be made to the Federal Court. This is the sort

of case where the court would otherwise order,

otherwise it would put the owner of a ship against

which proceedings in rem are brought in an unfair

and virtually impossible position, because the law

is, as Your Honours know, that if a proceeding is

commenced in rem and an unconditional appearance is

entered, the proceeding continues both in rem and

in personam. So that a foreign shipowner whose

Ship(2) 112 2/3/94

ship was arrested and who had legitimate reasons

for challenging the jurisdiction of the Australian

courts, would be on the horns of a dilemma. In

some places and in some c0urts - it might depend

which court it was in - but in the Federal Court it would seem that the only right way to challenge the jurisdiction would be a conditional appearance, the course that my client has taken here, that if

Order 9 rule 6(2) applied and the court was not prepared to otherwise order, the penalty would be a

conversion of the action in rem into an action both

in rem and personam. That would surely be unjust.

So here it is a realistic submission that ultimately the court would use that power to

otherwise order. But in the end it probably does

not matter because at present this is a claim in
rem, and the question is whether as a claim in rem

it is within section 4(2)(a) and (b).

Your Honours, my learned friend, the

Solicitor-General, phrased some of his early

submissions as if we were relying mainly on

section 13 as a basis for using the Constitution in

the task of interpreting section 4.	We are really
not.	It is mainly a matter of relying on

section 14, admiralty and maritime jurisdiction

being mentioned in all the references we have

mentioned in our outline.

It is not a case of the tail wagging the dog, which might be a legitimate criticism if we were

relying on section 13. Section 14 begins:

In a matter of Admiralty or maritime

jurisdiction, a proceeding shall not be

commenced as an action in rem ..... except as

provided by this Act.

Then my learned friend took the Court to

Mr Meeson's book, extracts from which are in the

Attorney-General's material. First my learned

friend read the passage in the Attorney's material

at pages 42, 43, that:

Today the jurisdiction extends to all

questions relating to the -

ownership, both legal and equitable of -

a ship, whatever the nationality of the ship,

or the domicile or residence of the owner.

But the footnote to that sentence does nothing but

refer to section 20(7)(a) of the United Kingdom

Act. Then the learned author gives one example and

that is the example of The "Venture", the

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constructive trust case.	The "Venture" was a case
about the proceeds in court.	The plaintiff had

been the administratrix of the registered owner,
the person asserting the constructive trusts,

successfully in the Court of Appeal, was not the

original plaintiff but a claimant in relation to

the fund. That appears from the headnote, (1908) P

218, and the first half dozen or so lines on page

219.

So far as the precedent is concerned - this is

a useful vehicle to respond to a couple of points.

The precedent is over the page, at 44 to 45 of the

Attorney's materials. That statement of claim,

Your Honours, is just like Antares and similar to

"Bineta". It is a claim to legal ownership. True

it is that the plaintiff says we have an oral

agreement and I am already the beneficial owner,

which in this context would mean equitable owner.

But paragraph 4 is that the defendant has refused

to execute a bill of sale, which is the document

that gives legal title. True it is that the

declaration claimed begins with a declaration that

the plaintiff is the beneficial owner and is

entitled to be registered as the legal owner and an

order that the defendant execute a bill of sale.

That is just like Antares.

I said a moment ago it was a useful vehicle to

respond to something else. We do not submit and

never have submitted that the presence of a

contract takes the matter outside the concept of a

proprietary maritime claim. That is why we accept

Antares as being correct. But it must be a claim

where the plaintiff asserts or relies on its own

proprietary rights. Very frequently those rights

will come from contracts, of course. We are not

suggesting all contractual claims have to fall in

section 4(3), and I trust that that was

sufficiently clear from my submissions in-chief.

It is perfectly true that many overseas

countries have systems of law that do not recognize

the division between legal and equitable ownership.

As I say, our case does not really depend on equitable ownership, but that is not really the

point. The real point is that to the extent we

need to make the submission, "owner" should be
given the same meaning as in sections 17 to 19.

Under our system of law that will exclude equitable owners because the scheme of sections 17 to 19 -

and I believe this is non-controversial - is to

make sure that the person whose ship is arrested is

a person who would be liable in an action in

personam.

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My learned friend, the Solicitor-General, referred to construction claims. I was not sure

why because we have disclaimed reliance on the

American authorities. My learned friend, by sheer

inadvertence I believe, said that construction

claims have always been a maritime lien. I think

my learned friend meant a statutory right in rem.

Of course, it is not a helpful analogy because in a

construction claim, quite apart from the fact that

it is section 4(3), it is the builder, who may be a

vendor of course, who arrests the vessel. In the

kind of claim with which we are concerned, it is a

purchaser who want_s to arrest the vessel.	So it
may not be a helpful analogy in any event.

Your Honours, unless there is any other point

which might assist the Court if I tried to address,

that is all we wish to add by way of reply.

MASON CJ:  Thank you, Mr Callaway. The Court will consider

its judgment in this matter and will adjourn until

10.15 am tomorrow.

AT 11.50 AM THE MATTER WAS ADJOURNED SINE DIE

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