Teekay Shipping (Aust) Pty Ltd and Australian Maritime Safety Authority
[2012] AATA 519
•7 August 2012
[2012] AATA 519
Division GENERAL ADMINISTRATIVE DIVISION File Number
2011/4172
Re
Teekay Shipping (Aust) Pty Ltd
APPLICANT
And
Australian Maritime Safety Authority
RESPONDENT
DECISION
Tribunal Deputy President R P Handley
Date 7 August 2012 Place Sydney Decision Summary: The decision under review is affirmed.
...........[sgd]..................................
Deputy President R P Handley
CATCHWORDS
INFRASTRUCTURE AND TRANSPORT – maritime safety – port state control inspection of ship – defective sewage treatment plant – issue of whether ship unseaworthy or substandard under the Navigation Act – environmental protection and international obligations – decision under review affirmed
LEGISLATION
Administrative Appeals Tribunal Act 1975
Navigation Act 1912 (Cth)
Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Cth)
CASES
CV Sheepvaartonderneming Ankergracht v Stemcor (A/sia) Pty Ltd (2007) 160 FCR 342
FC Bradley & Sons Ltd v Federal Steam Navigation Co Ltd (1926) 24 Ll L Rep 446
Fleet Management Ltd and Australian Maritime Safety Authority (2007) 94 ALD 285
Huddart Parker Ltd v Cotter (1942) 66 CLR 624
Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
Shi v Migration Agents Registration Authority (2008) 235 CLR 286
SECONDARY MATERIALS
International Maritime Organisation Resolution A.787(19) Port State Control Procedures
Instruction to Surveyors 63
International Convention for the Prevention of Pollution from Ships 1973
International Convention for Safety of Life at Sea 1974 (SOLAS)
Marine Orders Part 11 Substandard Ships Issue 2 (Order No 14 of 2002)
REASONS FOR DECISION
Deputy President R P Handley
Teekay Shipping (Aust) Pty Ltd (the Applicant) has applied for the review of a decision of the Australian Maritime Safety Authority (AMSA) (the Respondent) to provisionally detain a ship, the Fuji Spirit, on the ground that it was unseaworthy because its sewage treatment plant was defective. The Applicant is the Australian manager of the Fuji Spirit.
BACKGROUND
On the morning of 7 September 2011, the Fuji Spirit, an oil tanker, berthed at Gellibrand Pier in the Port of Melbourne. At approximately 1:00pm on that day, a delegate of AMSA, Darryl Rosairo, who is a Port Marine Surveyor, boarded the Fuji Spirit to conduct an on-board Port State Control Inspection. According to Mr Rosairo’s statement dated 1 February 2012, his initial inspection involved checking the vessel’s documentation. He then conducted a general inspection of the vessel consistent with Port State Control Inspection procedures.
In the course of his inspection, Mr Rosairo identified four defects on-board the Fuji Spirit, three of these being obvious defects in equipment or procedure (deficiencies 1, 2 and 4). He decided that deficiencies 1, 2 and 4 were sufficiently serious to require rectification prior to the vessel’s departing from Port Melbourne. He decided that the fourth defect – deficiency 3 – warranted provisional detention of the ship.
The fourth defect was in the operation of the ship’s sewage treatment plant. At approximately 3:30pm on 7 September 2011, Mr Rosairo had inspected the Fuji Spirit’s Sasakura Super Trident ST-3AN sewage treatment plant (the plant). In the course of his inspection, he noticed a build-up of dried sludge in the sludge return clear line, a clear vinyl hose through which water and effluent should have been constantly reticulating. On his applying pressure to the hose, the dried sludge broke away from within the hose’s surface. Mr Rosairo was subsequently told by the Chief Engineer that the sewage treatment tank was half empty. Mr Rosairo told the Chief Engineer the sewage treatment plant was not operating properly and that this was grounds for the detention of the Fuji Spirit in port. However, he said that if the problem could be rectified before he completed his inspection and paperwork, no detention order would be recorded.
Approximately 75 minutes later, Mr Rosairo was advised that the plant was operational. On reinspecting the sludge return line, he observed a partial flow of water and effluent which passed through the hose in spurts rather than as a continuous stream. He then checked the air supply blower gauge reading and found it to be over 4 kg/cm2, greater than the pressure of 3 kg/cm2stated in the operating manual for the plant. Having also observed the intermittent flow of the water and effluent through the hose, Mr Rosairo concluded that the blockage had not been cleared, and formed the view that the plant remained inoperative, and that the ship was therefore unseaworthy as it posed a threat of harm to the environment.
As a result, Mr Rosairo decided to provisionally detain the Fuji Spirit pursuant to s 210(1) of the Navigation Act 1912 (Cth) and, a little later on the same day (7 September 2011), AMSA notified the Bahamas (the Fuji Spirit’s flag state) and Lloyd’s Register of this by email. However, due to a typographical error in the email address, the Bahamas administration did not receive the original notification until 9 September 2011 after the notification had been resent to the correct address.
Mr Rosairo formed the view that there were clear grounds for believing that the ship, its equipment or crew, did not substantially meet the requirements of the International Convention for Safety of Life at Sea 1974 (SOLAS) and International Convention for the Prevention of Pollution from Ships 1973, as modified by the Protocol of 1978 (MARPOL). He stated as the grounds for detaining the Fuji Spirit:
“the ship appears to me to be unseaworthy and/or substandard in the following respects… Sewage Treatment Plant is defective… and as per Report of Inspection (Forms A and B) dated 07.09.2011” [FORM B] “2910…Sewage Treatment Plant is Defective…MARPOL Annex IV”
Either later on 7 September 2011, or early on 8 September 2011, a surveyor from Lloyd’s Register attended the Fuji Spirit and verified that the deficiencies identified by Mr Rosairo had been rectified. On being advised of this, Mr Rosairo attended the Fuji Spirit on 8 September 2011 and agreed that all deficiencies had been rectified.
In the course of his reinspection of the plant, Mr Rosairo claims he was advised by the Chief Engineer that, in addition to the blockage and air supply fault, a faulty second stage drain valve had been found to be not completely closed, and that this had been rectified. Mr Rosairo formed the view that this deficiency explained why the sewage treatment tank was half empty. AMSA claims that the effect of this defect would be the discharge of untreated sewage from the plant through the overboard outlet.
Mr Rosairo released the ship from provisional detention at 2:30pm on 8 September 2011 pursuant to s 210(6)(b) of the Navigation Act and the Bahamas administration and Lloyd’s Register were notified of this by fax at 6.22pm on that day.
On 28 September 2011, the Applicant applied to the Tribunal pursuant to s 377F(a) of the Navigation Act for a review of the decision to provisionally detain the Fuji Spirit.
LEGISLATION, CONVENTIONS, PROCEDURES
Section 210 of the Navigation Act 1912 (Cth) states:
210 Detention of unseaworthy and substandard ships
(1) If it appears to the Authority that a ship is unseaworthy or substandard, the Authority may order the ship to be provisionally detained.
(2) The Authority shall immediately give the master of the ship notice of the provisional detention, together with a statement of the grounds of the detention.
(3) The Authority shall direct a person to prepare a report as to whether the ship is unseaworthy or substandard.
(4) The ship shall be surveyed by a surveyor if a survey is necessary for the preparation of the report.
(5) Unless the Authority decides to order the ship to be unconditionally released, the Authority shall provide the master of the ship with a copy of the report.
(6) On receipt of the report, the Authority may:
(a) order the ship to be finally detained; or
(b) order its release unconditionally or on such conditions as the Authority considers appropriate.
(7) If an order for the final detention of the ship is made, the ship shall not be released until the Authority is satisfied that its further detention is no longer necessary, and orders its release.
Section 207(1) of the Act provides that, subject to an exception (which is not relevant to this matter):
… a ship is to be treated as seaworthy under this Act if, and only if:
(a) it is in a fit state as to the condition of hull and equipment, boilers and machinery, the stowage of ballast or cargo, the number and qualifications of crew including officers, and in every other respect, to:
(i) encounter the ordinary perils of the voyage then entered upon; and
(ii) not pose a threat to the environment; and
(b) it is not overloaded.
Section 207A states:
(1) A ship is, for the purposes of this Act, substandard if the ship is seaworthy, but conditions on board the ship are clearly hazardous to safety or health.
(2) In determining whether a ship is substandard, regard shall be had to such matters as are prescribed.
Sections 190B, 191, 191A, 267ZF, and 425 of the Navigation Act allow for the making of regulations to give effect to international conventions. Specifically, section 267ZF allows for the making of regulations to give effect to Annex IV of MARPOL. Further, section 425 (1AA) allows for the making of Marine Orders in any circumstances in which regulations can be made.
Marine Orders Part 11 Substandard Ships Issue 2 (Order No 14 of 2002) states relevantly:
4 PRESCRIBED MATTERS
For the purpose of sub-section 207A(2) of the Navigation Act 1912, the following matters are prescribed.
Item
Deficiencies
…
Sewage treatment plant
If fitted and operating, is not operating in accordance with the manufacturer’s instructions.
Delegates of the Respondent are also bound by Resolution A.787(19) of the International Maritime Organisation (IMO), titled Port State Control Procedures, which was adopted by the IMO on 23 November 1995. Of specific relevance is Chapter 4 of Resolution A.787(19), titled ‘Contravention and Detention’, which provides guidelines on when a ship can be identified as substandard, the submission of information concerning deficiencies on a ship, port state action in response to alleged substandard ships, the responsibilities of the port state to take remedial action, the detention of ships, and procedures for rectification of deficiencies and release. Further guidance as to the detention of ships, and specifically where deficiencies found in a ship are sufficiently serious to merit its being detained, is provided in Appendix 1 to Port State Control Procedures.
AMSA has prepared an internal working document dated 10 October 2005 providing guidance to Marine Surveyors on the procedures to be followed where deficiencies are identified in the course of a Port State Control Inspection. In this Instruction to Surveyors 63 (ITS 63) at Annex D, Marine Surveyors are instructed to use ‘Deficiency Action Codes’ in respect of individual deficiencies found in the course of an inspection. Surveyors are instructed to “use their professional judgment in deciding which deficiency action code is to be used”. Of relevance to this matter are Deficiency Action Codes 17 and 30, which are defined as follows:
Action Code 17 – Rectify Deficiency Before Departure
... to be used for deficiencies that are hazardous to safety, health or the environment and warrant rectification before the ship sails…
A follow-up visit will normally be required. Upon rectification, the Code 17 will be updated to a Code 10 [deficiency rectified]…
A Code 17 cannot be “upgraded” to a Code 30. Therefore, if a deficiency renders a ship unseaworthy or substandard, it is to be detained until the detainable deficiencies have been appropriately rectified, irrespective of the time available for repairs…
Action Code 30 – Detainable Deficiency
This code is to be used when a deficiency is serious enough to jeopardise the ship’s seaworthiness, safety of crew/passengers on board or present an unreasonable threat of harm to the environment and warrants a detention of the ship to ensure rectification of the serious defect.
…
Where an action code 30 is allocated, the deficiency must be assessed for recognised organisation responsibility…
Section 267ZQ of the Navigation Act empowers AMSA to give directions to the master or owner of a ship if “of the opinion that a foreign ship is not constructed in accordance with Annex IV”. Such directions include “that the ship comply with specified requirements while it is entering, is in or is leaving any port, or a specified port or specified ports, in Australia” (s 297ZQ(1)(c)).
The Protection of the Sea (Prevention of Pollution from Ships) Act 1983 (Cth) (the Protection of the Sea Act), s 26D prohibits the discharge of sewage into the sea subject to specified exceptions including in subsection (6):
(a) where the sewage has been comminuted and disinfected using a system approved in accordance with the regulations, or orders made pursuant to the regulations, giving effect to paragraph 1.2 of Regulation 9 of Annex IV to the Convention--the discharge is made when the ship is at a distance of not less than 3 nautical miles from the nearest land;
(b) where the sewage is not sewage referred to in paragraph (a)--the discharge is made when the ship is at a distance of not less than 12 nautical miles from the nearest land;
(c) where the sewage has been stored in holding tanks, or originates from spaces containing living animals--the sewage is not discharged instantaneously but is discharged at a prescribed rate when the ship is proceeding en route at a speed of not less than 4 knots.
Section 26DAA empowers AMSA to require the discharge of sewage at a reception facility:
(1) A prescribed officer may require the owner or master of a ship, by written notice given to the owner or master, as the case may be, to cause a specified quantity of sewage to be discharged within a specified period from the ship to a specified facility that is suitable to receive that quantity of sewage if the officer has reason to believe that retention of the sewage would create a risk of discharge from the ship into the sea.
(2) The owner or master of a ship to whom a notice is given under subsection (1) must comply with the notice.
Penalty: 500 penalty units.
THE ISSUES
The decision in this case was made by the AMSA delegate, Mr Rosairo, pursuant to the power in s 210(1) of the Navigation Act. The power is a discretionary one and the precondition to its exercise is that it must appear to AMSA that a ship is unseaworthy or substandard. In this case, Mr Rosairo gave as the ground for his decision to provisionally detain the ship that it appeared to him that the ship was unseaworthy because the sewage treatment plant was defective, and with reference to MARPOL Annex IV. Whether a ship is unseaworthy must be determined in accordance with the definition in s 207(1) (see above at [13]). AMSA submits that it appeared that the ship was unseaworthy because it posed a threat to the environment (s 207(1)(a)(ii)) as a result of its sewage treatment plant being defective and there being a risk of its discharging sewage into the sea while the ship was in port.
The Applicant contends that the AMSA delegate’s expertise with regard to sewage treatment plants was questionable, that he was too hasty in making a provisional detention order, and that the correct or preferable decision would have been either to not make an order and allow more time to fix the defect, or to make an order requiring the defect to be rectified before the ship departed port. The Applicant also referred to AMSA’s powers to make directions under the Protection of the Sea Act which could have been utilised.
The issues to be determined in this matter are as follows:
1)Whether, at the time of the inspection, the sewage treatment plant on the Fuji Spirit appeared to be defective;
2)Whether an apparently defective sewage treatment plant is a sufficient ground for a finding of unseaworthiness and for making a provisional detention order under s 210(1) of the Navigation Act; and
3)Whether the decision to detain the Fuji Spirit was the correct and preferable decision in all the circumstances.
THE EVIDENCE
David Maneckshana
The Applicant relies on the report prepared by David Maneckshana, Vessel Manager with Teekay Marine Management, and reviewed by Bikramjit Kanjilal, Director, Quality Assurance, Teekay Marine Management, dated 14 September 2011. Mr Maneckshana has been an AMSA certified Class 1 Marine Engineer for 10 years.
Attached to Mr Maneckshana’s Report are Statements from the Master, Chief Engineer and First Assistant Engineer of the Fuji Spirit. The Master’s Statement is undated. Those of the Chief Engineer and First Assistant Engineer are dated 11 September 2011. The Master states the “Inspector’s attitude was professional”. He said the Inspector allowed time to investigate and rectify the defect while he was completing his paperwork in the ship’s office. During that time, the ship’s staff cleaned the sludge return hose and the flow was visible but the Inspector was not fully satisfied. The Inspector was apparently fully familiar with such sewage treatment plants.
The Chief Engineer states that the Inspector was in an “angry mood” and found the plant defective. The Chief Engineer said, “I requested him to give us some time to investigate, but he was in no mood to listen and he left ER [Engine Room] saying I will detain your ship”. In the meantime, the First Engineer cleaned the flexible hoses, flushed the line with fresh water and normalised the level in the tanks. This restored the flow in the sludge return line. The Chief Engineer went to the ship’s office and asked the Inspector to inspect the plant, but on observing the flow, the Inspector said it was not normal. After the Inspector left the Engine Room, further remedial work was undertaken, and the air pressure, previously set at 2.5kg/cm2, was set at 3kg/cm2 as per the Manual. When a continuous flow through the sludge return was established after a few minutes, the Chief Engineer returned to the ship’s office to see the Inspector but he had already left.
The Chief Engineer said that about an hour later, the Vetting Inspector, who was also on board the ship, inspected the plant and was satisfied that it was working in accordance with the Manual. The next day – 8 September 2011 – a Lloyd’s surveyor checked the plant and found it was operating satisfactorily. This was confirmed when the AMSA Inspector reinspected the plant.
The First Assistant Engineer’s account of what occurred is similar to that of the Chief Engineer. In addition, he states that after they had restored the flow in the sludge return line and the Chief Engineer brought the Inspector down to the Engine Room to check the flow, the Inspector insisted that the flow was not good enough compared to what he had seen in a demonstration video. The First Engineer said the Inspector:
… also insisted that the line was still chocked and that the air pressure at 2.5kg was too high. At this time I reduced the pressure to 1kg and pointed out that it didn’t affect the flow.
Still he was not satisfied…
The Master, Chief Engineer and First Assistant Engineer were not available to give evidence. In his report, Mr Maneckshana states that the provisional detention order issued against the Fuji Spirit by the Respondent “appears excessive” due to corrective action being taken immediately in relation to the plant, the fact that the vessel was not scheduled to sail until 15 September 2011 (a week following the inspection), there being no violation of MARPOL, no unreasonable risk being posed to the environment by the vessel, and the fact that the order of the Respondent did not place any restrictions on the use of the plant.
In his report, Mr Maneckshana notes that, apart from the lack of sludge circulation, there is no evidence of a defective sewage treatment system. He states that, on 7 September 2011, a BP Vetting Inspector reviewed the plant’s operation with the Chief Engineer as part of his inspection, and that subsequently a Class surveyor was called to check the condition of the Plant on 7 September 2011, who also accepted it was working as it should.
Mr Maneckshana’s report further states that after providing the report from the Class surveyor to the Respondent:
The Detention order was withdrawn unconditionally on 8th September 2011 … There is no evidence that untreated sewage was discharged overboard … no untreated matter had transferred to the last chamber.
Mr Maneckshana’s report acknowledges the possibility of a “short term blockage near the bottom of the clarification chamber” of the plant, but states that all indications were “that there was sufficient and continuous aeration of the aeration chamber to effectively mix the raw sewage with active sludge and keep the system operative”. He states that the service air pressure was set to 2.5 kg/cm2, and this should have been sufficient to ensure sludge lift, although the air pressure had probably stopped, due to the blockage.
Mr Maneckshana gave oral evidence at the hearing. He said that the Fuji Spirit is controlled from Singapore but he works in the Applicant’s Sydney office. On 7 September 2011, the Singapore office requested that he go to Melbourne to inspect the ship. Mr Maneckshana flew to Melbourne on 8 September 2011 where he inspected the ship and interviewed the Chief Engineer, the Assistant Engineer and the Master. Mr Maneckshana said he has worked on numerous sewage treatment plants including those similar to that installed on the Fuji Spirit.
Mr Maneckshana described how the sewage treatment plant on the Fuji Spirit works. Sewage flows into an aeration tank where aerobic bacteria bio-digest the sewage. Air is pumped under pressure into the tank encouraging the bacteria to consume the sewage and also lifting the activated sludge into a clarification tank and later into a chlorination tank where chlorine tablets kill any organisms in the sludge. From time to time, this inert sludge is pumped out, the system is flushed out, and then put back on line.
Mr Maneckshana said that, according to the Fuji Spirit’s maintenance records, its plant was pumped out, back-flushed, the bacterial culture was topped up, and put back on line on 4 September 2011 while at sea. He said that when the plant was put back on line, the engineers may have adjusted the air pressure incorrectly, or the pressure could have dropped over the course of two or three days and could have caused the “non-flow” through the sludge return line (transcript, 12 June 2012, p 16).
Mr Maneckshana said the Chief Engineer or Assistant Engineer are required to inspect the ship’s machinery three or four times a day – in the morning, in the afternoon, and at night. For the sewage treatment plant, this would involve checking the sludge return line, the air pressure, and making sure that there are no leaks and that the plant is operating normally (transcript, 12 June 2012, p 17).
Mr Maneckshana said on the morning of 7 September 2011, the Fuji Spirit “made fast” at 9:48am. Prior to this, the ship would have been manoeuvring and the Chief Engineer and First Assistant Engineer would have been in the engine room in case anything should go wrong in closed waters. Thus, they would not have conducted routine maintenance at this time. Based on the normal routine, a routine inspection might have taken place about noon. The ship began discharging its cargo of crude oil at 2:42pm. Mr Maneckshana said it is possible the sludge return line might have dried out by the time Mr Rosairo’s inspection began at 3:30pm (transcript, 12 June 2012, p 55).
Mr Maneckshana said there will always be a layer of slime on the inside of the sludge return line and “If there is non-flow for even an hour, that hose is going to dry up” (transcript, 12 June 2012, p 40). The engineers told him that at the time of the AMSA inspection, the air pressure was too low and there was no flow through the sludge return line. This was an easy thing to rectify by adjusting the air pressure. Mr Maneckshana said he was told by the engineers that they tried to explain this to Mr Rosairo, but he would not take their word for it. They were scared because Mr Rosairo was showing signs of aggression, both verbal and in his body language.
Mr Maneckshana said that when he visited the ship on 8 September 2011, he spent about two hours speaking with the Master and Chief Engineer who then called in the First Assistant Engineer, with whom Mr Maneckshana spoke in the presence of the others. Mr Maneckshana also spent between 30 and 45 minutes speaking with Mr Rosairo. Mr Maneckshana said when he spoke with Mr Rosairo, “He did not seem to me like someone who understood the system very well” (transcript, 12 June 2012, p 49). Mr Maneckshana made short notes of the conversations which he used in writing his report. The Master, Chief Engineer and First Assistant Engineer were asked to prepare statements but Mr Maneckshana did not have these at the time he prepared his report. Mr Maneckshana said he sent his report to the Fleet Director in Singapore who sent it to the Director of Marine Quality Assurance in Vancouver. Mr Maneckshana had a telephone discussion with both the Singapore and Vancouver offices before finalising his report on 14 September 2011 (transcript, 12 June 2012, pp 31 – 33). The purpose of his report was to set out what had occurred and why the ship was detained.
Mr Maneckshana agreed that in his report he expressed concern that the Chief Engineer and First Assistant Engineer did not know the correct air pressure setting for the plant (transcript, 12 June 2012, p 41). He agreed that despite the Chief Engineer or First Assistant Engineer inspecting the machinery three to four times a day, they did not pick up that the air pressure setting was incorrect (transcript, 12 June 2012, p 42). Mr Maneckshana also agreed that the crew did not comply with the instructions in the maintenance schedule (transcript, 12 June 2012, p 65). Mr Maneckshana acknowledged that when the sludge does not reticulate properly, it causes a build up of sludge in the clarification tank. Ultimately, this will cause sludge to spill back into the aeration tank, but not into the chlorination tank, because the sluice for the aeration tank is lower. Moreover, because the plant had been flushed out four days earlier, there was no possibility that the system could fill up resulting in an overflow and causing pollution (transcript, 12 June 2012, pp 42 – 45).
Darryl Rosairo
Mr Rosairo said he is qualified as a Master Mariner for which he completed a Diploma at the Melbourne Institute of Technology, including studying engineering. He undertook further training for accreditation as a Port Marine Surveyor. He has experience of sewage treatment plants from his long career at sea and is “very familiar with the concept and the procedures” (transcript, 12 June 2012, p 73). Mr Rosairo said his primary role as a Port State Control Surveyor is to ensure that a ship’s machinery is functioning correctly and, if it is not, point out the defect. It is then up to the ship’s crew to work out how to rectify the problem (transcript, 12 June 2012, p 74).
Mr Rosairo was asked about the use of Action Codes 17 and 30. With a Code 17, requiring rectification of a defect before departure, whether a further inspection of the ship is made before departure depends on the availability of the surveyor. Sometimes a verbal assurance from the Master that the defect has been rectified is accepted. Mr Rosairo acknowledged that when a Code 17 is issued, there is a strong incentive for the Master to ensure the defect is fixed because of the possibility that a Port State Control Surveyor will conduct a further investigation to check this. Even if the Master is only required to confirm to the surveyor over the phone that the defect has been fixed, this is then recorded in AMSA’s records. ITS 63, Annex D states that in the case of an Action Code 17, “A follow-up visit will normally be required”. (The limitation on a Code 17 is that in the event that the defect is not rectified: ITS 63 says “A Code 17 cannot be ‘upgraded’ to a Code 30”.)
Mr Rosairo said that with a Code 30, requiring the provisional detention of the ship, an inspection is required to confirm the defect has been rectified before the provisional detention can be lifted. With a defect that can lead to a provisional detention, AMSA surveyors always allow time to rectify the defect while the surveyor is on board (transcript, 12 June 2012, pp 74 – 75).
Mr Rosairo said that he had seen “quite a lot” of the sewage treatment plants of the kind installed on the Fuji Spirit. His view, based on experience, is that they can clog up easily and if this is not rectified immediately, the system will stop working. There is then a danger that a build up of sludge will cause an overflow into the chlorination tank which, if filled to a high level, will cause activation of the discharge pump which will pump the contents of that tank overboard (transcript, 12 June 2012, p 75).
Mr Rosairo said he had a clear recollection of dried up sludge in the Fuji Spirit’s sewage treatment plant’s sludge return line. It could not have dried out in a few hours, because there would have been some evidence of moisture as a result of the humidity in the plant. His best estimate was that the plant “hadn’t been operating for a while” (transcript, 12 June 2012 p 76).
Mr Rosairo said he asked the Chief Engineer to investigate why the sewage treatment plant tank was half full. The reply he got at a later stage was that “they found that the clarification valve was not completely shut”. Mr Rosairo explained that he meant by this the second stage drain valve at the bottom of the clarification hopper (transcript, 12 June 2012, p 80).
In cross-examination, Mr Rosairo said the Fuji Spirit’s sewage treatment plant was “one widely used on a lot of ships” (transcript, 12 June 2012, p 83). He approached his inspection of the plant in accordance with Manuals for this type of plant. The reason for the sludge return line being a clear vinyl hose is to facilitate monitoring of the flow of effluent through the hose. Apart from checking the air supply gauges, there is nothing else visible to demonstrate the plant is working. Mr Rosairo said that when he saw the dried up sludge in the sludge return line, he asked for the hose to be disconnected so that he could see inside to check whether there was a blockage (transcript, 12 June 2012, p 86). When the hose was disconnected, “a lot of flakes fell down on deck” (transcript, 12 June 2012, p 87). At that stage, he left the engine room to get his camera from the ship’s office and, when he came back, he took pictures of the hose. Mr Rosairo said he asked the crew why the plant was not working, but they seemed to think it was working.
Mr Rosairo said he then went back to the ship’s office and, as a matter of protocol, phoned his manager and told him what he had found: that there was no sludge return, that the hose was dry and flakes fell out when the hose was removed, that the air pressure gage was reading 1kg/cm2 (the Manual said the correct reading was 3kg/cm2), and that in this type of sewage treatment plant, there was no holding tank. His manager, who is a Marine Engineer, told him that it was a detention matter (transcript, 12 June 2012, p 90).
Mr Rosairo told the Master of the Fuji Spirit that if the defect could be rectified while Mr Rosairo was completing his paperwork, he would treat the defect as a Code 17 matter, requiring rectification before the ship departed port, reducing the Code 17 to a Code 10 matter on rectification. (ITS 63, Annex D states that Action Code 10 is used “when a surveyor has checked that a noted deficiency has been rectified”.)
Mr Rosairo said the time taken for an inspection varies from one ship to another. He described the Fuji Spirit as a “fairly large” oil tanker (transcript, 13 June 2012, p 103). At the time of his inspection, the ship’s cargo, crude oil, was being discharged and a vetting officer was also present, but Mr Rosairo was given priority. Mr Rosairo said when he conducts such an inspection, he tries to be as professional as he can, and he denied speaking harshly to the crew or in a way that would suggest he was irritated (transcript, 13 June 2012, p 105). He acknowledged that his “detection of the defective sewage treatment plant may have contributed to the engineers being a little bit anxious” (transcript, 13 June 2012, p 106).
Mr Rosairo said he reviewed the manual for the sewage treatment plant in the Engine Room to check the correct air pressure for the plant’s operation. He said that, as a matter of course, he would have asked to see the log for the plant, but he did not record this in his notes.
Mr Rosairo said that after he identified the defect in the operation of the sewage treatment plant, he gave the crew time to fix the problem while he attended to his paperwork. He said he was probably on the ship 45 minutes beyond his time, and if fixing the problem was as simple as adjusting the air pressure, “that would have taken them 10 minutes max” (transcript, 13 June 2012, p 119). When told by the Chief Engineer that the plant was working, he went back down to inspect the plant. By that time, he knew from the manual that the correct air pressure was 3kg/cm2. On inspection, he found the effluent was passing through the sludge return line in spurts, and saw that the air pressure had been adjusted to 4kg/cm2. Mr Rosairo said this indicated that the hose was still clogged (transcript, 13 June 2012, pp 120 – 1). It was at that stage that he decided to issue a Code 30.
Wayne Cooper
Wayne Cooper, the Manager of AMSA’s Maritime Operations Division – South, provided a statement dated 1 February 2012. Mr Cooper said he spent 15 years at sea, and is a Marine Engineer. He worked for 10 years as a Marine Surveyor with AMSA before being appointed Manager in 2010. Mr Cooper explained the operation of the sewage treatment plant on the Fuji Spirit, and described his involvement in the events leading up to Mr Rosairo’s issue of a provisional detention order. Mr Cooper said that when Mr Rosairo reinspected the plant and found the sludge return flow was intermittent and the air pressure was set at 4kg/cm2, 30 per cent high than that specified in the manual, this indicated a blockage in either the air or sludge return lines and that the plant was not operating according to the manufacturer’s specification. The ship’s crew’s attempts to rectify the problem “by adjusting the air regulator did nothing to restore the sludge flow and demonstrate[d] a lack of understanding of the principles of operation of the unit” [paragraphs 27 – 8]. As there was no alternative sewage treatment option, an “Action Code 30 (ship detained) indicated the seriousness of the situation” [paragraph 32].
Mr Cooper also gave oral evidence at the hearing. He said if there is a build up of sludge in the plant’s aeration tank, it will flow into the clarification tank even if the air lift is not working. Eventually, the accumulation of sludge in the clarification tank will result in sludge flowing into the chlorination tank (transcript, 13 June 2012, pp 133 – 134).
Mr Cooper said the dried flakes of sludge in the sludge return line found by Mr Rosairo suggests the system had not been working for a considerable time. The humidity in the system meant that the line would not dry out within hours – it is more likely that this would take “a day or more” (transcript, 13 June 2012, p 135). When Mr Rosairo was called back to reinspect the plant and observed effluent spurting through the hose, this indicated the system [was] not operating in accordance with the manufacturer’s specification and that there was a defect in the system (transcript, 13 June 2012, p 135). Mr Cooper said there are a range of possible reasons for such a defect, ranging from something that can be easily fixed to something fundamentally wrong with the system.
Mr Cooper said AMSA’s role is to see whether the plant is operating properly. It is not AMSA’s policy to diagnose problems. This is the responsibility of the ship’s Master. If a defect is identified in the course of a Port State Control inspection, generally speaking, depending on the severity of the deficiency, the surveyor will follow a common sense approach and give the crew any opportunity to fix the problem (transcript, 13 June 2012, p 138). As to how much time should be allowed to fix a problem, Mr Cooper said if it is a matter of adjusting the air pressure valves, he would probably say half an hour was enough time “because there’s no guarantee that when they do all this, that they’re going to fix it” (transcript 13 June 2012, p 184). Whether a defect is sufficient to detain a ship depends on how significant the defect is to the seaworthiness of the ship.
Mr Cooper said that on the docking of a ship with a volatile cargo such as crude oil, there is likely to be a flurry of activity for the first hour after the vessel berths and then a careful maintenance watch of the discharge of the cargo by responsible members of the crew (transcript, 13 June 2012, p 154). Apart from a Port State Control inspection by an AMSA surveyor, there may also be a vetting inspection by a prospective charterer, for example by major oil companies who are assessing the suitability of a vessel for a future charter. Such an inspection tends to be more detailed than an AMSA inspection and would probably be arranged prior to the ship’s arrival in port (transcript, 13 June 2012, p 155).
Mr Cooper was asked about the lack of flow through the sludge return line. He said if he was conducting an inspection and there appeared to be no flow, he might ask the crew to disconnect the hose to verify this (transcript, 13 June 2012, p 167).
Mr Cooper was referred to the Chief Engineer’s statement dated 11 September 2011. Mr Cooper said the Engineer’s description of the action taken to try and rectify the defect indicated “unfamiliarity” with the operation of the plant. Had Mr Cooper been aware of this at the time of the inspection, and with the plant still not working after the crew had put a fix in place that they thought was acceptable but was not, he would not have been inclined to allow further time but instead would have left the ship and asked the crew to phone him when the classification society’s surveyor was satisfied that the equipment met international standards (transcript, 13 June 2012, p 187).
SUBMISSIONS
Applicant
Ms Nolan, for the Applicant, noted that the power in s 210(1) of the Navigation Act is a discretionary one and the Tribunal must therefore decide what is the preferable decision in all the circumstances of the case. While ITS 63 is intended as a guide to the exercise of discretion conferred on AMSA surveyors, the decision-maker (in this case, the Tribunal) must take care to ensure that it does not slavishly follow the guidelines and disregard the legislation and particular circumstances of the case.
The Applicant contends that the correct and preferable decision would have been to make no decision with respect to detention or, at most, to have applied an Action Code 17 requiring rectification before departure. Among the reasons put forward to support this contention, the Applicant contends that the Port State Control inspection was conducted in haste without the necessary technical expertise. Ms Nolan said that at the time of the inspection, a BP vetting inspector was on board and the ship was discharging a volatile cargo. Many of the crew were distracted by these tasks and felt flustered. Mr Rosairo’s manner was interpreted by the crew, whose first language was not English, as being angry, they felt intimidated, and he confused them by asking them to disconnect the sludge return line.
Ms Nolan submitted that a defect will only render a ship ‘unseaworthy’ if it cannot be readily fixed on the voyage in the ordinary course of management. In this case, the defect was readily curable by adjusting the air pressure, which the manufacturer’s manual contemplated needed to be inspected on a daily basis.
Ms Nolan said the fact that ITS 63 states a Code 17 cannot be upgraded to a Code 30 is an irrelevant consideration to a surveyor’s decision-making. It creates a systemic bias towards the use of a Code 30 which will have a significant adverse effect on whether ship charterers will charter a particular vessel. At most, the AMSA Surveyor should have applied a Code 17 which, according to ITS 63, will normally require a follow up inspection. However, Ms Nolan pointed to other powers open to AMSA under the Protection of the Sea Act which could have been utilised by AMSA in this situation, for example, a direction that the sewage treatment plant not be used in port or that sewage from the plant be discharged at a reception facility.
Ms Nolan submitted that Mr Rosairo should have allowed the crew a greater opportunity to fix the problem. There was no immediate threat to the environment and his decision to issue a provisional detention order was excessive in the circumstances.
Respondent
Mr Erskine, for AMSA, submitted that the wording of s 210(1) of the Navigation Act indicates that there is a temporal element requiring that the Tribunal only take into account evidence before the original decision maker: Shi v Migration Agents Registration Authority (2008) 235 CLR 286, for example Kiefel J at 324 ([133] – [134]). Section 201(1) requires that consideration be given to whether “it appears” to AMSA that a ship is unseaworthy or substandard, in which case AMSA may order that the ship be “provisionally detained”. The provisional nature of the order – the first decision contemplated by s 210 – is reflected in s 210 (2) to (5), requiring the preparation of a report on whether the ship is unseaworthy or substandard. On receipt of the report, s 210(6) provides for AMSA to make a second decision – on whether to finally detain the ship or order its release unconditionally or subject to conditions.
Thus, Mr Erskine submitted that if equipment on the ship is not working and there appears to be a threat to the environment, then the ship will appear to be unseaworthy. The reason why the equipment is not working is then a matter for further investigation under s 210(2) to (5) and for final determination under s 210(6). The AMSA inspector does not have to know why the equipment is not working – only that it is not working. Thus, the focus in this case is on the state of the equipment at the time of the initial inspection and matters that should have been in evidence at that time.
Mr Erskine said if the equipment appears to have been faulty at the time of the initial inspection, there is then a further question: whether the apparent fault justified the finding of unseaworthiness and provisional detention.
Mr Erskine submitted that much of Mr Maneckshana’s report was irrelevant to these issues and, in any event, it should be noted that he was an employee of the Applicant and not a dispassionate observer. His report includes unspecified input from the Fleet Director in Singapore and the Director of Marine Quality Assurance in Vancouver, and did not take into account the statements from the Master, Chief Engineer and First Assistant Engineer, which were received after the report was finalised. Mr Maneckshana also seems to have assumed Mr Rosairo’s account was wrong if it was not in accord with the evidence of the crew. Mr Maneckshana’s evidence should therefore be treated with caution and given little weight.
Mr Erskine said there is no evidence that inspections of the sewage treatment plant by the crew were being made in accordance with the manual. The flakes of sludge that fell on the floor when the sludge return line was disconnected indicated the equipment had not been working for some time. Moreover, both Mr Rosairo’s and Mr Maneckshana’s evidence indicates that the crew did not know the correct air pressure setting, and were not familiar with the plant.
Mr Rosairo allowed a reasonable time for the crew to fix the problem but they were unable to do so. On leaving the ship, an important piece of equipment was not operating properly, the crew was unable to fix it, and provisional detention was a reasonable decision to take to facilitate the further steps contemplated by s 210(2) to (6) being taken. On the next day, the problem having been fixed, the provisional detention was lifted as provided for in the legislation. Thus, the correct or preferable decision, standing in the shoes of the AMSA surveyor at that time, is to affirm the decision.
Mr Erskine noted that the Action Codes are an outcome of an administrative agreement between groupings of maritime nations. The issuing of an Action Code 17 is an administrative option not open to the Tribunal under s 210(1).
DISCUSSION
As stated above, the first issue for the Tribunal to determine is whether, at the time of the inspection by the Port State Control inspector, Mr Rosairo, the sewage treatment plant on the Fuji Spirit appeared to be defective. I agree with Mr Erskine’s submission that the wording of s 210(1) indicates that there is a temporal element limiting the review to how the plant appeared at the time of the inspection. Thus, the focus of any review should be on its appearance at the time of the decision..
I accept Mr Rosairo’s evidence (which is not in dispute) that at the time of his initial inspection the sewage treatment plant was not working properly. There was no effluent passing through the clear vinyl sludge return line as there should have been and, when disconnected, flakes fell onto the engine room floor, indicating that it had not been working for a while. I also find Mr Cooper’s evidence that, because of the humidity in the system, it was likely that it would take a day or more for the vinyl hose to dry out, to be plausible. In this regard, I do not accept Mr Maneckshana’s evidence that the hose could dry up if there is non-flow for even an hour. In any event, it is clear that the sewage treatment plant was not working properly, and was apparently defective, at the time of the inspection.
The second issue for the Tribunal to determine is whether an apparently defective sewage treatment plant is a sufficient ground for a finding of unseaworthiness and for making a provisional detention order under s 210(1) of the Navigation Act.
I note the definition of ‘seaworthy’ in s 207(1) of the Act. Amongst other requirements for a ship to be treated as seaworthy, the definition states that the ship should “not pose a threat to the environment”. I also note the power to provisionally detain is exercisable where a ship is ‘substandard’, meaning, pursuant to s 207A, that even if the ship is seaworthy, where conditions on board the ship are clearly hazardous to safety or health, it may appear to be substandard having regard to prescribed matters, which include whether the sewage treatment plant is not operating in accordance with the manufacturer’s instructions: see Marine Orders Part 11 (at paragraph 16, above).
Ms Nolan referred me to the decision in CV Sheepvaartonderneming Ankergracht v Stemcor (A/sia) Pty Ltd (2007) 160 FCR 342, where the Full Federal Court discussed the meaning of unseaworthiness. At [183], the Court referred to the High Court decision in Huddart Parker Ltd v Cotter (1942) 66 CLR 624, at 663, where Williams J said:
If, therefore, the defect is sufficient to render the ship unfit for the due and safe carrying of the goods or the crew, and it is not a defect which can be readily cured on the voyage, it will constitute unseaworthiness …
The Federal Court also referred, at [187], to Scrutton LJ’s judgment in FC Bradley & Sons Ltd v Federal Steam Navigation Co Ltd (1926) 24 Ll L Rep 446, at 454:
Scrutton LJ held that the vessel has to be reasonably fit … . He also held that it was well established that a ship was not unseaworthy, at the beginning of the voyage, because of a defect which could easily be rectified on the voyage in the ordinary course of management …
With the definitions of ‘seaworthy’ and ‘substandard’ in the Navigation Act, and the specific power given to AMSA to provisionally detain a ship in s 210(1), I have not found the common law to be of assistance in this case. By contrast, the statutory context in which the power to detain is given to AMSA is of assistance in understanding how the s 210(1) power is intended to operate. As Mr Erskine pointed out, the power is one to provisionally detain, consequent upon which s 210(2) to (5) require further action, in particular the preparation of a report as to whether the ship is unseaworthy or substandard, which may involve a survey of the ship where necessary. Section 210 contemplates two decisions by AMSA, the first being provisional detention of the ship and the second, unless the ship has already been released unconditionally, being a decision made on receipt of the report on whether the ship is unseaworthy or substandard, a decision to either finally detain the ship or to release it unconditionally or subject to such conditions as AMSA considers appropriate.
The Tribunal notes that marine pollution is a matter of international concern in respect of which Australia has international treaty obligations pursuant to MARPOL. Australia also has obligations as a result of IMO Resolution A.787(19) Port State Control Procedures, in relation to unseaworthy and substandard ships.
In the Tribunal’s view, it is clear from the legislation and the context in which the legislation operates that a defective sewage treatment plant is to be regarded as a sufficiently serious matter for a finding of unseaworthiness. In this case, the Fuji Spirit’s sewage treatment plant was apparently defective. After an attempt by the ship’s crew to fix the problem while Mr Rosairo was completing his paperwork in the ship’s office, the plant was still, in his view, defective. I note the response by the crew was sufficient to raise doubts about their familiarity with the operation of the plant, as Mr Maneckshana acknowledged. The crew were not available to give evidence about this at the hearing.
At the time Mr Rosairo left the ship, it was not clear what the cause of the problem was. As Mr Cooper said, there were a range of possible reasons for such a defect, from something that could be easily fixed, to something that was fundamentally wrong with the plant. In my view, having allowed time for the crew to fix the defect and in the light of what appeared to be the crew’s lack of familiarity with the plant, there were sufficient grounds for a finding that the ship was apparently unseaworthy and for the making of a provisional detention order under s 210(1) of the Navigation Act.
The third issue for the Tribunal to determine is whether the decision to detain the Fuji Spirit was the correct and preferable decision in all the circumstances. The Tribunal notes that AMSA prepared ITS 63 to provide guidance to its marine surveyors in undertaking their work. Relevantly, Annex D provides guidance in relation to ‘Deficiencies and Detentions’, including on the use of Action Codes.
As the Tribunal said in Fleet Management Ltd and Australian Maritime Safety Authority (2007) 94 ALD 285 at [16], while ITS 63 “does not have the force of a regulation or maritime order … it does set out the policy of the Authority and is intended to guide the exercise of the discretion conferred on the Authority by sections 207 and 210 of the Act.” The Tribunal will generally apply lawful government policy unless there are cogent reasons to the contrary, for example that the application of a policy would lead to an injustice in a particular case: Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, at 644-5. In this instance, however, while AMSA policy may be of assistance to the Tribunal in terms of determining the correct or preferable decision, it is not open to the Tribunal to make a decision to apply the Action Codes, although this could be the subject of a recommendation under s 43(1)(c)(ii) of the Administrative Appeals Tribunal Act 1975.
In this case, it is easy with the benefit of hindsight to criticise the AMSA decision, given that the sewage treatment plant on the Fuji Spirit was apparently working properly after further adjustments had been made either later on 7 September or early on 8 September 2011. That this would be the outcome was, obviously, not known to Mr Rosairo at the time he left the ship.
I accept Mr Cooper’s evidence that while a Port State Control inspector will usually allow a short time to fix a problem, as Mr Rosairo did here, at some point a line has to be drawn, remembering that what is at issue is the making of a provisional detention order which anticipates the making of a second decision once the cause of the defect has been established.
The Applicant has referred to the practical consequences of a provisional detention order being made for the reputation of a ship, with potential charterers viewing such an order negatively. The context is one in which it is open to the Port State Control inspector to apply one of a number of ‘Action Codes’ set out in ITS 63 to address the problem according to the inspector’s assessment of the situation. It is true that the inspector could have applied an Action Code 17, especially in view of the fact that the Fuji Spirit was not due to leave port for another eight days, but the use of a Code 17 did not mandate a further inspection and it was still open to the ship to leave port without the defect being rectified.
For the Tribunal, it is the application of legislative scheme that determines its decision. In this instance, I am satisfied from the facts that at the time of the making of the decision, given the evidence available to the AMSA delegate at the time, the correct or preferable decision was made. The legislative scheme contemplated that if the defect were to be rectified, the ship could be unconditionally released from the provisional detention order. This is exactly what happened, with Mr Rosairo lifting the detention order on inspecting the ship again on 8 September 2011 and being satisfied that the defect had been rectified.
DECISION
The decision under review is affirmed.
I certify that the preceding 88 (eighty eight) paragraphs are a true copy of the reasons for the decision herein of Deputy President R P Handley.
..........[sgd]..............................................................
Associate
Dated 7 August 2012
Dates of hearing 12-13 June 2012, 24 July 2012 Date final submissions received 24 July 2012 Counsel for the Applicant B Nolan Counsel for the Respondent
Solicitors for the Respondent
C Erskine
HWL Ebsworth Lawyers
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