Waitemata Stevedoring Services Pty Ltd v The Ship "Rangitata"

[1998] FCA 304

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 115 of 1998

BETWEEN:

WAITEMATA STEVEDORING SERVICES PTY LIMITED
PLAINTIFF

AND:

THE SHIP "RANGITATA"
FIRST DEFENDANT

ECOMAR - SCHIFFARHTS GMBH & CO KG
SECOND DEFENDANT

JUDGE:	LINDGREN J
DATE:	16 MARCH 1998
PLACE:	SYDNEY

REASONS FOR JUDGMENT
(ex tempore)

INTRODUCTION

There is before the Court an application by the plaintiff for release from arrest of the ship “Rangitata”.  The ship was arrested on the plaintiff’s application.  The application for release has been brought on urgently.  There is evidence that notice of the application has been given to the caveators.  None have appeared to oppose the application.  The application for release is, however, opposed by the Marshal.  There is a dispute between him and the plaintiff as to the correct amount of the fees and expenses to which he is entitled.  By a letter dated 16 March 1998 from the Marshal’s solicitor to the solicitors for the plaintiff, the Marshal has made a demand for payment of $93,800, purportedly, pursuant to Admiralty Rule 78.  The plaintiff contends that the true amount of the fees and expenses of the Marshal is less.  The dispute is apparently to be the subject of a hearing before Tamberlin J on 25 March. 

The plaintiff submits that I should order release of the vessel now, leaving the Marshal in effect to be protected by the plaintiff's solicitor’s undertaking to the Court.  The Marshal submits that he should not be put in the position of having to rely on only the solicitor’s undertaking.

ADMIRALTY RULES
Admiralty Rule 39 provides that a party to a proceeding commenced as an action in rem may apply in accordance with Form 12 for an arrest warrant in respect of the ship or other property against which the proceeding was commenced.  Form 12 contains an undertaking by the party so applying “to pay the fees and expenses of the Marshall in complying with this application”. 

Admiralty Rule 41 provides that an application for an arrest warrant constitutes an undertaking to the Court by, in the circumstances of this case, the solicitor who applied for the arrest on behalf of the plaintiff, to pay to the Marshal on demand “an amount equal to the amount of the fees and expenses of the Marshal in relation to the arrest”.

Admiralty Rule 52(1) provides that a party to a proceeding may apply to the Court in accordance with Form 19 for the release of a ship or other property that is under arrest in the proceeding.  Form 19 contains a further undertaking by, in the circumstances of this case, the solicitor for the plaintiff “to pay the fees and expenses of the Marshal in connection with the custody of the ship ... while under arrest”.  Sub-rule 52(3) provides that on such an application the Court may order the release from arrest of the ship or property “on such terms as are just”. 

Rule 53 provides that the Marshal may refuse to release a ship or other property from arrest unless arrangements “satisfactory to the Marshal have been made for the payment of the fees and expenses of the Marshal in connection with the custody of the ship or property while it was under arrest”. Finally, Rule 78 provides that where a person is liable to pay fees and expenses of the Marshal under the Admiralty Rules, the Marshal may, inter alia, make one or more demands for interim payments on account of those fees or expenses.

REASONING
In the present case there are two undertakings by the plaintiff’s solicitor: that which arises by the operation of Rule 41 and the other contained in the application for release with which I am dealing.  I hasten to say that there is no suggestion that the plaintiff’s solicitor does not intend to honour his undertakings. 

As I see the position, the scheme of the Rules is that, as between the Marshal and the person who has given an undertaking, where there is a dispute as to the amount of the fees and expenses, as there is in the present case, it is the person, who has given the undertaking, rather than the Marshal, who must be at risk during the intervening period between the making of the application for release and the final determination of the correct amount of the fees and expenses to which the Marshal is entitled.

It seems to me that it is a price of the great benefit of being able to obtain an arrest of a ship that the Marshal must be furnished with the protection of both the in personam undertaking to pay and the security provided by custody of the ship itself coupled with the effect of the Admiralty Rules, in particular, Rule 53. To express the matter differently, at the present time the Marshal has the benefit of both the in personam undertaking and of security in the form of the ship under arrest.  What the plaintiff seeks is that the Marshal’s protection be reduced to that of having only the in personam undertaking.  It is not correct to say that the Marshal would be in as strong a position with only that undertaking: there is the possibility of complications if the solicitor who gave the undertaking should die or become bankrupt, for example.

It seems to me that if the plaintiff wishes to avoid the risk of incurring further charges while the ship continues to remain under arrest, it must come to terms with the Marshal, subject, of course, to the supervision of the Court.  This view is supported by the terms of Rules 53 and 78 to both of which I referred.

The present issue is really no different from that which commonly arises in other contexts from the impossibility of determining immediately an issue.  Pending the final determination of the amount of the fees and expenses to which the Marshal is entitled, it is clear to my mind, that it is the plaintiff which, if it wishes to have the ship released, must submit to such terms as will adequately protect the Marshal against the possibility that the amount contended for by him may be correct.

CONCLUSION
The appropriate order is that there be an order for release of the ship from arrest upon the plaintiff’s paying to the Marshal the fees and expenses of the Marshal in relation to the arrest and in connection with the custody of the ship while under arrest, or, alternatively, making arrangements satisfactory to the Marshal for the payment of those fees and expenses.

I certify that this and the preceding three (3) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren

Associate:

Dated:  1 April 1998

Counsel for the Plaintiff:	D A  Cowdroy QC with Ms L A  Muston
Solicitor for the Plaintiff:	Conway Leather Shaw
Solicitor for the Admiralty Marshal	D C  Coleman
Counsel for the Master and Crew:	J B  Whittle
Solicitor for the Master and Crew:	J A  Levingston
Date of Hearing:	16 March 1998
Date of Judgment:	16 March 1998