Eschersheim, The (Dortmund, Erkowit, Jade, Salus (formerly Rotesand))
|England & Wales
|LORD JUSTICE CAIRNS,LORD JUSTICE SCARMAN,SIR GORDON WILLMER
|22 July 1975
|Judgment citation (vLex)
| EWCA Civ J0722-1
|22 July 1975
|Court of Appeal (Civil Division)
 EWCA Civ J0722-1
In The Supreme Court of Judicature
Court of Appeal
Queen's Bench Division Admiralty Court
(Mr. Justice Brandon)
Lord Justice Cairns
Lord Justice Scarman and
Sir Gordon Willmer
Admiralty Action In Rem against:
The Ship "Salus" (formerly "Rotesand") and The Ship "Jade"
The Ship "Eschersheim"
MR. J.F. WILLMER Q.C. and MR. N. PHILLIPS (instructed by Messrs. Richards, Butler & Co, Solicitors, London) appeared on behalf of the Second Defendants in Action 1972 folio 451 and the Defendants in. Action 1972 folio 461.
MR. MICHAEL THOMAS Q.C. and MR. A. CLARKE (instructed by Messrs. Ince & Co., Solicitors, London) appeared on behalf of the First Defendants in Action 1972 folio 451.
MR. D.W. STEEL (instructed by Messrs. Waltons & Co., Solicitors, London) appeared on behalf of the Plaintiffs in Action 1972 folio 461.
This is an appeal from an interlocutory decision of Mr. Justice Brandon in two actions in rem for damage caused to the ship Erkowit and her cargo in the course of salvage operations in which the defendants' tug Rotesand was engaged. The Jade and the Eschersheim were two sister ships of the Rotesand. The owners of the Erkowit proceeded against the Jade and the owners of the cargo against the Eschersheim. (The shipowners also proceeded against the Rotesand, which had been sold and renamed Salus hut the action against that ship was discontinued and there is no need to make further reference to it.) In the ship's action the master and crew were joined to claim for loss of their effects. The defendants applied to the judge to strike out the writs or parts thereof, alternatively to stay the actions under Section 4 of the Arbitration Act 1950. He struck out the claim of the master and crew and from that part of his decision there is no appeal. Otherwise he dismissed the defendants' applications and they appeal. There are respondents' notices supporting the judge's decision on alternative grounds.
The facts are set out with the greatest care and clarity in the judgment of Mr. Justice Brandon reported in and I shall give only a brief summary of them.
On 30th October 1970 a collision took place in the Bay of Biscay between the Erkowit and the Dortmund. The Erkowit was holed and the Rotesand went to her assistance. A salvage agreement in Lloyds' open form was signed on behalf of both plaintiffs and of the defendants. The Rotesand towed the Erkowit to La Coruna and beached her. The defendants' servants then carried out operations, which were not effective, to save the Erkowit or her cargo and both (except perhaps for some small part of thecargo) became total losses. The cargo included a quantity of insecticide partly in drums on deck and partly in holds, which was washed into the sea. The Spanish government alleges on behalf of fishermen that the pollution of the sea caused great damage to their interests and claims heavy damages against the owners of the Erkowit and against the salvors. There is likely to be much delay before those claims are dealt with.
In this country actions in rem have been brought by both the present plaintiffs against the Dortmund and have not yet come to trial. In those actions the owners of the Dortmund by their defence contend, inter alia, that the loss of the Erkowit and her cargo and the pollution were caused by the negligence of the salvors.
Because the plaintiffs apprehended that such allegations would be made on behalf of the Dortmund they started the actions to which this appeal relates, the claims being made in tort or alternatively for the breach of the salvage agreement. The negligence alleged, as appears from an affidavit sworn on behalf of the plaintiffs, is (1) beaching the Erkowit in an exposed place; (2) patching her with wood and canvas instead of with steel; (3) delay in carrying out the operations. The damages claimed in the shipowners' action include an indemnity against any liability to the Spanish government.
In their application to the judge the defendants sought to strike out the plaintiff shipowners' claim for indemnity on the ground that the court had no jurisdiction in rem in respect of such a claim. In the course of the hearing of the appeal leave was given to the defendants to amend their notice of appeal and to contend that the whole of the writ should be set aside on the ground that the court had no jurisdiction in rem in respect ofany part of the claim. Further, leave was given to the defendants to amend their notice of appeal in the cargo owners' case to raise a similar contention.
In both actions the judge refused a stay under the Arbitration Act because, although he held that the disputes were within the arbitration clause of the salvage agreement, he exercised his discretion by refusing a stay.
In the respondents' notice in the shipowners' case those plaintiffs sought to found jurisdiction on a basis on which the judge had held against them, as an alternative to the bases on which he had held in their favour. As to stay, they contended that the judge was wrong in holding that the dispute was within the arbitration clause and advanced reasons, additional to those on which the judge based his decision, why the discretion should be exercised against a stay. By amendments for which leave was given during the hearing of the appeal they put forward, in relation to the application to strike out, further alternative bases of jurisdiction.
In the cargo owners' case the original respondents' notice dealt only with the application to stay on broadly similar lines to the shipowners' notice. By supplementary respondents' notice, for which leave was given during the hearing of the appeal, they, like the shipowners, put forward in relation to the application to strike out alternative bases of jurisdiction.
The jurisdiction of the High Court in Admiralty matters is now defined by Section 1 (1) of the Administration of Justice Act 1956 in terms which so far as relevant to the present appeal are as follows: "The Admiralty jurisdiction of the High Court shall be as follows, that is to say, jurisdiction to hear and determine any of the following questions or claims" – I omitparagraphs (a) (b) and (c) – "(d) Any claim for damage done by a ship; (e) Any claim for damage received by a ship;" – I omit (f) – "(g) Any claim for loss of or damage to goods carried In a ship; (h) Any claim arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship; (j) Any claim in the nature of salvage (including any claim arising by virtue of the application, by or under section Fifty-One of the Civil Aviation Act 1949, of the law relating to salvage of aircraft and their apparel and cargo".
The mode of exercise of such Admiralty jurisdiction is prescribed by Section 3 of the Act, the relevant provisions of which are as follows: "(1) Subject to the provisions of the next following section, the Admiralty jurisdiction of the High Court, the Liverpool Court of Passage and any County Court may in all cases be invoked by an action in personam".
"(4) In the case of any such claim as is. mentioned in paragraphs (d) to (r) of subsection (1) of Section One of this Act, being a claim arising in connection with a ship, where the person who would be liable on the claim in an action in personam was, when the cause of action arose, the owner or charterer of, or in possession or control of, the ship, the Admiralty jurisdiction of the High Court and (where there is such jurisdiction) the Admiralty jurisdiction of the Liverpool Court of Passage or any County Court may (whether the claim gives rise to a maritime lien on the ship or not) be invoked by an action in rem against – (a) that ship, if at the time when the action is brought it is beneficially owned as respects all the shares therein by that person; or (b) any other ship which, at the time when the action is brought, is beneficially owned as aforesaid".
The plaintiff shipowners contended on the appeal that their claim fell within paragraphs (d), (e), (h) and possibly (g) and(j) of Section 1 (1). Damage, they claim, was dona to the Erkowit by the Rotesand, by beaching the Erkowit in an unsafe place; clearly damage was received by the Erkowit; the claim in contract arises out of the salvage agreement, which was an agreement for the use or hire of the Rotesand. As to (g), the suggestion is that the claim for indemnity in respect of the pollution may in a broad sense be said to be a claim for the loss of goods carried in a ship; and as to (j) it was submitted that a liberal interpretation of the words "in the nature of salvage" would enable a claim for damage done in the course of salvage to be included. I do not consider that either (g) or (j) is capable of the meaning sought to be attached to it and if the shipowners are to establish jurisdiction at all it must in my view be under (d), (e) or (h).
The cargo owners' contentions were similar except that their main reliance was on (d), (g) and (h). Their attempts to apply (e) and (j) to the cargo involved as strained a construction of the paragraphs as that suggested by the shipowners in relation to (g) and (j). So in my opinion the cargo owners must look to (d), (g) or (h) if they are to found jurisdiction. Their case under those paragraphs corresponds exactly with that of the shipowners under (d), (e) and (h).
The defendants' case under (d) is that neither the Erkowit nor her...
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