Ocean Prefect Shipping Ltd v Dampskibsselskabet Norden as

JurisdictionEngland & Wales
JudgeMr Justice Teare,Mr. Justice Teare
Judgment Date06 December 2019
Neutral Citation[2019] EWHC 3368 (Comm)
Date06 December 2019
Docket NumberCase No: CL 2019 000736
CourtQueen's Bench Division (Commercial Court)

[2019] EWHC 3368 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

Mr. Justice Teare

Case No: CL 2019 000736

Between:
Ocean Prefect Shipping Limited
Claimant
and
Dampskibsselskabet Norden AS
Defendant

Charles Priday and Jason Robinson (instructed by Sash Solicitors) for the Claimant

James Shirley (instructed by MFB) for the Defendant

Emily Wilsdon (instructed by The Government Legal Department) for the MAIB

Hearing date: 4 December 2019

Approved Judgment

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.

THE HONOURABLE Mr Justice Teare

Mr Justice Teare Mr. Justice Teare
1

On 10 and 11 June 2017 the British registered vessel OCEAN PREFECT, which was under charter, twice ran aground in the course of entering the port of Umm Al Quwain in the UAE. As is often the case with such events the grounding of this British registered vessel caused the Marine Accident Investigation Branch, an independent inspectorate within the Department of Transport (“MAIB”), to investigate the circumstances of the grounding to see what lessons could be learnt with regard to improving the safety of shipping. As is also often the case when a vessel under charter grounds, her Owners alleged that the grounding was caused by a breach of the warranty by the Charterers that the port to which the vessel was directed by the Charterers was safe, and that such breach had caused financial loss to the Owners. The charterparty contained a London arbitration clause and so the Owners' claim is being pursued in arbitration.

2

The MAIB completed its investigation into the grounding and issued its report on 27 April 2018. The arbitration hearing is due to take place next week and the Owners wish to refer to the MAIB report. The Charterers and the MAIB say that that should not happen. They say that before the MAIB report is admitted into the arbitration the court must give permission for that to happen pursuant to regulation 14(14) of the Merchant Shipping (Accident Reporting and Investigation) Regulations 2012. The Charterers and the MAIB further say that permission should be refused. The Owners say that the court's permission is not required and that any decision as to admissibility of the MAIB report is a matter for the arbitral tribunal pursuant to section 34(2)(f) of the Arbitration Act 1996. If the court's permission is required then the Owners says that the court should grant permission in the interests of justice.

3

Since the arbitration hearing is scheduled to take place next week the court is required to decide the application as a matter of great urgency. The Owners' application was only issued on 27 November 2019 and was heard on 4 December 2019. In view of the need for urgency this judgment will not, perhaps, be as full as it would otherwise be. That is unfortunate because this is the first occasion on which the use of MAIB reports in a private and confidential arbitration has arisen for decision. The issue is, as will become apparent, of very great concern to the MAIB. Equally, the issue is of very great concern to the Owners who wish to rely upon the MAIB report to support their claim in the arbitration.

4

The Owners' arbitration claim was issued pursuant to CPR 62.2(1)(d). Although counsel for the MAIB objected to that procedure it seems to me to be unobjectionable. However, the MAIB was not made a party, although notice of the application was given to the MAIB. I consider the MAIB ought to have been made a party. The MAIB has a very obvious interest in the application.

5

The MAIB was established in 1989 following the HERALD OF FREE ENTERPRISE disaster. The manner in which it conducts investigations is governed by the Merchant Shipping Act of 1995. It is necessary to note a number of provisions. Section 259(2)(i) empowers an inspector

“to require any person who he has reasonable cause to believe is able to give any information relevant to an ……..investigation ….(ii) to answer……..such questions as the inspector thinks fit to ask, and (iii) to sign a declaration of the truth of his answers.”

6

It is the understanding of the Chief Inspector of the MAIB, Captain Moll, that a witness does not have any right to refuse to answer on the grounds that the answer may incriminate the witness. In return, section 259(12) provides that

“no answer given by a person in pursuance of a requirement imposed under subsection (2)(i) above shall be admissible in evidence against that person ……..in any proceedings except proceedings in pursuance of subsection 1(c) of section 260 in respect of a statement in or declaration relating to the answer”

7

Proceedings pursuant to section 260(1)(c) include such matters as making a false statement.

8

The Merchant Shipping (Accident Reporting and Investigation) Regulations 2012 were made by the Secretary of State pursuant to powers conferred by section 267 of the Merchant Shipping Act 1995. They provide as follows:

“5 (1) The sole objective of a safety investigation into an accident under these Regulations shall be the prevention of future accidents through the ascertainment of its causes and circumstances.

(2) It shall not be the purpose of such an investigation to determine liability nor, except so far as is necessary to achieve its objective, to apportion blame.”

9

Regulation 13(2) imposes an obligation upon the MAIB not to make certain documents or records (for example statements taken by an inspector or evidence from voyage data recorders) available for purposes other than a safety investigation, unless a court orders otherwise. Regulation 13(3) provides that a person who has given a statement to an inspector “may make available a copy of their statement or declaration to another person as they see fit”. Regulation 13(5) provides:

“Subject to paragraph (6), no order must be made under paragraph (2) unless the Court is satisfied, having regard to the views of the Chief Inspector, that the interests of justice in disclosure outweigh any prejudice, or likely prejudice, to—

a. the safety investigation into the accident to which the document or record relates:

b. any future accident safety investigation undertaken in the United Kingdom; or

c. relations between the United Kingdom and any other State, or international organisation.”

10

Regulation 14(14) provides:

“If any part of any document or analysis it contains to which this paragraph applies is based on information obtained in accordance with an inspector's powers under sections 259 and 267(8) of the Act, that part is inadmissible in any judicial proceedings whose purpose or one of whose purposes is to attribute or apportion liability or blame unless a Court, having regard to the factors mentioned in regulation 13(5) (b) or (c), determines otherwise.”

11

Regulation 14(15) provides:

“For the purposes of paragraph (14) the documents are any publication produced by the Chief Inspector as a result of a safety investigation.”

12

Regulation 14(17) defines “judicial proceedings” as including;

“Any civil or criminal proceedings before any Court or person having by law the power to hear, receive and examine evidence on oath.”

13

These regulations were first issued in 2005. The 2005 regulations were differently worded. The entire report was to be inadmissible and the word “tribunal” was also found in regulation 13(9) and (10) as follows (emphasis added):

“(9) If any part of the report or analysis therein is based on information obtained in accordance with an inspector's powers under sections 259 and 267(8) of the Act, the report shall be inadmissible in any judicial proceedings whose purpose or one of whose purposes is to attribute or apportion liability or blame unless a Court or tribunal, having regard to the factors mentioned in regulation 13(5) (b) or (c), determines otherwise.

(10) In this regulation judicial proceedings includes any civil or criminal proceedings before any Court, tribunal or person having by law the power to hear, receive and examine evidence on oath.”

14

The evidence before the Court from the Chief Inspector of the MAIB, Captain Moll, was that the 2005 Regulations were introduced by Parliament to address a concern that MAIB reports were being frequently relied upon by parties in proceedings to establish blame or liability. That recollection is supported by the comment in Admiralty Jurisdiction and Practice by Meeson and Kimbell 5 th ed. at paragraph 7–104 that prior to 2005 it was not unusual for the MAIB report to be included in the trial bundle. Reference was made to The Bowbelle [1997] 2 Lloyd's Reports 196 and The Saint Jacques II [2003] 1 Lloyd's Reports 203 where, in the latter case, Gross J. permitted reference to be made to the MAIB report as fresh evidence; it had been published after the decision of the Admiralty Registrar and before the hearing of an appeal from his decision. When maritime casualties were investigated by means of a Formal Investigation under the Merchant Shipping Act the report of the Formal Investigation was not admissible in subsequent litigation (usually, but not always, a collision action in the Admiralty Court); see The Speedlink Vanguard and The European Gateway [1986] 2 Lloyd's Reports 265 at pp.269–270. Nevertheless judges of great authority, in particular Devlin J. and Steyn J., suggested that the reports of a Formal Investigation should be made available to a court (pursuant to a statutory provision) so that it could make such evidential use of the report as it thought fit; see p.273. In the event the statutory provision introduced in 2005 made the limited provision now to be found in regulation 14(14) of the 2012 Regulations.

15

The 2012 Regulations were introduced to implement the Code of...

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