Tavoulareas v Tsavliris and Others (No 2) ; Tavoulareas v AG Tsavliris & Sons Maritime Company
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE TOMLINSON,Mr Justice Tomlinson |
| Judgment Date | 09 March 2006 |
| Neutral Citation | [2006] EWHC 414 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2001 Folio No. 1225 and 2004 Folio No. 675 |
| Date | 09 March 2006 |
[2006] EWHC 414 (Comm)
IN THE HIGH COURT OF JUSTICE
COMMERCIAL COURT
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Tomlinson
Case No: 2001 Folio No. 1225 and 2004 Folio No. 675
(1) George Tsavliris
(2) Andrew Tsavliris
(3) A.g.tsavliris And Sons Maritime Company
(4) Tsavliris Salvage International Ltd
Mr David Goldstone (instructed by Messrs Howe and Keates) for the Claimant
Mr Peter Irvin (instructed by Messrs Constant and Constant) for the Defendants in both actions
Hearing dates: 21 February 2006
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.
There is before the court an application in two related actions. The application is that in each action this court should give formal recognition to a judgment rendered by a court of another European Community State, here Greece, pursuant to Article 33 of Council Regulation (EC) No. 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, to which I shall refer hereafter as the "Judgments Regulation." The judgment of the Greek court grants negative declaratory relief. It is said that recognition of the Greek judgment in these actions would give rise to a defence of res judicata or issue estoppel which is why it is raised by the Defendants in the actions as the principal issue in the disputes between the parties. I have not been invited to decide whether recognition of the judgment would have the effect for which the Defendants contend. In certain circumstances it might not be possible or appropriate to consider an application of this sort without addressing that question. However I proceed upon the basis, as did the parties, that it is arguable that recognition of the Greek judgment might entitle the Defendants to have the English actions against them dismissed. In view of the conclusion which I have reached as to the disposal of this application I believe that it is unnecessary to decide what would be the effect of the Greek judgment were it to be recognised in these English actions.
The background to the actions brought both here and in Greece is unusual. The actions have their roots in a casualty suffered in August 1991 by a tanker called "Atlas Pride" and in her subsequent salvage. The Claimant Mr Tavoulareas is effectively the beneficial owner of the Atlas Pride. The salvage was carried out by the well known Tsavliris interests. The Defendants are companies and persons associated with the Tsavliris interests. I do not know when precisely the salvage was completed but in July 1993 the Lloyd's Open Form Salvage Award was published, making an award in favour of Tsavliris of a substantial sum in excess of US$7 million.
The origins of the dispute were described by David Steel J in a judgment which he gave in the first of the actions on 8 December 2004, [2004] EWCA 3400 (QB). The first action is brought by Peter Tavoulareas as Claimant against Messrs George and Andrew Tsavliris and also against two corporate Defendants, A.G Tsavliris and Sons Maritime Company and Tsavliris Salvage International Limited. Neither of the corporate Defendants has been served with the proceedings but the two personal Defendants were served therewith at the end of 2001. Although the proceedings were issued in November 2001 it is a feature of the action that so far the court has not been invited to adjudicate upon the merits of the dispute. It should not be thought however that that is indicative of inactivity. David Steel J began his judgment in this way: —
"The background to this dispute is very unusual. The claimant is in the ship owning business, and through a one-ship company called Atlas Marine Maritime Limited, he is effectively the beneficial owner of a tanker called Atlas Pride. The defendants are companies and/or personnel associated with a well-known salvage group, which I will call for short "Tsavliris".
In August 1991, that is to say some 13 years ago, the Atlas Pride suffered a casualty off the coast of South Africa. I am told that her bow fell off. At the end of the month, a Lloyd's Open Form Salvage Agreement was concluded between Tsavliris (for the moment I will not distinguish between the various companies within the group) and the shipowners.
Shortly thereafter, what I shall euphemistically call "arrangements" were entered into between the Tsavliris' interests and the shipowners. The documentation relating to those arrangements are threefold. Firstly, a letter dated 3 September 1991 on Tsavliris' notepaper addressed to Mr Alexatos, who I understand to be one of the principals in the shipowning company, headed "Atlas Pride – Heavy Weather Damage", the document reads: "We confirm that upon receipt of the salvage award or amicable settlement proceeds, we shall pay to you or your nominees the amount of 38% of the amount so received in the same currency, after first deducting relevant legal fees and other expenses and the cost of subcontracting equipment or services, provided the cost will not exceed 25% of the gross amount". There is then a further provision allowing for the position where the expenses are greater. That is signed on behalf of Tsavliris by a Mr Constantinides, a Managing Director.
At face value this is a remarkable agreement because it seems to involve the salvors agreeing simply to share the salvage award, and a very substantial proportion of it, with the shipowners.
Associated with this document is another more obscure document. Again it refers to the Atlas Pride, it is on Tsavliris' notepaper, it is signed by Mr Constantinides, and it reads: "We confirm the amount of the freight for the Alsama Alabama…" (I understand a vessel into which some of the cargo was transhipped): "…as well as the funds for the repairs, for which there will be the same facility. It shall be paid back to you normally as soon as the money is collected from the award."
Again, this is an unusual agreement (if it reflects one) in which somehow the freight for the lightening vessel, which perhaps was going to be paid by the shipowners, would be reimbursed out of the salvage award, but also that repair costs would receive the same treatment, repairs presumably to the vessel. Notably, the original document has a notation on it, which I do not believe we have focused on during the course of argument, referring to "Algamin Bank Netherlands NV" and a bank account at that bank held by Tango Investment Holding Corporation, another company in the Tsavliris group.
The third document which emerged in or around this time, is dated 30 September 1991, again on Tsavliris' notepaper and again apparently signed by Mr Constantinides. It is addressed to the board of directors of McHugh Investments Limited, care of Atlas Maritime, and reads: "We, A G Tsavliris hereby acknowledge we owe you the sum of $748,000 with which you have facilitated us upon our request to meet expenses relating to salvage and transhipment of the Atlas Pride and we confirm we shall repay the money to you, as well as any additional money you may loan us for the same reason immediately and unconditionally out of the salvage award relating to the Atlas Pride.
It appears that in June 1993, some considerable time after the completion of the salvage services, an assignment was entered into by the claimant in favour of Banque Indosuez in Paris. Notice of that assignment purporting to be under an unidentified loan agreement but certainly relating to advances made in respect of costs incurred in regard to the salvage of the Atlas Pride was given to Tsavliris….
A month later the salvage award was published. It made an award in favour of Tsavliris of a very substantial sum in excess of US$7 million. Given the nature of the casualty, I would regard it as likely that the vast bulk of the award was against the cargo interests."
I will call the action begun on 7 November 2001 "the first action." In it Mr Tavoulareas claims US$794,232.24 as the balance outstanding under the loan agreement.
On 8 November 2001 Messrs George and Andrew Tsavliris, their brother Nicholas Tsavliris and four Tsavliris companies, Alexander G. Tsavliris and Sons Shipping Company, Tsavliris Russ (Worldwide) Salvage and Towage Limited, Tsavliris Salvage International Limited and Tango Investment Holding Corporation issued proceedings in the Piraeus Multi-member Court of First Instance against two corporate defendants and Mr Tavoulareas personally. I shall call that action "the Greek action." In the document initiating the Greek action the Tsavliris interests referred to the instruments of 3 and 30 September 1991 and referred to a loan from the Tavoulareas interests to the Tsavliris interests which, it was said, had been fully repaid with interest. The Tsavliris interests claimed a declaration that they had no debt or responsibility to the Tavoulareas interests arising out of the various arrangements in connection with the salvage of the Atlas Pride. That document also stated that Mr Tavoulareas was resident in London giving an address in Regent's Park. Mr Tavoulareas had not in fact lived at this address since 1992.
The Greek proceedings were served upon the Public Prosecutor on 19 November 2001, whose function it was so far as concerned Mr Tavoulareas to forward the process for service pursuant to the Hague Convention. An attempt to serve the relevant documents at the Regent's Park address was indeed made although unsurprisingly this was unsuccessful. However it was contended by the Tsavliris interests that this was...
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