Lloyd's Maritime and Commercial Law Quarterly
AUSTRALIAN MARITIME LAW DECISIONS 1995
Martin Davies*
A. Practice and procedure
1. Malaysia Shipyard and Engineering Sdn Bhd v. The ship Iron Shortland as surrogate for the ship Newcastle Pride
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In this case, the Federal Court of Australia held that the word “owner” in the surrogate ship provision (s. 19) of the Admiralty Act 1988 (Cth) includes a beneficial owner who is not the registered owner of the ship in question. The decision may have considerable significance in practice, because it makes it possible for claimants in Admiralty to go behind the veil of the one-ship company to pursue the “true” owner of a fleet of ships. Whether claimants will often be able to avail themselves of that possibility remains to be seen.
The plaintiff claimed that it had not been paid for repairs performed on the ship Newcastle Pride at its shipyard in Malaysia. The registered owner of the Newcastle Pride was a one-ship company which was a wholly-owned subsidiary of Capeco Maritime N.V. (“Capeco”). Capeco also owned all the shares in another subsidiary, Everbird Corp. N.V. (“Everbird”), which was the registered owner of the ship Iron Shortland. The Iron Shortland had been chartered and sub-chartered under demise charterparties, and it was being operated by the demise sub-charterer, B.H.P. Transport Pty Ltd (“B.H.P.T.”). The plaintiff instituted Federal Court proceedings in rem against the Iron Shortland as surrogate for the Newcastle Pride, and had the ship arrested while waiting for berth in Western Australia. The writ named Capeco as the “relevant person” (the person who would be liable in an action in personam).2
The plaintiff argued that the Iron Shortland was a surrogate for the Newcastle Pride because Capeco satisfied the requirements of s. 19 of the Act, in that it was (a) the owner or charterer of, or in possession or control of, the Newcastle Pride when the cause of action arose, and (b) the beneficial owner of the Iron Shortland when the proceeding was commenced. Beneficial ownership, the plaintiff said, was sufficient to satisfy the requirements of s. 19.
Capeco did not enter an appearance and took no part in the proceedings, which were contested by B.H.P.T. By notice of motion, B.H.P.T. sought orders that the Iron Shortland
* Harrison Moore Professor of Law, The University of Melbourne. I am grateful to the members of the Maritime and Air Law Group of Mallesons Stephen Jaques in Melbourne for their assistance in preparing this article.
1. (1995) 131 A.L.R. 738 (F.C.A.).
2. Admiralty Act 1988 (Cth), s. 3(1).
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