Lloyd's Maritime and Commercial Law Quarterly
Ship arrest in Northern Ireland: Is there still a question whether a charter by demise is capable of being a “beneficial interest” in a ship?
Craig Dunford*
Ship arrest in Northern Ireland is governed by the first schedule to the Administration of Justice Act 1956, which authorises an action in rem against a ship only where the person who would be liable on an in personam claim within the first Schedule was, when the cause of action arose, the owner or charterer of or in possession or control of the ship, if at the time the action is brought, she is beneficially owned as respects all her shares by that person. This paper argues that case law in this area leaves the Northern Irish courts—and possibly others around the world—free to construe “beneficial interest” as capable of embracing a demise charter.
The International Convention relating to the Arrest of Sea-going Ships, signed at Brussels on 10 May 1952 (“the 1952 Convention”) is a multilateral treaty, with over 70 ratifications and accessions worldwide.1 Its essential principle is that a Convention state is bound to allow the arrest of ships of its nationality in the port of any other Convention state, provided that a valid arrest warrant is issued within the domestic jurisdiction of the port state. Article 1 of the 1952 Convention sets out a limited list of claims for which ships can be arrested—largely reflective of those claims which common law jurisdictions recognise as founding a right to arrest. The United Kingdom is a signatory to the 1952 Convention, and remains bound by it. It implemented the Convention in the Administration of Justice Act 1952, though with slightly different provision for different parts of the UK.
The domestic jurisdiction in respect of the arrest of ships in Northern Ireland is found in the first schedule to the Administration of Justice Act 1956, para.3(4) of which reads as follows:2
“In the case of any such claim as is mentioned in paragraphs (d) to (r) of sub paragraph (1) of paragraph 1 of this part of this schedule 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
* KC.
1. The 1952 Convention came into force on 24 February 1956. A second convention, the International Convention on the Arrest of Ships 1999, came into force on 14 September 2011, but has thus far been ratified by—and therefore applies in—only 11 countries. In practice, it has not replaced the 1952 Convention, and seems unlikely to do so in the foreseeable future.
2. Emphasis added.
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