The Action in Rem - Essay Example

? The Action in Rem is The Action in Personam Dressed Up. A Critical Analysis Under maritime law, a maritime lien or res is a secured right which is peculiar to this industry. A lien or res is a charge on property for payment of a debt, and it refers to a property right in a ship or vessel offered to a creditor by law as security for the loan or debt or claim emanating from certain service offered to ship to facilitate her use in navigation in repairing a damage or an injury caused to the ship in navigable waters. (Force et al 2006:262). Under maritime law, the action in rem is a fundamental procedure on which a creditor can depend upon on post judgment enforcement and pre-judgment security. The cargo in action in rem or the seizure of the vessels places the res under judicial custody pending adjudication of the creditor’s claim. The notion behind arresting the ship rests in the notion of the ship itself as being the wrongdoer and thereby liable to arrest and offer the same for sale to settle the claims by a creditor. It normally involves securing the appearance of the defendant ship owner and corroborates the jurisdiction of the Court. If the Court permits the maritime creditor’s claim, the verdict is then enforceable against the detained res by judicial sale or security given to assume its place. (Force et al, 2006:262). An action in rem may be initiated against a ship in connection with which a claim arose or against a sister ship. As per the decision held in Gatoil Inc. v Arkwright –Boston Co [1985] A.C. 255 at 265, under the Arrest Convention, there exists a right to initiate an action in rem against another ship of the owner. (Gault et al: 2003:31). An action in rem can be initiated in the High Court against the ship where there exists a maritime lien on the ship and in cases where there exists a statutory right to proceed in rem. (Gault et al 2003:31). For many centuries, action in rem is the remedy most sought for and used to, and it is being the specialty of the Admiralty Court and for the Courts having parallel jurisdiction and it offers a chief benefit over the same. For initiating any action against a ship is the specialty to proceed in the Admiralty Court directly, and it has been regarded as the illustrious aspect of the Admiralty jurisdiction. Even from the Elizabethan era, the action in rem is being employed in the Admiralty court and however, during the middle of the nineteenth century, the modern theory of maritime liens, i.e. rights against the ship started to evolve. The starting of consideration of the action in rem is itself must lie in the onset of the theory of maritime liens as the two concepts have become interconnected. (Wiswall 1970:155) As per Jervis, maritime lines were the founding stones of actions in rem which was itself a maxim as laid down in “The Bold Cuccleugh” where a solid substantive verdict was given that the action in rem was a proceeding directly against a ship and not a procedural mechanism to enrich personal jurisdiction over owners. (Wiswall 1970:158). Thus, in the case of action in rem, action in personam cannot be claimed was vitiated by the verdict given by Sir Francis Jeune in “The Dictoar “in 1891 and when action being in rem, and if any bail that had been offered should stand as a substitute for the ship, and it should be treated as the limit of the liability and it was not proper to award a decree or a judgement in personam in an action in rem. Thus, separate legal proceedings should be initiated for an action to be brought in personam was needed mainly to obtain satisfaction of the balance of the savage award. (Wiswall 1970:158). Traditionally, an action in rem has been considered as an action against the ship itself and does not refer to any action against a ship owner until and at least the ship owner acknowledges services of the claim form. “The House of Lords “in “The Indian Grace “held that under the “s.34 of the Civil Jurisdiction and Judgments Act, 1982 “, an “action in rem” is nothing but a legal proceeding against the shipowners from the time when the “Admiralty Courts “have seized with jurisdictional authority by the delivery of a claim form or by the fact of the acknowledgement of the issue of a claim form will be regarded as a sufficient service of the claim form. (Gault et al 2003:31). Majority of maritime claims arising from contract, tort or from specialty maritime operations like salvage, often result in maritime liens or rem. However, all maritime claims cannot result in action in rem, and exceptions may be created by statutes or by precedents. For instance, a claim by a seaman for personal injuries under Jones Act is not regarded as a lien as held in “Plamals v Steamship Pinar Del Rio”1. Likewise, the insurance premiums which are due under a contract of marine insurance were not regarded as a lien as held in “re Insurance Co .of Pennsylvania”2. (Force et al 2006:262). Action in Personam In personam is a Latin word which refers to “regarding a person; a judgment, a right or an entitlement that is embedded to particular persons.” There can be practical difficulties as regard to the requirement of action in personam in the action for rem both for admiralty and plaintiffs in Anglo common law jurisdictions. It is commonly acknowledged that the issue of the in personam link, being a valid precondition to rem admiralty jurisdiction, when there is a conditional appearance by the defendant shipowner to contest jurisdictional issues. In “Ship Kobe Maru” v. Empire Shipping Co Inc3, the Owners of the ship claimed that the onus of proving the necessary legal and factual features justifying the court’s exercise of in rem admiralty jurisdiction rests with the plaintiff and there is applicability of normal civil standard of proof of balance of probabilities. In action rem cases, the plaintiff may be needed to access a great deal of info that is not willingly available to him. A plaintiff may witness issues in obtaining the necessary details of a foreign vessel ownership setup, or may witness that his action in rem has been disturbed due to the transfer of ownership of the vessel immediately after the cause of action arose but before the initiation of action in rem. Further, transfer of ownership might have happened as a sham, mainly to thwart any in rem liability and in such scenarios , the plaintiff has to persuade the court to pierce the corporate veil and request to reinstate before sham status. (Force & Davies, 2005:289). In case of ownership disputes, the dispute to jurisdictional issues will be set aside on arguments that the in personam relation was absent. If the plaintiff with necessary proof able to convince the court that there exists adequate proof about the owner of the ship, then the ship owner’s application to cancel the action in rem would be futile. (Force & Davies, 2005:289). The English admiralty courts, in the late nineteenth century, had progressively outstripped themselves from the personification principle and espoused the procedural theory. In the famous case “The Dictator “, it was concluded by Sir Francis Jeune as when the ship owners themselves present in the court, an “action in rem” is. “ a way of implementing against the owners in appearance , if they could have held personally accountable in the Admiralty Court , the plaintiff’s whole claim can be met be the owners.” In “The Tervaete “case, Scrutton L.J opined that “It is now corroborated that process in rem is not footed on misconduct of the ship personified as a delinquent but is a way of fetching the owner of the ship to pay his private liability by attaching his property.” Thus, before an action in rem may be initiated in admiralty, the plaintiff is needed to corroborate not only that its maritime claim comes under the acknowledged heads of judicial authority but also that the individual who would be accountable on the claim in an action in personam was the charterer or the owner of or in control or in possession of the ship when the cause of action arose. (Myburgh 2005:7). Under action in personam, the plaintiff is needed to make out who is the “human” defendant, and he should also demonstrate that there is a nexus of control or ownership presents between the in personam defendant and the appropriate vessel or its surrogate so as to substantiate for initiating an action in rem. If the plaintiff does not discharge its onus of proof as about the owner or charterer or who controls the ship, then the defendant’s application (shipowner) to suspend the action in rem will succeed, and the ship will be made free from attachment. (Myburgh 2005:7). Action in personam will become intricate in civil law jurisdictions as unlike common law jurisdictions, if there exists no equitable or beneficial ownership and also does not acknowledge the concept of institution of trusts. Thus, this wide gap in comprehending of what officially comprises ownership of ships in different nations and legal backgrounds offers a fertile ground for relative conflict of law issues. (Myburgh 2005:1). In “ The Andrea Ursula4 “ case , Brandon J observed that the action in personam is not limited to equitable or legal ownership but includes the interests of a charterer by the demise or any other individual with analogues full legal control and possession of the ship who might be asked to be accountable in an action in rem. . (Myburgh 2005:13). In “ I Congreso del Partido5 “ , Robert Goff J opined that the phrase “ beneficial owner” includes reasonable ownership , whether or not followed by legal ownership , and does not include control and possession , now seems to have accepted in English Courts. . (Myburgh, 2005:14). In “ The Nazym Khikmet “ , the plaintiffs who were the owners of cargo who transported the cargo in the vessel initiated against the Zorinsk an action in rem on the footing that the BLASCO was the appropriate person accountable in personam who was the beneficial owner of the Zorinsk at the when action in rem was initiated. Both BLASCO and the Republic of Ukraine claimed that Zorinsk was owned by the Republic instead of BLASO and hence the action in personal link was not proven for corroborating the admiralty jurisdiction. This was agreed by High Court and also by the Court of Appeals. (Myburgh 2005:14). Thus , in “ The Inessa Armand “ and in “ The Nazym “ , the English Courts have examined the law of the vessel’s port registry under the Ukrainian laws or as the lex situs of the vessel instead of the law of defendant ship owner’s domicile. (Myburgh 2005:14). Conclusion Under Anglo-Common Law jurisdictions, it is essential that admiralty courts to match up the right of the ship with that of the right in personam defendant .Thus, associating the personal liability to in rem action rests at the very central point of the procedural theory and offers a justification in Anglo-Common Law Jurisdictions for ship arrest. Thus, in personam connection or link acts as the crucial element for deciding the ambit of the Anglo-Common Law courts lawful provision of admiralty jurisdiction in rem and of offering the practical litmus test of whether the arrest of the ship is lawful or not under the procedural theory. (Myburgh 2005:51). Thus, we have to agree the statement that the action in rem is the action in personam dressed up as held in “The Tervaete “case, where Scrutton L.J opined that “It is now corroborated that process in rem is not footed on misconduct of the ship personified as a delinquent but is a way of fetching the owner of the ship to pay his private liability by attaching his property.” List of References Force Robert & Davies Martin. (2005).Jurisdiction and Forum Selection in International Maritime Law. New York: Kluwer Law International. Force Robert, Yiannopoulos A N & Davies Martin. (2006). Admiralty and Maritime Law. New York: Beard Books. Gault Simon, Hazelwood Steven J & Tettenborn A M. (2003).Marsden on Collisions at Sea. London: Sweet & Maxwell. Myburgh Paul. (2005). Arresting the Right Ship: Procedural Theory, the In Personam Link and Conflict of Laws. www.maritimelaw.org.nz/myburgh/Force.pdf Wiswall F.L. (1970). The Development of Admiralty Jurisdiction and Practice in 1800. 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