Stolt Kestrel BV v Sener Petrol Denizcilik Ticaret AS

Under this head the Claimant contends that the judge was wrong to regard section 190(6) as applicable only to in rem proceedings.

The judge’s reasoning on this point was as follows:-

“60 The Defendant submits that s190(6) is clearly addressed at in rem proceedings and has no application to in personam proceedings.

61 As the Defendant points out, this sub-section obliges the Court upon the fulfilment of the cited conditions to "extend the period allowed for bringing proceedings to an extent sufficient to give a reasonable opportunity of so arresting the ship." In referring to "arresting the ship" the sub-section is surely concerned only with the extension of time for in rem proceedings. By contrast, the ship cannot be arrested by way of an in personam claim form.

62 The Claimant submits that, as the title to s.190 makes clear, the section is concerned with both in rem and in personam claims and throughout the section any reference to "proceedings" is referring to both.

63 It is correct that section 190 is concerned with the "Time limit" for both in rem and in personam proceedings. However, that does not in itself mean that "proceedings" in s.190 must always be referring to both in rem and in personam proceedings, regardless of content and context. The section must be interpreted intelligently rather than mechanically.

64 I agree with the Defendant that s.190(6) is clearly concerned only with in rem proceedings. The rationale of the extension granted thereunder is the lack of a reasonable opportunity to arrest the defendant ship. That has no application to an in personam claim. One brings an in personam claim by serving the claim form on the person, not the res. One cannot arrest by way of an in personam claim.

65 The fact that there may have been no reasonable opportunity to arrest the ship is not relevant to and does not justify a failure to serve in personam proceedings. As such, it cannot justify an extension of time for so doing, still less a mandatory extension.

66 On the Claimant's case it would be entitled to a mandatory extension of time for service of its in personam claim form regardless of the ease of service and for reasons unrelated thereto. This cannot sensibly have been the purpose of s.190(6).

67 In my judgment s.190(6) is referring to and only applies to in rem proceedings. It follows that the Claimant is not entitled to a mandatory extension of time in respect of the in personam proceedings.”

I agree with this reasoning and I cannot improve upon it. As a matter of straightforward statutory interpretation the points made by the judge are simply unanswerable. The words of the statute are very clear and do not admit of their application to claims in personam. Moreover I agree with Sener that it would be bizarre if a claimant should be excused from acting diligently in issuing and serving proceedings in personam by the circumstance that there has been no opportunity to arrest the wrongdoing vessel, or a sister ship thereof. If the wrongdoing vessel were to become a total loss for whatever reason, the owner at the time of the wrongdoing would potentially be at risk of suit for evermore. It would be astonishing if either the framers of the Brussels Collision Convention of 1910 or Parliament which gave the Convention the force of law by enacting the Maritime Conventions Act 1911 intended this extraordinary consequence, and plainly neither did.

Ground 2 contends that Hamblen J was wrong to hold that the in personam claim form was time-barred, and should have held that the bringing of proceedings in rem protected time for the purpose of bringing proceedings in personam, by analogy with the reasoning of Hobhouse J in “The Nordglimt” [1987] 1 QB 183.

Strictly speaking Hamblen J did not hold that “the claim was time-barred” but rather that the in personam proceedings were brought after the period of two (or three) years from the accrual of the cause of action, and therein lies the fallacy in the Claimant’s argument. Section 190(3) of the MSA is a provision which bars the remedy while leaving the underlying claim in existence. Article III rule 6 of the Hague-Visby Rules by contrast, which is the provision with which Hobhouse J was concerned in The Nordglimt, is a provision which extinguishes the claim if suit is not brought within one year after delivery of the goods or the date when the goods should have been delivered.

This court has very recently had to consider a similar point arising in relation to Article 16 of the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea. That Convention is now given the force of law in the United Kingdom by section 183 of the MSA. Article 16 provides:-

“ARTICLE 16

Time-bar for actions

1.

An action for damages arising out of the death of or personal injury to a passenger or for the loss of or damage to luggage shall be time-barred after a period of two years.

As already foreshadowed section 190 of the MSA is derived from the 1910 Collision Convention which was in turn enacted into law in the UK by the Maritime Conventions Act 1911, now replaced by provisions in the MSA. Article 7 of the Convention provides:-

“Actions for the recovery of damages are barred after an interval of two years from the date of the casualty.

The period within which an action must be instituted for enforcing the right to obtain contribution permitted by paragraph 3 of Article 4, is one year from the date of payment.

The grounds upon which the said periods of limitation may be suspended or interrupted are determined by the law of the court where the case is tried.

The High Contracting Parties reserve to themselves the right to provide, by legislation in their respective countries, that the said periods shall be extended in cases where it has not been possible to arrest the defendant vessel in the territorial waters of the State in which the plaintiff has his domicile or principal place of business.”

This Article was enacted into UK domestic law by section 8 of the Maritime Conventions Act 1911, which provides:-

“8.

No action shall be maintainable to enforce any claim or lien against a vessel or her owners in respect of any damage or loss to another vessel, her cargo or freight, or any property on board her, or damages for loss of life or personal injuries suffered by any person on board her, caused by the fault of the former vessel, whether such vessel be wholly or partly in fault, or in respect of any salvage services, unless proceedings therein are commenced within two years from the date when the damage or loss or injury was caused or the salvage services were rendered, and an action shall not be maintainable under this Act to enforce any contribution in respect of an overpaid proportion of any damages for loss of life or personal injuries unless proceedings therein are commenced within one year from the date of payment:

Provided that any court having jurisdiction to deal with an action to which this section relates may, in accordance with the rules of court, extend any such period, to such extent and on such conditions as it thinks fit, and shall, if satisfied that there has not during such period been any reasonable opportunity of arresting the defendant vessel within which the jurisdiction of the court, or within the territorial waters of the country to which the plaintiff’s ship belongs or in which the plaintiff resides or has his principal place of business, extend any such period to an extent sufficient to give such reasonable opportunity.

No rules of court were made pursuant to the proviso in the second limb of section 8.

The MCA 1911 has now been superseded by the MSA. I have already set out the relevant provision, section 190.

It should be noted in passing that section 190(6)(b) of the MSA represents the area in which the High Contracting Parties reserved to themselves the right to legislate for a mandatory extension of time. Inability to arrest the wrongdoing vessel (or perhaps a sister) within the jurisdiction of the court is not dealt with in the Convention, although it is provided for by section 8 of the MCA 1911 and now by section 190(6)(a) of the MSA. The discretionary power to extend time, formerly contained in the first part of section 8 of the MCA, and now contained in section 190(5) of the MSA, is also not derived from the 1910 Brussels Collision Convention. English law has no provisions pursuant to which time limits may be suspended or interrupted, although section 33 of the Limitation Act 1980 allows for the disapplication of time limits: Higham v Stena Sealink Ltd. [1996] 1 WLR 1107.

The Aries thus stands as direct authority for the proposition that section 190(3) of the MSA bars the remedy whilst leaving the claim in existence. It is with the availability of the remedy that section 190(3) of the MSA is concerned. As Hamblen J rightly observed, the two year time limit in section 190(3) of the MSA applies to the proceedings which are being brought. The relevant proceedings being brought which are here under consideration are those commenced by the issue of the in personam claim form. These are not the same proceedings as the in rem proceedings.

In The Nordglimt Hobhouse J was concerned with the claim by the receivers of cargo carried on board the Nordkap for shortage of and damage to the cargo which was carried on terms which included the Hague-Visby Rules. Within the one year period allowed the claimants commenced in Belgium an action in personam against the owners of the Nordkap, the contractual carriers. Over two years later the claimants commenced an action in rem and issued a warrant for the arrest of the vessel Nordglimt, a sister ship, claiming damages on the same facts. The Nordglimt was arrested and released on provision of security. On the shipowners’ application to have the action in rem struck out and the warrant of arrest set aside on the ground that their liability to the plaintiffs had been discharged under Article III rule 6 of the Hague-Visby Rules as the proceedings had not been brought within one year of the date of delivery of the goods and that the court lacked jurisdiction to hear the action in rem by virtue of the provisions of the Civil Jurisdiction and Judgments Act 1982, Hobhouse J held that “suit had been brought” for the purposes of Article III rule 6 by the in personam action in Belgium, and that accordingly the defendant owners had not been discharged from liability. It is immediately apparent that that reasoning has no application where one is concerned, as here, with a provision which bars the remedy. Here the question is simply whether the relevant proceedings, those begun by the issue of the in personam claim form, were brought after the expiry of the relevant period. They were. It is nothing to the point that different proceedings were brought in time.

Ms Selvaratnam also submitted that the decisions of the Court of Appeal in The Deichland [1990] 1 QB 361 and of the House of Lords in The Indian Grace (No.2) [1998] AC 878 demonstrate that irrespective of the form of claim form, be it in rem or in personam, in reality it is the same party being sued, the owner of the vessel named in the claim form. On that reasoning therefore it is argued that proceedings had been brought against Sener in time.

This argument is misconceived for a number of reasons, principally because it again fails to focus on the relevant proceedings, those begun by the in personam claim form, which on no showing have been brought in time. So far as concerns the in rem claim form as originally issued it is wrong for a further reason. The identity of the personal defendant to an in rem claim, whether natural or corporate, if there is to be one, is not known until there is an acknowledgement of service – see the discussion at paragraphs 12 and 15 above. If there is no acknowledgment of service an in rem action may proceed against the res alone. By the time of the issue of the in rem claim form here Sener were no longer the owners of the Vessel. Had the Vessel been arrested so as to found jurisdiction – security had already been provided – Sener might have acknowledged service pursuant to a contractual obligation owed either to Delmar or to their P&I Club. Equally however and perhaps more likely Delmar might have acknowledged service with a view to protecting their ability to claim an indemnity in respect of the consequences of the arrest. Certainly it could not be regarded as axiomatic that Sener would become a defendant to the action.

It was to meet this point that Ms Selvaratnam relied on the sister ship proceedings. All but one of the sister ships were owned by Sener on the date of their joinder as defendants, and so far as I know still are in their ownership. This however does not assist the argument. The proceedings against the sister vessels were no more proceedings against Sener than was the original in rem claim form. Were a sister vessel to be arrested, Sener might or might not acknowledge service of the proceedings. Moreover, if it did acknowledge service, only then would Sener become a defendant to the proceedings. The sister ship proceedings were only brought on 23 January 2014. It is accepted that they do not relate back to the date of issue of the in rem claim form. The sister ship proceedings are proceedings for the bringing of which an extension of time has been granted, but that does not assist with the enquiry whether the in personam proceedings have been brought in time.

Furthermore Ms Selvaratnam is not in my judgment right to suggest that The Deichland and the Indian Grace (No.2) have swept away the traditional learning on the nature of an Admiralty action in rem. Another point with which Hobhouse J had to deal in the Nordglimt was the suggestion that the English Court should decline jurisdiction over the in rem proceedings pursuant to Article 21 of what was then the 1978 Brussels Jurisdiction Convention, because that action was between the same parties as the Belgian action. Hobhouse J explained the position as follows:-

“…The defendants [in an Admiralty action in rem] are customarily described as 'the owners of the ship' and the writ is addressed to 'the defendants and other persons interested in the ship'. Since the latter part of the last century, the form of the writ has been used to support an argument that an action in rem is an action against the owners of the ship, but in every case that argument has been rejected. The most convenient statement is that of Fletcher Moulton LJ in The Burns [1907] P 137 at 149–150:

“I am, therefore, of opinion that the fundamental proposition of the argument of the appellants' counsel fails, and that the action in rem is an action against the ship itself. It is an action in which the owners may take part, if they think proper, in defence of their property, but whether or not they will do so is a matter for them to decide, and if they do not decide to make themselves parties to the suit in order to defend their property, no personal liability can be established against them in that action. It is perfectly true that the action indirectly affects them. So it would if it were an action against a person whom they had indemnified. The decision of an action against a person whom the London County Council had indemnified might affect the London County Council, but that fact would not make the action an action brought against them within the meaning of the Public Authorities Protection Act. The only possible support, in my opinion, for the proposition put forward by counsel for the appellants is to be found in the language of the writ itself by which the action in rem is now commenced; but I am of opinion that this ought not to weigh with us. If the old form of warrant is looked at by which the arrest of a ship used to be made, the language in no way supports the contention of the appellants. On the contrary, it is evident from the language of that warrant that the process was regarded then as being directed against the ship itself. That old form was abandoned, and a new form of writ was employed, by direction of those who were responsible for drawing up the Forms under the Judicature Act. I think it was in 1883 that the rule was passed which directed the present form of writ to be issued in Admiralty actions in rem. The direction itself shews that, whether the language was felicitous for the purpose or not, the writ was intended to apply to the old-established Admiralty action in rem, and was not intended to have the effect of creating a new type of action or altering the nature of the action; and when we turn to the form which was at the same time prescribed for the writ of possession in an Admiralty action in rem, where there had been a default of appearance, we find that the language is quite suitable, and shews that the proceeding is against the ship itself.”

Unless and until anyone appears to defend an action in rem, the action proceeds solely as an action in rem and any judgment given is solely a judgment given against the res. It is determinative and conclusive as against all the world in respect of the rights in the res but does not create any rights that are enforceable in personam. An action in rem may be defended by anyone who has a legitimate interest in resisting the plaintiff's claim on the res. Such a person may be the owner of the res but equally it may be someone who has a different interest in the res which does not amount to ownership, or again it may be simply someone who also has a claim in rem against the res and is competing with the plaintiff for a right to the security of a res of an inadequate value to satisfy all the claims that are being made on it. It will also be appreciated both from what I have said and from a general understanding of the law of maritime liens that the owner or other person defending the action may be under no personal liability to the plaintiff.

In the present case it is alleged that the owners of the Nordglimt are under a personal liability to the plaintiffs, but that is not part of the essential character of an action in rem as such. Unless and until a person liable in personam chooses to defend an action in rem, the action in rem will not give rise to any determination as against such person of any personal liability on his part, nor will it give rise to any judgment which is enforceable in personam against any such person.

The consequence of this is that in my judgment on the correct interpretation of art 21 of the 1968 convention, an Admiralty action in rem is not at the time of its inception an action between the same parties as an action in personam. It will only become an action between the same parties when and if a shipowner, liable in personam, chooses to appear in the action and defend it. It is from that moment, and not before, that the action first acquires the character of an action between the plaintiff and the shipowner; it will also be appreciated that it only acquires that character as the result of an act of the shipowner, and that such a consequence does not inevitably follow from the act of the plaintiff in starting the action in rem.”

The Deichland was concerned with another provision of the 1968 Brussels Convention, Article 2, which provides that:-

“Subject to the provisions of this Convention, persons domiciled in a contracting state shall, whatever their nationality, be sued in the courts of that State.”

The demise charterers of The Deichland, in January 1986 the contractual carriers of a cargo of steel coils from Glasgow to La Spezia, were domiciled in Germany. The plaintiff shippers alleged that the coils were damaged in transit by reason of the demise charterers’ breach of contract. In January 1987 the plaintiffs issued a writ in rem in respect of the alleged damage and in November 1987 the writ was served on Deichland at Erith. As at the date of issue of the writ the vessel was still demise chartered to the German demise charterers but by the date of service of the writ the demise charter had come to an end. No-one acknowledged service. The vessel was not arrested. The demise charterers’ P&I Club sent a letter to the plaintiffs guaranteeing damages up to £54,000 in consideration of the plaintiffs refraining from arresting the vessel. Relying on Article 2, which in effect provided that they were not to be sued otherwise than in the jurisdiction of their domicile, the demise charterers sought a declaration that the English Court had no jurisdiction over them in respect of the claim. Sheen J dismissed the application, holding that the demise charterers were not defendants to the action in rem so long as it remained simply an action in rem and for so long as they declined to submit to the jurisdiction of the court by entering an appearance, now an acknowledgment of service. The Court of Appeal allowed the demise charterers’ appeal, but it is important to note the limited manner in which it did so. Neill LJ expressly noted the special characteristics of an English admiralty action in rem and cast no doubt upon the traditional analysis. He concentrated rather upon the proper construction of Article 2 of the Brussels Convention and said this at page 374:-

“ It is true that in the present case the vessel is no longer chartered to Deich and that the jurisdiction to entertain the action in rem is based on the provisions of section 21 of the Act of 1981. But looking at the reality of the matter it is Deich who is interested in contesting liability and against whom the plaintiffs would wish to proceed in personam if an appearance is entered. The position might have been different if the parties to the 1968 Convention and to the Accession Convention had had no knowledge of the Admiralty jurisdiction of the High Court, but it is quite clear from paragraphs 121 and 122 of Professor Schlosser's report on the Accession Convention (Official Journal 1979 No. C. 59, p. 71) that detailed consideration was given to the exercise of jurisdiction in maritime matters by the courts of the United Kingdom.

In these circumstances I find it impossible to conclude that on the proper construction of articles 2 and 3 of the 1968 Convention Deich is not being "sued" in these proceedings even though at this stage the proceedings are solely in rem. Deich is liable to be adversely affected by the result of the proceedings and wishes to contest the merits of the plaintiffs' claim. By English law an Admiralty action in rem has special characteristics though, as has been seen, these characteristics were modified by the Act of 1956 in line with the 1952 Convention. I do not consider, however, that the rules relating to such actions and governing the rights of a plaintiff to levy execution can affect the substance of the matter when the court is faced with an international Convention designed to regulate the international jurisdiction of national courts.”

It is plain therefore that The Deichland is simply a decision on the proper interpretation of Article 2 of the Brussels Convention. It casts no doubt upon, indeed it reinforces, the traditional analysis of the nature of an Admiralty action in rem.

The same is true mutatis mutandis of the decision of the House of Lords in the Indian Grace (No.2). This case was concerned with section 34 of the Civil Jurisdiction and Judgments Act 1982 (“the CJJA”) which provides:-

“No proceedings may be brought by a person in England and Wales or Northern Ireland on a cause of action in respect of which a judgment has been given in his favour in proceedings between the same parties, or their privies, in a court in another part of the United Kingdom or in a court of an overseas country, unless that judgment is not enforceable or entitled to recognition in England or, as the case may be, in Northern Ireland.”

A cargo of munitions belonging to the Republic of India was carried from Sweden to Cochin in the Indian Grace, owned by the India Steamship Company, who I will call the owners. In the course of the voyage a fire occurred in one hold which was extinguished with water. Some of the cargo was jettisoned. A much greater part was damaged. The Republic brought proceedings in personam against the owners in Cochin in respect of the jettisoned cargo. Judgment was obtained in a relatively small amount, the sterling equivalent of £7,200. Whilst that action was proceeding the Republic issued an Admiralty writ in rem and served it on a sister ship belonging to the owners whilst she was at Middlesbrough. The claim put forward by that writ was in respect of the damage to cargo and was about 360 times the size of the claim for the jettisoned cargo, about £2.6 million. The same cause of action was therefore asserted as had been asserted in Cochin. The owners entered an appearance and thereby submitted to the jurisdiction of the English Admiralty Court. The owners sought an order pursuant to section 34 of the CJJA to the effect that the Republic was precluded from pursuing the action in rem having obtained the Cochin judgment in personam. It was held by the House of Lords that, quoting from the headnote, “although the judgment in personam in Cochin had not yet been obtained when the action in rem had been begun in England, an action that was continued was “brought” within the meaning of section 34 of the Act of 1982; that an action in rem was in reality an action against the owner of the ship and should not be allowed to proceed where a foreign judgment in personam had been obtained on the same cause of action; and that, the plaintiffs’ claim in the Admiralty Court having been “brought” on a cause of action in respect of which judgment had been given in their favour in the Cochin Court in proceedings “between the same parties, or their privies” within the meaning of section 34, their action was, subject to the issue of estoppel, barred.” The House of Lords went on to hold that the Court of Appeal had been entitled to hold that the owners were not estopped by convention or acquiescence from relying on section 34.

The relevant ratio of this decision is, in my respectful view, very limited. It is to be found in Lord Steyn’s speech at page 913 C to the following effect:-

“It is now possible to say that for the purposes of section 34 an action in rem is an action against the owners from the moment that the Admiralty Court is seised with jurisdiction. The jurisdiction of the Admiralty Court is invoked by the service of a writ, or, where a writ is deemed to be served, as a result of the acknowledgment of the issue of the writ by the defendant before service: The Banco [1971] P. 137. From that moment the owners are parties to the proceedings in rem.” (Emphasis supplied.)

The decision should, in my view, be regarded as one on the proper interpretation of section 34 of the CJJA. It is true that at page 911 Lord Steyn said that the view of Hobhouse J in The Nordglimt that at the date of its commencement an action in rem was not between the same parties as an in action in personam “was always a very narrow view, and that given the decision of the European Court of Justice in The Maciej Rataj (The Tatry) the decision in The Nordglimt is no longer good law” and that “his [Hobhouse J’s] analysis can no longer be supported.” However I would make two points in that regard. Firstly, the European Court of Justice in The Tatry [1999] QB 515 was concerned with the proper interpretation of Article 21 of the Brussels Convention. The question posed of the Court and its answer are set out as follows at pages 535/6, paragraphs 46-48:-

“46.

The national court's second question is whether a subsequent action has the same cause of action and the same object and is between the same parties as a previous action where the first action, brought by the owner of a ship before a court of a contracting state, is an action in personam for a declaration that that owner is not liable for alleged damage to cargo transported by his ship, whereas the subsequent action has been brought by the owner of the cargo before a court of another contracting state by way of an action in rem concerning an arrested ship, and has subsequently continued both in rem and in personam, or solely in personam, according to the distinctions drawn by the national law of that other contracting state.

47.

In article 21 of the Convention, the terms "same cause of action" and "between the same parties" have an independent meaning: see Gubisch Maschinenfabrik K.G. v. Palumbo (Case 144/86) [1987] E.C.R. 4861, 4874, para. 11. They must therefore be interpreted independently of the specific features of the law in force in each contracting state. It follows that the distinction drawn by the law of a contracting state between an action in personam and an action in rem is not material for the interpretation of article 21.

48.

Consequently, the answer to the second question is that a subsequent action does not cease to have the same cause of action and the same object and to be between the same parties as a previous action where the latter, brought by the owner of a ship before a court of a contracting state, is an action in personam for a declaration that that owner is not liable for alleged damage to cargo transported by his ship, whereas the subsequent action has been brought by the owner of the cargo before a court of another contracting state by way of an action in rem concerning an arrested ship, and has subsequently continued both in rem and in personam, or solely in personam, according to the distinctions drawn by the national law of that other contracting state.”

The court was thus concerned with the status of an action in rem when it was continuing, following entry of appearance by the owner of the arrested vessel, as both an action in rem and an action in personam. The court was not concerned with the character of an action in rem at its inception when the writ, now claim form, is issued. Second, both The Tatry and The Indian Grace, as was The Deichland, were concerned with claims for loss of or damage to cargo carried by a ship. Such a claim does not give rise to a maritime lien, and the Admiralty jurisdiction in rem is only available in respect of vessels owned or demise chartered at the date of issue of the claim form by the person who would be liable on the action if brought in personam. It is easier in such a case to assimilate an action brought in rem to an action brought in personam against a person who is necessarily the owner or demise charterer of the vessel at the date of issue of the claim form, because that person would be expected to acknowledge service of a writ in rem and enter a personal appearance in order to defend the claim. This reasoning underpins the decisions in The Deichland and The Indian Grace. Collision damage however attracts a maritime lien, as graphically illustrated by the circumstance that the current action in rem was properly brought against the vessel notwithstanding her change of ownership between the date of collision and the date of issue of the claim form. I note that at page 908 of his speech in The Indian Grace Lord Steyn said:-

“…This case is not concerned with maritime liens. That is a separate and complex subject which I put to one side.”

With all appropriate deference therefore I would respectfully suggest that it is not easy to reconcile Lord Steyn’s eschewing of consideration of the special nature of a maritime lien with his assertion that the traditional analysis of the nature of an Admiralty action in rem as expounded by Hobhouse J in The Nordglimt can no longer be regarded as good law. Lord Steyn’s reasoning simply does not address a case such as the present.

Lord Steyn’s speech has been subjected to powerful extra-judicial criticism by Nigel Teare QC, now as Teare J the current Admiralty Judge – see [1998] LMCLQ 33. He suggests, as I have done above, that the decision should be regarded as one only on the ambit of section 34 of the CJJA 1982, whilst acknowledging the apparent width of the manner in which Lord Steyn expressed himself.

As noted above, before Hamblen J it was not suggested that the sister ship proceedings had any relevance to the question whether the in personam action against Sener was brought in time. For the reasons I have already given even if the sister ship proceedings could, as from the joinder of the sister ships, be regarded as an action brought against Sener, that would be of no avail in showing that proceedings in personam had been brought against Sener within two (or three) years after accrual of the cause of action, even were that a relevant enquiry. It is not a relevant enquiry. The relevant enquiry is whether the in personam claim form was issued in time. It was not. I would however respectfully suggest that, for the reasons I have given, The Indian Grace is an insubstantial foundation for the suggestion that, for the purposes of section 190(3) of the MSA, an Admiralty claim form in rem issued against one or more ships in the beneficial ownership of or demise chartered to the person, real or corporate, who would be liable if sued in personam, is of itself without more properly to be regarded as proceedings brought against that person.

In her reply Ms Selvaratnam suggested that it was clear even before The Indian Grace that the naming of the sister ships would “implead” their owners in the following proceedings and she relied on a passage in the speech of Lord Atkin in The Cristina [1938] AC 485 to the following effect:-

“These being the facts I come to the conclusion that when the plaintiffs issued a writ in which they constituted as defendants the steamship or vessel Cristina and all persons claiming an interest therein, in the body of which the same ship and all persons claiming an interest therein were commanded within eight days to cause an appearance to be entered for them in the Probate, Divorce, and Admiralty Division, and on which they indorsed the claim to have possession adjudged to them of the said steamship or vessel Cristina, they were directly impleading the Spanish Government, whom they knew to be the only persons interested in the Cristina other than themselves, and from whom they desired that possession should be taken after it was adjudged to them.”

With respect this simply does not help because the sister ships were in the present case simply joined too late. Ms Selvaratnam did not however explain what she meant by “implead”. Furthermore, the vessel was in that case arrested and the Spanish Government entered a conditional appearance which would presuppose service of the writ. Mr Teare dealt with these points in the article to which I have made reference above, and I can do no better than cite the relevant passage:-

“Lord Steyn relied heavily on the sovereign immunity cases, in particular the decision of the House of Lords in The Cristina. He said:

The proposition that the foreign sovereign is directly impleaded as a defendant by service on his vessel is therefore conclusively established. That proposition must carry with it the legal consequence that the sovereign is a party to the action in rem.

Lord Steyn added that the sovereign immunity cases were not cited to Hobhouse J., in The Nordglimt and that he did not mention them. However, Clarke J., did deal with them at first instance in The Indian Grace (No. 2). Lord Steyn did not comment on Clarke J.’s treatment of them.

There is no doubt that the sovereign immunity cases established that the court will not permit an Admiralty action in rem to proceed against the vessel where the owner is a foreign sovereign. In The Cristina the House of Lords held that an action in rem against a vessel owned by a foreign Sovereign impleaded the foreign sovereign. Lord Steyn concluded from that proposition that the sovereign must be a party to the action in rem. At first instance in The Indian Grace (No. 2) Clarke J. did not consider that that conclusion could be drawn. Perhaps it all depends on what is meant by “impleading”.

It is noteworthy that there is no suggestion in the speeches of the House of Lords in The Cristina that the analysis of an action in rem found in The Dictator, The Gemma and The Dupleix was erroneous in stating that the owner became a party after he has entered an appearance. On the contrary, Lord Wright referred to those cases and remarked that the modern writ in rem was “directed against the ship” and stated that “under the modern and statutory form of writ in rem a defendant who appears becomes subject to liability in personam. Thus the writ in rem becomes in effect also a writ in personam.”

Lord Wright concluded that, because the sovereign owner of a ship is commanded by the writ to appear or let judgment go by default, he is called upon to sacrifice either his property or his independence. He was therefore directly “impleaded”. This was the sense in which the term was used; it was not used in the sense of being party to an action such that judgment might be given against the party. Given his acceptance of the analysis of the action in rem set out in The Dictator, it is submitted that it would be wrong to conclude that Lord Wright (or Lord Atkin) considered that an owner who did not appear was party to the action in rem. If so, it is submitted that Lord Steyn was wrong to conclude that an owner is a party to an action in rem before appearance. By contrast, Clarke J., at first instance, distinguished between being impleaded and being party to an action. It is submitted that he was right to do so.”

I respectfully agree. The Cristina is of no relevance not least because there has been here no service of the claim form on any of the sister ships, but also because as I have already pointed out, the sister ships were joined too late to enable the argument erroneously founded on The Cristina to be advanced.

The argument here was that even if the judge was right to regard himself as bound by the “Al Tabith”, as was common ground before him, he was nonetheless wrong to focus on the reasons why an in personam claim form was not issued in time and to leave out of account, in his evaluation of the question whether an extension of time should be granted, the factors set out at paragraph 77(a)-(h) of his judgment. I regret that I do not understand this argument. The Court of Appeal in the Al Tabith held that establishing a good reason for the failure to issue the writ in time is an essential element in the demonstration of a good reason for an extension of time. The judge simply applied that approach. In my judgment this ground of appeal has no independent life of its own.

Mr John Kimbell QC assumed the burden of arguing this point in the context of both the appeal and the application for permission to appeal. His argument may be summarised as follows:-

(i)

The Court of Appeal in the Al Tabith fell into error by transplanting into the discretion afforded by section 8 of the Maritime Conventions Act 1911, now section 190(5) of the MSA, the approach adopted under the then R.S.C Order 6 rule 8 when consideration was given to the question whether the validity of a writ for service should be extended. That approach required demonstration of good reason for an extension, and ordinarily the showing of a good reason for failure to serve the writ during its original period of validity would be a necessary step towards establishing good reason for grant of an extension;

(ii)

The decision in the Al Tabith is not binding on us because reached without consideration of the prior decision of the Court of Appeal in The Igman;

(iii)

As a matter of statutory construction section 190(5) MSA calls for an unfettered one stage exercise of discretion. In the consideration of the question whether an extension should be granted the claimant is accordingly entitled to have all relevant factors taken into account, including those relevant to the balance of hardship or prejudice consequent upon a decision to grant or to refuse an extension of time.

This had, maintained Mr Kimbell, been the invariable approach of the Admiralty Court between 1913 and 1993.

Mr Kimbell submitted that the power to extend time under O.6 r.8 is conceptually distinct from that given by section 190(5) MSA, in that in the first case the jurisdiction of the court has been invoked, and it is not surprising that an onus is placed upon he who invokes it to get on with the proceedings. This it is suggested is different from simply allowing the time within which proceedings may be brought to expire. That is of course true, and indeed in Waddon v Whitecroft [1988] 1 WLR 309 Lord Brandon said, at page 315:-

“I would readily accept that there may be cases in which the court's discretion under R.S.C., Ord. 6, r. 8 to extend the period of validity of a writ already issued, and its other discretion under section 33 of the Limitation Act 1980 to extend the primary period of limitation, may fall to be exercised either in favour of or against an applicant on very similar grounds. I do not accept, however, that this will necessarily be so in all or even a majority of cases. The reasons for not serving a writ which has been issued before the expiry of the primary period of limitation, and the reasons for not issuing a writ at all within that period, may differ widely. I do not think, therefore, that it would be right to lay down any general principle that a judge deciding an application for extension of the period of validity of a writ in a personal injury case should be obliged to deal with the matter in precisely the same way as if he were deciding an application for extension of the primary period of limitation.”

There may well be different considerations to take into account. In particular, in the case of allowing the time limit to expire, it may often be the case that the claimant has not taken legal advice, whereas in the case of a failure to serve proceedings, almost invariably, certainly in this class of litigation, it will be lawyers who bear the responsibility to effect service.

All that notwithstanding, it was Lord Brandon who as Brandon J observed in The Owenbawn [1973] 1 Lloyds Rep 56 at 59:-

“I was referred to a large number of authorities relating to two matters. The first matter is the renewal of a writ under the appropriate rule, and the other matter is the extending of time under section 8 of the Maritime Conventions Act, 1911. It seems clear that, whether the Court in a case of this kind is asked to renew a writ, or whether it is asked to extend the time under section 8, very similar considerations apply. It has been helpful to see how the Court has dealt with applications of both kinds over the years.”

In the Al Tabith at first instance Sheen J said this:-

“It seems to me that plaintiffs who seek to establish that there is good reason to extend the normal period of limitation must show that their failure was not merely due to their own mistake. It cannot be a good reason for extending the time limit that the defendants are unable to show that there would be any specific prejudice to them in conducting their defence. At the end of two and a half years, it would be virtually impossible to show such prejudice. Mr Charlton invited me to consider the balance of hardship. If balance of hardship could constitute good reason for extending a time limit, that time limit would always be extended.”

The argument addressed to the Court of Appeal in the Al Tabith by Mr Timothy Charlton QC was in essence the same as that advanced by Mr Kimbell and Ms Selvaratnam here. Ground 1 of the Notice of Appeal in the Al Tabith read:-

“The Learned Judge was wrong to refuse to look at the “balance of hardship” when considering whether in all the circumstances of the case, there was good reason to grant the plaintiffs the extension of time for commencement of the proceedings which they seek.”

Hirst LJ dealt with this argument as follows between pages 340 – 342:-

“ It is not presently in dispute that the same "good reason" test applies under s. 8 of the 1911 Act as is regularly applied when deciding whether or not to extend the validity of a writ under O. 6, r. 8 (see per Mr. Justice Brandon, in The Owenbawn, [1973] 1 Lloyd's Rep. 56 at p. 59 and per Mr. Justice Sheen in The Zirje, [1989] 1 Lloyd's Rep. 493 at p. 497).

The correct approach under O. 6, r. 8 has been laid down authoritatively in four recent House of Lords' cases. In Kleinwort Benson Ltd. v. Barbrak Ltd., (sub nom. The Myrto) (No. 3), [1987] 2 Lloyd's Rep. 1; [1987] A.C. 597, the leading speech, with which the other members of the Appellate Committee agreed, was given by Lord Brandon of Oakbrook.

Having reviewed the history of O. 6, r. 8 and the earlier authorities, he held at p. 13, col. 1; p. 622C that there must be implied into O. 6, r. 8, as a matter of construction:

…a condition that the power to extend shall only be exercised for good reason.

He then proceeded at p. 13, col. 2; p. 622H:

The question then arises as to what kind of matters can properly be regarded as amounting to "good reason". The answer is, I think, that it is not possible to define or circumscribe the scope of that expression. Whether there is or is not good reason in any particular case must depend on all the circumstances of that case, and must therefore be left to the judgment of the Judge who deals either with an ex parte application by a plaintiff for the grant of an extension, or with an inter partes application by a defendant to set aside an extension previously granted ex parte... The decision whether an extension should be allowed or disallowed is a discretionary one for the Judge who deals with the relevant application. Jones v. Jones shows that, in exercising that discretion, the Judge is entitled to have regard to the balance of hardship. In doing so, he may well need to consider whether allowing an extension will cause prejudice to the defendant in all the circumstances of the case. Once a Judge has exercised his discretion, it is only on very limited grounds, too well known for it to be necessary for me to set them out here, that an Appellate Court would be justified in interfering with his decision.

In the second case, Waddon v. Whitecroft Scovell Ltd., [1988] 1 W.L.R. 309, the leading speech, with which the other members of the Appellate Committee agreed, was also delivered by Lord Brandon.

Having referred to the Kleinwort Benson case, Lord Brandon stated as follows in the key passage in his speech:

In Kleinwort Benson's case the House, after reviewing a long line of authorities on the present RSC, Ord. 6, r. 8 and its predecessor, laid down the following principles as applicable to the exercise of the court's discretion on an application for extension of the validity of a writ in cases where questions of limitation of action are involved. (1) On the true construction of Ord. 6, r. 8 the power to extend the validity of a writ should only be exercised for good reason. (2) The question whether such good reason exists in any particular case depends on all the circumstances of that case. Difficulty in effecting the service of the writ may well constitute good reason but it is not the only matter which is capable of doing so. (3) The balance of hardship between the parties can be a relevant matter to be taken into account in the exercise of the discretion. (4) The discretion is that of the judge and his exercise of it should not be interfered with by an appellate court except on special grounds the nature of which is well-established.

Lord Brandon then proceeded to review the various grounds on which the decision of the first instance Judge, Mr. Justice Michael Davies, were criticized, two of which are presently relevant. First, at p. 314G, he said:

The second ground of appeal was that what a plaintiff had to show was good reason for an extension of the original period of validity of the writ, and not good reason for failure to serve it during that original period, and that Michael Davies J. had wrongly confused these two different matters. While it may be possible to visualise a case in which establishment of the second matter is not a necessary step to establishment of the first, I do not find it easy to do so. In the present case at any rate it seems to me that the two matters are inextricably bound together. That is the approach which Michael Davies J. appears to have adopted and I cannot see that he erred in doing so.

Then at p. 317H:

The seventh ground of appeal was that Michael Davies J. did not take into account the balance of hardship between the parties, although Kleinwort Benson's Case showed that this was a proper matter for consideration. Here again I think that there is some misconception as to the effect of that part of the decision in that case. This House was not saying that balance of hardship could of itself constitute good reason for extending the validity of a writ. What it was saying was that, where there were matters which could, potentially at least, constitute good reason for extension, balance of hardship might be a relevant consideration in deciding whether an extension should be granted or refused. In the present case Michael Davies J. found, rightly as I think, that there were no matters which could, even potentially, amount to good reason for extension. In those circumstances the question of balance of hardship did not arise.

Thirdly, in Baly v. Barrett, [1988] N.I. 369, the leading speech, with which the other members of the Appellate Committee agreed, was again delivered by Lord Brandon who stated as follows at p. 417A:

In the Waddon case the House corrected an apparent misunderstanding of principle (3) above by emphasising that the question of the balance of hardship between the parties can only arise if matters amounting to good reason for extension, or at least capable of so amounting, have first been established. In that case the balance of hardship between the parties may be a relevant factor in the exercise of the court's discretion. But, if no matters amounting to good reason for extension, or capable of so amounting, have been established, the effect of principle (1) is that there is no room for the exercise of discretion at all, and the question of the balance of hardship between the parties does not therefore arise.

Fourthly, the principle was restated yet again, in identical terms, by the House of Lords in Dagnell v. Freedman, [1993] 1 W.L.R. 388, citing the previous three authorities.

…

First and foremost, on the main point of principle, in my judgment the House of Lords' line of authority quoted above is fatal to Mr. Charlton's submission that there is a one-stage and not a two-stage process. The correct two-stage test was placed beyond any shadow of doubt by Lord Brandon in the key passage in the Waddon case, as explained in Baly v. Barrett.

At stage one the Court must consider whether good reason for an extension has been demonstrated by the plaintiff, which is essentially a question of fact. If, and only if, the plaintiff succeeds at stage one in establishing good reason does the Court proceed to stage two, which is a discretionary exercise involving value judgments including, where appropriate, the balance of hardship, which then enters the arena for the first and only time.

It follows that in my judgment Mr. Justice Sheen's ratio in the italicized passage quoted above was, despite Mr. Charlton's criticisms, sound in law as a matter of general principle. Furthermore, the first sentence of this italicized passage, which lies at the very heart of the learned Judge's reasoning and which states categorically that the plaintiffs must demonstrate that their failure was not merely due to their own mistake, is unimpeachable. Mere carelessness has never been a good reason for an extension (see note 6/8/4 in The Supreme Court Practice 1993).”

What Hirst LJ refers to as the italicised passage is that which I have set out at paragraph 75 above.

Both Rose and Russell LJJ, the other members of the court in the Al Tabith, approached the case in the same manner. Rose LJ pointed out that the want of any realistic defence is, in the absence of an admission of liability, an obvious reason for starting proceedings within the prescribed period rather than a good reason for not doing so. There being no good reason to grant an extension, i.e. no good reason why a writ had not been issued in time, the question of hardship did not arise. Russell LJ said:-

“The sole operative cause of the delay in issuing the writ was, in my judgment, the human error of Mr Dawson. He was not induced to make the mistake by any active or passive conduct on the part of the defendants.

Wherever the balance of hardship lies, it is, in my view, immaterial, unless and until the plaintiff overcomes the first hurdle which confronts him, namely of demonstrating some legally excusable lapse responsible for the delay. A lapse such as mere forgetfulness, as in this case, is not in my view capable of being regarded as legally excusable.”

I do not accept Mr Kimbell’s suggestion that the jurisdiction under section 8 of the Maritime Conventions Act 1911 was exercised consistently in the manner he suggests. The two very earliest cases which he cited to us do not bear out his argument. In The James Westoll [1923] P 94, in fact decided in 1913, Lord Parker of Waddington seems to have focused exclusively on the absence of good reason for making a claim in time. It is true that he points out that if the court were to permit a statute barred claim to proceed, it is “quite possible that the defendant “might suffer serious inconvenience and injustice.” But that is simply a general statement as to the usual effect of overriding a statutory time bar. The court there made no attempt to weigh the relative balance of hardship or prejudice. It was simply axiomatic that because there was no good reason shown why the action had not been issued in time, and because to override the time bar might well prejudice the defendant, no extension would be granted. The other members of the court, Lord Sumner and Warrington J, agreed with Lord Parker. I do not think that this is far removed from the approach in the Al Tabith.

The Kashmir [1923] P 85 was a particularly hard case. Argument was addressed to the judge, Hill J, concerning the relative hardship which would be caused in the event that time was or was not extended but the judge, citing The James Westoll, expressed his conclusion upon a very short ground:-

“…one starts with the fact that the defendant has obtained his limitation, and it must not be interfered with unless there is good reason. The only reason alleged in the present case for interfering is that the plaintiff, though she knew of the loss of her son, did not know that the loss gave her any cause of action. It seems to me that that is a wholly insufficient ground for depriving the defendants of a right which they had otherwise acquired, especially after so long an interval.”

The Court of Appeal, Lord Sterndale MR, Warrington and Younger LJJ, upheld his decision, whilst noting that the facts in the case before them could not have been more different from those which obtained in The James Westoll. Again that looks to me very like the application of a two stage test, requiring first demonstration of good reason for the failure to issue proceedings in time. The hardship to the plaintiff in The Kashmir was very considerable.

The approach to the exercise of the jurisdiction has no doubt developed over time, and it seems to me natural, inevitable and desirable that it should have been influenced by decisions in other cognate areas. As the citation from the judgment of Hirst LJ in the Al Tabith shows, the 1980s and 1990s was a period in which the jurisdiction under Order 6 rule 8 was examined by the House of Lords on no less than four occasions. It would be extraordinary, particularly in light of the lead given by Brandon J in The Owenbawn, if the manner of exercise of the jurisdiction under section 8 of the Maritime Conventions Act 1911 had not been influenced by this learning. Moreover in Dagnell v Freedman [1993] 1 WLR 388 it was emphasised by the House of Lords that the approach mandated by that learning is not inflexible. Although good reason for justifying extension of the validity of the writ had to be shown, it was normally (my emphasis) impossible so to do without first showing good reason for the failure to serve the writ during its initial validity. Furthermore, the two stage enquiry does not involve two watertight compartments. As Waite LJ put it in Lewis v Harewood [1997] P.I.Q.R.P 58, at P 60:-

“A judge exercising the discretion to extend time, at the suit of a party seeking an extension of time for service after the validity of the proceedings has expired and after expiry of any relevant limitation period, has to conduct the inquiry in two stages. He must first be satisfied, at stage one, that there is good reason to extend time, and also that the plaintiff has given a satisfactory explanation for his failure to apply before the validity of the proceedings expired. If he is not so satisfied, that is the end of the application and stage two will never arise. If he is so satisfied, then he must go on, at stage two, to a general exercise of a discretion involving a consideration of all the circumstances including the balance of prejudice or hardship. Matters relevant at stage two are not, however, irrelevant at stage one. There is a degree of overlap, and a judge addressing the inquiry at stage one is entitled and bound to take into account any matters which appear to him to be relevant to the issues of good reason and satisfactory explanation, notwithstanding that the same matters will also be relevant (assuming it arises at all) to the exercise of his discretion at stage two.”

Order 6 rule 8 has of course now been replaced by CPR 7.6. CPR 7.5(2) provides “the general rule is that a claim form must be served within four months after the date of issue.” CPR 7.6 provides:-

“7.6

(1)

The claimant may apply for an order extending the period for compliance with rule 7.5.

(2)

The general rule is that an application to extend the time for compliance with rule 7.5 must be made –

(a)

within the period specified by rule 7.5; or

(b)

where an order has been made under this rule, within the period for service specified by that order.

(3)

If the claimant applies for an order to extend the time for compliance after the end of the period specified by rule 7.5 or by an order made under this rule, the court may make such an order only if –

(a)

the court has failed to serve the claim form; or

(b)

the claimant has taken all reasonable steps to comply with rule 7.5 but has been unable to do so; and

(c)

in either case, the claimant has acted promptly in making the application.”

In Hashtroodi v Hancock [2004] 1 WLR 3206 at paragraph 35 of the judgment of the Court Dyson LJ emphasised that even where there is no reason for the failure to serve in time other than incompetence of the claimant’s legal representatives, that is not an absolute bar to relief although it is a powerful reason for refusing to grant an extension of time. On the facts of that case, it was decisive.

Against this background I turn to the decision in The Igman. The leading judgment in that case is a long extempore judgment delivered by Evans LJ which is, with respect, not at all easy to follow. That case concerned a collision between the “Malandrinon” and “The Igman”. The P&I Club in which Malandrinon was entered gave a letter of guarantee which included the following:-

“In consideration of your refraining from arresting or detaining the vessel “Malandrinon” owned by Wildvalley Shipping Company SA or any other vessel in the same or associated ownership management possession or control anywhere in the world…

We further undertake that when requested to do so we will irrevocably instruct solicitors in England to accept service of proceedings issued in the English High Court of Justice Admiralty Court on behalf of the owners of the MV “Malandrinon”.”

Subsequent to the collision the Malandrinon was sold by Wildvalley Shipping Company and renamed the “Atilim 2”. Shortly before the time bar expired, both sides issued proceedings. The solicitors for The Igman issued an in rem claim form in which the defendant was named as “the owners of the ship “Atilim 2” (formerly named “Malandrinon”). Their opponent solicitors, Messrs Clydes, objected that they were not bound by the letter of guarantee to accept service because (i) they did not act for the current owners of the Atilim 2; and (ii) the claim form was in rem, whereas the letter of guarantee contemplated a claim form in personam. The solicitors for The Igman therefore issued a fresh in personam claim form and duly sought an extension of time pursuant to the discretionary limb of section 8 of the Maritime Conventions Act 1911. They also sought leave to counterclaim out of time in the respondents’ action. The questions for the court were amongst other things (i) whether there needed to be any in personam claim form or whether the in rem claim form would suffice and (ii) supposing that there needed to be a fresh in personam claim form, whether time could be extended for its commencement.

The first point to note is that there was no challenge in the Court of Appeal to the basis upon which the judge below, Sheen J, had approached the exercise of his discretion. He had directed himself by reference to the decision of the House of Lords in The Myrto.

Secondly, Evans LJ concluded that the causative error by the claimants’ solicitors, if there was one, was the failure to appreciate that Clydes, the respondents’ solicitors, might take the point which they did on their obligation to accept service of the in rem writ. Evans LJ regarded this error, if such it was, as “a technicality only” – Hoffmann LJ called it “a matter of such high technicality.” Put another way, if the solicitors were at fault they were not culpable and good reason was shown why they had not issued an in personam writ within the time allowed.

Having reached that conclusion, Evans LJ went on to ask:-

“Overall, as regards the question of discretion, it seems to me essential to have regard to what I will call “the justice of the case” with particular need for reference to the question whether the appellants show a good reason for an extension in this case. In substance it seems to me that the court has to ask itself: does the appellants’ error merit the consequences which a refusal would imply, taking account also of the respondents’ position and their interests? In my judgment it does not, and the extension should be granted.

I would give greater weight than the learned judge did in particular to the fact that the appellants’ error, if there was one, was a technicality only.”

In expressing himself in this way Evans LJ was proceeding to the second stage of the enquiry. At this stage he was balancing all the considerations, having regard to what he called “the justice of the case”. The judge had evidently given little or no weight to the highly technical nature of the error. Evans LJ accordingly considered it appropriate to grant an extension, in fact an extension in which to serve a counterclaim, although as he pointed out it made no real difference whether such an extension was granted or an extension of time within which to issue an in personam claim form.

As it happens Evans LJ also went on to conclude that on the true construction of the Club letter of guarantee the respondents’ solicitors Messrs Clyde and Co had been obliged, on behalf of Wildvalley Shipping Company SA, to accept service of the in rem writ notwithstanding the change of ownership. He pointed out that technically it might be necessary to extend the time for service of that writ, so that it could now be served on Messrs Clydes, but that that was not necessary because of an undertaking given to the court by Clydes that they would accept service in the event that the court determined that they had been obliged so to do. In the light of this finding as to the proper construction of the letter of guarantee, the previous part of the reasoning in the judgment of Evans LJ is strictly unnecessary to his decision. The other two members of the court however did not express a view as to the proper interpretation of the letter of guarantee. Hoffmann LJ said “…assuming that the writ was not in the proper form, the appellant’s mistake was a matter of such high technicality that I think that it would be a reproach to the administration of justice in the Admiralty Court if such a slip, assuming it to have been one, should deprive the appellants of what appears on the face of it to be a promising cause of action. In my judgment the learned judge misdirected himself by not taking into account this, as it seems to me, vital feature of the case.” Russell LJ adopted a similar approach.

In conclusion I do not consider that The Igman is authority, and certainly not clear authority, for the application of a one stage test different from that prescribed by the House of Lords in relation to Order 6 rule 8. The case can be explained simply on the basis that the assumed error was not culpable, on the contrary was of the highest technicality, and afforded good reason for the failure to issue an in personam writ in time.

In The Pearl of Jebel Ali [2009] 2 Lloyd’s Rep 484 the court was referred to both the Al Tabith and The Igman, albeit reference to the latter case would seem to have been for the purpose of showing that counsel experienced in this field, Mr Peter Gross QC, as he then was, had not argued in that case that counterclaims were not caught by section 8 of the Maritime Conventions Act 1911. Notwithstanding reference to The Igman it was, according to Teare J, “common ground” in the case before him that the discretion conferred on the court by section 190(5) of the MSA, although expressed in unfettered terms, “should be exercised in the principled manner explained by the Court of Appeal in the Al Tabith.” The judge continued:-

“First, the court must consider whether there is good reason for an extension of time. Secondly, if there is good reason, the court must consider whether it is appropriate to exercise its discretion in favour of extending or refusing to extend time. That two-stage test reflected the approach to applications to extend the validity of a writ pursuant to the former RSC Order 6 rule 8. In The Owenbawn [1973] 1 Lloyd’s Rep 56 Brandon J said at page 59 that “very similar considerations” apply whether the court is asked to renew a writ or extend time under the Maritime Conventions Act. Similarly, in The Zirje [1989] 1 Lloyd’s Rep 493, Sheen J said at page 497 that the “good reason” test should be applied “by parity of reasoning” to applications to extend time under the Maritime Conventions Act. He said the same in Asianic International Panama SA v Transocean Ro-Ro Corporation (The Seaspeed America) [1990] 1 Lloyd’s Rep 150 at page 153. That approach was not in dispute in The Al Tabith and The Alanfushi.

36.

However, in The Baltic Carrier and The Flinterdam [2001] 1 Lloyd’s Rep 689 David Steel J noted that the relevant rule for extending or renewing a claim form is now CPR Part 7.6. The case before him concerned an application to extend time for the commencement of proceedings pursuant to section 190 of the 1995 Merchant Shipping Act in circumstances where a claim form had been issued within time but had been allowed to expire. David Steel J noted that section 8 of the 1911 Act had been used in the past to permit the extension of the validity of an existing claim form as well as extending time so as to validate the issue of a claim form out of time and that “the practice which accordingly has developed is to treat applications pursuant to the discretionary power accorded by virtue of section 190 on similar principles to applications to extend the validity of the claim form pursuant to the relevant Rules of Court”. Having referred to CPR Part 7.6 he described the discretion as unfettered subject to the express limitations in the rule that the applicant must have taken all reasonable steps to serve the claim form and must have acted promptly in making the application.

37.

In form the discretion conferred by section 190 of the Merchant Shipping Act 1995 is, like its predecessor, an unfettered discretion. However, the discretion under section 8 of the 1911 Act was always exercised in a principled manner by requiring there to be “special circumstances which create a real reason why the statutory limitation should not take effect”; see The William Gray and The Llandovery Castle (1920) 2 Ll L Rep 273. In The Hesselmoor and The Sergeant [1951] 1 Lloyd’s Rep 146 Willmer J reviewed the authorities and summarised their effect as being that there must be “some good and substantial reason for the exercise of the Court’s discretion in favour of allowing the action to proceed”. In The Seaspeed America [1990] 1 Lloyd’s Rep 150 Sheen J saw no difference between “a real reason” (as in The Llandovery Castle) and “a good reason”. I consider that the discretion conferred by section 190 of the Merchant Shipping Act 1995 should be exercised in the same principled manner because, if time is extended, the statutory limitation will not take effect. There must therefore be good reason for extending time. What is a good reason cannot be defined. Whether there is or is not a good reason must depend upon all the circumstances of the case; see The Myrto (No 3) [1987] AC 597 at page 622 per Lord Brandon.

38.

The present case is not one in which a claim form was issued in time but not served in time. Rather, it is one in which a claim form was not issued within time by one ship and an extension of time is sought pursuant to section 190 of the Merchant Shipping Act 1995 to permit a counterclaim to be made in the claim issued within time by the other ship. In such a case the first of the two express limitations in CPR 7.6 (that all reasonable steps to serve the claim form have been taken) can have no application because a claim form was not issued within time (see para 29 of David Steel J’s judgment in The Baltic Carrier). The second express limitation (that the applicant has acted promptly in making the application) can apply and in any event would be a consideration to bear in mind when exercising the discretion conferred by section 190 of the Merchant Shipping Act 1995.”

Teare J went on to find that there was a good reason for an extension of time because the solicitor acting for the owners of Pearl of Jebel Ali had misunderstood the terms of a muddled agreement not in standard form. His misunderstanding was not culpable. The judge therefore went on to consider as stage two of the inquiry whether discretion should be exercised in favour of the owners of Pearl of Jebel Ali.

The approach of Teare J was very similar to that followed by David Steel J in The Baltic Carrier, albeit the latter was as noted a case in which a claim form had been issued in time but had been allowed to expire without service. David Steel J first concluded that the threshold requirements of CPR 7.6 had been satisfied and then turned to the issues material to the exercise of discretion. I agree with Mr Bright that the authorities on CPR 7.6 make it clear that the starting point is to determine and evaluate the reason why the claimant did not do what he ought to have done within time. If applied here by analogy, it is relevant to test the conduct of the Claimant by reference to its mistaken belief that the claim form issued in October 2012 was an in personam claim, or at any rate that it included a claim in personam. The Claimant nonetheless took no steps to attempt to serve in personam, or indeed any other steps to pursue a claim in personam, for another 12 months. The Claimant here can derive no comfort from the change in the rules in 1999. As was the case in Hashtroodi v Hancock, the errors here on the part of the Claimant’s solicitors were “particularly egregious” and there was “nothing sufficient to outweigh the complete absence of any reason which might go some way to excuse the failure to serve in time” – see per Dyson LJ at paragraph 35.

For all these reasons I would reject Ground 3(b) of the appeal. In my judgment the Al Tabith was correctly decided and was rightly applied by the judge here as indeed it was by Teare J in the Pearl of Jebel Ali.

Ground 4 seeks to salvage the grant of permission by Eder J to serve the in rem claim form out of the jurisdiction on Sener in Turkey. That order is said to be justified as permitting a form of alternative service pursuant to PD 61 paragraph 3.6(7). Obviously, this is not an argument relied upon in the paper application made to Eder J.

The first variant of ground 4 suggests that Hamblen J could have ordered alternative service of the in rem claim form upon Sener because it could be shown that the Vessel had been within the jurisdiction of the court after the cause of the action arose. Advisedly, as I think, this argument was not put to Hamblen J. Firstly, the argument ignores all of the learning concerning the nature of an Admiralty action in rem, extraordinarily so considering the change of ownership which had occurred by the time of issue of the claim form. Secondly, as pointed out by the judge in the context of the argument which was put to him, an order under PD 61 paragraph 3.6(7) may only be made when the property against which the claim is made, here the Vessel, is within the jurisdiction of the court. Neither when Eder J was asked to make the order permitting service out of the jurisdiction nor when Hamblen J was invited to uphold that order was the Vessel within the jurisdiction.

The second limb of Ground 4 reads:-

“Hamblen J erred in law in holding that he had no power to order alternative service of the in rem claim form upon Sener to take effect prospectively in the event it could later be established that Niyazi S or one of her sister ships called within the jurisdiction.”

This is an astonishing proposition, which again ignores the proviso to paragraph 3.6(7) which requires that the Vessel be in the jurisdiction before an order for substituted or alternative service can be made.

The purpose behind the use of the present tense in the proviso is remarked upon by Derrington & Turner, ‘The Law and Practice of Admiralty Matters’ (2007) at paragraph 6.19:

“Substituted service is not generally appropriate in the case of an in rem proceedings for two reasons. The first is that the property must be within the jurisdiction to be susceptible to the jurisdiction of the court [citing The Freccia del Nord [1989] 1 Lloyd’s Rep 388] and substituted service has the potential to subvert that connection. The second reason stems from the traditional view that the in rem jurisdiction is not invoked until the writ is served on the ship and the warrant is executed [citing The Banco [1971] P 137, 153, The Good Herald [1987] 1 Lloyd’s Rep 236, 238.].”

As for Ms Selvaratnam’s contention that paragraph 3.6(7) of PD 61 has “no utility” unless she is right in her construction of the Practice Direction, this is incorrect. It is of utility whenever a defendant vessel is within territorial waters, yet it is impractical physically to serve the in rem claim form on the ship. This is a relatively common occurrence, in particular where a vessel does not make fast alongside a shore berth, but remains at anchorage where it may be difficult or dangerous to effect service: see paragraph 49 of the judgment of Hamblen J below, referring to the Claimant’s own evidence as to the information received from the Admiralty Marshal and to the observations of Brandon J in The Berny [1977] 2 Lloyd’s Rep 533, at 548 col 1. Mr Bright invited consideration also of a collision within the 12 mile limit between an innocent and a guilty vessel, with the latter sinking or taking on water; suppose that salvors are engaged in refloating the vessel, and there is a concern that she will be refloated and immediately towed away, before an in rem claim form can be served. In such circumstances, the utility of the provision for substituted service is that it is not necessary to undertake risky and/or expensive operations to affix the claim form upon the ship. Rather, the owners’ representatives can, with appropriate permission granted pursuant to paragraph 3.6(7), be served with process.

For all these reasons I would dismiss the appeal.

I can deal more shortly with the application for permission to appeal in this case.

I take the facts very largely, with gratitude, from the Applicant’s skeleton argument.

The Odyssée is a catamaran yacht built in France in 2006. It was said to have been purchased in 2007 by a Mr Nobili, a Belgian citizen, but it is owned by the Claimant company, CDE S.A. At all material times it was insured with a Belgian insurer, ESA Euroship Allianz.

The SB Seaguard is a 26 metre support craft owned and operated by an English company, Sure Wind Marine Limited. The SB Seaguard was at all material times entered with the Shipowners’ P&I Club.

On 16 April 2011 Mr Nobili sailed the yacht into Ramsgate Harbour and moored at a visitor’s pontoon.

On the evening of 17 April the SB Seaguard hit the Odyssée whilst she was still moored at the visitor’s berth. The Odyssée sustained substantial damage.

Between March 2012 and October 2013 there were extensive communications between the parties. The impression given was that the SB Seaguard’s Club would settle the claim after the repairs had been completed, once a “final statement” with supporting invoices had been submitted.

On behalf of the Applicant, the matter was dealt with by Mr Yves de Ruyter, an experienced claims handler who had spent his entire career in the insurance industry and was the managing director of a company that manages claims on behalf of ESA Euroship Allianz, the insurers of the Odyssée. Mr de Ruyter was based in Belgium. For the Respondent the matter was handled by Mr McCooke, a claims handler at the Shipowners’ P&I Club.

It was said that during these discussions the Shipowners’ P&I Club had encouraged the Applicant and its insurers not to instruct solicitors. By way of example, in an email of 5 October 2012 Mr McCooke wrote:-

“I do not believe that there is anything to be gained by appointing a solicitor to “attack the owner of the SB Seaguard”, and would hope that we can continue our dealings on this unfortunate incident in good faith, as has been and remains our intention from the outset.”

The repairs to the Odyssée were complicated. They were not completed until late March 2013. They cost €275,000.

The two year time limit for bringing a claim against the SB Seaguard expired on 17 April 2013.

The parties appear to have taken no notice of the time bar and in May 2013 a meeting took place, the purpose of which was for the surveyor appointed by the Shipowners’ P&I Club to inspect the repair work. Mr de Ruyter was simply unaware of the two year limitation period applicable to collision cases. Mr McCooke does not appear to have appreciated that the time bar had expired until some time later.

In September 2013 Mr de Ruyter submitted the final claim statement to the Shipowners’ P&I Club.

On 21 October 2013 Mr McCooke emailed Mr de Ruyter informing him that the claim had been considered but that “unfortunately the claim is now time barred under English law”.

An in personam claim form was issued on 23 December 2013. On 20 January 2014 an application was made for an extension of time in accordance with section 190(5) of the MSA.

The Admiralty Registrar conducted a contested oral hearing of the application for an extension of time. The hearing extended over two days. The Applicant was represented by Mr Richard Sarll and the Respondent by Mr Chirag Karia QC. Mr de Ruyter gave oral evidence and was cross-examined. Ironically it was on this occasion Mr Sarll who was arguing for a one-stage test. In his reserved judgment the Admiralty Registrar records Mr Sarll’s submission, after citation of the Al Tabith, Hashtroodi v Hancock, Collier v Williams [2006] 1 WR 1945, Hoddinott v Persimmon Homes (Wessex) Limited [2008] 1 WLR 806, The Pearl of Jebel Ali and The Baltic Carrier as being:-

“d.

The test applicable to CPR 7.6 is wholly different from that applicable to RSC O.6 r.8 so that it is not necessary to show a “good reason” for ordering an extension of time but, pursuant to CPR Part 7.6, the court is simply required to “act justly” in accordance with the overriding objective.

e.

Therefore the proper test applicable to section 190 MSA 1995 is not a two stage test but a one stage test which would allow the court an unfettered discretion to extend time guided by the overriding objective but subject to provisions of CPR Part 7.6(3).”

Apparently Mr Sarll referred the Admiralty Registrar to the decision in The Igman, not in support of his argument just summarised but in order to explain to the Registrar that the Appellants in The Stolt Kestrel were seeking to argue before this court that the test should be as applied in The Igman.

At paragraph 7 of his judgment the Admiralty Registrar posed to himself three questions:-

“The issues posed by the parties’ arguments.

7.

It seems to me that an appropriate approach to the issues raised is as follows:

a.

What test is to be applied when considering an application to extend time for the commencement of proceedings under s.190 of the Merchant Shipping Act 1995? Is it a two stage test, as held in The Al Tabith and which was accepted in The Pearl of Jebel Ali and other more recent cases or a single stage test based solely upon the overriding objective and the requirement to do justice? Is it still necessary to show a good reason for allowing the application or has that requirement disappeared with the alteration of the rules from RSC 0.6,r.8 to the provisions of CPR Part 7.6?

b.

Assuming that the test requires that the applicant shows a good reason, was there a good reason for the claim form not having been issued within the limitation period set out in s.190 of the Merchant Shipping Act?

c.

Assuming that the Claimant’s single stage approach is correct, are the circumstances in this case such that it would be proper to allow an extension of time?”

After extensive discussion of the authorities the Registrar concluded that he should apply the same test as that approved in The Al Tabith and subsequently followed in The Pearl of Jebel Ali. He continued:-

“Whether there was a good reason

31.

Since the “good reason” test is to be applied those cases which have given indications as to what may or may not amount to a good reason are still valid and, at least, persuasive. These include:

a.

The Mouna [1991] 2 Lloyd’s Rep 221, a claim for cargo damage, in which the plaintiffs failed to serve the writ before it expired during which time negotiations had continued. The Court of Appeal (Glidewell L.J and Bracewell J) held that the mere fact of negotiations was not, of itself, a good reason for extending the time for the service of the writ and although conduct by one party might lead to the view that an agreement to extend the time for the service of the writ might be inferred in the absence of such agreement something less was not sufficient.

b.

In The Al Tabith the Court of Appeal also held that the following matters cannot constitute “good reason” for an extension: (a) Carelessness or mistake by the claimant or those acting for it; (b) That the claimant has an “open and shut” case and the defendant has no defence, unless the defendant has formally admitted liability; (c) That negotiations are ongoing; (d) that the defendant was equally oblivious of the expiry of the limitation period and carried on negotiating. Furthermore it was decided that in the absence of a clear agreement to extend time proof would be needed that the defendant had “actively misled” the claimant. Anything less will not operate as a good reason.

32.

In my view the Claimant has failed to demonstrate that there was a “good reason” for failing to commence proceedings in time:

a.

Mr. De Ruyter was unaware of the two year limitation period applicable to collision cases. This arose, I think, because he appears to have been comparatively inexperienced in shipping matters. He asserted that there would be at least a 10 year limitation applicable in Belgium which, to my mind, demonstrated his lack of maritime experience as it was the Brussels Convention of 1910 which brought s.8 of the MCA 1911 into existence and, not surprisingly, Belgium was a signatory to that Convention.

b.

He also candidly stated that if he had been aware that there was a two year limitation period he would have ensured that proceedings were commenced in good time. As a matter of simple logic it must follow that his lack of knowledge was not the sole reason for the failure to commence proceedings. In my view lack of the requisite knowledge of the law whether by a lawyer or a lay person cannot amount to a good reason.

c.

Furthermore Mr. De Ruyter could, and, in my opinion, should have taken legal advice at an earlier stage. If he had done he would have been advised of the two year time limit unless his lawyers were negligent. In my view it follows that Mr. De Ruyter was at fault in failing to take advice at a sensible stage and this also contributed to the failure to commence proceedings in good time.

d.

The fact that negotiations were continuing is irrelevant unless the conduct of the defendant was such as to amount to an actual agreement that time would be extended or that the Defendant would not take the time bar point. It is quite clear that no such agreement could have been made for the simple reason that Mr. De Ruyter was himself unaware that there was a time bar.

e.

There is no duty upon a defendant to warn or remind a claimant that time for commencing proceedings is running out or that, if it does, the defendant intends to rely upon it, see The Mouna at p. 229.

f.

Insofar as Mr. De Ruyter sought to suggest that he was lulled into a false sense of security by those acting for the defendant, in particular Mr. McCooke, that suggestion is fallacious as it cannot be said that he was lulled into a false state of security about a situation of which he was totally unaware. There is no suggestion that Mr. McCooke’s conduct led Mr. De Ruyter to believe that time would be extended or that no limitation point would be taken. He could not possibly have been influenced into any such belief because that would have required a knowledge of the existence of the time bar which he simply did not have.

33.

For the reasons set out above I consider that it is incumbent upon the Claimant to establish a “good reason” and that it has failed to do so.”

The Registrar thus had no reason to consider how he would have exercised his discretion at the second stage of the inquiry, had that been necessary, but he regarded as “notable” that there was a very significant delay between 21 October 2013 when the Respondent raised the limitation defence and 20 January 2014 when the Applicant filed its application under section 190(5) of the MSA. After further consideration of authority bearing on that issue the Registrar continued:-

“36.

In my view the delay before issuing the application for an extension of 3 months is outside what can be regarded as generally acceptable unless there are strong grounds for excusing the delay. Having considered the witness statement of Mr. Glynn-Williams dated the 15th September 2014 I agree with Mr. Karia’s submission that it demonstrates that the Claimant failed to act promptly and did not demonstrate the degree of urgency required. I was particularly struck by the following: (i) there is no satisfactory explanation as to why Mr. De Ruyter’s principals thought it was necessary to instruct Dutch lawyers with respect to a collision which occurred in English waters, (ii) there is no satisfactory explanation as to why it took so long to instruct English lawyers to advise and act, (iii) it took over two months before the Claim form was issued and (iv) there is no satisfactory explanation as to why the application notice was not issued until a month later.

37.

Had it been necessary to proceed to the second stage of the test set out in The Al Tabith I would, in any event, have concluded that it would not be just to allow the Defendant’s application. Thus if I had held that Mr. Sarll’s approach to the nature of the test to be applied was correct, namely that the Court should exercise a wide discretion to act fairly unhindered by the two stage test provided for in The Al Tabith, I do not think that it can be seriously argued that the Court should entirely disregard the evidence as to why the Claimant failed to commence proceedings in time. In my view that would be a relevant part of the background necessary for the consideration of the discretion proposed by Mr. Sarll. Had that been the correct test then, for the reasons I have already given the lack of a satisfactory reason for the failure combined with the Claimant’s failure to issue the necessary application promptly would have caused me to come to the same conclusion, namely that the application should be dismissed.”

Mr Karia submitted that the application for permission to appeal should fail simply on the basis that the Registrar had in any event indicated how he would have exercised his discretion at stage two had it been appropriate to do so. I do not agree with that submission, because with all respect to the Registrar he does not appear to have considered all of the relevant factors in his evaluation, confining himself to the combined effect of the lack of a good reason for the failure to issue proceedings in time and the delay in issuing the necessary application once it became apparent that the time limit point was taken. It would have been necessary to balance those considerations against the circumstance that the Applicant would be deprived of a substantial claim to which the Respondent appeared to have no answer and which the Respondent had given every indication would be met.

It follows however from what I have said already in relation to the appeal in the Stolt Kestrel that the Registrar in my view adopted the correct approach to the application before him which he regarded as failing at the first stage. The question whether there was good reason for failing to commence proceedings in time does not involve the exercise of a discretion but it is nonetheless an evaluative exercise in which it is for the decision-maker to decide what weight to attribute to the various considerations. Another decision-maker on another day might have come to a different conclusion, but I do not consider that the decision reached by the Registrar was outside the ambit of reasonable decision-making. The Registrar directed himself appropriately by reference to the authorities. Furthermore the Registrar had the advantage which we do not that he saw and heard Mr de Ruyter give his evidence and be cross-examined thereon. Our disadvantage is two-fold – the recording machine was not activated while Mr de Ruyter was giving his evidence so that no record is available thereof. The judge’s decision is carefully reasoned and it is not suggested that he failed to have regard to relevant factors or placed reliance on irrelevant factors, simply that he attributed weight thereto in a manner with which the Applicant, not unnaturally, disagrees. I do not consider that there is any real prospect of this court interfering with the Registrar’s assessment and I would accordingly refuse permission to appeal.