MV Snow Delta: Discount Tonnage Ltd v Serva Ship Ltd

• Jurisdiction: South Africa
• Citation: 1998 (3) SA 636 (C)

MV Snow Delta: Discount Tonnage Ltd v Serva Ship Ltd
1998 (3) SA 636 (C) [*]

1998 (3) SA p636

Citation	1998 (3) SA 636 (C)
Case No	A316/97
Court	Cape Provincial Division
Judge	King DJP, Thring J, Viljoen AJ
Heard	February 2, 1998
Judgment	March 11, 1998
Counsel	DJ Shaw (with him M Wragge) for the appellant; JJ Gauntlett (with him RWF MacWilliam) for the respondent

Flynote : Sleutelwoorde

Appeal — In what cases — Rule nisi ordering attachment of ship ad fundandam jurisdictionem in terms of s 3(2)(b) of Admiralty Jurisdiction Regulation Act 105 of 1983 discharged on return day — Ship leaving area of jurisdiction — C Whether appeal against discharge of rule competent since, in absence of ship, nothing left to attach within Court's jurisdiction to give effect to rule — Ship under valid, binding and effective order of attachment in period between grant and discharge of rule — Claimant's action for damages regarded, in terms of s 1(2)(a)(ii), as commencing with D attachment of ship when rule granted — If such attachment adequate to found jurisdiction, such jurisdiction continuing to exist until end of claimant's action, even though ground upon which jurisdiction established (attachment of ship) ceasing to exist — Appeal thus competent.

Shipping — Time charter — Whether time charterer having rights and interest in ship capable of attachment ad E fundandam jurisdictionem — Rule nisi ordering attachment in terms of s 3(2)(b) of Admiralty Jurisdiction Regulation Act 105 of 1983 of 'all of the respondent's possessory right, title and interest' in ship granted on basis of demise charter — Ship actually under time charter — Time charterer's interest in ship consisting of right against owner to have goods F carried in specific ship — Time charterer thus having interest in preservation or protection of chartered ship — Rule nisi clearly and unambiguously authorising attachment of 'all of the respondent's . . . interest in' ship, whatever such interest might be — Rule thus not a nullity — Provided other requisites met, confirmation of attachment competent. G

Ownership — Incorporeal property — Right of action — Locus of — Justification for rule that right of action deemed to be at place where debtor located being that creditor able to enforce right against debtor there — If right enforceable as effectively elsewhere, could equally be deemed to exist there — Thus no reason in logic or in law why incorporeal not H capable of existing in several places simultaneously.

Shipping — Time charter — Attachment of time charterer's rights under charterparty — Locus of time charterer's rights against owner — Such rights constituting incorporeal property-Owner appearing to 'reside' in London — Although I competent for time charterer to enforce rights in London, equally open to charterer to proceed in personam against owner in Cape Town if ship to which such rights relating first properly attached ad fundandam jurisdictionem in terms of s 3(2)(b) of Admiralty Jurisdiction

1998 (3) SA p637

Regulation Act 105 of 1983 — Such rights located in Cape Town for as long as ship to which they relate inCape Town and thus amenable to attachment in Cape Town. A

Headnote : Kopnota

Section 3(2)(b) of the Admiralty Jurisdiction Regulation Act 105 of 1983 provides that an action in personam 'may only be instituted against a person . . . whose property within the Court's area of jurisdiction has been B attached by the plaintiff or applicant to found or confirm jurisdiction'. To this end the appellant, a peregrinus, with the intention of prosecuting a maritime claim for damages against the respondent, also a peregrinus, obtained a rule nisi ordering the attachment of 'all of the respondent's possessory right, title and interest in the MV Snow Delta' then in port at Cape Town, 'including any possessory right which might arise from the C respondent's possession and control of the vessel in terms of a demise charterparty concluded between the respondent and the vessel's owner'. The appellant had been under the impression that the respondent had been the demise charterer of the vessel, whereas it had time chartered the vessel for five years from 25 August 1995. Furthermore, at the time of the attachment (2 September 1996) the vessel was under subcharter to another party, D also in terms of a time charterparty, at a higher rate of hire (US $1 051 per day) than that payable by the respondent to the owner. On the return day the Court discharged the rule on the grounds that the respondent's rights under the time charterparty (and, possibly, under the subcharter), being incorporeal rights having no existence independently of the location of the person exercising the rights, were not amenable to attachment to E found or confirm the Court's jurisdiction because they were not situate within the Court's jurisdiction. The vessel subsequently sailed from Cape Town.

Apart from the merits, the respondent raised two issues in resisting the appeal. The first was whether the Court should even entertain the appeal: the question whether or not the attachment had correctly been ordered was merely of academic interest because, with the vessel having long since sailed, there would in any event be nothing F within the Court's jurisdiction to attach to give effect to the rule. The second was that the incorrect factual basis on which the rule had been granted, namely the reliance on a demise charter rather than a time charter, rendered its confirmation on the return day incompetent: in effect, that it had become a nullity. It was also submitted that the G respondent had divested itself of its rights under the main charterparty when it had concluded the subcharterparty.

Held, as to the first issue raised by the respondent, that during the period between the granting of the rule on 2 September and its discharge on 16 September the vessel had been under a valid, binding and effective order of attachment ad fundandam jurisdictionem. Should the discharge of the rule be set aside and the rule be H confirmed, that order would take effect from the date of the order of the Court a quo. The fact that after 16 September the vessel had ceased to be under attachment did not detract from the fact that, soon after the rule had been granted, the vessel had lawfully been placed under attachment ad fundandam jurisdictionem. If such attachment had been adequate to found jurisdiction at the time, that jurisdiction would continue to exist until the I end of the appellant's action, even though the ground upon which it had been established (the attachment of the vessel) might have ceased to exist. (At 643G/H--644B/C.)

Held, further, given that in terms of s 1(2)(a)(ii) of the Act an admiralty action commenced with the making of an application for the attachment of property to found jurisdiction, that the appellant's action for damages had to be regarded as having commenced on 2 September 1996 when it had J

1998 (3) SA p638

applied for the attachment; that that was the date on which jurisdiction was to be determined; and that, if there A had been jurisdiction on that date by virtue of the attachment, that jurisdiction would continue to exist, regardless of what might have happened to the vessel thereafter. (At 644H--I.)

The dicta in Thermo Radiant Oven Sales (Pty) Ltd v Nelspruit Bakeries (Pty) Ltd 1969 (2) SA 295 (A) at 310D--H and 301D--F applied. B

Held, further, as to the second issue raised by the respondent, that, although as a time charterer the respondent had no title to the vessel or right to its possession or control, it had an interest in the vessel, consisting of its right against the owner to have its goods carried in that specific vessel. It could hardly be suggested that a time charterer had no interest in the preservation or protection of the chartered vessel: his right to her use and employment would or could adversely be affected if the vessel were lost or damaged. (At 647F/G--H/I.) C

Held, further, that, as a matter of construction, the rule nisi clearly and unambiguously had authorised the attachment of 'all of the respondent's . . . interest' in the vessel, whatever that interest might be, over and above its 'possessory right' and 'title' in the vessel. That conclusion was strengthened by the words 'including any D possessory right which might arise from the respondent's possession and control of the vessel . . .' which followed. (At 648D/E--E/F.)

Held, accordingly, that the rule nisi had not been a nullity: the respondent had an interest in the vessel, albeit not a possessory one, arising out of its time charterparty; that interest had been attached pursuant to the rule; and, to E that extent, it had been competent for the Court a quo to have confirmed the attachment, provided the other requisites therefor had been met. (At 648I/J--649A.)

Held, further, that there had at no time been a cession by the respondent of its rights and obligations under the main charterparty to the subcharterer. Moreover, there was incontrovertible evidence that the respondent's rights F under the main charter had a saleable, commercial value, the hire payable under the subcharter being US $1 051 per day higher than that payable under the main charter. (At 649C/D--D and E--F.)

Held, further, that the fact that the value of the property to be attached to found jurisdiction might be insufficient to satisfy a judgment which the Court might subsequently give would not per se oust jurisdiction or render the attachment liable to be set aside. (At 649F--F/G.) G

Held, further, as to the merits, that, although in South African law an incorporeal in the form of a right of action was usually deemed to be at the place where the debtor concerned was or resided or was domiciled, what was important was that the underlying reason for this...