In troubled waters

01.01.06

In troubled waters

Duncan MacLean, Partner in Brodies' commercial litigation department offers an overview of the process and procedures involved in arresting a ship in Scotland.

How Scotland differs

Terminology

In Scotland a Pursuer is what is known in England as the Plaintiff or Claimant and a Defender is what is known as the Defendant. The initiating document in a cause is a Summons in the Court of Session, or an Initial Writ in the Sheriff Court. A warrant to arrest is the order granted by the Court authorising arrest of the vessel. It is not effective until the arrest is actually carried out.

Jurisdiction

Admiralty jurisdiction in Scotland is conferred on Scotlands Supreme Court, the Court of Session throughout Scotland and on local Sheriff Courts for their territorial areas. Most Admiralty actions in Scotland are raised in the Court of Session. There is no specialist Admiralty Court or judge, but provision is made for the use of Nautical Assessors. The Admiralty jurisdiction of Courts in Scotland arises, in general, where (a) the Defender has his residence or place of business in the area for which the Court acts, (b) the cause of action arose in the area for which the Court acts, (c) the Court is already hearing an action arising out of the same incident or series of incidents or (d) jurisdiction has been agreed, or a ship owned by the Defender has been arrested to found jurisdiction. This latter ground, which would also apply to an arresment in rem is specifically excluded from the jurisdiction regime of the Brussels Convention of 1968.

What may be arrested?

A ship, its cargo, or freight may be arrested. Ship is defined as including every description of vessel used in navigation. Although guidance may be obtained from previous cases, it is not possible to provide an exhaustive definition of what constitutes a ship. The Scottish Courts have recently held, for example, that a semi submersible drilling rig was a ship, and have therefore allowed arrest of such a rig on more than one occasion.

Types of arrestment

An arresment in rem in Scotland is a remedy directed against the vessel itself, in distinction to an action in personam which is a remedy directed against the owner of the vessel. In Scotland, generally, an arrestment in rem may only be used to enforce a maritime lien, that is a claim arising either in respect of a collision, a claim for salvage, or for seamens wages. The statutory right to arrest in rem is more restricted than in England and applies, broadly, where there is a dispute as to ownership of possession of a mortgage over a ship. The remedy of arrestment of assets owned by a debtor in security of a claim exists in the general law in Scotland, and in this general form is known as an arrestment on the dependence(of the action). Most ship arrests will be arrestments on the dependence and will be in the context of Admiralty Actions in personam, that is directed against the shipowner or demise charterer. In common with the principles of the general law of Scotland, an arrestment on the dependence may only be executed against a vessel which is the ship with which the action is concerned or, another ship which is wholly owned by the Defender against whom the action is directed. The class of claims for which a ship may be arrested is enacted in Scotland by statute and is derived from the Geneva Arrest Convention of 1952.

Preparing for arrest

The Scottish Court system is based on written pleadings, and thus pleadings are required to support an application for arrest. The initiating document is a Summons which, broadly, is equivalent to a detailed Statement of Claim under the English system. Accordingly, the Summons must have enough information to set out the case both as a matter of fact and law so that the Court can determine whether a prima facie or colourable case has been made out. If any supporting documents are available they should provided so that they can be referred to if appropriate in, or at the very least produced with, the Summons when it is presented to the Court. Affidavits, although competent, are not commonly used in Scotland, and would be used in support of rather than in place of written pleadings. The Summons requires to be drafted by Counsel or another person with rights of audience in the Court of Session.

Procedure for obtaining warrant to arrest

The procedure for obtaining a warrant to arrest has been revised to make it compliant with ECHR. An application is required to be considered by a judge before any warrant to arrest may be issued. The Court requires to be satisfied that there is a case made out on the merits, thereby underling the importance of having as full pleadings in the Summons as time and circumstance permit. The judge considers the application in chambers with submissions. The specific necessity for an arrest needs to be demonstrated. The claimant will also have to demonstrate, in order to comply with ECHR, that the remedy of arrest sought is proportionate to the claim. A caveat will not be triggered by an application for a warrant for arrest.

The time frame for an arrest

The Court of Session operates a system whereby a judge is always available, on call, for an out of hours application. In order to bring an application out of hours urgency must be demonstrated. The court will recognise urgency where a ship is only going to be within the jurisdiction for a short period of time. As a result of the more detailed system of pleading and the requirement to have the matter placed before a judge, instruction for an arrest should be given at as early a stage as possible. In the local Sheriff Courts is much more difficult to obtain an order out of hours.

Practical issues

Scotland does not have an Admiralty Marshal. An arrest is physically effected by a Messenger at Arms, who is appointed by warrant of the Court. He requires to physically attend at the vessel, which must at the time be within a harbour or recognised anchorage. He will arrest the vessel and deal with the formalities of the arrest, including informing the appropriate Harbour Authority. The location of the vessel in Scotland must be borne in mind when considering the time available for an arrest. The Claimant in Scotland presently has no responsibility to either the vessel under arrest or her crew, at least not until the stage when he moves to formally take possession of it through the Court process.

Counter security and damages for wrongful arrest

There is no requirement in Scotland for a claimant to provide counter security. Whilst an owner may apply at any point to the Court for security from a claimant, this is as part of the general law and is not a special remedy available only in cases of arrest. Such an order would generally costs in the event of the pursuer failing, rather than security for damages. A claimant can be liable in damages if the arrest is held to be wrongful or procedurally inept. As part of recent and still developing law following ECHR a first instance judge has held, albeit obiter, that if an arrest is used without objective justification and in particular if a claimant is unsuccessful in the action a Defender may be entitled to damages for any loss he has suffered in consequence of arrest. The matter has not yet been properly tested.

For further information on Brodies shipping law services, contact:
Duncan MacLean
Partner
t: 0131 656 0152
e: duncan.maclean@brodies.com