On 7 September 2022, a fire broke out on the Big Kahuna at a marina in Corfu. The fire spread to other vessels in the marina, three of which sank, including the Halcyon. On 15 November 2022, the owners and English insurers of the Big Kahuna commenced a limitation claim in the English Admiralty Court pursuant to the LLMC 1976 (incorporated into English law by s 185 and Sch 7 of the Merchant Shipping Act 1995). On 14 December 2023, the owners of the Halcyon issued proceedings against the owners of the Big Kahuna in the Court of First Instance of Piraeus, Greece, seeking compensation for the loss and damage caused by the fire.

There is a significant difference between the limitation regimes in the two countries. Pursuant to art 15.2.b of the Convention, the regime governing limitation claims in England and Wales incorporates a small craft limit for vessels of less than 300 tons. This limit of 500,000 SDRs (about GBP 530,000) applies to the Big Kahuna. Greece incorporated the same limit from 1 May 2023, but not retrospectively. Thus, the relevant Greek limit would be calculated in accordance with art 6 of the Convention, and would be 1,510,000 SDRs (about GBP 1.6m).

Halcyon Yacht Charter LLP applied for an order staying the English proceedings on the basis of forum non conveniens because 'the courts of Greece are clearly and distinctly more appropriate as the forum for resolution of both limitation and the underlying substantive claims'.

Held: The application for a stay is dismissed.

It is true that the natural forum for the underlying claims is Greece. But the limitation claim is a separate and distinct claim. In a limitation claim there are usually just two issues: (1) the amount of the limitation fund; and (2) an art 4 defence, if raised. The first is an arithmetical calculation, which rarely gives rise to a dispute. The second is a defence which, since the introduction of the more tightly-drawn wording of art 4 of the LLMC 1976, is notoriously difficult to make out, is therefore seldom raised, and for which there is in this case no support. The cause of the fire is unknown. Eighteen months have elapsed and no evidence has emerged to suggest that it was started deliberately or recklessly. A speculative and improbable art 4 defence is no basis upon which to find England an inappropriate forum.

It is common for the limitation claim and the underlying claims to be tried (or arbitrated) separately and in separate jurisdictions. Examples include Bouygues Offshore SA v Caspian Shipping [1998] 2 Lloyd’s Rep 461 (CMI2371); and The Volvox Hollandia [1988] 2 Lloyd’s Rep 361, 370 (CMI2407). If the proper forum for a limitation claim were to default to the jurisdiction of the tort, a defendant could always trump the claimant’s choice of forum. But it has been emphasised that 'a shipowner is at liberty to choose his domiciliary court as the forum in which to set up his limitation fund and establish his right to limit his liability': The Volvox Hollandia 379. English courts 'should be exceedingly slow to interfere with such a settled practice which has international ramifications'. The first claimant is the English insurer and the second claimant is the English beneficial owner of the vessel in respect of which a decree is sought. There is nothing sinister or untoward in them (together with the registered owner) bringing this claim against a Welsh company, of whom at least one of the beneficial owners is Welsh, in England. Although the insurer of the Halcyon is not a defendant, that insurer is also an English company. Of other potential claimants against the fund, with the exception of the marina itself, not one is Greek. On the contrary, they represent a variety of different nationalities and flags, including Germany, Malaysia, Italy, and the Cayman Islands.

The availability in England of a single, unitary limitation claim (as opposed to the need to raise limitation as a defence to each substantive claim) allows the orderly management and ranking of a full cohort of claims against the limitation fund. Even if limitation is raised in Greece, an English court cannot be deterred from proceeding with a limitation claim here by the prospect that a court in another jurisdiction may not recognise its limitation decree. That would be no basis to conclude that that other court was the more appropriate forum. Finally, the claimants cannot fairly be accused of forum shopping. Given the primacy afforded to the shipowner as to choice of jurisdiction, it is hard to see how that can have frustrated the expectations of other potential claimants. The defendant’s real complaint is that a limitation fund established here will be one third the size of a limitation fund established in Greece. But if England is a forum where the limitation claim may be tried 'suitably for the interests of all the parties and the ends of justice' (a phrase originating from the judgment of Lord Kinnear in Sim v Robinow (1892) 19 R 665) a juridical advantage such as this is not relevant.

In The Herceg Novi [1998] 2 Lloyd’s Rep 454 (CMI770), the application of these principles led the English Court of Appeal to stay an English action in favour of Singapore, even though the English claimants were thereby deprived of the higher limits of the 1976 Convention (in force in England) in favour of the lower limits of the 1957 Convention (then in force in Singapore). The Court of Appeal held that 'in terms of abstract justice' neither Convention was 'objectively more just than the other'. Therefore the only question was whether substantial justice would be done in Singapore, which the Judge below (Clarke J) had already found to be clearly or distinctly the more appropriate forum. The Court of Appeal held that substantial justice would indeed be done in Singapore and therefore granted a stay of the English proceedings. The facts of The Herceg Novi have resonance in this case.