On 25 January 2003 there was a collision in the North Sea, outside territorial waters, north of Terschelling in the Friesland Junction area, between the Seawheel Rhine, owned by Northsea and bareboat chartered by B&N, and the Assi Eurolink, owned by Westereems, as a result of which the Assi Eurolink sank. The Dutch State initiated proceedings on 7 February 2003 against Northsea and Westereems before the Rechtbank Groningen for the recovery of costs for the marking and removal of the wreck of the Assi Eurolink. Westereems started proceedings against Northsea (10 February 2003) and B&N (11 February 2003) before the Rechtbank Groningen for the damage relating to the Assi Eurolink and for an indemnity for the wreck removal costs which might be payable to the Dutch State. On 19 February 2003 Northsea started arbitration proceedings against B&N in Stockholm (Sweden) and claimed that B&N is obliged to compensate Northsea for all claims directed at Northsea relating to the collision. On 24 February 2003 B&N filed an application with the Court in Stockholm (Sweden) for the limitation of liability and deposits security from Northsea’s P&I Club and from the hull and machinery underwriter of the Seawheel Rhine. The Stockholm court set the liability limit at SDR 1,800,093. Westereems’ appeal against this decision was rejected. On 25 February 2003 the Dutch State effected an attachment on the Seawheel Rhine in Rotterdam. The attachment was lifted on 26 February 2003 in exchange for a guarantee from Northsea’s P&I Club to an amount of SDR 2,628,375, being the amount of the wreck fund liability limit calculated for the Seawheel Rhine under art 8:755 Dutch Civil Code. On 13 March 2003 Westereems effected an attachment on the Seawheel Rhine in Rotterdam, which attachment was lifted in exchange for two guarantees amounting to SDR 2,628,375 (wreck fund) and SDR 1,800,093 (property fund). In October 2003 Westereems and the Dutch State conditionally submit their claims to the limitation fund constituted in Sweden, while contesting the Swedish court’s jurisdiction. B&N and Northsea start an action on the merits against the Dutch State and Westereems. The Netherlands and Sweden are both party to the Limitation of Liability for Maritime Claims Convention 1976 (LLMC 1976). Unlike the Netherlands, Sweden did not make a reservation with regard to claims for the costs of wreck removal; Sweden had no wreck fund. Northsea and B&N demand in the current provisional measures proceedings that Westereems and the Dutch State are ordered to return the guarantees, or otherwise that the amount of the guarantees is reduced to the value of the Seawheel Rhine, being USD 1.9 million.

Held: The recognition and enforcement in the Netherlands of the decision of the Swedish court on the application for limitation of liability, which is not provided for in the LLMC 1976 itself, is governed by the EC Reg 44/2001 (Brussels I).   

The decision of the Swedish court for the constitution of a limitation fund is a judgment within the meaning of art 32 EC Reg 44/2001, and it makes no difference that the decision was rendered ‘ex parte’ (compare ECJ 14 October 2004, Schip en Schade 2006/97 in the matter of the Cornelis Simon (Maersk Oil & Gas C-39/02))

As follows from the aforementioned judgment (of the ECJ), recognition of a decision to constitute a fund to limit liability without prior notice to the relevant creditor, even if this creditor has filed an appeal contesting the jurisdiction of the court which rendered the decision, cannot be refused in this country on the basis of art 34.2 EC Reg 44/2001, provided this decision was served on or notified to the defendant in a regular and timely manner. The latter is the case in these proceedings, now that it has been established that Westereems filed an appeal against this decision before the Svea Court of Appeal in Stockholm, which presupposed such service or notification. Pursuant to art 33 para 1 EC Reg 44/2001, the decision of the Swedish fund court must therefore be recognised without any special procedure being required, whereby in a case such as this one, pursuant to art 35 para 3 EC Reg 44/2001 the jurisdiction of the Swedish court may not be reviewed and, pursuant to art 36 EC Reg 44/2001, under no circumstances may there be a review as to the substance of the decision rendered in Sweden.

The legal consequence in this country of the decision of the Swedish fund court is thus determined by Swedish law. This includes art 13 of the LLMC 1976, in which provision 'immunity' from attachments is laid down. The recognition in the Netherlands of that decision entails that this 'immunity' also applies in this country. As the recognition takes place without a review as to the substance of the decision by the Swedish fund court, it must also be assumed that, in accordance with the implicit decision, the abovementioned arbitration proceedings satisfy the condition for constituting a fund that legal proceedings have been instituted with regard to claims subject to limitation as laid down in art 11 of the LLMC 1976.

Article 13.1 of the LLMC 1976 entails that a person who has brought a claim against the fund is not permitted to exercise any right relating to such claim with regard to any other assets of a person who constituted the fund or on whose behalf the fund was constituted. This means that attachments, effected prior to or after the constitution of the limitation fund by a person who has brought a claim against the fund, lack legal effect. It follows from this that in such a case the attachments must be lifted, without the court applied to having any discretion in this respect. The circumstance that in this case the attachments lacks legal effect and must be lifted without further consideration, also means that it is not permitted to demand security in exchange for which the attachment will (or might) be lifted.

The facts show that on 13 March 2003, after the limitation fund was constituted, Westereems attached the Seawheel Rhine and that it submitted its claim to the fund in October 2003. That Westereems submitted its claim to the fund conditionally and while disputing the jurisdiction of the Swedish court do not change the fact that there was a claim submission.

The attachment therefore lacks legal effect and the lifting thereof and the return of the security posted in exchange for lifting of the attachment is therefore imperatively prescribed.

The Supreme Court can dispose of this matter itself. The judgment of the provisional measures judge must be quashed. In the fact-finding instance Westereems presented the defence that the claim for return of the guarantees should fail on the basis of the specific conditions agreed by the parties in the guarantee agreements on which the guarantees must be returned. As considered above, the attachment lacks all legal effect and it is not permitted to demand security in exchange for the lifting of the attachment. The defence, which is also based on the view that the guarantees serve the purpose of lifting of the attachment, thus fails. The primary claim against Westereems will therefore be awarded. The appeal in cassation is allowed and Westereems is ordered to return the two guarantees.