This is a limitation action brought pursuant to the Convention of Limitation of Liability for Maritime Claims 1976 (LLMC 1976). No limitation fund has been constituted.

Dominator Ltd (Dominator), the plaintiff, is a company incorporated in the Isle of Man. Dominator is the registered owner of a motor yacht the XTC of London. Gilberson SL (Gilberson), the first defendant, is a company incorporated in Spain and is the registered owner of a motor yacht, the Bertona. Zeeland Chart SL (Zeeland), the second defendant, is a company incorporated in Spain and is the registered owner of a motor yacht, the Yasanti. Joy Sea-Gestao Nautica LDA (Joy), the third defendant, is a company incorporated in Madeira and the registered owner of a motor yacht, the Glamour.

In 2008 the XTC of London was berthed at Marina Port Vell, Barcelona, Spain, when it caught fire and sank. As a result of the fire three other vessels were sunk: the Bertona, the Glamour and the Ladies First; and at least five other vessels were damaged: the Yasanti, the Drumfire, the Serenity, the Sinera Tres and the Three Sisters. The vessels which sank have now been recovered, and there is an ongoing investigation by the police into the circumstances of the fire. It is suggested that the likely cause was a defective dishwasher. Wreck removal costs amount to approximately EUR 500,000.

Dominator commenced a limitation action on 14 February 2008 in the Isle of Man and applied to serve Gilberson, Zeeland and Joy out of the jurisdiction. Gilberson and Joy contested the Manx Court's jurisdiction.

Held: Service on Gilberson, Zeeland and Joy out of the jurisdiction was proper. Dominator has the right to bring a pre-emptive limitation action in the Isle of Man under art 10 of LLMC 1976.

This claim is governed by the LLMC 1976 in spite of the fact that the Isle of Man is not a signatory to it. That Convention was incorporated into the law of the Isle of Man by the Merchant Shipping Act 1995 (Application) Order 1999 under s 5(2) of the Merchant Shipping Act 1985.

Leave to serve the defendants out of the jurisdiction was granted pursuant to O 6 R 1(h) of the Rules of the High Court of the Isle of Man which provides for service out of the jurisdiction with leave of the Court 'in any other case whereupon cause is shown the Court shall be of opinion that there are sufficient special grounds to warrant service of a summons or notice out of the jurisdiction'. Application was made under that Rule because, unlike the procedure in England, no specific procedure has been established in the Isle of Man for admiralty proceedings. The Isle of Man is not a Contracting State to the Brussels Convention and its successors, currently the EU Judgments Regulation 44/2001, having elected not to become so after debate in Tynwald in 1993. If Dominator has a right to bring a pre-emptive limitation action in the Isle of Man, art 10.3 of the LLMC 1976 applies to establish the procedure to be adopted. That procedure must be that of the Isle of Man. There is no specific procedure laid down for limitation claims so the general procedure must be applied.

There is no reason why O 6 R 1(h) should not apply in principle to this case. What are the 'sufficient special grounds' in this case? There are a number of authorities which support the proposition that a shipowner is entitled to bring a limitation action in the courts of its own domicile. ​A defendant can always be sued in the courts of its own domicile. This is a fundamental rule of private international law. It follows therefore that the one court that would have jurisdiction over all claims for liability in personam arising from a maritime casualty, wherever that casualty took place, would be the court of the shipowner's domicile. A shipowner would therefore reasonably anticipate proceedings to be brought against it in the court of its own domicile and a claimant making a claim against the shipowner would likewise consider the court of the shipowner's domicile to be the appropriate court in which to commence proceedings. These facts are equally relevant for the court to take into account in assessing whether there are 'sufficient special grounds' for granting leave to serve the proceedings out of the jurisdiction.

When Deemster Doyle was considering the issue of leave to serve out of the jurisdiction there were no other proceedings in any other court. He was entitled to take the absence of other proceedings into consideration as a fact when granting leave and that fact could be part of the 'sufficient special grounds'. There are now 'other proceedings' but that fact should not make any difference to the question whether leave should be granted. This application is not one for a stay based on forum conveniens. What was not known at the time of the application before Deemster Doyle is that there is a difference in the way the courts would determine claims to be subject to limitation. In Spain and England the wreck removal costs would not be covered by the limitation fund, whereas in the Isle of Man they would. The consequence for Gilberson and other potential claimants against Dominator would be, in effect, to double the amount to which Gilberson and other claimants would have potential access, ie the wreck removal costs of EUR 500,000 and the limitation fund of GBP 500,000 if proceedings were decided in Spain or England. That difference might or might not be relevant to an issue of forum conveniens but cannot be relevant to the matters that Deemster Doyle should have taken into account in deciding whether to grant leave to serve out of the jurisdiction.

Other considerations of policy might encompass the desire for international Conventions to be interpreted in a similar fashion. Counsel for Dominator referred to the position in Germany where a limitation action takes the form of a simple application not directed 'against' any person. There is, therefore, no question of the need to obtain leave to serve any defendant out of the jurisdiction. There is also the reasonable expectation that the procedure of the Isle of Man courts should keep pace with developments in the law unless distinctly prohibited from so doing. Irrespective of general considerations applying to the interpretation of the LLMC 1976 in the Isle of Man, in this particular case, there were ample facts upon which Deemster Doyle could rely to found 'sufficient special grounds'.

The prime consideration to be given to a Convention should be the natural meaning of the words in context. Article 31 of the Vienna Convention on the Law of Treaties 1980 provides that a treaty shall be interpreted 'in accordance with the ordinary meaning to be given to the terms of a treaty in their context and in the light of its object and purpose'.

Based upon his interpretation of the LLMC 1976, counsel for Gilberson submitted that art 10 should be read the light of art 11 and that if a pre-emptive limitation action is not provided for in art 11 neither should it be permitted under art 10. Even if he were correct in his interpretation of art 11, there is no reason for holding that art 10 must mirror that of art 11. The two articles are in different chapters of the Convention and the circumstances are different in the sense that art 10 contemplates no limitation fund being established and art 11 does so contemplate.

Counsel for Gilberson produced a document produced by the Comité Maritime International (CMI) headed 'DRAFT GUIDELINES (Draft February 2008) Prepared after the 2nd Meeting of the I-SC on Procedural Rules Relating to Limitation of Liability in Paris 13-14 September 2007'. The CMI, by its constitution has the purpose 'to contribute by all appropriate means and activities to the unification of maritime law in all its aspects'. He referred the Court to draft guidelines under the heading of 'JURISDICTION'. Such guidelines recommend that when a State has jurisdiction in relation to limitation actions it should strive to ensure only one local court deals with all claims. Neither that guideline nor any other in the document assisted on the interpretation of art 10 of the LLMC 1976.