On 3 March 2021, the claimant lodged a claim against the owners of the Nabiha Queen for USD 2,132,658.84 for the alleged breach of a charterparty agreement by the defendant. The vessel was arrested on the same day.

The defendant sought to set aside the warrant of arrest, and applied for the immediate and unconditional release of the vessel on the ground that the Court lacked admiralty jurisdiction over the vessel. The defendant asked for a stay of proceedings as a matter of right pending arbitration in London under English law in terms of cl 31 of the charterparty agreement upon which the claim and the defendant's application was based.

The defendant argued that the vessel was incurring significant losses as a result of the arrest warrants issued by the Court; that the vessel is laden with various containerised perishable cargo approximately weighing 12,155 tons and continued arrest of the ship will delay the delivery of the cargo and attract civil claims for non-delivery of the cargo; and that the Court when exercising its admiralty jurisdiction under s 4 of the Judicature Act, just like its sister courts in England, has no admiralty jurisdiction over disputes concerning agreements for claims with arbitration clauses.

Held: The proceedings shall be stayed pending referral of the dispute to arbitration. An order is hereby issued directing the release of the Nabiha Queen on condition that the defendant provides a bank guarantee from a first class international bank in the sum of USD 1,000,000.

This Court has two options - to stay the proceedings pending the referral of the same to arbitration, or to strike out the suit. It is in the interests of justice, and that of the parties, to order that the proceedings herein be stayed pending referral of the dispute to arbitration, rather than striking out the entire suit.

The application sought, among other orders, an order for setting aside the arrest and ordering the release of the Nabiha Queen. Section 4(2)(c) of the Judicature Act is worded as follows: 'The admiralty jurisdiction of the High Court shall be exercisable - ... In accordance with the same procedure, as in the High Court in England, and shall be exercised in conformity with international laws and the comity of nations.' The architecture of the legislation is to adopt the law in England and the international law applicable, but in doing so the Court does not abandon, abdicate, or neglect the powers that are inherently vested in it.

The Civil Procedure Rules (UK), Pt 61 on admiralty claims guide the Court on what orders to make with regard to release of the motor vessel when a claim is stayed. In essence, the Rules provide that on an application to release a vessel held as security for a claim in arbitration, the Court would, in accordance with the usual practice, only exercise its discretion to release on provision of sufficient security to cover the claim on the basis of the claimant's reasonably arguable best case.

Taking into consideration the particulars of losses as provided under the head claim in para 17 of the statement of claim, most of the expenses are subject to be proved upon a full hearing. A security of USD 1,000,000 as a precondition of the release would thus be reasonable in the circumstances.