This case involved the arrest of the Agios Nikolaos (IMO 9820283), a chemical/oil tanker formerly known as the Nasir and the Marvin Independence. The plaintiff, a Hong Kong-based company, sought a declaration that it was the legal and/or absolute and/or sole owner of the vessel. Rexel intervened in the proceedings on behalf of the defendant ship, claiming to be its legal owner. The dominant element of Rexel's argument was that the plaintiff was acting abusively and contrary to the decisions of the Greek courts, which ultimately rejected the plaintiff's application for precautionary measures. In addition, the issue of lack of jurisdiction of the Cyprus Court due to the exclusive jurisdiction of the Greek courts was raised. It was Rexel's position that this Court lacked international jurisdiction, since the courts of Greece had exclusive international jurisdiction over the matter in accordance with arts 2.a and 24.5 of Regulation (EU) 1215/2012 of the European Parliament and of the Council on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast) (the Regulation).

Rexel requested that the Cyprus Court declare its jurisdictional incompetence in favour of the Greek Court, as the latter was the first to hear the lawsuit, which had the same object and the same cause of action between the same parties. On 17 September 2021, the plaintiff filed precautionary measures against Rexel before the single-member first instance Court of Piraeus, and in particular for a judicial guarantee of the defendant ship, which was then docked in the port of Elefsina. On the basis of this request, a temporary order was issued which prohibited the departure of the ship and any change in its real and legal status. This trial ultimately did not take place, because the plaintiff withdrew its application for precautionary measures.

Rexel referred to the background facts on the basis of which it became the owner of the vessel. Rexel alleged that the ship was arrested while owned by its previous owner, Diamond Product Tankers Ltd (Diamond), on behalf of a creditor, Seven Seas. The judicial auction was attended by three other shipping companies. The plaintiff filed an application for precautionary measures against Seven Seas and Diamond in Greece, requesting the suspension of the auction. On 30 August 2021, the single-member first instance Court of Piraeus rejected the plaintiff's application. On the same day, Diamond's debt to Seven Seas was repaid in full by the plaintiff. Nevertheless, the auction resumed, following the announcement of an independent foreclosure notice by Marvin Shipping Services Inc (Marvin), another creditor who opposed the cancellation of the auction. As a result, the e-auction took place on 1 September 2021. After successive and increasing bids, the ship was awarded to Rexel, which submitted the largest bid for USD 17,100,000. This was followed by the removal of encumbrances on the ship and the registration of its transfer to Rexel, which changed its name to the Agios Nikolaos, after which the ship was registered in the Marshall Islands.

Held: Rexel's application is rejected. The security required for the vessel's release is increased.

There is no doubt that the defendant ship was sold at a compulsory auction in Greece, and was awarded to Rexel. The plaintiff argues that it agreed on a bareboat charter of the ship with Marvin for five years and, as a result of this agreement, the ship was delivered to the bareboat charterer, Diamond, but that Marvin and Diamond fraudulently colluded to register Marvin as its absolute owner by forging documents. The plaintiff has filed a lawsuit against Diamond in Panama, which is still pending. There are also criminal charges pending. The plaintiff also proceeded with the Greek lawsuit. In addition, they are considering an arbitration procedure in London for the fees owed by Diamond. The plaintiff's position is that Marvin fraudulently secured a summary judgment in Greece, due to an alleged debt, on the basis of which the compulsory auction was ordered. It was as a result of these fraudulent actions that the transfer of the ship to Rexel was finally secured. As a result, the plaintiff brought another action against Rexel in Piraeus, requesting recognition of ownership and return of the defendant ship. The plaintiff further explains that the present action is based on art 35 of the Regulation, as an adjunct to the Greek action, aimed at retaining the defendant ship within the jurisdiction of Cyprus to preserve the status quo until the trial of the Greek lawsuit. The plaintiff reiterates that it has always been the real owner of the ship, and that its ownership 'was illegally transferred to Rexel, after the ship was illegally registered by Diamond, following a series of forgeries of the ship's title'. According to the plaintiff, Rexel knew what took place in Greece.

Rexel's position is that the legal result of the compulsory auction is indisputable. Even according to the law of the Marshall Islands, where the ship is registered, it is recognised that the absolute owner of the ship is Rexel, and it is not possible to recognise any revocation of Rexel's title. By appealing to the Greek authorities, the plaintiff has essentially exhausted its rights, especially with regard to preliminary measures. Rexel is a reputable company. The auction price was paid by Rexel without any borrowing, and there is no evidence that it will seek to evade any of its obligations under any decision of the Greek court. Rexel is a bona fide third party who acquired the ship through a court auction. While the ship remains under arrest, there is significant potential for damage and ultimately a reduction in its value. The Greek lawsuit will take about three years to be tried, and 8-10 years in order to issue an irrevocable decision.

The first point that needs to be resolved is whether this Maritime Court has jurisdiction and what its legal basis is. The plaintiff argued from the outset that the nature of these proceedings is ancillary to the Greek action. Article 35 of the Regulation is an important article on the consolidation of jurisdiction between Member States and the protection which, although temporary, may be essential and crucial for the safeguarding of rights and obligations: 'Application may be made to the courts of a Member State for such provisional, including protective, measures as may be available under the law of that Member State, even if the courts of another Member State have jurisdiction as to the substance of the matter.' It follows from the wording of art 35 that international jurisdiction may belong to one Member State (Greece), and that temporary measures may be sought in another Member State (Cyprus). In Commerzbank Aktiengesellschaft v The Ship 'Tour 2', Maritime Court No 2/18, 25 May 2018, Michailidou J faced similar issues in respect of an application for annulment of a ship arrest, in order to assist in a lawsuit abroad. He considered that art 35 could be a platform for issuing a ship arrest in the alternative in another jurisdiction. The question that must be answered is whether the temporary measures in the present case are grounded in the law of Cyprus. The answer is simple, and arises from the presence of the defendant ship in the jurisdiction of the Republic of Cyprus, which makes possible the requested temporary measures under art 35, on the basis that international jurisdiction belongs to the Greek court, while the Cypriot process is ancillary.

In the present case, the plaintiff's affidavit fully satisfies the conditions laid down for a ship arrest. Article 35 of the Regulation applies to this case. While Rexel claims a lack of jurisdiction of the Cypriot Court under arts 2, 24, 26 or 29 of the Regulation, it ignores the dynamics of art 35, given the international jurisdiction of the Greek Court and the subsidiary form of the present proceedings. The plaintiff's action in rem, and its arrest of the ship, was the only way to seek precautionary measures under art 35 of the Regulation. Of course, it should not be ignored that the process of temporary measures was tried and failed in Greece. This issue may be relevant to Rexel's suggestion of abuse of process. However, this Court is not called upon to give a final ruling on the rights of the parties. In particular, having considered what has been proposed by the plaintiff in the present proceedings, a maritime claim arises for consideration, and the plaintiff's claim cannot be classified as unfounded. Furthermore, the assistance of the Court cannot be considered unjustified.

The guarantees that exist (after modifications) are the following: (a) an amount of EUR 250,000 deposited with the Central Bank; (b) EUR 150,000 guarantee by a credible guarantor in the case file; and (c) EUR 10,000 cash, ie a total of EUR 410,000. Bearing in mind the respective positions of both sides, and in an effort to balance things, in addition to the existing guarantee conditions, a further guarantee is justified as follows:

(a) an amount of EUR 150,000 to be deposited by bank transfer to the Central Bank of Cyprus or by bank guarantee, within 30 days.

(b) an amount of EUR 250,000 to be deposited by bank transfer to the Central Bank of Cyprus or by bank guarantee, within 90 days.

Otherwise, Rexel's application is rejected. The warrant of arrest of the ship is valid.