The plaintiff, Handytankers KS, entered into a Shelltime 4 form charterparty with the defendant, Arpeni Pratama Ocean Line Tbk, for a term of five years. There were repeated breaches of the charterparty by the defendant: failure to pay hire on time or at all. In March 2013 The plaintiff invoked the LMAA arbitration and obtained a final award for unpaid hire and damages totally in sum of USD 9,599,464.30 that notwithstanding remained unsatisfied. The plaintiff subsequently issued warrants of arrest ships owned by the defendant. Proceedings in rem commenced against the Alas, pursuant to s 12A(2)(h) of the High Court Ordinance, Cap 4: 'any claim arising out of any agreement relating to … the use or hire of a ship'.

The defendant applied for orders to set aside the arrest of the vessel. It was argued amongst others that arrest in rem was no longer available after the plaintiff’s claim had crystallised into a final judgment or award, because art 1.2 of the Arrest Convention 1952, as enacted in Hong Kong legislation, defines arrest as 'the detention of a ship by judicial process to secure a maritime claim, but not include the seizure of a ship in execution or satisfaction a judgment'. The defendant urged the court to construe s 12A(2) of the Ordinance consistently with art 1 of the 1952 Convention.

Held: The defendant’s application dismissed.

There is no head of admiralty jurisdiction in Hong Kong for the enforcement of arbitration awards as such. However, this case is distinguished from The Chong Bong and The Bumbesti (CMI872), where the plaintiffs both expressly phrased their causes of action as being founded, or to enforce, the award. This was fatal to their claims. The arrest of The Alas here was designed to achieve a judgment in rem for breach of the original charterparty, rather than as an enforcement mechanism for the English arbitral award. On this ground, the defendant’s Arrest Convention argument fell away and the plaintiff was entitled to pursue its in rem action to arrest a vessel notwithstanding the existence of an arbitral award.