On 18 April 2000 the MV Guzin S and its bunkers were sold pursuant to an order of the Court. The purchase price of the vessel, USD 2,780,000, was held by the Registrar as a fund in terms of the provisions of s 9 of the Admiralty Jurisdiction Regulation Act 105 of 1983 (the Act). A referee was appointed to receive, consider and report to the Court on any claims filed with him. A total of 19 claims were received by the referee, who reported back on 26 October 2000.

Prior to its sale on 18 April 2000 the MV Guzin S was owned by Ece Denizcilik Ve Ticaret AS, a Turkish company. The vessel was registered in the Turkish registry. The applicant, Hamburgische Landesbankgirozentrale, a German bank, was the holder of a first degree first rank Turkish mortgage registered over the vessel. It lodged two claims with the referee. The first is for USD 2,327,135.97 in respect of the balance owing under a loan agreement secured by the mortgage. A second claim of USD 17,424.02 is said in the referee's report to be in respect of expenses incurred concerning the vessel such as ship's reporting service, hull insurance and layup insurance. The referee recommended payment of the applicant's claims in full. He recommended a ranking in terms of s 11(4)(d) of the Act.

A dispute arose as to the validity of the applicant's claims. Several creditors intervened to oppose the referee's recommendations.

Held: The report of the referee in relation to the validity, the amount of, and the ranking of the claim of the applicant is confirmed.

Shaw, Admiralty Jurisdiction and Practice in South Africa 8 says that the origins of the heads of maritime claim stated in the definition of maritime claim in s 1(1)(ii) of the Act are to be found largely in the Arrest Convention 1952. See also MV Heavy Metal: Belfry Marine Ltd v Palm Base Maritime Sdn Bhd 1999 (3) SA 1083, 1096 (SCA) (CMI365). Article 1.1.q of the Arrest Convention provides that 'maritime claim' means a claim 'arising out of', amongst other things, 'the mortgage or hypothecation of ships'. Berlingieri, dealing with this definition, comments that: 'The wording is not entirely correct, for the claim does not arise out of a mortgage, but out of the contract (eg loan agreement) in respect of which the mortgage is executed. It would have been more correct to refer to claims secured by a mortgage. This, however, would have created practical drafting difficulties, since the maritime claims are listed under the opening sentence of art 1(1), which is worded: '''Maritime Claim' means a claim arising out of one or more of the following''. A correct wording is used instead in the French text of art 7(1)(f) of the Convention, which provides: ''Si la créance est garantie par une hypothèque maritime ou un mortgage sur le navire saisi.''' In dealing with the English version of art 7, which relates to the jurisdiction of the Courts of the country in which the arrest was made, and which refers in art 7.1.f to cases 'if the claim is upon a mortgage or hypothecation of the ship arrested', the learned author says: 'The French text differs slightly, for it refers to claims secured by a mortgage or a hypothèque. Both because the two texts must be construed with the aid of one another, and because the claims covered by this provision cannot differ from those covered by art 1(1)(q), there should not be any doubt that the word ''upon'' in the English text has the same meaning as ''garantie'' (secured by) in the French text.'

According to Shaw, South Africa has never become a party to the Arrest Convention 1952. However, in the light of the fact that the heads of maritime claims are, to some extent, based on the Convention, what is said by Berlingieri supports the proposition that the reference to a claim 'relating to' 'any mortgage' in the definition of 'maritime claim' in s 1(1) of the Act must, of necessity, be intended to include a claim under a loan agreement secured by a mortgage over a ship. Indeed, were this not so, there would be no other provision in the definition of 'maritime claim' in s 1(1) of the Act for a claim in respect of a loan secured by a mortgage over a ship (which is probably the most frequent reason for registering a mortgage over a ship) to be regarded as a maritime claim. It is inconceivable that such a common claim was not intended by the legislature to be a 'maritime claim'.