Cruz Holdings Ltd (Cruz) was the owner of the MV Southern Phoenix. PDL International Pte Ltd (PDL) was the charterer of the vessel at the relevant time. The vessel was in its final stages of loading in Suva Harbour, and was being towed away from the dock, when it sank nearby on 6 May 2017. The cause of the sinking of the vessel, and the liability thereof, has yet to be established. Neither Cruz nor PDL has admitted liability to date.

Cruz constituted a limitation fund by payment into Court of FJD 1,713,573.64. PDL sought an order to intervene and join the proceeding as a second plaintiff and to rely on Cruz’s limitation fund, rather than pay its own fund into Court. The Court declined PDL's application. PDL sought leave to appeal. CCB Envico Pty Limited (subrogated to its insurer QBE), opposed PDL's application.

PDL argued, among other things, that the Judge erred in law and fact in finding that, as the charterer of the ship, it did not have the benefit of the limitation fund under Pt 5 of the Maritime Transport Act 2013 (the Act). PDL submitted that it should be given leave to intervene, that it was an 'owner' pursuant to the Act, and that it was entitled to limit its liability in accordance with ss 79 and 81 of the Act. PDL also argued that the Judge erred in law and in fact by finding that it had relied on art 11.3 of the LLMC 1976 to regard the limitation fund established by Cruz as constituted by PDL, when this reference was used during submissions to draw a distinction between the LLMC 1976 and Pt 5 of the Act in connection with the interpretation of a statute based on a treaty, where the treaty has not been implemented into domestic law. The Judge further erred in law in failing to consider that the LLMC 1957 does provide for the establishment of limitation fund by an owner to be available to a charterer under arts 2.2, 2.3, 2.4 and 6.2, which are applicable to PDL. Finally, the Judge erred in law in failing to consider that Pt 5 of the Act should be considered and interpreted on the basis of international comity of legal principles, since the regime and principles of limitation of liability for a ship are longstanding, apply internationally in many jurisdictions, and allow a charterer to rely on a limitation fund established by an owner.

Held: PDL's application for leave to appeal is dismissed.

There is no provision in the LLMC 1957, which is adopted and ratified by Fiji, for PDL to have Cruz’s limitation fund treated as also being PDL's limitation fund. There is also no such provision in the Act. PDL's argument was initially primarily based on the provisions of the LLMC 1976. The LLMC 1976 found it necessary to adopt the 'sharing' rule as a special deeming provision, which contradicts PDL's assertion.

The substantive matter before the Court is the issue of liability to the claimants (mainly cargo owners) in connection with the cargo lost and other damage caused by the sinking of the vessel. The interlocutory ruling that PDL wishes to appeal has not, as of yet, determined the substantive matter at all. Cruz has not admitted liability in this matter, and this is one of the substantive issues that still has to be made out. The Court has yet to determine the persons with just claims arising out of the casualty, and against whom those claims lie. At this stage, the court has ordered PDL to pay its fund into court as Cruz has done, pending determination of liability and the vetting of claims. The Court cannot see why PDL does not intend to deposit its limitation fund into Court until the substantive matter has been dealt with by the Court.

The LLMC 1976 has not been incorporated into Fiji law. In particular, art 11.3 of the LLMC 1976 was not contained in Pt 5 of the Act. Further, the Schedule to the Act lists the LLMC 1957, and the LLMC 1957 does not contain art 11. The Act does not contain any legal basis on which PDL could seek entitlement to the benefit of Cruz's limitation fund.

[For the subsequent successful leave to appeal application in the Court of Appeal, see PDL International Pte Ltd v Cruz Holdings Ltd [2022] FJCA 7 (CMI1785).]