The plaintiff was a company incorporated in Canada, conducting business as a ship chandler in Montreal. The plaintiff alleged that it acted as an agent for the defendant, Joseph Roth (Cyprus) Shipping Co Ltd, and made disbursements for the ship Royal Clipper at the latter's request. However, the defendant failed to reimburse the plaintiff. Consequently, the plaintiff instructed solicitors in London to attempt to recover the money.

On 8 November 1978, the London solicitors filed an action in rem against three ships, all registered in Cyprus, and owned by the defendant when the writ was issued. The plaintiff's solicitors inquired of Lloyd's Intelligent Services if any of the ships were in the jurisdiction of the United Kingdom. They were informed that none of the ships were within the jurisdiction. Subsequently, the plaintiff's solicitors instructed Lloyd's to monitor the vessels closely and report if any of them entered the jurisdiction.

It became evident that the ships usually did not come into the jurisdiction of the United Kingdom. By August 1979, the plaintiffs discontinued the Lloyd's Intelligent Services watch as they thought they were wasting money. Consequently, the writ was allowed to lapse on 8 November 1979. However, a few weeks later, the plaintiff's solicitors received news that the ship Helene Roth had entered the jurisdiction. Upon receiving this information, the plaintiffs instructed their solicitors to apply to the Admiralty Registrar for an extension of the validity of the writ.

The Registrar refused the application, even though it was supported by an affidavit indicating the plaintiff's solicitors' efforts to keep track of the three ships named in the writ.

Upon the Registrar's refusal, the plaintiff's solicitors issued another writ on 23 November 1979. Due to the further affidavit in which it was deposed that none of the three vessels had called within the jurisdiction until the arrival of the Helene Roth, the Registrar took the view that it would be appropriate to reissue the writ. The Helene Roth was subsequently arrested.

On 29 November 1979, solicitors acting on behalf of the defendant sought to set aside the action and unconditionally release the Helene Roth. The basis for this motion was an affidavit indicating that on 14 November 1979, ownership of the Helene Roth was transferred from the defendants to Helene Roth Maritime Co Ltd of Limassol (HRM). The notice of motion was issued on behalf of the latter company. The Court noted that HRM was not the defendant in the action, and that if no appearance was entered, the action would continue against the res. However, the Court granted HRM permission to intervene in the action and enter an appearance as 'persons interested in the ship'.

Held: Application dismissed with costs.

HRM argued that the Registrar should not have extended the validity of the writ because the second writ had been issued based on the same cause of action between the same parties. However, the Court stated that the plaintiff's solicitors intended the second writ to involve the same parties because their clients wanted to secure a judgment against the defendants. It held that although the second writ could have been served, it would have been futile because the ship could not be arrested in the second action. The reason for this was that 'the person who would have been liable on the claim in an action in personam was not, at the time of the issue of the second writ, the beneficial owner of all the shares in the ship against which the action was brought'.

The Court referred to s 3(4) of the Administration of Justice Act 1956 (the Act), which stated that the admiralty jurisdiction of the High Court could not be invoked by an action in rem against a ship if, at the time the action is instituted, the ship is not in the beneficial ownership of the person liable in personam. This provision prompted solicitors, whose clients wished to take advantage of it, to promptly issue a writ after the cause of action had arisen. By doing so, the validity of the writ would likely expire well before the claim became stale. However, in cases where there had been no reasonable opportunity to serve the writ, its validity should be extended. Additionally, if the ownership of the ship named in the writ had changed before an application to renew the writ was made, that would further justify extending its validity. This is because, unlike most Queen's Bench cases, the plaintiff would no longer be able to successfully invoke the jurisdiction of the High Court by issuing another writ in rem.

The Court also rejected the argument made by HRM that if the owner purchased the ship at a time when the writ could not be validly served, the owner acquired a ship that had obtained immunity from service in a similar manner as a ship could receive immunity through a time bar. The Court held that the two situations were not comparable because a plaintiff would be aware of a time bar and would have a duty to diligently pursue the action. However, the change of ownership of a ship is a voluntary act and can be carried out discreetly through a secret sale. Treating it as a time bar would allow defendants to introduce their own time bars without notifying the plaintiffs.

The Court noted that merchant ships freely travel worldwide, and it is not uncommon for them to depart port before their owners have settled their debts to shore parties such as suppliers of goods, materials, ship repairers, or agents. One of the functions of this Court is to assist creditors in such cases. Therefore, if a writ in rem is issued before a ship has changed ownership, a subsequent change in that ownership would provide even more reasons to renew the writ, unless it was not pursued diligently.

HRM argued that this approach would prejudice third party purchasers of ships by exposing them to the action in rem. The Court rejected this argument as a general proposition and based on the facts. The facts revealed that the change in ownership of the Helene Roth occurred within a group of companies. Regardless of the motive for the change in ownership, the Court focused on the fact of the change itself. It held that it had little doubt that those responsible for the sale of the Helene Roth knew full well of the claim pending against the defendants. Regarding the general proposition, the Court referred to The Monica S [1967] P 741 (CMI2139) which held that:

[A] would-be purchaser of a ship would have to reckon with the possibility of numerous claims having already attached to the ship without his having notice of them … . A purchaser always has to reckon with the possibility of maritime liens, and under many foreign laws all or most of the claims which in England only give right of action in rem give rise to such liens.

The Court expressed that it would be surprising if HRM had not taken any precautions to protect itself against such claims, such as taking an indemnity from the seller against claims that attached prior to the sale. However, it held that even if HRM had failed to protect itself in this way, it would not be a good enough reason to deprive the plaintiff of its right to take the ship as security for the satisfaction of any judgment it obtains. The right to arrest a ship is part of the law of England and is recognised by international Convention. It is a valuable weapon in the hands of any court exercising admiralty jurisdiction and all shipowners are, or should be, aware of it.