The M/V Transmichigan (a German-flagged vessel owned by Poseidon Schiffahrt GmbH) collided with the M/S Netuno (a Brazilian-flagged vessel) in the channel of the St Clair River at the southern end of Lake Huron, close to the international boundary between Michigan and Toronto, Canada (with the exact location vis-à-vis the actual border undetermined). An initial suit was filed in federal court in Michigan in personam and in rem by the Netuno’s owner against the Transmichigan/Poseidon, but was dismissed, prior to perfection of in rem jurisdiction, after initial crew discovery. Thereafter, Poseidon filed a nominal in rem action against the Netuno in the Federal Court of Canada at Montreal (while the Netuno was under repair at Toronto), and the Netuno’s owner counterclaimed for damages. However, the Netuno apparently sailed from its repair berth in Toronto without posting any bail in the in rem proceeding, such that the proceeding was deemed not to be a true in rem action. Poseidon commenced a third proceeding in Savannah, Georgia, (the Netuno's next port of call) against the Netuno in rem. The Netuno was not arrested in the Georgia action, but the owner filed a stipulated waiver of arrest to have the same effect as if an arrest warrant had been served. Poseidon acknowledged that the purpose of the Georgia action was to have access to a larger limitation of liability fund under US law than would be available under Canadian law.

The Georgia action was initially dismissed on forum non conveniens grounds in favour of the Canadian proceedings, pending proof that bail/security was furnished therein, and with the lower Court’s frank admission that '[w[hether the jurisdiction of the [Canadian] admiralty courts there in collisions between foreign vessels is mandatory or merely discretionary I do not know'. In support of this result, the lower Court relied on: (i) the owner of the Netuno's pending counterclaim in the Canadian action; (ii) witnesses familiar with the vessels’ damage and repairs were located in Canada (notwithstanding that the pilots of the vessels were American and their cargo was bound for America); and (iii) 'the matter of decent regard for international judicial comity in a case where a court of a neighboring country, versed in traditions of English admiralty law, first obtained and is presently exercising jurisdiction over an identical action'. The lower Court noted that Germany and Brazil (the relevant vessel flag States) were parties to both the Collision Convention 1910 and the Collision (Civil Jurisdiction) Convention 1952. Likewise, the lower Court noted prior US case law acknowledging 'that the Brussels Convention of 1910 is the governing law in American courts in respect to collisions at sea between foreign vessels and owners who are the subjects of the signatory nations', but likewise noted that '[t]his is a fog-shrouded area of American admiralty law and it is better to steer clear of it'. Ultimately, the lower Court held that 'it [was] unnecessary to reach the question of the effect … of the Brussels Convention of [1910 or] 1952' given the forum non conveniens dismissal.

[For the Fifth Circuit's reversal, see Poseidon Schiffahrt GmbH v M/S Netuno (CMI1048).]