The plaintiff arrested the fourth defendant vessel, the MT Ocean Princess 1. The release of the vessel was sought, as well as directions to the plaintiff to get the cargo on board discharged to enable the vessel to sail.

The plaintiff had entered into a sale and purchase agreement with the first defendant for 3,000 mt of bitumen in June 2018. The cargo was carried from Jabel Ali, UAE, to Karachi, Pakistan. On discharge, the surveyor noted that the cargo was behaving unusually. There was an abnormal formation of bubbles, and water presence was suspected. The discharge of the cargo was stopped due to safety reasons. The plaintiff brought a claim under ss 3(2)(g) and 3(2)(h) of the Admiralty Jurisdiction of High Courts Ordinance 1980 (the Ordinance) on the basis that the first defendant and second defendant (the supplier of the bitumen) colluded and defrauded the plaintiff by delivering substandard product; and that the fourth defendant vessel had, by way of negligence, allowed water contamination, as this was a special cargo and utmost care was required to be maintained.

The fourth defendant contended that the case as drafted and pleaded was not one which could be entertained under the admiralty jurisdiction, but was only a claim for damages under the ordinary civil jurisdiction. The plaintiff had only served on the master of the vessel. In the absence of the carrier or charterer, the suit under the admiralty jurisdiction was not competent - that suit was in rem and in personam. Therefore, the vessel could not be arrested. The claim as set up was only against the vessel, and being in rem, no relief could be sought against the carrier or charterer. Only s 3(2)(h) of the Ordinance could be attracted, but on the given facts, it also did not apply. No claim was maintainable on the basis of the bill of lading, which was governed by the Bill of Lading Act 1856.

Held: The order for arrest of the vessel is confirmed. However, since no terms were settled for furnishing security, the following directions are made:

(i) The fourth defendant shall furnish solvent surety/a bank guarantee for USD 630,810 or its equivalent amount, to the satisfaction of the Nazir of this Court;
(ii) On furnishing security, the arrest orders shall be recalled, and as a consequence thereof, the Office of this Court shall issue a release order;
(iii) Upon furnishing of such release order(s), the concerned Port Authorities shall immediately allow the vessel to sail.

The fourth defendant objects that the claim, as set up by the plaintiff, does not fall within the ambit of ss 3(2)(g) and 3(2)(h) and s 4(4) of the Ordinance, because only the master of the vessel has been impleaded as a defendant, and the shipowner or charterer are not before the Court. Secondly, according to the fourth defendant the dispute is between the plaintiff and the first and second defendants regarding the quality of the goods in question, and therefore it is not a fit case where the admiralty jurisdiction of this Court can be invoked by arresting the vessel. However, it is settled law that if a claim under the admiralty jurisdiction falls within the ambit of ss 3(2)(g) and 3(2)(h) of the Ordinance, read with s 4(4), it can be entertained by the Court even in the absence of the shipowner or the charterer in question. It is a matter of record that the master of the vessel has come before the Court to defend the claim, and he has done this as an employee of the shipowner or charterer; hence, the stance taken as to the non-impleading of the latter is not convincing, but is meaningless. Reliance in this regard may be placed on Yukong Ltd v MT Eastern Navigator PLD 2001 SC 57, where the Supreme Court held:

Regarding objection of the petitioner about the respondent United Marine Service S.A. cited as defendant No. 2, it is noted that they, being owner were cited as the defendant and this fact alone does not take the suit from the ambit of Admiralty Jurisdiction. In the case reported as The Republic of India v. India Steamship Co. (1997) Weekly Law Reports 818 (827), it was held that, the owners are the real party in a suit in rem, therefore, no objection can be taken for citing said corporation as defendant No. 2. The objection of the petitioner is not sustainable in law.

The Ordinance provides as follows:

3. Admiralty Jurisdiction of the High Court. ...

(2) The Admiralty jurisdiction of the High Court shall be as follows, that is to say, jurisdiction to hear and determine any of the following causes, questions or claims - ...

(g) Any claim for loss of or damage to goods carried in a ship;
(h) Any claim arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship; ...

4. Mode of exercise of Admiralty jurisdiction. ...

(4) In the case of any such claim as in mentioned in clauses (e) to (h) and (j) to (q) of subsection (2) of section (3), being a claim arising in connection with a ship, where the person who would be liable on the claim in an action in personam was, when the cause of action arose, the owner or charterer of, or in possession or in control of the ship, the Admiralty jurisdiction of the High Court may, whether the claim gives rise to a maritime lien on the ship or not, be invoked by an action in rem against -

(a) that ship, if at the time when the action is brought it is beneficially owned as respects majority shares therein by that person; or
(b) Any other ship which, at the time when the action is brought, is beneficially owned as aforesaid.

In this case no further interpretation of these provisions is warranted, in as much as it is the same vessel, which is under arrest, that was required to carry the cargo in question. A bill of lading for such purposes is already a matter of admitted fact. Though the claim of the plaintiff may have been against other defendants as well, in so far as the present applications are concerned, the cause of the plaintiff seeking arrest of the vessel squarely falls within the admiralty jurisdiction of this Court. Moreover, it is also by now settled that a claim in rem and personam is simultaneously maintainable under the admiralty jurisdiction of this Court.

At this stage of the proceedings, the Court cannot come to a definite conclusion, as to first, what damage, if any, has been caused; and secondly, who is responsible for it, but at the same time, while exercising admiralty jurisdiction, the Court can order the arrest of the vessel, notwithstanding the niceties and complexities of the arrangement between the contesting parties. It is of pivotal importance to note that the admiralty jurisdiction is a jurisdiction to proceed against a ship, which keeps on sailing in world waters, and coming in and out of the territorial jurisdiction of a particular Court. The action in rem against a particular ship is intended to be a procedural device intended to secure the appearance of the owner of the ship and thus to gain personal jurisdiction over the owner, as normal. Once the owner is before the Court, the question is to be determined according to the interests of the parties.