On 27 November 2023, the ship Guzel, owned by Clearline Shipping Ltd (the shipowner), allided with a berth owned by the federal Government and leased by LLC NUTEP (the claimant). The claimant was obligated to conduct any necessary repair works. The claimant preliminary assessed the damage at around RUB 140,000,000. The ship was detained by the harbour master for 72 hours under art 81 of the Merchant Shipping Code of Russia (the MSC RF). The claimant applied to arrest the ship.

The claimant argued that not granting the arrest might cause difficulty or impossibility of judgment enforcement because the shipowner did not have any other property in Russia. The ship was built in 1980 and had been operational for 43 years, so its value was proportionate to the claim. The claim for damage caused by the ship was a maritime claim, secured by a maritime lien.

Held: The arrest was granted.

According to art 388(2) of the MSC RF, the ship can be arrested only for a maritime claim. The Code stipulates the criteria for ship arrest (art 390 of the MSC RF). A maritime lien is one of separate grounds for the arrest. According to art 3.1 of the Arrest Convention 1952, a maritime claimant can arrest the particular vessel involved in the incident or any other vessel owned by the person liable.

Under ss 9 and 10 of the Informational Letter of the Presidium of the Supreme Commercial Court of Russia No 78, dated 7 July 2004, non-provision of counter-security in the claim amount is not a mandatory ground to dismiss the application for a security measure. Also, non-submission of the document proving the counter-security payment cannot be an unconditional ground for application dismissal.

According to art 388(1) of the MSC RF, ship arrest is any detention of a ship or restriction of its movement when it is located in Russia based on the judicial act of a court, commercial court, or authorised arbitration institution aimed at securing a maritime claim. The list of maritime claims is stated in art 389 of the MSC RF. So, the maritime arrest is a special security measure that does not require any additional justification except as stipulated by the Arrest Convention 1952: the existence of a maritime claim, and ownership of the relevant ship.

The provisions of the MSC RF correspond to the Arrest Convention 1952. So, according to the legislative provisions and international practice of ship arrest, the ship can be arrested if two criteria are met: 1) a maritime claim is against the particular vessel (arrest in rem); and 2) the particular vessel is owned or chartered by the person liable (arrest in personam). Under art 92(2)(5) of the Commercial Procedure Code of Russia, an applicant must justify the arrest application.

The claim was secured by a maritime lien (art 367(1) of the MSC RF). A maritime lien continues to encumber the ship irrespective of a change of its registration or flag for one year (arts 370 and 371 of the MSC RF). If a maritime lien secures the claim, the claimant can arrest the vessel and request its judicial sale to satisfy the claim. This is the only remedy available for the claimant. Therefore, to protect and realise the claimant’s rights as a maritime lienee, the ship must be arrested.

The claimant also argued that if the ship had not been arrested, it would have been difficult or impossible to enforce the judgment.

The Court found that the claimant successfully proved that it would be difficult or impossible to enforce the claim in the absence of arrest. Therefore, the arrest application was granted.

[Ruling confirmed on appeal: see the Ruling of the Fifteenth Commercial Court of Appeal in Case No A32-66449/2023 dated 18/04/2024]