Viktorovich (the applicant) applied to arrest the Ivan Belov, owned by Stellar Shipping JSC. The Court dismissed the application.

The applicant appealed, arguing that the ship's registration in the Russian International Register of Ships does not mean it cannot leave Russia, thereby rendering any prospective judgment unenforceable. Ship arrest is a legitimate means of securing a claim under the Arrest Convention 1952 and the Merchant Shipping Code of Russia (the MSC RF). Ship arrest does not jeopardise the use of the ship but secures the applicant's claim.

Held: The appeal is dismissed.

The vessel allided with the claimant's berth. The preliminary damages caused were RUB 14,893,320.

Under art 92(1) of the Commercial Procedure Code of Russia (the CPC RF), security measures must correspond to the claim they secure and be proportionate to it. The court should assess the reasonableness and justification of the security measure claimed, the connection between the measure and the claim, the probability of causing significant damage to the applicant, the balance of parties' interests, and the protection of public interests and those of third parties (s 14 of the Resolution of the Supreme Court of Russia No 15 dated 01/06/2023 (Resolution No 15)). Under s 16 of Resolution No 15, an actual or potential threat of the judgment's unenforceability can be a reason to grant a security measure.

Under s 389 of the MSC RF, a ship can be arrested only for a maritime claim. Grounds for ship arrest are stipulated in art 390 of the MSC RF. One of them is that the ship is owned by the person liable for the claim.

Ship arrest is also regulated by the Arrest Convention 1952. According to the Convention, arrest means the detention of a ship by judicial process to secure a maritime claim but does not include the seizure of a ship in execution or satisfaction of a judgment (art 1.2). Under art 3.1, a claimant may arrest either the particular ship in respect of which the maritime claim arose, or any other ship which is owned by the person who was, at the time when the maritime claim arose, the owner of the particular ship. Under art 6, the rules and procedures for ship arrest are subject to the national law of Contracting States.

Thus, based on the provisions mentioned and international practice regarding ship arrest, a ship can be arrested if two criteria are met: there must be a maritime claim against the ship (arrest in rem), and the ship is owned by the person liable (arrest in personam) (Resolution of the Presidium of the Supreme Commercial Court of Russia No 9284/02 dated 19 November 2002; Rulings of the Supreme Commercial Court of Russia No VAS-9003/13 dated 17 February 2014 and No VAS-2562/14 dated 7 March 2014).

According to s 7 of the Informational Letter of the Presidium of the Supreme Commercial Court of Russia No 78 dated 07/07/2004, preliminary security measures and counter-security must be proportionate to the claim they secure. A commercial court assesses proportionality by comparing the rights and interests the applicant sought to protect with the value of the property arrested, the material consequences of the prohibitions imposed on the defendant and other criteria.

The Court emphasised that the application sought to arrest the ship, meaning its detention and restriction of its use. This would affect the shipowner's and commercial operator's rights and cause them material damage. The Court could not establish whether the damage that could be caused by arrest was proportionate to the claim. The arrest could also lead to other negative consequences (cargo deterioration, breaches of obligations to third parties, etc). Based on this, the Court of first Instance did not have grounds to arrest the ship.