The plaintiff was a company offering shipping services, including the chartering of vessels. The first defendant was a UAE-flagged vessel berthed at Karachi Port. The second defendant was the registered owner as well as the manager/operator of the first defendant. The third defendant was a refinery registered under the laws of Pakistan and was a regular importer of crude oil. The third defendant established Pakistan's first floating single point mooring and port facilities, for which it had to hire vessels. The second and third defendants entered into an agreement whereby the second defendant hired out and put at the disposal of the third defendant various tugs, pilot boats and utility boats. For the purposes of honouring its commitment to the third defendant, the second defendant approached the plaintiff to hire one of its utility boats, the MV Osam Jumbo-5, which was chartered by the second defendant from the plaintiff pursuant to a time charterparty. The second defendant allegedly failed to pay the hire charges. The plaintiff arrested the first defendant, the MT Bofors, which was owned by the second defendant.

The plaintiff alleged that the reason for the second defendant's default was that the third defendant had delayed its payments to the second defendant. This dispute between the second and third defendants had been settled through a compromise in Admiralty Suit No 04/2017. The plaintiff further contended that the total value of the first defendant vessel was a maximum of USD 90,000. The pllaintiff therefore also joined the third defendant in this suit and sought an order of attachment before judgment as well as a garnishee order against the third defendant.

The first and second defendants argued that the claim could not be entertained under the admiralty jurisdiction of this Court because the offending ship, the MV Osam Jumbo-5, was never owned by the second defendant, and in fact was owned by the plaintiff itself. Therefore, the claim in personam against the vessel could not be enforced in rem against the first and second defendants. They also argued that the provisions of Order XXXVIII, Rule 5, CPC which deals with orders of attachments, could not be invoked and applied in a case under the admiralty jurisdiction, and does not apply, as there had been no authorised admission as claimed in respect of the plaintiff's outstanding payments. In the alternative, they argued that the offending vessel was not a ship within the meaning of s 2(k) of the Admiralty Jurisdiction of The High Court Ordinance 1980 (the Ordinance), relying on Aleem Ahmad Ansari v MV Ashar PLD 1986 Quetta 54, where the Baluchistan High Court held that a floating platform can be said to be useable in navigation only if it could withstand perils of sea, which would mean storms, tempest, tidal waves, etc, whereas, the boat in question hardly met these criteria.

The third defendant contended that it had no relation or agreement with the plaintiff, and therefore no suit was maintainable against it under the admiralty jurisdiction of this Court.

Held: The order for the arrest of the first defendant and its release against furnishing a guarantee is confirmed. As to the other relief of attachment before judgment under Order XXXVIII, Rule 5, CPC is concerned, the plaintiff has failed to make out any case to that effect; that relief is declined.

Admiralty jurisdiction has been conferred on this Court; that is to say, the jurisdiction to hear and determine 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 (s 3(2)(h)), whereas the mode of exercise of such jurisdiction has been provided in s 4(4), which states that in case of any claim mentioned in cll (e)-(h) and (j)-(q) of s 3(2), 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 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 or not the claim gives rise to a maritime lien on the ship, be invoked by an action in rem against that ship, if at the time when the action is brought it is beneficially owned as respects majority shares therein by that person; or any other ship which, at the time when the action is brought, is beneficially owned as aforesaid.

If the contention of the first and second defendants is accepted, no admiralty claims could be satisfied against a party utilising a vessel under a time charter. Indeed, if permitted, this would benefit all time charterers, and in each default they would go scot free, and would never be subjected to any admiralty jurisdiction of courts the world over. It needs to be appreciated that in terms of s 4(4) of the Ordinance, the plaintiff must first identify the relevant person who would be liable in personam when the cause of action arose. That person can be either the owner, or the charterer, or the person in possession or control of the ship in connection with which the claim arose. It also provides that for establishing a claim in rem for the arrest of that ship, the relevant person must beneficially own majority shares in that ship. And, when it is in respect of any other ship, or a sister ship as it is commonly known, the relevant person must beneficially own the other ship. Hence, if the person liable when the cause of action arose was the time charterer, and it is not possible to arrest that ship in connection with which the claim arose for any reason, any ship beneficially owned by the time charterer would be a target for arrest in terms of s 4(4). The objection regarding the jurisdiction of this Court under the Ordinance is misconceived and is overruled. The plaintiff has rightly invoked the admiralty jurisdiction conferred upon this Court for the arrest of the first defendant for its outstanding claim of hire charges against the second defendant in respect of the MV Osam Jumbo-5.

The plaintiff also seeks an order of attachment before judgment. This is premised on the fact that the value of the arrested vessel is much less than the claim of the plaintiff, and for this reason, the second defendant has not exercised any option for having it released by furnishing any guarantee before this Court. It is settled law that admiralty jurisdiction is totally separate and independent from the common law jurisdiction or the civil jurisdiction of a Court. As a contrast to common law or civil jurisdiction, ship arrest has the consequence of obtaining security in lieu thereof for the claimed amount, and to establish jurisdiction, even if there is no substantive link between the claim and the jurisdiction, other than the presence of the arrested ship within the jurisdiction of the Court. It is in these peculiar facts and circumstances, as well as the nature of the admiralty jurisdiction under the Ordinance, that an application for the arrest of a vessel or ship is to be decided by the Court. It is a measure to secure the claim against a party who is in alleged default. Because of the peculiarity of maritime law and the issue of jurisdiction in international waters and the claims of the respective parties, a method for arresting the vessel and its release against a suitable guarantee has been provided in admiralty law worldwide. In Civil Law systems, there are three distinct rules provided in civil procedure codes: rules for a provisional pre-trial remedy (for example, conservatory measures to obtain security for a claim, called in French saisie conservatoire); rules relating to establishing jurisdiction on the merits, which may be based on a substantive link between the claim and the particular jurisdiction; and codified rules relating to the status of some claims as preferred claims over unsecured creditors. By contrast, in Common Law jurisdictions, commencing the in rem action and the arrest of the ship merges all three distinct functions. Namely, it has the consequence of obtaining security for the claim; of establishing jurisdiction on the merits (even if there is no substantive link between the claim and the jurisdiction other than the presence of the arrested ship in the jurisdiction); and of securing the position of statutory maritime claimants as preferred creditors over unsecured ones by the issue of the proceedings in rem. Article 7 of the Arrest Convention 1952 adopted a middle way between Common Law and Civil Law in that the Court where the arrest was made should have jurisdiction on the merits, if its own domestic law permitted it, but the parties are allowedvto agree another jurisdiction. Ship arrest is not linked to, or to be confused with, the ordinary powers of a civil court, including the powers to order for attachment before judgment or for that matter any other enabling and subsidiary powers vested in the court ordinarily.

The Ordinance, in terms of s 4(4), provides either for arrest of a particular ship in respect of which the claim arose, ie the offending ship; or in the alternative any other ship (a sister ship) which was, at the time when the claim arose, owned by the alleged defaulter. Thus, either that particular ship or a sister ship can be arrested. The English Court of Appeal had occasion to consider whether a claimant in an admiralty action is entitled to arrest more than one ship in order to secure its claim. In the case of Owners of the Motor Vessel 'Monte Ulia', commonly known as The Banco case, reported at [1971] 1 All ER 524, the claimant commenced an admiralty action against six ships. The offending ship was the Banco. The owners applied to set aside the service of the writ and warrants of arrest in respect of all the vessels save the Banco. The Court scanned through the historical jurisdiction of the Courts of Admiralty and then referred to the Arrest Convention 1952, with special reference to art 1.1 which defines the 'Maritime Claim', art 1.2 which defines 'Arrest', art 3.1 which permits the claimant to arrest not only the offending ship, but any other ship owned by the same owner, and art 3.3 which makes it clear that if a ship is arrested in any one of the jurisdictions of the Convention countries or bail or other security has been given in such jurisdiction, any subsequent arrest of the ship or of any ship in the same ownership by the same claimant for the same maritime claim shall be set aside and the ship released. After referring to the provisions of the Convention, the Court held that 'only one ship of the same owner may be arrested'. The Court thereafter referred to s 3(3) of the Administration of Justice Act 1956 (UK) and held that the phrase 'any other ship' means 'ship' and not 'ships'.

Lastly, as to the objection of the first and second defendants that the vessel in question is not a ship as defined in s 2(k) of the Ordinance, it suffices to observe that on the basis of record placed before the Court, the MV Osam Jumbo-5 is a 2,000 BHP supply vessel, built in the year 1983, having a UAE Flag, built by Ishii Shipbuilding Co Ltd, Japan, having navigation and communications equipment, with all-round view wheelhouse, forward and aft control consoles, radar, SSB, VHF, autopilot, gyrocompass, magnetic compass, NAVTEX receiver, portable VHF, eco-sounder, GPS, AIS and GMDSS system, and apparently fulfils the definition of a ship which includes any description of vessel used in navigation. When an object has the shape of a vessel (which in this case it has) and is used in navigation in navigable waters, it is called a ship within the meaning of the admiralty jurisdiction of this Court. In Global Marine Drilling & Co v Triton Holdings Ltd (The Sovereign Explorer) [2001] 1 Lloyds Rep 60, from the Scottish jurisdiction, a mobile offshore drilling unit was arrested for the purpose of obtaining security in relation to a dispute under a sub-charter party, which was referred to arbitration and an application by the defendant to set aside the arrest on the ground that the Sovereign Explorer was not a ship was refused by Lord Marnoch.