This case is an appeal from a decision of a single Judge in the Federal Court of Australia on 1 August 2012 in Programmed Total Marine Services Pty Ltd v The Ship ‘Hako Fortress’ (2012) 293 ALR 139, [2012] FCA 805.

In April 2012, Programmed Total Marine Services Pty Ltd (PTMS) applied for and secured the arrest of four Singaporean ships, Hako Fortress, Hako Endeavour, Hako Excel and Hako Esteem. The arrests were made pursuant to ss 4(3)(m) and 18 of the Admiralty Act 1988 (Cth) (Admiralty Act) in lieu of amounts owed to PTMS for providing goods and services, including master and crew, to the ships under a deed dated 7 April 2011. PTMS argued in the alternative that it had been subrogated to each master’s and crew’s maritime lien for their wages, and therefore had a maritime lien for each claim under s 15(2)(c) of the Admiralty Act. The other parties to the deed were Boskalis Australia Pty Ltd (Boskalis), who chartered the ships from Hako Offshore Pte Ltd (Hako Offshore) to move rocks required for the development of an LNG plant off Western Australia. The shipowners eventually provided security for the claims and the vessels were released from arrest in May 2012.

One of the issues for determination was whether the claim fell within the definition of a general maritime claim under s 4(3)(m) of the Admiralty Act. The shipowners argued that the services were supplied to Hako Offshore rather than the ships, as is required by s 4(3)(m). The primary Judge found against the shipowners on this ground. The primary Judge regarded PTMS’s claim that it had a maritime lien under s 15(2)(c) of the Admiralty Act to be arguable, as the contractual obligation on PTMS to pay the masters and crews was irrelevant to whether PTMS could be subrogated to their maritime liens when it paid them.

The shipowners sought leave to appeal to the Full Court of the Federal Court of Australia.

Held: Leave to appeal granted. Appeal dismissed.

Section 4(3)(m) of the Admiralty Act defines a general maritime claim as a ‘claim in respect of goods, materials or services (including stevedoring and lighterage services) supplied or to be supplied to a ship for its operation or maintenance’. The definition of a maritime claim in art 1.1 of the 1952 Arrest Convention includes: ‘(k) goods or materials wherever supplied to a ship for her operation or maintenance’.

Rares J: In answer to the various challenges by the shipowners, PTMS was required to establish that it had formulated a maritime claim within the meaning of s 4(3)(m) (or a maritime lien within the meaning of s 15(2)(c)). It was also necessary to establish that its claim was in respect of goods and services supplied to the ships themselves, and not actually to Hako Offshore, to satisfy s 4(3)(m). The Australian Law Reform Commission intended that by adding the bracketed words in s 4(3)(m), referring to loading and unloading operations, the Australian phraseology would be wider than the equivalent in the Arrest Convention 1952 and the analogous s 1(1)(m) of the Administration of Justice Act 1956 (UK): see ALRC 33 [171]. The connection between the supplied goods and the ship was regarded as critical. The connection must necessarily be direct. The supply cannot be made through a third party, like the shipowner. The identity of the ship, and that the supplied goods are for the use of that ship, must be specified.

The primary Judge’s finding in holding that the deed between the parties clearly contemplated the supply of masters and crew to particular vessels was correct. No other situation was evidenced by the deed. The ships’ names were specified in the deed and the services that PTMS supplied were to the benefit of each ship, which as a matter of practicality must have officers and crew to operate. Importantly, cl 5.4 of the deed empowered PTMS to remove crew members from particular vessels in certain circumstances if Hako Offshore required it. These facts culminated to satisfy the requirements under s 4(3)(m) of the Admiralty Act.​

Buchanan J: There was no question that PTMS had intended to provide services to the ships in question and not to Hako Offshore pursuant to s 4(3)(m) of the Admiralty Act. The contract between them invited no other interpretation.