This was a claim brought by the plaintiff bunker supplier under s 3(2) of the Admiralty Jurisdiction of High Courts Ordinance 1980 (the Ordinance) seeking recovery of USD 667,599.35. The plaintiff applied for the arrest of the defendant vessel until sufficient guarantees were furnished for the outstanding claim.

According to the plaintiff, the fifth defendant charterer, a company incorporated in the UAE, contracted in May 2016 for the supply of 290 mt of intermediate fuel oil and 40 mt of marine gas oil for the vessel in question. The plaintiff argued that the owners and charterers of the vessel were liable to pay jointly and severally, because the owners remained actively involved in the bunker supply process. The physical supplier of the bunkers also kept on informing the owners in respect of the supplies and therefore, notwithstanding the fact that the order was placed by the charterer, the owners and their vessel were equally responsible for payment.

The owners contended that the vessel was on a time charter, and that all negotiations in respect of the supply of bunkers were done with the charterer. The owners did not undertake any liability to the plaintiff. The charterparty clearly provided that the bunkers were to be purchased and paid for by the charterer. In order to maintain a claim under the admiralty jurisdiction, it first had to be established that the claim could be maintained in personam against a defaulting party. Only then could a claim in rem be maintained against a vessel. Since there was no claim in personam against the owners, the vessel could not be arrested and detained for such a claim. Under the admiralty law in Pakistan, a claim in respect of a bunker supply does not attract a maritime lien, and is therefore to be governed by the provisions of ss 3 and 4 of the Ordinance only. The owners also referred to the bunker supply receipts, and contended that the master of the vessel had clearly affixed a stamp to the effect that such supplies were on account of the charterer and therefore, notwithstanding the fact that the master represented the owners of the vessel, no such claim could be maintained against the vessel. In support of this contention the owners relied upon Atlantic Steamer's Supply Co v MV Titisee PLD 1993 SC 88; VN Lakhani & Co v MV Lakatoi Express PLD 1994 SC 894 (CMI576); and Naseem Oils v MT Miramis 2012 CLD 1413.

Held: Claim dismissed. The Nazir of the Court is directed to release/discharge the surety furnished by the owners.

According to the plaintiff, since the bunkers were supplied to the vessel, the claim falls under s 3(2)(l) of the Ordinance, which provides for claims in respect of necessaries supplied to a ship, read with s 4 thereof, wherein the mode of exercise of the admiralty jurisdiction of the Court has been provided. The plaintiff's further case is that since the bunkers were received by the master of the vessel, who is and was employed by the owners, the owners cannot plead ignorance once the supplies have been made.

Admiralty jurisdiction has been conferred on this Court in terms of s 3 of the Ordinance, which provides for various maritime claims from cll (a)-(r). Clause (l), which is relevant for present purposes, deals with claims in respect of necessaries supplied to a ship. The mode of exercise of such jurisdiction has been provided in s 4(4), which states that in case of any such claim as is 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.

The Yuta Bondarovskaya [1998] 2 Lloyd's Rep 357 involved identical facts to the present case before this Court. The Court in that case considered in detail the aspect of an implied actual authority, as well as apparent or ostensible authority, and came to the conclusion that in a time charter (until otherwise provided, and that too with the consent of the owner), there cannot be any conferment of authority to buy bunkers on the account of the owners merely for the reason that the ship is being managed by the master and crew of the owners. The Court observed that it is the responsibility of the time charterer to provide and pay for bunkers if the charterer wishes to use the vessel for its own purposes; and that the idea that an owner who time chartered its vessel to a time charterer was authorising the time charterer to contract on its behalf, was contrary both to the express terms and to the underlying basis of a time charter, as under the standard forms of time charter the owner was not expressly agreeing to pay for the bunkers; and that the suggestion that there was any implied authority, or that it was within the usual authority of a time charterer to buy bunkers on behalf of owners, was not arguable.

In India the same approach is followed. In MV Kiveli v Monjasa DMCC 2018 (5) ALT 73 (MANU/HY/0089/2018) the Hyderabad High Court held that, because the bunker delivery note clearly stated that the supply was on account of the charterer, notwithstanding the fact that it was received by the master of the vessel, prima facie there was no liability on the part of the owner in such a case. A similar view was expressed by the Bombay High Court in Gulf Petrochem Energy Pvt Ltd v MT Valor (MANU/MH/0624/2015) which involved identical facts.

The dicta laid down in those cases fully apply to this case, inasmuch as the plaintiff has not been able to show or substantiate that the time charterer had any sort of authority to contract on behalf of the owners or the vessel. The bunkers were supplied by the plaintiff to the charterer. It is also apparent that the bunkers were not supplied at the request of the owners of the vessel. The plaintiff has failed to make out any case in personam against the owners of the vessel. In order to safeguard its interest, knowing that its claim against the vessel and owner would fail, the plaintiff obtained sufficient security in the shape of postdated cheques from the time charterer, and is at full liberty to seek their encashment, and if not, then any other appropriate remedy as may be available for it in accordance with the applicable laws. The plaintiff under no circumstances can be permitted to take undue advantage under the admiralty jurisdiction of this Court by the arrest of the vessel, and then compelling and dragging the owners to pay the amount being claimed, when no case for a claim in personam has been arguably made out.