This document summarizes various claims under Admiralty jurisdiction, focusing on

"damage done by a ship" and claims from agreements concerning the carriage or use of a
ship.

2. Claims for Damage Done by a Ship (s 20(2)(e) of SCA 1981)

• Lord Diplock in The Eschersheim [1976] 1 WLR 430 (HL), p 438, defined "damage
done by a ship" as a term of art meaning the damage must be the direct result or
natural consequence of something done by those engaged in the navigation of the
ship, and the ship itself must be the actual instrument by which the damage was
done5.
• Physical contact between the ship and the damaged object is not essential; a ship
negligently causing a wash that damages another vessel or property ashore is
included6.
• The Eschersheim [1976] 2 Lloyd's Rep 1: A Sudanese ship, The Erkowit, was
damaged in a collision. Subsequently, due to the salvors' negligence in beaching The
Erkowit, it became a total loss, resulting in lost cargo and pollution 7. The House of
Lords decided that the act of casting off The Erkowit was something done by those
navigating the Rotesand (the tug), causing damage to The Erkowit and its cargo,
thus falling under this sub-paragraph8. Both shipowners' and cargo-owners' claims
fell under this sub-paragraph, though they were considered borderline cases 9.
• This provision is extended to cover claims for pollution damage under the MSA
1995, Sched 4, by virtue of s 20(5)(a)(b)10. The Eschersheim also held that pollution
caused by escaping oil after negligent beaching during salvage can be enforced
under sub-para (e)11.
• Pure Economic Loss: In The Dagmara and The Ama Antixine [1988] 1 Lloyd's Rep
431, it was held that a claim for pure economic loss could be enforced under this
head. Sheen J referred to Currie v M'Knight [1897] AC 97, stating that damage could
be done by a ship without direct physical contact or transmitted physical force.
• In Currie v M'Knight [1897] AC 97, Lord Halsbury stated that "it must be the fault of
the ship itself" imports that the ship against which a maritime lien is claimed is the
instrument of mischief, and some act of navigation of the ship itself should be the
cause of the damage14. An act of self-preservation (cutting ropes) was held not to be
an act of navigation, even if other ships were damaged 15.
• A claim for damage done by a ship gives rise to a maritime lien and can be enforced
under s 21(3) of the SCA 1981 16.

3. Claims for Loss of Life or Personal Injury (s 20(2)(f) of SCA 1981)

• This sub-paragraph covers loss of life or personal injury due to defects in a ship, her
apparel or equipment, or wrongful acts, neglect, or default of owners, charterers,
persons in possession or control of a ship, or the master or crew, in the navigation
or management of a ship, or in the loading, carriage, or discharge of goods, or
embarkation of persons.
• This provision is very wide, stemming from the Arrest Convention 1952 and
incorporated into the AJA 1956.
• The Sylph (1867) LR 2 A&E 24: Sir Robert Phillimore explained that the court
originally had jurisdiction over torts and injuries within the ebb and flow of the tide,
and on the high seas.
• The Beta (1869) LR 2 PC 447: The Privy Council affirmed that a personal injury
claim was within "damage done by a ship". Lord Romilly stated that s 7 of the
Admiralty Court Act clearly included every possible kind of damage, including
personal injuries21.
• The Maritime Conventions Act 1911, s 5, clarified that admiralty jurisdiction for
"damage" included damages for loss of life or personal injury, allowing in rem or in
personam proceedings22.
• The current Act (SCA 1981) has separated this provision from "damage done by a
ship" and expanded it to include incidents beyond negligent navigation 23.
• Maritime Lien vs. Statutory Right in Rem: A question exists whether these claims
attract a maritime lien or are just statutory rights in rem24. Thomas (in On maritime
liens) is certain there is a maritime lien for personal injury claimants, but not for
those claiming under the Fatal Accidents Act (FAA) 1976 for loss of life, as that
jurisdiction is solely statutory. However, the document argues that personal injury
and loss of life claims ought to be treated as an extension of the "damage done by a
ship lien"26.
• Wrongful act, neglect or default in the navigation or management of a ship:
The 1981 statute extended this to defects of a ship and defaults of certain persons,
covering negligence in both navigation and management, and any defect in the ship,
apparel, or equipment causing loss of life or personal injury 27.
• Incidents that occurred on board another ship:
o The Radiant [1958] 2 Lloyd's Rep 596, p 608: Personal injury sustained by a
skipper due to a defective tow rope from a sister ship was held to give rise to
a cause of action, demonstrating that defective equipment of one vessel can
affect a person on another.
o The Maid of Kent [1974] 1 Lloyd's Rep 434: A pilot was crushed between a
pilot launch and a ship due to the wash from The Maid of Kent passing too
near and too fast29. The Court of Appeal held that the negligence was
 foreseeable, and the claim could be enforced under s 20(2)(f) of the SCA
198130.
• Defect in a ship, her apparel or equipment under para (f): The cause of action
can lie in common law duty of care, breach of contract, or other statutes like the
Employers' Liability (Defective Equipment) Act (EL(DE)A) 1969, Fatal Accidents
Acts (currently 1976), Occupiers' Liability Act 1957, or MSA 1995 31.
o The Derbyshire [1988] 1 Lloyd's Rep 109: The House of Lords held that a
vessel constituted "equipment" within the meaning of the EL(DE)A 1969,
allowing an action by personal representatives of a deceased engineer whose
death was caused by a defective vessel. Lord Oliver explained the Act's origin
in addressing employer liability for defective equipment provided in the
course of business, even if the defect was attributable to a third party. Lord
Goff agreed that "equipment" includes ships, considering the definition in s
1(3) of the Act as clarifying rather than limiting.
• Claims in the Admiralty Court by foreigners against a foreign ship for a tort
committed on the high seas:
o The Esso Malaysia [1975] QB 198, pp 205–06: This case dealt with whether
the Fatal Accidents Acts applied to foreigners 35. Brandon J held that the
plaintiff, as administrator of deceased Russian seamen, had a good cause of
action under the FAAs against the Panamanian shipowners following a
collision on the high seas. This decision, applying Davidson v Hill [1901] 2 KB
606, settled that dependants of a deceased killed by a ship's wrong, foreign
or not, and regardless of incident location, can sue in England 37.

4. Claims for Loss of or Damage to Goods Carried on a Ship (s 20(2)(g))

• This paragraph permits the arrest of the ship in which the goods were carried, her
sister ship, or any other ship beneficially owned by the person (carrier) liable for
the in personam claim.
• The Eschersheim (see under 3.5.1) decided that if a cargo-owner chooses to arrest a
non-carrying ship that caused the damage, they must rely on another sub-paragraph
of s 20(2) (e)39.
• Claims against the carrying ship may be subject to exclusion or limitation of liability
under carriage by sea Conventions (Hague Rules, Hague-Visby Rules, Hamburg
Rules).

5. Claims Arising Out of an Agreement Relating to the Carriage of Goods on a Ship or

to the Use or Hire of a Ship (s 20(2)(h))
• This sub-section is broad, encompassing claims in contract and tort arising from
agreements related to goods carriage or ship use/hire41. The claim does not need to
be directly connected to or made between the two parties to the action 42.
• The St Elefterio [1957] PD 179: Willmer J held that the words of s 1(1)(h) of the AJA
1956 were wide enough to cover claims in contract or tort arising out of any
agreement relating to the carriage of goods in a ship.
• The Antonios P Lemos [1985] AC 711 (HL): The House of Lords held that the phrase
"arising out of" can be equivalent to "connected with" and that the agreement does
not need to be between the plaintiffs and defendants for the claim to fall under para
(h).
• Claims in negligence or deceit for ante-dated bills of lading:
o The Sennar [1983] 1 Lloyd’s Rep 295: A claim for indemnity or damages for
fraud, breach of duty, or negligence connected with the shipment of cargo,
specifically involving a wrongly dated bill of lading, was held to arise out of
an agreement relating to the carriage of goods in a ship.
• Claims under an agreement for the mooring and unmooring of a vessel:
o The Queen of the South [1968] P 449: Brandon J held that the plaintiffs' claim
for unpaid services related to mooring and unmooring the defendant's ship,
rendered using their motor boats, fell within "an agreement relating to the
use or hire of a ship".
• Claims against salvors for negligence during the salvage services:
o The Eschersheim [1976] 2 Lloyd’s Rep 1: Claims by both the owners of the
salved vessel and cargo owners for damages due to salvor's negligence were
held to be enforceable under sub-para (h), as the salvage agreement was
considered an agreement for the use of a ship (the tug)47.
o The Tesaba [1982] 1 Lloyd’s Rep 397: Sheen J held that the plaintiffs' claims,
arising from a breach of the salvage agreement by the shipowners (failure to
provide security), did not fall under para (h) because it was not an agreement
for the use or hire of The Tesaba, but for the use or hire of the tugs 48. This
decision appears to unnecessarily limit the scope compared to The
Eschersheim49.
• Claims for indemnity against a shipowner under a towage contract for the loss
of a tug:
o The Conoco Britannia [1972] QB 543 or [1972] 1 Lloyd’s Rep 342: Brandon J
gave a wide interpretation to "relating to the use or hire of a ship," holding
that it covered the hire of a tug under a towage contract, allowing a claim for
indemnity.
• Claims for wrongful detention of goods:
 o The Gina [1980] 1 Lloyd’s Rep 398: It was held that a claim for wrongful
detention of goods by the defendants' vessel, where the defendants claimed a
lien for freight, properly came under para (h), allowing the plaintiffs to use in
rem procedures to obtain security51.

6. Excluded Claims from Paragraph (h)

• While "relating to the use or hire of a ship" has been interpreted widely, the House
of Lords chose a narrow construction for "an agreement relating to the carriage of
goods in a ship" in certain contexts, such as non-payment of insurance premiums or
brokerage52.

This document, Chapter 3: Mode of Exercise of Jurisdiction, discusses the nature and
evolution of in remclaims in Admiralty law, particularly focusing on how these claims are
initiated and affect ship ownership.

1. Origins and Functions of In Rem Proceedings

• Statutory rights by way of an in rem action were first established by the ACA 1840,
covering claims like towage and necessaries for foreign ships 1. Further rights were
added by the ACA 1861, including claims for building, equipping, or repairing ships,
necessaries supplied to any ship elsewhere than its home port, claims by bill of
lading holders for damaged goods, and masters' claims for disbursements2. The
Judicature (Consolidation) Act 1925, Administration of Justice Act (AJA) 1956, and
Supreme Court Act (SCA) 1981 further expanded these claims 3.
• An in rem claim is primarily against the property (e.g., ship, cargo, or freight) 4. It
requires the property to be within the jurisdiction for arrest, unless the defendant
provides security5.
• English procedural law recognizes a triple function for in rem claims:
o To obtain security for the claim6.
o To invoke the English court's jurisdiction on the merits 7.
o For "non-truly in rem" claims, to crystallize the right in rem on the property
from the time the claim form is issued 8.

2. Crystallization of Non-Truly In Rem Claims: The Monica S

• The decision in The Monica S [1967] 2 Lloyd's Rep 113 established that a non-truly
in rem claim crystallizes on the ship from the time the in rem claim form is issued9.
This means the claim can be enforced against the ship even if ownership changes
after the writ is issued but before service or arrest.
 • In The Monica S, cargo owners issued an in rem writ for cargo damage. The ship's
ownership changed before the writ was served. Brandon J held that the new owner,
being the owner at the time of service, had an interest in defending the suit, and the
statutory right in rem accrued upon the ship at the time the action was brought,
regardless of subsequent ownership change.
• This decision protected maritime claimants, as a purchaser could rely on contractual
indemnity from the seller if the ship was encumbered by maritime liens or statutory
rights in rem12.
• Brandon J emphasized that it would be "strange" if a statutory right of action in rem
only became effective against a subsequent change of ownership upon arrest,
especially when arrest is often prohibited 13. Policy considerations seemed
important in his decision14.

3. "Action Brought" vs. "Jurisdiction Invoked"

• There has been debate on whether "action brought" in the statute means only the
issue of the writ, or also service or arrest15.
• The Banco [1971] P 137, decided after The Monica S, found that jurisdiction was
invoked upon service of the writ, not its issue, when multiple ships could be
named16. Lord Denning MR agreed that jurisdiction was invoked when the writ was
served and a warrant of arrest executed 17.
• Brandon J, in The Berny [1977] 2 Lloyd's Rep 533, later noted that "when the action
is brought" and "when the jurisdiction is invoked" were not intended to be the same,
inferring from the statute's use of both phrases 18.
• The SCA 1981, replacing the 1956 Act, uses "action may be brought" in all relevant
sub-sections, eliminating "jurisdiction may be invoked" to avoid confusion 19.
• It has been established that, until March 1, 2002, the court's jurisdiction (in
personam or in rem) could only be invoked by the service of proceedings 20.

4. The Defendant in In Rem Proceedings: Procedural vs. Personification Theory

• Historically, two theories existed:

o Procedural theory: Views the in rem action as a way to compel the
defendant (person liable for the claim) to appear and defend personally 21. If
they appear, they can be personally liable beyond the ship's value 22.
o Personification theory: Considers the ship (res) as the "personified"
defendant, stemming from the concept of maritime liens attaching to the ship
from the moment of the incident23.
• The procedural theory gained prominence, particularly after The Dictator [1892] PD
304, which held that if ship owners put up bail in a salvage claim, they were
 personally liable for any judgment balance exceeding the bail 24. This decision was
criticized for confusing in rem action with maritime attachment (a procedural device
for compelling appearance)25.
• Despite criticism, the procedural theory largely prevailed26.

5. Features of In Rem Claims Prior to The Indian Grace (No 2)

• Before The Indian Grace (No 2) [1998] 1 Lloyd's Rep 1, in rem proceedings had
several features:
o Primarily a vehicle for obtaining security and founding jurisdiction 27.
o For maritime liens, it gives effect to an already accrued lien, enforceable
regardless of ownership changes 28.
o For non-truly in rem claims, a statutory right in rem accrues from the time
the proceeding is issued, enforceable despite subsequent ownership
transfers to bona fide purchasers 29.
o The ship's value generally limited satisfaction of claims unless the defendant
submitted to jurisdiction, making the action in personam as well30.
o Without submission, the in rem proceeding remained solely in rem
domestically, but it compelled the defendant to appear 31.
o A court sale by the admiral marshal extinguishes all encumbrances and gives
clean title32.

6. Nature of In Rem Claims After The Indian Grace (No 2)

• The Indian Grace (No 2) [1998] 1 Lloyd's Rep 1 held that an in rem action is against
the owners of the ship from the moment of service of the writ (now claim form) 33.
• Factual Background of The Indian Grace: A cargo of munitions on The Indian
Grace was damaged by fire. A claim for damages was made in India. Subsequently,
an in rem action was brought in England, and a sister ship, The Indian Endurance,
was arrested. The owners provided security and submitted to English jurisdiction 34.
The defense argued "res judicata" under s 34 of the Civil Jurisdiction and Judgments
Act (CJJA) 1982, stating that a judgment in India for the same cause of action
between the same parties should bar the English action 353535.
• The House of Lords found that the owners of the vessel served with the in rem
action were the same as the defendants in the Indian action, meaning s 34 could
apply3636. Lord Steyn concluded that for the purpose of s 34, an action in rem is an
action against the owners from the moment the Admiralty Court is seised with
jurisdiction37.
• Criticisms and Implications:
 o Lord Steyn's reasoning was criticized for potentially going beyond the
specific issue of s 3438.
o The decision may have indirectly undermined The Monica S by suggesting
that if a foreign judgment is given, a claimant who issued in remproceedings
but didn't get security might not be able to pursue those proceedings by
arresting the ship39.
o However, the document argues that The Monica S dealt with the accrual of a
security interest from the issue of proceedings, while The Indian Grace
concerned personal jurisdiction for res judicata from the time of service40.
o The effect of The Indian Grace is that only the previous owner, liable in
personam, would be personally bound from the time of service, not a bona
fide buyer41. An innocent purchaser still faces the risk of arrest, but the
action in rem provides pressure on the person liable in personam to put up
security42.
o A court's jurisdiction, for purposes of international conventions like the
Brussels/Lugano Conventions (Art 21), is seised at the time of service 43434343.
This aims to avoid irreconcilable judgments 44.

7. Non-Truly In Rem Claims: In Personam Link

• For claims within paras (e)-(r) of s 20(2), an in rem claim under s 21(4) of the SCA
1981 requires:
o The claim to arise in connection with a ship 45.
o The person who would be liable in personam (the relevant person) was,
when the cause of action arose, the owner or charterer or person in
possession or control of the ship46.
• "Charterer" has been broadly interpreted to include demise, time, or voyage
charterers47. "Person in possession or control" refers to someone in the position of a
demise charterer, such as a manager, operator, salvor, or mortgagee 48.
• Beneficial Ownership: This term, not in the Arrest Convention 1952, was initially
thought to include those in possession or control 49494949. However, in Congresso del
Partido [1978] 1 All ER 1169, Goff J defined "beneficially owned" as equitable
ownership, not mere possession or control, a definition widely accepted 50.
• The Father Thames [1979] 2 Lloyd's Rep 364 followed Congresso del Partido, holding
that a demise charterer is not a beneficial owner. However, in that case, the in rem
writ was not set aside due to a maritime lien (collision damage) attaching from the
incident51.
• For arrest, the beneficial owner must own all shares in the ship 52. Minority
shareholding is not sufficient53.
 • Piercing the Corporate Veil: English law generally upholds the separate legal
personality of companies (Salomon v A Salomon & Co Ltd [1897] AC 22)54545454. The
corporate veil can only be pierced in special circumstances indicating a "mere
facade" to evade legal limitations or existing third-party rights, not future rights55.
Adams v Cape Industries [1991] 1 All ER 929 provided guidelines for this56.
• In one-ship companies, piercing the corporate veil to trace ownership from the
registered owner to the de facto owner is restricted57. The Evpo Agnic [1988] 2
Lloyd's Rep 411 reinforced this, with Lord Donaldson MR refusing to pierce the
corporate veil for sister companies unless there was fraud58.

8. Sister Ship Arrest

• The SCA 1981 allows the arrest of a "sister ship" (a ship beneficially owned by the
person who would be liable in personam)59.
• The beneficial owner of the sister ship must be the same as the person liable in
personam at the time the in rem action is brought60.
• The Maritime Trader [1981] 2 Lloyd's Rep 153 clarified that the relevant time for
beneficial ownership is when the writ is issued, not when the cause of action
arose61.
• The Evpo Agnic [1988] 2 Lloyd's Rep 411 confirmed that the corporate veil would
not be pierced merely because two sister companies shared a controlling
shareholder, absent fraud62. This means if two ships are owned by separate "one-
ship" companies, even if controlled by the same holding company, one cannot arrest
the other as a sister ship unless the corporate veil can be legitimately pierced 63.

9. Abuse of Process and Concurrent Actions

• If a claimant has a judgment from a foreign court, they may be barred from bringing
a new action in England for the same cause of action against the same parties due to
res judicata (s 34 of CJJA 1982)64.
• The Indian Grace ruled that an in rem action can be considered "between the same
parties" as an in personam action for the purpose of s 34, especially when the ship's
owners submit to jurisdiction65656565. This aligned English law with the Brussels
Convention (Art 21) on concurrent proceedings 66666666.
• However, some argue that the broad principle from The Indian Grace should be
limited to the context of s 34 and not universally affect the nature of in
remproceedings67676767.
• An unsatisfied foreign in personam judgment generally does not bar an in rem action
for maritime liens, though this rule was not definitively decided in The Indian
Grace68.
• The principle of lis alibi pendens (action pending elsewhere) and res judicata is
crucial in preventing conflicting judgments 69.