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Hsinlong Fisheries Ltd v Zhejiang Xinlong Fisheries Co. Ltd [2015] FJHC 162; Admiralty 5.2014 (6 March 2015)

IN THE HIGH COURT OF FIJI
AT SUVA
CIVIL JURISDICTION


Admiralty No. 5 of 2014


BETWEEN:


HSINLONG FISHERIES LIMITED
a limited liability company having its registered office at 26 Matua Street, Suva, Fiji
PLAINTIFF


AND:


ZHEJIANG XINLONG OCEAN FISHERIES CO LIMITED
having its registered office at Shanlyn Road, Yuechen District, Shaoxing, Zhejiang, China.
1ST DEFENDANT


AND :


SHENZHEN SHUIWAN PELAGIC FISHERIES CO LIMITED
having its registered office at whose registered place of business is situated at Room 501, Xingji Building, New Xinsha Road, Shajing Bao'an District.
2ND DEFENDANT


AND:


MV ZHONG YANG 19

a ship presently lying at the Suva Harbour
3RD DEFENDANT IN REM


Counsel : Ms. R. Lal for the Plaintiff
Mr. K. Jamnadas for the Defendants
Date of Hearing : 18th, 25th February and 2nd March 2015
Date of Judgment : 6th March 2015


Catch words : Admiralty - Warrant of Arrest of a Ship- discretionary or as of right -ex parte Application - non disclosure of material facts- Applicability of Order 75 of UK Supreme Court Rules.


JUDGMENT


INTRODUCTION


  1. The Plaintiff filed an endorsement of claim and a writ of summons on 26th September, 2014 and simultaneously by way of ex parte notice of motion sought arrest of vessel 'MV ZHONG YANG 19'. The said ex parte motion was supported by an affidavit of Wei Qiu Quan dated 26th September, 2014. The ex parte motion was granted by the court on 29th September, 2014 upon the submission and affidavit filed and the vessel 'MV ZHONG YANG 19' was arrested. On 16th October, 2014 a notice of motion was filed on behalf of the Defendants, seeking inter alia, plaintiff's claim be struck off and the vessel 'MV ZHONG YANG 19' be released. The statement of claim was filed on 15th October, 2014, and it was served to the Defendants on 24th October, 2014. When the matter came up on 29th October, 2014 I have given directions for the Plaintiff to file an affidavit in opposition by 3rd November, 2014 and a reply to that by 5th November, and fixed the hearing of the motion on 7th November, 2014, but the Defendants sought further time for an affidavit in reply and, upon the request of the Defendants the hearing was refixed for 28th November 2014 and again on this date the counsel for the Defendants sought adjournment of hearing of their summons to 2015 and also sought additional time to file their affidavit in response. Accordingly the hearing was adjourned to 18th February, 2014. The Defendants' main contention is the suppression of material facts by the Plaintiff in ex parte application for arrest of the vessel.

FACTS


  1. According to the affidavit in support of the arrest of the vessel 'MV ZHONG YANG 19' the Plaintiff is a limited liability company engaged in the supplies of fish for sale and also financing of the construction of commercial fishing vessel.
  2. According to the said affidavit 1st Defendant is a company incorporated in China, engaged in the long line Tuna fishing in the Pacific and 2nd Defendant is a company incorporated in China engaged in the business of owning fishing licenses.
  3. The Plaintiff further states that it had advanced a sum of US$1.163,029.73 and JPY 12,270,494.00 (in the affidavit incorrectly stated as JP$) to the 1st Defendant and annexed the copy of alleged loan agreement. Further it states that the said sum was for the construction of the vessels belonging 1st Defendant.
  4. The 3rd Defendant 'MV ZHONG YANG 19' is beneficially owned by the 1st Defendant according to the said affidavit filed in support of the arrest.
  5. The Plaintiff further stated that the loan amount was advanced to the 1st Defendant through third party receipts to the Plaintiff and had given the details of the same.
  6. The Plaintiff states that total loan amount was defaulted by the 1st Defendant and hence the money was advanced to build the vessels owned by it including 'MV ZHONG YANG 19'.
  7. The Defendants had acknowledged the writ on 10th September, 2014 and a further amended acknowledgement of service was filed on 2nd October, 2014.
  8. On 16th of October,2014 the Defendants filed an inter partes notice of motion seeking inter alia;
    1. The Plaintiff's claim be struck out as frivolous, vexatious, and abuse of process.
    2. The release of 'MV ZHONG YANG 19'
    1. Damages for arrest.
    1. Assessment of damages before the Master
    2. Cost on indemnity basis.
  9. The Defendants filed an affidavit in support of the said motion dated 15th October, 2014. The said affidavit in support was sworn by Fang Yuan who is a director of the agents of the Defendants in Fiji. Though initially there was an objection raised by the Plaintiff regarding the authority of the said deponent that objection was withdrawn at the hearing.
  10. In the affidavit in support of Fang Yuan inter alia stated
    1. On 25th August 2014 the Plaintiff had instigated an admiralty action No 3 of 2014 for the alleged debt.
    2. In that the Plaintiff had sought to arrest two sister vessels belonging to 1st Defendant on the same alleged debt in the action in rem.
    1. The said Admiralty Action No 3 of 2015was heard inter partes and it was dismissed with cost .
    1. Again on the same alleged debt the Plaintiff instituted Admiralty Action 4 of 2014 and in that action an application for arrest of 1st Defendant's vessel was made.
    2. In the Admiralty Action 4 of 2014 the application to arrest another sister vessel was rejected and after that the said action was discontinued by the Plaintiff and present action in rem instituted.
    3. Without revealing any previous attempts in Admiralty Actions 3 of 2014 and Admiralty Action 4 of 2014 the present action was initiated and ex parte order for arrest was obtained.
  11. In the affidavit in opposition of the motion of the Defendants, of the Plaintiff had admitted that the Admiralty Action Nos 3 of 2014 and 4 of 2014 as well as the present action are based on the same debt, but arrests were sought against sister vessels.
  12. The Defendants state that there is material non disclosure in the ex parte application for arrest and also seeks to strike out the action for abuse of process.

ANALYSIS


The Law


  1. The High Court obtains the Admiralty Jurisdiction in Fiji and the Section 18(2) of the Prat VI of the High Court Act (Cap 13) deals with the jurisdiction and states as follows:

'The High Court haas the admiralty jurisdiction which the High Court of Justice in England possessed on 4th December, 1987.'


15. The arrest of a ship in an Admiralty action in rem, apart from being the basis of jurisdiction also allows the party seeking arrest a security for the claim and also secures the appearance of the party in court.[1]


16. The jurisdiction of the High Court of Fiji relating to the Admiralty Action is the same as jurisdiction of the High Court of Justice in England on 4th December, 1987. The main legislation of UK that confer Admiralty jurisdiction is found in Supreme Court Act 1981(Chapter 54) of UK.[2]


17. Sections 20, 21, 22, 23 of the UK Supreme Court Act 1981 deals with the Admiralty Jurisdiction of High Court of UK.


18. The other legislations that deal with Admiralty Jurisdiction are Hovercraft Act 1968 as amended by the Supreme Court Act 1981, The Oil in Navigable Waters Act 1971 Section 8 and Schedule 2, para 4 and the Prevention of Oil Pollution Act 1971, Section 13[3]. The Admiralty Jurisdiction of Fiji will not confine to UK Supreme Court Act 1981 and all the above mentioned UK legislation that conferred jurisdiction to High Court of UK will also confer similar Admiralty Jurisdiction, to deal with specific instances, to High Court of Fiji, in terms of Section 18(2) of High Court Act (Cap 13) of Fiji.


19. It should be noted that the admiralty jurisdiction of UK High Court in 1987 was adopted to Fiji as stated above, but this confined only to the jurisdiction and the UK admiralty rules of procedure contained in Order 75 of the Rules of Supreme Court was not adopted. This distinction is important for the issue before this court, which I will address later in this judgment.


20. In Fiji the Section 25(2) of the High Court Act empowers The Chief Justice to make rules and in terms of that Supreme Court (now the High Court) (Admiralty) Rules (Cap. 13 Ed. 1978 Subsidiary legislation) were made . The schedule to the said Admiralty Rules in Fiji was amended in 1993 by High Court (Admiralty) (Amendment) Rules 1993. Apart from the said amendment that dealt with certain charges in Admiralty proceedings, there were no changes to the rules of procedure in Fiji for more than a century. This is an important feature in Admiralty procedure in Fiji and this deviate from the UK Admiralty procedure which had evolved over the years with the changes to their rules.


21. In UK, the procedure relating to Admiralty Actions were dealt in Order 75 of the Rules of the Supreme Court (UK). The said Order 75 had changed over the years and in Fiji, High Court Rules of 1988 (Cap 13A) Order 75 of UK Supreme Court Rules, was not included. This is a noteworthy omission and should have been done with a reason.


22. In Fiji the Admiralty proceedings are conducted in accordance with Supreme Court (Admiralty) Rules[4] as amended by High Court (Admiralty) (Amendment) Rules 1993.


23. It was held in the 'Voseleai' [1994] 40 FLR 224


'Time does not permit me in this interlocutory application to canvass the applicability to Fiji of Order 75 of the White Book. I have however been referred to an interesting judgment of Cullinan J. in "The Haima 747" Admiralty Action No. 1 of 1985 in which his lordship concluded that: "... Order 75 still applies (in Fiji) in default of the Admiralty Rules and where not inconsistent therewith." I am content to adopt the same conclusion in this case'


  1. So, the position in Fiji is though Order 75 of UK Supreme Court Rules was entirely left out from the High Court Rules of 1988, the provisions contained in Order 75 of UK Rules of Supreme Court was applied when there is a lacuna and, application of UK provision, is not inconsistent with the Supreme Court (Admiralty) Rules, which were adopted in Fiji in 1894. Such an application is only possible when the Fiji Supreme Court (Admiralty) Rules are found wanting.

25. So resort to Order 75 of the UK Rules of Supreme Court is allowed when such application to Fiji is not inconsistent with Supreme Court (Admiralty) Rules. In order to apply the provisions contained in Order 75 there should also be a lacuna in Fiji relating to Admiralty Procedure, namely Supreme Court (Admiralty) Rules. Order 75 of the UK Rules of Supreme Court is comprehensive provision and when applying it to Fiji certain provisions had already got the sanction of the High Court, but I am not aware of any case law that had applied the Order 75 in toto. That will not be possible as Supreme Court (Admiralty) Rules will directly conflict with certain provisions of Order 75 of the UK Rules of Supreme Court. This may be the reason for Order 75 of UK Rules of Supreme Court in its entirely left out from the Fiji High Court Rules of 1988. At that time, Fiji already had Supreme Court (Admiralty) Rules to deal with procedural aspects.


26. Since the arrest of ships invariably involve foreign vessels there are issues of international relations and international trade and in order to have a uniform law, there was an attempt by the United Nations to adopt an international convention relating to arrest of ships[5]. International Convention on Arrest of Ships, 1999 was adopted on 12 March 1999 at the United Nations/International Maritime Organization Diplomatic Conference on Arrest of Ships held in Geneva from 1 to 12 March 1999. [6] This Convention came in to force on 14th September, 2011, six months after 10 states have expressed concern to bind by it . This again indicate the reluctance of the states to adopt a uniform law relating to arrest of ships as 11 years have taken for 10 states to ratify or accede it. Neither UK nor Fiji has ratified/acceded this convention.[7] The resulting position is that though there are similarities among the states relating to action in rem in Admiralty actions, there is no uniform rules of practice among the nations regarding the Arrest of Ships.


27. In UK prior to 1986 as well as in Fiji the arrest of a ship was a discretionary remedy available in an action in rem. Often, such an application for arrest of a ship is made ex parte for pragmatic reasons. In UK the Admiralty Proceedings were conducted in terms of Order 75 of the Rules of Supreme Court (UK) and arrest of a vessel was a discretionary remedy till new amendments were introduced to UK Rules of Supreme Court in 1986.


28. In Fiji arrest of a vessel is dealt in Supreme Court (presently High Court) (Admiralty) Rules and the Order 2 of the said Rules states as follows:


ORDER II-ARREST WARRANT


O. 2, R. 1. Admiralty affidavit, etc., required to lead warrant


'1. In admiralty actions in rem a warrant for the arrest of property may be issued at the instance either of the plaintiff or of the defendant at any time after the writ of summons has issued, but no warrant of arrest shall be issued until an affidavit by the party or his agent has been filed, and the following provisions complied with:-


(a) the affidavit shall state the name and description of the party at whose instance the warrant is to be issued, the nature of the claim or counter-claim, the name and nature of the property to be arrested, and that the claim or counter-claim has not been satisfied;


(b) in an action of wages or of possession the affidavit shall state the national character of the vessel proceeded against; and, if against a foreign vessel, that notice of the commencement of the action has been given to the Consul of the State to which the vessel belongs if there be one resident in Fiji, and a copy of the notice shall be annexed to the affidavit;


(c) in any action of bottomry the bottomry-bond, and, if in a foreign language, also a notarial translation thereof, shall be produced for the inspection and perusal of the Registrar, and a copy of the bond, or of the translation thereof, certified to be correct, shall be annexed to the affidavit.


O. 2, R. 2. Except by leave

2. The Court or a judge may in any case allow the warrant to issue although the affidavit in rule 1 mentioned may not contain all the required particulars; and in any action of wages the Court or judge may also waive the service of the notice and in an action for bottomry the production of the bond'.(emphasis added)


29. The above Order 2(a) of the Fiji Admiralty Rules are analogous to Order 75 rule 5(7) of the UK Rules of Supreme Court prior to 1986 amendment to said rule. There were changes made to Order 75 of the UK Rules of Supreme Court made in 1986 and that changes have significantly changed the character of warrant of arrest from discretionary remedy to a remedy available as of right. This was held in The Varna [1993] 2 Lloyds Report 253. It was also held that since the remedy was no longer discretionary, there was no requirement for full and frank disclosure.


30. The issue of non disclosure of material facts in an ex parte application for arrest of a ship was dealt in The Vosso.[8] The (C.A) [1984] 1 Lloyd's Rep 235, [1984] 1 Q.B. 477. It was held that non disclosure of material facts in an arrest of a ship is fatal to the order of arrest, as the arrest of a vessel was a discretionary remedy.


31. In The Varna [1993] 2 Lloyds Report 253 at 256-257, Lord Justice Scott held,


'It has transpired that since The Vosso the form of r. 5 of O. 75 has been changed. The change is highly material.


At the time The Vosso was decided r 5(1) had read.


'After a writ has been issued in an action in rem a warrant... for the arrest of the property against which the action.... Is brought may, submit to the provision of the Rule, be issued a the instance of the plaintiff....


It was the rule in this form which Lord Justice Robert Goff had held in the Vosso justified and application for the issue of arrest being categorized as an application for a discretionary remedy which it lay in the power of the Court to grant or refuse.


By the Rules of Supreme Court (Amendment No 3) Order, (S.I. 1986, No 2289), the following was substituted.


In an action in rem the plaintiff...may after the issue of the writ in the action and subject to the provisions of this rule, issue a warrant .... For the arrest of the property against which the action is brought.....


In addition, a new par.(6) was introduced . The new par.(6) is in these terms:


A warrant of arrest may not be issued as of right in the case of property whose beneficial ownership has, since the issue of the writ, changed as a result of the sale or disposal by any court exercising Admiralty jurisdiction.


In addition, reference in the previous r.5 to a party applying for issue of a warrant were altered to reference to a party intending to issue the warrant. And, a new par(8) was added in these terms:


Issue of a warrant of arrest takes place upon its being sealed by an officer of the registry or district registry.'


Further at 257 held


.....which I think follow inexorably from the nature of the changes in r.5.First, in par (1), power to issue the arrest warrant is expressly bestowed on the plaintiffs. References to the plaintiffs applying for the issue of the warrant are removed. Previously, the role of the plaintiff had been merely that of applicant, the power of issuance being that the Court .Second, the reference in par.(6), to the circumstances in which a warrant "may not be issue as of right" suggests that in other cases the issuance of a warrant is intended to be "as of right", provided, of course, that the other steps in relation to the issuance of the warrant being taken by a plaintiff as a matter of right, consequent upon the issuing of a writ in rem and upon compliance with the affidavit requirements of r.5.


32. From the abovementioned reasoning it is evident The Varna (supra) did not apply the ratio of The Vosso [9]as the O. 75 of UK Rules of Supreme Court was amended in 1986 in the manner stated in above judgment. It is also noteworthy that even in The Varna[10] the importance of full and frank disclosure in ex parte application dealing with discretionary remedy was reiterated in these terms: p 257


'...the requirement of "full and frank disclosure", a phrase well understood in the context of applications to the Court for discretionary orders of the sort that Lord Justice Robert Goff referred to by way of analogy in The Vasso, has in my opinion, no real substance except in the context of an application for a discretionary remedy in circumstances in which there is an obligation of disclosure cast upon the applicant.'


33. The written submissions filed today, the counsel for the Plaintiff argues that there is no requirement for full and frank disclosure in an application for arrest of a ship in Fiji. For her argument first the attention of the court is drawn to the Fatiaki J's judgment in The 'Voseleai' [1994] 40 FLR 224. I do not think that I have to repeat myself as I have dealt what was quoted in the submissions of the Plaintiff earlier in this judgment. In short Order 75 of the UK Rules of Supreme Court can be applicable when there is a default of the Admiralty Rules of Fiji and where that is not inconsistent with Fiji Admiralty Rules. There cannot be embracing of Order 75 of UK Rules of Supreme Court in toto.


34. Apart from the The 'Voseleai' [1994] 40 FLR 224, the Plaintiff's submission has quoted a passage from Wasawasa Fisheries Ltd v Karim's Ltd [1998] FJHC 248; [1998] 44 FLR 102 ( Decided on 26 May 1998)(unreported) and had underlined a contention of a counsel, paraphrased in the said judgment. Submissions made by the parties and the respective contentions are often quoted in judgments, and whether quoted verbatim or paraphrased, they do not form part of the ratio or even obiter dicta of the judgment as they are not findings of a judge. So they are neither binding nor persuasive for judicial consideration. In the said case submissions were made as to the applicability of The Varna[11] in Fiji, but unfortunately this issue was not addressed in the judgment and the issue was dormant for nearly 16 long years and had resurfaced again. There was no definitive pronouncement of the applicability of The Varna [12]in Fiji so far. I am unable to find application of the said case in Fiji and the above analysis would show such application is not warranted in Fiji and still the arrest of a ship in Fiji is a discretionary remedy available for a party. In an ex parte application the Plaintiff has an obligation to disclose all material facts relating to arrest.


35. So the change in the law introduced in The Varna [13]was entirely depended on the change of the Order 75 of the UK Rules of Supreme Court in 1986. The change of Order 75 rule 5 has no application to Fiji. The said UK rule 5 deals with the requirements of the affidavit in support of the arrest. In Fiji the issue is dealt in Order 2 of the Supreme Court (Admiralty) Rules. So there is no lacuna in Fiji Admiralty rules in order to resort to Order 75 rule 5 of the UK Rules of Supreme Court. So, the order to issue a warrant of arrest in Fiji remains a discretionary remedy of the court. Hence The Varna[14] cannot be applied and the law remains similar to the UK law prior to 1986. So The Vosso[15] still applies to Fiji and non disclosure of material fact in an ex parte application for arrest is an abuse of process and any order for arrest under such material disclosure needs to be set aside on that ground.


Non Disclosure of Material Facts


36. In The Vosso[16] Robert Goff LJ dealt the issue of material non disclosure as follows; at 1135-1136


'It is axiomatic that in ex parte proceedings there should be full and frank disclosure to the court of facts known to the applicant, and that failure to make such disclosure may result in the discharge of any order made on the ex parte application, even though the facts were such that, with full disclosure, an order would have been justified (see R v Kensington Income Tax Comrs, ex p Princess de Polignac [1917] 1 KB 486). Examples of this principle are to be found in the case of ex parte injunctions (Dalglish v Jarvis [1850] EngR 688; (1850) 2 Mac & G 231, 42 ER 89), ex parte orders made for service of proceedings out of the jurisdiction under RSC Ord 11 (The Hagen [1908] UKLawRpPro 6; [1908] P 189 at 201, [1908-10] All ER Rep 21 at 26 per Farwell LJ) and Mareva injunctions (Negocios del Mar SA v Doric Shipping Corp SA, The Assios [1979] 1 Lloyd's Rep 331). In our judgment, exactly the same applies in the case of an ex parte application for the arrest of a ship where, as here, there has not been full disclosure of the material facts to the court.'


37. Non disclosure of material facts in an ex parte application where court's discretion is invited would be an abuse of process. If inaccurate evidence is placed in an affidavit that is not only a perjury, but also affront to judicial discretion in ex parte applications. In Ghafoor and others v Cliff and others[17] David Richard J held, at p1091


'Secondly, the claimants submit that Mr. Cliff's affidavit in support of the application contained serious misrepresentations and failed to make full and frank disclosure of relevant facts. These are serious criticisms in any case, but the importance of accurate evidence is particularly acute on an application without notice, and the duty of disclosure on such an application has been stressed by the courts on many occasions (see, for example, Fitzgerald v Williams, O'Regan v Williams [1996] 2 All ER 171 at 177, [1996] QB 657 at 667-668 per Bingham MR). The principles are well established and well known on applications without notice for injunctions and other interim relief, but they are fundamental to the proper functioning of the court's process on any application without notice. It is of course the very fact that the application is made without notice to other interested parties which makes these principles so important. Other parties do not have the opportunity to correct or supplement the evidence which has been put before the court.' (emphasis added)


Application of Law to the facts


38. As I have discussed, above the position of Admiralty proceedings in Fiji has not changed as the Supreme Court(now the High Court) (Admiralty) Rules have not been changed as done in UK to Order 75 of the UK Rules of Supreme Court. The position in Fiji as regards to the arrest of vessels are similar to the UK law prior to 1986. So the ratio of The Vosso [18]applies.


39. The arrest of a ship is a discretionary remedy in Fiji in terms of the Order 2 of the Supreme Court (now High Court) (Admiralty) Rules as amended. The arrest of a ship in Fiji is not granted as of right and granted by the court upon an application after considering the facts stated in the affidavit in support of the application for arrest. So there is an obligation for full and frank disclosure.


40. The main contention of the Defendants is that Plaintiff has failed to disclose the material facts in the ex parte application for arrest of ship, which was granted by the court. This ex parte application was supported by an affidavit which failed to disclose prior admiralty Actions on the same alleged debt to the Plaintiff.


41. The Plaintiff had instituted admiralty action No 3 of 2014 and also No 4 of 2014 in this court and both cases were dealt by a brother judge. Admiralty Action No 3 was dismissed with cost, I was not submitted with the reasons for such dismissal. It may be that there was no written reasons given. But it is clear from the Affidavit in support of the Arrest of the Ship in the said action that the alleged debt is the same as in both actions as well as in the action before me. This is an admitted fact in the affidavit in opposition. In the Admiralty Acton No 3 the affidavit in support was sworn by CHENGBIN YANG and in the paragraph 11 he had sworn as:


'That the 1st Defendant and the Plaintiff entered into a verbal agreement, in the understanding, whereby we provide the service as in delivery of motor vessel spare parts, repairs and maintenance of fishing motor vessels that operates under or chatted by the 1st Defendant, in exchange of payments by the 1st Defendant for our service.'


42. In the Admiralty Action 4 of 2014 same debt was the subject matter and in the affidavit in support of the application made in that case WEI QIU QUAN at paragraph 12 stated as follows


'That the 1st Defendant and the Plaintiff entered into a verbal agreement, in the understanding, whereby the 1st Defendant borrows money from our company as they lack fund to build vessel.'


43. The failure to disclose failed attempts, in two previous attempts to arrest sister ships based on the same debt itself is a material non disclosure in the ex parte application for arrest in the present case. Since the alleged debt is the same the Plaintiff had an obligation to bring to court's attention of these proceedings namely Admiralty Actions 3 and 4 of 2014.


44. Apart from that there was obligation on the part of the Plaintiff to disclose the reasons for dismissal and discontinuance respectively. These are material facts for the court in order to exercise the discretion for the arrest of the ship 'MV 2 HONG YANG 19' on ex parte basis.


45. Not only had the Plaintiff failed to disclose previous actions, but also failed to give a reason for such non disclosure. At the oral hearing of this matter Ms. Rene Lal, the counsel for the Plaintiff only said that those facts relating to previous admiralty actions were not material. I do not think that argument can hold water.


46. When I inquired from the learned counsel for the Plaintiff the applicability The Varna[19] case to Fiji she could not state its applicability which is the main issue before be. Later, I gave time for further consideration of this issue and the learned counsel had submitted a written submission on that today. I have already dealt with said reasons given in the written submissions filed today as to why The Varna[20] should not be followed in Fiji.


47. In the circumstances The Vosso [21] applies and non disclosure of previous action itself will amount to material non disclosure. Apart from that as I have quoted previously in both previous Admiralty Action Nos 3 and 4 of 2014 the affidavits in support sworn by the respective deponents had sworn that the alleged debt to the Plaintiff was pursuant to a verbal agreement. In sharp contrast to that in the present ex parte application the affidavit in support stated that the alleged debt to the Plaintiff based on a written agreement and had annexed a translation of said agreement presumably written in Mandarin.


48. The affidavit in support of the present admiralty action was sworn by WEI QIU QUAN and in paragraph 8 of states as follows


'The Plaintiff advanced the sum of US$1,163,029.73 ......and JP$ (sic) 12,270,494.00.... to 1st Defendant for the construction of vessels. This Agreement is confirmed as a Loan Agreement dated 20th July, 2013. I annex hereto and mark with the letters 'WQQ6' with a copy of the Agreement translate into English.'


49. It is noteworthy that same deponent had sworn differently in the previous Admiralty Action No 4 of 2014 as quoted previously where he stated that there was only a verbal agreement. So it is clear that the Plaintiff had obtained the arrest of ship through suppression of material facts. The Plaintiff's failure to disclose previous Admiralty Actions namely action nos 3 and 4 of 2014 was a material non disclosure. The reasons for dismissal of action 3 of 2014 and discontinuance of 4 of 2014 was another material non disclosure. The conflicting statements by the same deponent as relates to the alleged debt and failure to provide an explanation as to how 'verbal agreement' suddenly became a written 'loan agreement' and non disclosure of earlier affidavits constituted material non disclosure. These material non disclosures are abuse of process in the ex parte application for arrest of ship.


50. In the previous Admiralty Action No 3 and 4 of 2014, the Plaintiff attempted to arrest sister vessels, but the material fact is that the alleged debt is same in Admiralty Action No 3 of 2014 and Admiralty Action No 4 of 2014 and also in the present ex parte application for arrest. The previous Admiralty Actions were also made ex parte for the arrest of sister vessels but the court had made the applications inter partes and earlier action was dismissed with cost and subsequent application for arrest in Action No 4 of 2015 was also refused but the action was subsequently discontinued and the present admiralty action was instituted with an endorsement of claim and also an ex parte application for arrest of the ship 'MV ZHONG YANG 19'.


51. Even in the affidavit in opposition to the present motion seeking release of the ship from arrest does not disclose any reason as to complete contradictory statements made by the deponent in the present action previously on the material issue before me. So the arrest of vessel 'MV ZHONG YANG 19' needs to be set aside and the vessel needs to be released unconditionally


52. In the notice of motion filed by the Defendants also seeks to strike out the Plaintiff's claim as frivolous, vexatious and also as an abuse of process. The Defendants state that the claim of the Plaintiff was an 'evolving claim' but failed to provide any authority in support of the contention for striking out a claim as an 'evolving claim'. The Defendants have yet to file their statement of defence and it is premature for such an application at this juncture and I will refuse the striking out at this moment.


CONCLUSION
53. The arrest of ship in Fiji is a discretionary remedy in terms of Order 2 of Supreme Court (Admiralty) Rules as amended. In an ex parte application there is obligation on the applicant to provide all material facts to court. The Plaintiff failed to do so and the vessel needs to be released. The cost of this application is summarily assessed at $5000 to be paid within 21 days.


FINAL ORDERS


  1. The Vessel 'MV ZHONG YANG 19' is hereby ordered to be released.
  2. The cost of this application is summarily assessed at $5,000 to be paid by the Plaintiff to the 1st Defendant within 21 days.
  1. Matter is adjourned before the Master for further directions.

Dated at Suva this 6th day of March, 2015.


.....................................
Justice Deepthi Amaratunga
High Court, Suva


[1] Derrington, Sarah C. "My ship, my castle: the forfeiture of property rights in the admiralty law context." University of Queensland Law Journal Dec. 2007: p 341+. Academic OneFile. Web. 6Mar. 2015.(AcademicOneFile database)

URLhttp://go.galegroup.com/ps/i.do?id=GALE%7CA178121270&v=2.1&u=wash89460&it=r&p=AONE&sw=w&asid=52a12d9133babe2292656ff41911a7fd

Gale Document Number: GALE|A178121270
[2] http://www.legislation.gov.uk/ukpga/1981/54/pdfs/ukpga_19810054_en.pdf
[3] The Supreme Court Practice 1988 p1124 75/1/1 – Admiralty Jurisdiction.
[4] Approved by Order in Council dated 10th March, 1894, published in the Fiji Royal Gazette of 25th July, 1894. (See Laws of Fiji (1945 Edition), Vol. VI, page 105.)
[5] UN Resolution 52/182 of 18th December,1997(source- UN Treaty Collection Data Base https://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=XII-8&chapter=12&lang=en
[6] UN Treaty Collection Data Base https://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=XII-8&chapter=12&lang=en
[7] ibid
[8] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[9] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[10] [1993] 2 Lloyds Report 253
[11] [1993] 2 Lloyds Report 253
[12] ibid
[13] ibid
[14] ibid
[15] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[16] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[17] [2006] 2 All ER 1079
[18] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[19] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]
[20] [1993] 2 Lloyds Report 253
[21] [1984] 1 Lloyd’s Rep 235, [1984] 1 Q.B. 477.[earliar Andria [1984] 1 All ER 1126]


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