ALRC 33 Civil Admiralty Jurisdiction Terms of Reference I, NEIL ANTHONY BROWN, the Minister of State for Communications, acting for and on behalf of the Attorney-General of the Commonwealth of Australia, HAVING REGARD TO THE FOLLOWING: (a) that the Admiralty jurisdiction in Australia is at present still exercised pursuant to the United Kingdom Colonial Courts of Admiralty Act, 1890; (b) that the Constitution enables the Commonwealth Parliament to make laws conferring jurisdiction on the High Court and other federal courts in matters of Admiralty and maritime jurisdiction, and to make laws investing any court of a State or Territory with such jurisdiction; and (c) the other countries, including Canada and New Zealand, to which the Colonial Courts of Admiralty Act, 1890 previously applied, have enacted their own Admiralty legislation in a revised and updated form; HEREBY REFER to the Law Reform Commission, for INQUIRY, REVIEW and REPORT thereon to the Attorney-General, all aspects of the Admiralty jurisdiction in Australia, and REQUEST the Law Reform Commission, in considering this reference, (a) to have regard to the Report of the Joint Committee of the Law Council of Australia and the Maritime Law Association of Australia and New Zealand dated 22 April 1982 on Admiralty Jurisdiction in Australia, and (b) to take note of the draft Admiralty Jurisdiction Bill set out as Appendix “A” to that Report, and, in particular, to (i) make recommendations on the provisions to be included in an Australian Admiralty Act; (ii) consider whether any, and if so what, consequential amendments should be made to other Commonwealth legislation, including the Navigation Act 1912; (iii) formulate draft Rules of Court for possible application by courts upon which Admiralty jurisdiction may be conferred by the Admiralty Act as recommended by the Commission; (iv) consider whether Australia should enact its own law of Prize and, if so, formulate recommendations for such a law; and (v) to formulate a draft Explanatory Memorandum that could be used as an aid in the interpretation of any Bill for an Act to give effect to recommendations by the Commission pursuant to these Terms of Reference. 23 November 1982 Participants The Commission For the purpose of the Reference, the President in accordance with s 27(1) of the Law Reform Commission Act 1973 created a Division comprising the following members of the Commission. President The Hon Justice MD Kirby, BA, LLM, BEc (Syd) (resigned 1984) The Hon Justice MR Wilcox, LLB (Syd) (Acting Chairman, 1984) The Hon Xavier Connor QC, LLB (Melb) 1985 Commissioner in Charge Professor JR Crawford, BA, LLB; (Adel), DPhil (Oxon) Commissioners Sir Maurice Byers, CBE, QC (resigned, December 1985) The Hon Justice FM Neasey, LLB (Tas) (retired, October 1984) Professor MC Pryles, LLB (Melb), LLM, SJD (SMU), LLD (Melb) The Hon Justice DM Ryan, QC, BA, LLB (Hons) (Melb) Mr T Simos, QC, BA, LLB (Syd), LLM (Harv), MLitt (Oxon) Officers of the Commission Secretary and Director of research Mr IG Cunliffe, BA, LLB (ANU) Mr Stephen Mason, BA, LLB, MTCP (Syd) (1986) Legislative Draftsman Mr Stephen Mason, BA, LLB, MTCP (Syd) The legislation set out in Appendix A was settled in collaboration with Mr JQ Ewens, QC, CMG, CBE, LLB (Adel), formerly First Parliamentary Counsel. Research Dr D Cremean, LLB (Melb), D Phil (Monash), Senior Law Reform Officer (to December 1983) S Curran, BA (Macq), LLB (NSW), Dip Int L (ANU), Senior Law Reform Officer (to January 1985) V Thompson, LLB (Adel), Law Reform Officer (from February 1985) Principal Executive Officer Mr Barry Hunt, BA (Syd) Library Ms Virginia Pursell, BA (NSW), Dip Lib (CCAE), Librarian Word Processing Mrs Jennifer Clark Mrs Anna Hayduk Miss Amanda Seeley Consultants to the Commission* Mr MR Blair, President, The Australian Shippers’ Council Captain KT Butterworth, Director of Naval Legal Services, RAN Mr R Cooper QC, Barrister, Brisbane Mr PA Cornford, Crown Law Office, Wellington, New Zealand Hon Justice KJ Carruthers, Supreme Court of NSW Dr DJ Cremean, Barrister, Victoria Ms M Calder, Solicitor, Sydney Mr RD Desmond, Solicitor, Middletons, Oswald, Burt & Co, Vic Mr PG Foss, Lawyer, Stone James Stephen Jaques, WA Mr MA Hill, General Manager, Associated Marine Insurers Aust Pty Ltd Mr P Holmes, Department of Transport, Canberra Professor DHN Johnson, Professor of Law, University of Sydney Captain P Klausen, Company of Master Mariners of Aust, Sydney Mr GJ Lindell, Senior Lecturer in Law, Australian National University (resigned December 1984) Mr B Makins, Nominee of the Australian Chamber of Shipping Mr R Muecke, Attorney-General’s Department, Canberra Mr CW O’Hare, General Counsel, Export Finance and Insurance Corporation Assoc Prof D Roebuck, Law School, University of Papua New Guinea Mr AT Scotford, Solicitor, Ebsworth and Ebsworth, Sydney Mr P Shannon, Department of Foreign Affairs, Canberra Professor IA Shearer, Professor of Law, University of NSW Hon Justice IF Sheppard, Federal Court of Australia Persons Nominated by State/Territory Governments * Mr BM Selway, Crown Solicitor, South Australia Mr KC O’Connor, Department of Attorney-General for Victoria Mr KJ Martin, Department for Justice and Attorney-General, Queensland Dr JA Thomson, Western Australian Crown Law Department Mr Dallas Booth, Department of the Attorney-General for New South Wales Mr I Hemming, Tasmanian Law Department * The recommendations in the report and statements of opinion and conclusion are necessarily those of the Members of the Law Reform Commission alone. They may not be shared by the consultants or nominees nor by the departments or organisations with which they are associated. Summary The Development of Admiralty Admiralty jurisdiction has a long history, dating back to 14th century England. In its modern form it is a distinctive jurisdiction with respect to a wide range of shipping and maritime disputes. The key feature of admiralty is the action in rem, which allows civil jurisdiction to be asserted over disputes, wherever arising, involving a ship. This jurisdiction is predicated mainly upon service of process on the ship, and can be backed up by arrest of the ship by the court, with the subsequent sale of the ship providing a fund from which claims can be met. As a result of developments in England from the 17th to the 19th century, two classes of in rem action came to be recognised: those based on a limited number of maritime liens (eg salvage, wages, collision damage) and those based on a much wider category of claims in contract or tort involving the operation of ships (eg goods supplied to a ship, cargo claims). The expansion of admiralty jurisdiction over the latter class of claims was brought about by legislation in the 19th and 20th century, and this process has been expanded through international developments (especially the 1952 Brussels Convention on the Arrest of Sea-Going Ships, a Convention that is itself now undergoing revision) and through further legislative expansion and development in countries such as the United Kingdom (1956, 1981), Canada (1970), New Zealand (1973) and South Africa (1983). The Need for Reform Further development of admiralty jurisdiction along these lines in Australia was pre*vented by the Colonial Courts of Admiralty Act 1890 (UK), a paramount force statute applying to Australia and limiting admiralty jurisdiction to matters within the admiralty jurisdiction in England in 1890. As a result there are many obscurities and uncertainties about the scope of the jurisdiction in Australia, even about its distribution among the various courts, and there are many unjustified limitations as to the subject matter of the jurisdiction. All are agreed on the need for reform. The Commonwealth Parliament has sufficient power, under s 76(iii) of the Constitution (which deals with matters ‘of Admiralty and maritime jurisdiction’) and otherwise, to carry out such reform: it can confer ‘Admiralty and maritime jurisdiction’ on appropriate Australian courts and regulate the exercise of that jurisdiction in appropriate ways. It can also repeal Imperial Acts dealing with admiralty jurisdiction so far as they apply in Australia. Basic Principles There are good reasons for retaining admiralty as a distinct jurisdiction. The long history of admiralty as a distinct jurisdiction has created international business expectations, arrangements and practices that rely on the fact that jurisdiction will be asserted over ships and shipowners in special ways. For these reasons it is desirable to accept the broad contours of what is traditionally and internationally accepted as falling within admiralty jurisdiction. The prime need is for clarification within the broad framework of admiralty jurisdiction, rather than a root and branch reform involving the abolition of admiralty jurisdiction and a restructuring of the general remedial powers of courts. Furthermore, Australia has distinct interests in admiralty and maritime jurisdiction, in view of its position as a country of shippers rather than shipowners, and as a country dependent on foreign shipping for much of its import and export trade. Thus Australia’s interests support a policy of maintaining and broadening admiralty jurisdiction in rem (a universal jurisdiction based on local service on the res) as an exception to a general principle of territorial jurisdiction. But any expansion must take account of international trends in admiralty jurisdiction. Australian admiralty jurisdiction needs to remain within generally acceptable limits, to ensure recognition of judgments and judicial sales in admiralty and to maintain the position of admiralty as an exceptional and special jurisdiction. A balance thus has to be struck between the interests of ship operators and those dealing with ships. But this balance can be struck in various ways and at various levels. On balance, a broad admiralty jurisdiction is desirable, with the interests of ship owners and financiers catered for through procedural means (including guarantees against vexatious arrest, and machinery for providing alternative forms of security). And it is in the interests of all that admiralty jurisdiction be stated in clear, precise and accessible form.