THE ASSOCIATED SHIP AND SOUTH AFRICAN ADMIRALTY JURISDICTION by Malcolm John David Wallis B Com, LL B cum laude (Natal), SC Judge of the High Court of South Africa Submitted in fulfilment of the requirements for the degree of Doctor of Philosophy in the Faculty of Law, University of KwaZulu-Natal (2010). As the candidate’s Supervisor I agree to the submission of this thesis . H STANILAND 2 ACKNOWLEDGEMENTS Researching and writing a work of this magnitude can never occur in isolation. Throughout its lengthy gestation I have benefited from the assistance of others to whom I owe substantial debts of gratitude. This is an opportunity to acknowledge their help. When I first mooted the possibility of a more modest piece of research to my supervisor Hilton Staniland he received the proposal with enthusiasm and thereafter encouraged me to undertake the lengthier process of preparing a doctoral dissertation. Throughout its production he has held himself available to give help when required and remained patient when the demands of practice threatened to overtake my ability to give it any attention and bring it to finality. Notwithstanding his own commitments he has facilitated bringing it to fruition and I am deeply grateful for his encouragement and assistance. No one involved in maritime law in South Africa can be unaware that without the contribution of Douglas Shaw QC the Admiralty Jurisdiction Regulation Act 105 of 1983 would not have seen the light of day and the development of this area of our jurisprudence would have been considerably hampered if not entirely stultified. I was privileged to be his junior and later his opponent in many cases and through that experience learned from him much of what I know about maritime law. Throughout the writing of this dissertation he has made available the resources of his library, the materials he had collected in regard to the drafting of the Act and above all his wisdom and encouragement (and on one occasion his ability to read Latin and translate it into English) whenever I have sought to discuss a knotty problem. I am pleased to have the opportunity to pay tribute to his contribution to South African maritime law and to thank him for all his assistance and friendship over the years. Friends and colleagues who practise in the field of maritime law and are active in the affairs of the Maritime Law Association have given encouragement, assistance and information and advice whenever that has been sought. David Gordon SC, Alex Jefferies SC and Mike Wragge SC were generous in making available the 3 resources of their libraries. Over the period whilst I have been writing this thesis Angus Stewart SC and I jointly built up a substantial maritime component of our chambers’ library. Without his contribution that library would have been poorer and of less assistance. Tony Norton arranged for me to have access to the minutes of the MLA. All of these and many others cheerfully endured my questions about aspects of maritime law and practice and willingly acted as sounding boards for my own views. I am particularly grateful to Mike Wragge, who read parts of the manuscript and offered helpful comments, as well as tolerating a number of phone calls to discuss novel points. Angus Stewart and Max du Plessis were extremely helpful in regard to the chapter on the constitutional implications of the associated ship and gave up their time to debate issues with me as well as providing helpful comment on the draft of that chapter. Over the years many of my friends and colleagues have discussed aspects of the associated ship with me and I have benefited enormously from their insights. The fear of omitting someone’s name precludes a list but to all concerned I am extremely grateful. My long serving and long suffering secretary Mrs. Tammy Campbell typed the bulk of the manuscript. Her ability to produce the manuscript quickly and accurately from my dictation has been an enormous help. Without that contribution I doubt that I would ever have finished the work. My colleague and friend Laurence Broster was a constant encouragement. Lastly the writing of a thesis inevitably involves a considerable investment of time and thought that would otherwise be devoted to different purposes. During most of the time when I was writing it I was in busy practice as a senior member of the Bar and I have put the finishing touches to it during my first year as a judge. My family have missed my company when I have been absorbed in writing and have been philosophical about my obsession with associated ships. Throughout they have encouraged me in the endeavour. Above all my wife Janet has borne with fortitude the time spent in my study and the library and the long periods of introspection and engagement with my laptop. I dedicate it to her with love and gratitude. ABSTRACT The associated ship and the jurisdiction to arrest such a ship created in terms of the Admiralty Jurisdiction Regulation Act 105 of 1983 is a unique legal institution in the world of maritime law and jurisdiction. The sister ship arrest envisaged by the Arrest Convention, 1952 is encompassed by the associated ship but the concept of an associated ship goes considerably further than the sister ship in going behind the separate corporate personality of ship-owning companies to their controlling interests and, on the basis of common control, providing that ships are associated. This status subjects them to arrest both in order to obtain security for court proceedings or arbitration, usually elsewhere than in South Africa, and arrest in actions in rem against the associated ship. This is in respect of claims arising in respect of other vessels in separate ownership. Although tentative consideration was given to a similar innovation when the Australian Law Commission undertook a review of admiralty law in Australia their legislation is confined to a surrogate ship arrest substantially along the lines of the sister ship arrest of the Arrest Convention. A proposal to introduce a similar institution by way of the revision of the Arrest Convention has not yet resulted in anything similar being introduced elsewhere. In South African maritime practice the associated ship jurisdiction has proved to be an important innovation, especially in conjunction with the power to arrest a ship for the purpose of obtaining security for proceedings in a foreign court or arbitration tribunal, and a substantial amount of maritime work involves associated ships. As an institution it has not hitherto been subjected to close scrutiny and the overall purpose of this work is to do that. It takes as a starting point the revision of South African admiralty procedure and jurisdiction leading to the enactment of the Admiralty Jurisdiction Regulation Act and the introduction of the associated ship. This task has been undertaken against the background of the general development of maritime law, the attachment ad fundandam et confirmandam jurisdictionem under the Roman Dutch common law of South Africa and the action in rem available in South Africa under the Colonial Courts of Admiralty Act 1890. The study reveals the common roots of these institutions in the Roman Law and the practice in maritime courts around Europe from the Middle Ages onwards and forms a 2 part of the foundation for the proposition in the final analysis that South Africa has created an institution that is distinct from the English action in rem and having its own particular features derived from both its English and Roman Dutch forebears. The central analysis explores from a critical standpoint the justifications advanced at the time for the introduction of the associated ship jurisdiction and finds these wanting notwithstanding that they have tended to linger in statements in the judgments of the courts. Instead a policy-based justification is advanced that it is submitted provides a proper justification for the associated ship jurisdiction in the South African context. Being based upon policy considerations it is not suggested that this justification is universally applicable or demands the same response from all nations, as each will be influenced by different factors depending on the nature of the maritime interests of the country considering such an institution. This is likely to hamper attempts to obtain international agreement on a similar jurisdiction to arrest vessels going beyond the provisions of the Arrest Convention. In the light of the suggested justification of the associated ship jurisdiction the Act itself is analysed and various difficulties of interpretation are addressed. These include a critical analysis of certain controversial decisions and a consideration of the constitutional implications of the associated ship. Finally the different threads are brought together in an analysis of the nature and consequences of the arrest of an associated ship and the action in rem against the associated ship. The fact that the jurisdiction has been harnessed to two distinct purposes having entirely different features is highlighted. Although maritime law always has a significant international dimension the fact that the associated ship is a uniquely South African institution means that the analysis is largely driven by the underlying principles of South African law and principles. The view is taken that the statute is a South African statute governing matters of the jurisdiction of South African courts and as such falls to be construed in the light of South African legal principles. The too ready resort on questions of interpretation (as opposed to substantive law where it is mandated as being the 3 applicable law in certain cases) to English precedents is deprecated although recognition is given to the influence that English admiralty law has played in the development of South African law in this field.