Page 38 - Insurance Times April 2024

On 13 January 2010, the port authority Transnet caused the in personam claim against it which underlay the action in
Alina II to be arrested in two actions in rem (against a rem. The attachment was therefore impermissible, and the
property) with a view to recovering those damages. appeal was dismissed. The practical result is that although
Transnet Ltd, claimed damages of some US$6m in contract Transnet could still pursue its claims against the owner in
and delict (tort) for the vessel’s extended occupation of the personam, it could not get pre-judgment security for those
berth. Transnet contended that it had suffered damages in claims unless it arrested some other property in the same
consequence of the vessel’s occupation of the berth during or associated ownership that might be found within the
this period. There was no significant difference between the jurisdiction.
two and henceforth the court treated them as a single
action. The owner of the vessel caused a notice of intention On 19 March 2010, the vessel was again arrested in an
to defend to be delivered on 27 January 2010, and on 19 action by four companies in the Kumba Mining group
February 2010, Transnet delivered its particulars of claim. advancing claims of nearly $275 million. This prompted the
attorney acting for the owner to send an e-mail to all the
It sufficed for present purposes to note that it advances other parties having actual or potential claims against the
claims in both contract and delict. The contractual claim was vessel saying:
said to arise from a contract between Transnet and the
owner of the vessel. The delictual claim was based on a legal Please be advised that:
duty allegedly owed by the owner to Transnet and a Any security which the owners may put up should be
negligent breach of that duty by the owner, either limited to the value of vessels.
personally or acting through the master and crew for whom
the owner is said to be vicariously liable. Accordingly, Let us know what you need in order to make a valuation
of the vessel before she departs.
Transnet’s claims were squarely based on the personal
liability of the owner and are pursued in rem by virtue of Be informed that any security which we provide to
the provisions of s 3(4)(b) of the Admiralty Jurisdiction enable the vessel to depart is without prejudice to our
Regulation Act 105 of 1983 (the Act). rights to apply in due course to (1) reduce the security
and/or (2) substitute it for security to cover all the claims
Transnet’s claims were initially pursued by the arrest of the against the vessel.’
vessel in actions in rem. Under that procedure in South
Africa, and elsewhere, the plaintiff is entitled to security only The reason, as explained by Transnet’s attorney in the
up to the value of the vessel even if the claims exceed that founding affidavit, was that it believed that if it attached
amount. Crucially, the owner of the vessel entered the vessel to commence an action in personam against its
appearances to defend those actions. When it became owner, the vessel could only be released against the
apparent that Transnet’s claims taken together with other provision of security for the full amount of Transnet’s claims.
claims against the vessel – which were asserted at US$275m The application was brought ex-parte and without notice
– might exceed its value, Transnet sought to commence an to the owner or its attorney in order to forestall a submission
in personam action against the owner of the Alina II. to the jurisdiction. The attachment order was made on 23
March 2010 and served on the master of the vessel the same
Under South Africa’s Roman-Dutch common law, such an day, the sheriff recording in his return of service that he
action against a foreigner can be commenced by the explained ‘the contents, nature and exigency thereof’ to the
attachment of an asset of the foreigner’s to found or confirm master. He also affixed a copy to the windscreen of the
the jurisdiction of the court. The plaintiff in the action would superstructure of the vessel.
then be entitled to security for the full value of its claim
before the asset could be released from attachment, even On 26 March 2010, the vessel’s P & I club provided a letter
if that exceeded the value of the asset. That is the of undertaking in respect of the full amount of Transnet’s
advantage that Transnet sought to achieve by attaching the claims and in respect of both the in rem and the in personam
vessel in the in personam(against the individual) actions. This allowed the vessel to sail.
proceedings.
Thereafter, the owner opposed the confirmation of the
The result was therefore that by entering appearances to attachment order. It did so on essentially two grounds. The
defend the actions in rem, the owner of the Alina II first was that the attachment constituted an abuse of the
submitted to the jurisdiction of the court in respect of the process of the court. The second was that such an

The Insurance Times April 2024 35