FEDERAL COURT OF AUSTRALIA

 

ADMIRALTY - arrested vessel - responsibility of Marshal to Master and crew - whether Marshal should direct arresting party or its solicitor to pay post arrest wages of Master and crew - whether wages claimed by Master and crew, if paid by Marshal, are an expense of the Marshal in relation to the arrest - no assumption by Marshal of employer’s responsibility for wages of Master and crew - functions and responsibilities of the office of the Admiralty Marshal in relation to vessels under arrest - extent of the maritime lien in respect of unpaid wages - whether cost of repatriation of the Master and crew to their home port can be described as an expense of the Marshal in relation to the arrest  - nexus required between expenses and duties of the Marshal in relation to the safe custody and preservation of an arrested vessel.


Admiralty Act 1988 (Cth)

Admiralty Rules rr 41, 47, 48, 49, 50, 75 and 78


Pritchards’ Digest of Admiralty and Maritime Law, 3rd edn 1887

F L Wiswall Jr, The Development of Admiralty Jurisdiction Practice Since 1800

“The Hoop” [1801] 4 C Rob 145, cited

Bayside Air Conditioning Pty Ltd v The Owners of the Ship “Cape Don” (unreported 15 May 1997), followed

Thomas, Maritime Liens, 1980

The Westport (No 4) (1968) 2 Lloyd’s Rep 559, followed

United States Trust Company of New York v Master and Crew of the Ship “Ionian Mariner” (1997) 149 ALR, followed

Jackson, Enforcement of Maritime Claims, 2nd edn

“The Mogileff” [1921] 7 Ll L Rep 130, cited

“The General Serret” [1925] 23 Ll L Rep 14, cited and applied

“The Berostar” [1970] 2 Lloyd’s Rep 403, cited

“The Vasilia” [1972] 1 Lloyd’s Rep 51, cited

Clausen v The Ship “Om Alqora” (1985) 38 SASR 494, followed

“The Leoborg” (No 2) [1964] 1 Lloyd’s Rep 380, followed

Smith v Federal Commissioner of Taxation (1987) 164 CLR 513, followed

 

PATRICK STEVEDORES NO 2 PTY LTD -v- TURAKINA

NG 114 OF 1998 AND

WAITEMATA STEVEDORING SERVICES LTD -v- RANGITATA, ECOMAR-SCHIFFARHTS & CO KG AND MASTER AND CREW LATELY EMPLOYED UPON THE SHIP RANGITATA

NG 115 OF 1998

 

TAMBERLIN J

SYDNEY

5 MAY 1998


IN THE FEDERAL COURT OF AUSTRALIA

 

NEW SOUTH WALES DISTRICT REGISTRY

in admiralty

 114/98 of 1998

 

BETWEEN:

PATRICK STEVEDORES NO 2 PTY LTD

PLAINTIFF

 

AND:

TURAKINA

DEFENDANT

 

 

 

                                                                                                                                    NG 115/98

BETWEEN:

waitemata stevedoring services ltd

PLAINTIFF

 

AND:

rangitata

first DEFENDANT

 

ecomar-schiffarhts GMBH & co kg

second defendant

 

master and crew lately employed

upon the ship RANGITATA

applicants

 

 

 

JUDGE:

TAMBERLIN J

DATE:

5 MAy 1998

PLACE:

SYDNEY


REASONS FOR JUDGMENT


There are before me two applications by the Master and crew of two ships, which have been arrested by this Court and which remain presently under arrest.  The first application is made in matter number NG 114/98, in which the plaintiff is Patrick Stevedores No 2 Pty Ltd (“Patricks”) and the defendant is the ship “Turakina”.  The second application is brought in matter number NG 115/98, in which the plaintiff is Waitemata Stevedoring Services Ltd (“Waitemata”) and the defendants are the ship “Rangitata”, Ecomar-Schiffarhts GMBH & Co KG and the Master and crew lately employed upon the ship “Rangitata.”


When the vessels were arrested in February 1998, each vessel had on board a Master and a full sea-going crew.


Submissions

 

The Master and crew on each vessel are understandably anxious to protect their entitlements in respect of the work undertaken by them in relation to the ships.  As at the date of hearing they do not wish to compromise the strength of their position by leaving the ships.  They, therefore, seek to ensure that satisfactory arrangements are made for their wages and other entitlements and also for their repatriation to New Zealand in due course.  As at the date of hearing, no offer satisfactory to them for payment of wages and repatriation had been forthcoming.


The orders sought by the Master and crew are substantially the same in each proceeding.  In the case of the “Turakina”, by way of example, the orders sought include directions from the Court that:


“The wages claimed by the Master and Crew for carrying out their duties in the preservation of the Turakina since the time of arrest on 19 February 1998 are to be paid as the Marshal’s cost of arrest, and are to be paid fortnightly or at such other times as may be agreed with the Marshal or ordered by the Court;

The Master and Crew are to be repatriated to their homes once they are discharged from the Turakina;

The cost of the repatriation of the Master and Crew are to be paid as the Marshal’s costs of arrest;

In the alternative to Orders 3 and 5, the wages are to be paid by the Owners ...”

Since the questions raised are substantially the same in both applications, I will consider the application made in respect of the “Turakina”.  This will, for practical purposes, determine the questions raised with respect to the “Rangitata”.

 

The “Turakina”


The “Turakina” was arrested on 19 February 1998 on the application of Patricks.  At the time of arrest there were a Master and eleven crew on board. The demise charterer was claimed to be South Pacific Shipping Limited of New Zealand (“SPS”), which is now in liquidation.  I use the expression “claimed to be” because there are other proceedings on foot in which it is alleged that the demise charter had been terminated prior to arrest.  On 19 February 1998, the liquidators of SPS purported to terminate, with immediate effect, the contracts of employment with the Master and crew.  From 19 February onwards, the Master and crew have remained on board and have been involved in daily work on the vessel.


Upon arrest the Marshal appointed the Master as “ship’s keeper” pending determination of the proceedings and if necessary the sale of the vessel.  The owners of the vessel have not paid the wages of the Master and crew since 19 February 1998.


The issues raised for determination are as follows:


·      whether, in the circumstances of this case, the wages claim by the Master and crew, in respect of work on the vessels since arrest on 19 February 1998, are expenses of the Marshal in relation to the arrest;

·      whether the Court should direct that the plaintiff in each proceeding pay the wages of Master and crew since the arrest;

·      whether the Master and crew should be repatriated to their home port once they are discharged from the vessels; and

·      whether the repatriation expenses are an expense of the Marshal in relation to the arrest.

The evidence


The evidence concerning the position of the Master and crew on board the “Turakina” was given by Captain Scarrott, who is the Master of that vessel.  He stated that from 19 February 1998 to 16 March 1998 there was cargo on board the vessel, which included reefer (refrigerated) containers requiring power for operation of the refrigeration units.  He also said that power was required for the ordinary welfare of the ship’s company.  He considers that the ship could be substantially de-manned and converted to “dead ship” status as soon as the cargo is unloaded and arrangements are made to repatriate the crew to New Zealand.  He says that the crew have not been paid any wages since 18 February 1998.  He attached to his affidavit, statements from members of the crew giving details as to the work undertaken by them since arrest.


In cross-examination he agreed that he was employed pursuant to a collective employment contract and that this was in force at the time of arrest.  He understood that the crew were also employed under a collective employment contract.  He confirmed that he and the crew have filed a caveat against release of the “Turakina” on the basis of their claims for wages and other entitlements.  Captain Scarrott agreed that after the cargo was discharged on 16 March 1998, there was no reason for all membersof the crew to remain on the vessel except for the fact that they had claims for wages and repatriation.  When asked if he would leave the vessel if paid the cost of repatriation, he agreed that he would if the payment also included his wages since arrest.  He was unable to say whether all crew members took a similar view.  He agreed that the work being carried out by the crew at the time of the hearing on 25 March 1998 was directed to ensure that the vessel was able to operate immediately on a sea-going voyage if so required and that the number of crew was sufficient to constitute a sea-going crew.  He further agreed that the number of crew presently on board exceeded the number required whilst the vessel was in port.


In relation to the “Rangitata”, the Master, Captain Cooke, stated that since arrest the crew have performed duties under his supervision, directed at keeping the ship in a fully maintained, operational and sea-worthy condition.  He referred to a number of statements as to their duties, which were attached to his affidavit.  He also confirmed that, after discharge of the cargo, the ship could be reduced to “dead ship” status, which would require minimal crew presence.  He stated that the current circumstances of the crew were unsatisfactory and that they had received no moneys by way of wages or entitlements since 19 February 1998.  In cross-examination he agreed that the ship was currently well maintained and that since 27 February 1998, he and the crew had been aware that the engagement of the crew by SPS had been allegedly terminated.  He said that he was aware that both he and the crew had a legal claim for a maritime lien over the ship for payment of outstanding wages and entitlements.


During questioning by Counsel for Waitemata, the following exchange took place:

“Q.      Captain so far as you know, do you expect the crew will remain on board the vessel until some arrangements are made for their repatriation?

A.        I do indeed, yes.

 

Q.        And I take it that you have not instructed the crew to leave the vessel?

A.        No I haven’t instructed them, no.

Q.        Both yourself I take it and the crew share the view that you will remain on board indefinitely?

A.        At the moment I cannot - I don’t think anybody can say indefinitely because we know that if the cargo for example is discharged which we have always expected it to be done over the past few weeks, and an agreement has been made that we would de-man the vessel after the cargo was out, so I cannot say indefinitely to you sir, no.

Q.        I see, so that the factor that keeps the crew on board is that it may be required to assist in the discharge of the cargo?

 

A.        That is only the one part, I think the actual much larger part to it is the case of remuneration for the work and being on board the ship and the repatriation costs which have not been given to us.

 

Q.        So even if the cargo is discharged, there is the prospect that the crew may remain on board until such time as a suitable offer is made to pay their outstanding claims and repatriate them, correct?

A.        My personal view would be that if the cargo is discharged from the ship, therefore the ship could be de-manned to a level suitable to whatever parties is necessary and again I would expect that the people de-manning the ship would be asked to pay the costs and the repatriation cost to us.”  (Emphasis added)

 

The position is that no arrangements satisfactory to the crew on either vessel have been made up to the date of hearing and it was apparent that they were unlikely to leave the vessel until such arrangements were made both with respect to their repatriation costs and their wage entitlements.

 

The Admiralty Marshal


Since this matter involves a consideration of the role and responsibilities of the Marshal it is of assistance to consider the functions and responsibilities of the office, particularly with respect to vessels under arrest in determining the extent to which, if any, the Marshal should assume liability to meet crew wages and repatriation costs..


The office of Admiralty Marshal dates back to the earliest days of the Admiralty jurisdiction.  In Pritchards’ Digest of Admiralty and Maritime Law, 3rd edn, 1887 at 1472, the office of Marshal is described as follows:


“The Marshal is the executive officer of the court, and performs duties analogous to those of the sheriff at common law.  He is charged with the execution of all process of the court, except writs and subpoenas ... The Marshal was formerly remunerated by fees but by 3 & 4 Vict. c. 66, ss 5-18 (now repealed), a yearly salary was substituted for them, and he was prohibited from taking any fees for his own use.  He attends the sittings of the court and carries the silver oar, as the emblem of the a maritime jurisdiction of the court.”


F L Wiswall Jr in his work The Development of Admiralty Jurisdiction Practice Since 1800, at 47-48, speaking of the Admiralty Marshal, says:

“In the nineteenth century, as today, the Marshal usually placed a member of his staff (known as a ‘ship-keeper’) aboard an arrested the vessel ..., to prevent her from leaving the Court’s jurisdiction and to protect her while in custody; care of a vessel in the custody of the Court has always been the Marshal’s direct responsibility, and Lord Stowell once gave a decree against the Marshal personally when property was lost from an arrested vessel despite the Marshal’s claim that his fees were not sufficient to provide a constant guard upon the ship in order to prevent waterfront predators from looting or tampering with her.  The Marshal’s lot was later ‘improved’ considerably: he became salaried in 1840 at five hundred pounds per annum - raised to seven hundred pounds by the end of Lushington’s tenure as Judge; moreover, the ship-keepers and others of the Marshal’s staff also became salaried, so that he was relieved of the burden of paying them out of his own fees; and as his duties included the appraisal and sale of vessels when decreed by the Court in actions in rem, he was permitted to continue charging a nominal broker’s fee upon such sales according to established custom.”

The decision of Lord Stowell referred to by Wiswall is that given in “The Hoop” [1801] 4 C Rob 145 at 146, where his Lordship said:

“The credit of the Court is concerned in the safe-keeping of the property under its protection.  If any such property is lost, it is at least the duty of the Marshal to be prepared to shew that it was not lost by any default of his.  If the fees of the Marshal’s office are not sufficient to enable him to provide means of security, it should be represented to those who have authority to increase them; but it is not a time to rely upon such a plea, when property under his keeping is alleged to have been already lost.”

His Lordship then decreed that the Marshal should pay the value of a long boat and cable lost while the ship was under his custody.  This decision illustrates the extensive nature of the Marshal’s responsibility in relation to an arrested vessel arising from custody.


It is worth noting that the above authorities draw attention both to the responsibility which attaches to the performance of the Marshal’s duties as executive officer of the Court and the need for adequate funds to carry out those functions.  In modern times there is provision in the legislation for the Master to obtain or recover funds from applicants or their solicitors in order to meet his expenses in relation to the arrest and sale of ships.


Under the Admiralty Act 1988 (Cth) (“the Act”) and the Admiralty Rules (“the Rules”), in exercising his functions and performing his duties, the Marshal has a broad discretion as to the way in which they will be performed.  It must be borne in mind, however, that when he executes a warrant for arrest, the Marshal does not thereby assume the employer’s responsibility for past or continuing wages due to the Master and crew.  The reason for this is, in part, outlined in the recent decision of Bayside Air Conditioning Pty Ltd v The Owners of the Ship “Cape Don” (unreported, 15 May 1997) by Cooper J as follows:


“As the Marshal ... acts as an officer of the court and not as a party to proceedings the Marshal should be fully indemnified for the costs he has incurred in discharging his duty.”

However, in some circumstances, for example, where some or all crew members have left the ship leaving her with an insufficient or inadequate complement of crew, it may be appropriate or essential for the Marshal to engage a crew in order to carry out his duties to preserve the ship and keep her in safe custody pending release or sale.  This may occur by the Marshal specifically engaging numbers of the existing crew or contracting with outside contractors.  In fact, in the case of each vessel under arrest, in this matter, it was necessary for the Marshal to engage four substitute engineers to replace two engineers, who had left each vessel.  This was done pursuant to a direction of the Court that it was appropriate in the circumstances to engage those engineers.  There can be no doubt that an express engagement in such circumstances will generally be an expense of the Marshal in relation to the arrest.


The Maritime lien


It is well-settled law that a claim for the wages of a Master or crew member confers on the claimants a maritime lien.  The nature of the security so provided is conveniently described in Thomas, Maritime Liens, 1980, at par 301, in these terms:


“The jurisdiction of the Admiralty Court over claims for wages provides mariners of every nationality with a convenient and effective forum for the resolution of those disputes which touch upon that area of their employment which probably concerns them most.  The recognition that claims for wages are also in the nature of a maritime lien, additionally awards to mariners a privilege and security not enjoyed by their brethren in terrestrial employment.  The view of the Admiralty Court has long been that the seamen serves the ship on which he is employed and the ship stands as security for his claim.”


As Thomas points out, claims of the Master for wages, in contrast to that of the crew, were originally not viewed with the same favour and it was only as a result of legislation concerning Admiralty matters, originating in the nineteenth century, that the Master came to enjoy a similar security to that of the seamen.  There is a provision in the Australian Act, which recognises that for the purposes of the Act, the expression “maritime lien” includes a reference to a lien for the wages of the Master: s 15(2)(c).


The Courts have taken a broad view of the expression “wages” when considering the extent of a claim for a maritime lien.  In  The Westport (No 4) (1968) 2 Lloyd’s Rep 559, for example, repatriation costs and union dues were allowed as part of the lien.  The extent of the seamen’s lien for unpaid wages was recently considered by the Full Federal Court in United States Trust Company of New York v Master and Crew of the Ship “Ionian Mariner” (1997) 149 ALR 200.  In that case, the Court acknowledged that a broad view must be taken of the expression “wages” with the consequence in that case that the lien was held to extend to obligations in respect of which a crew member’s remedy lies in damages.  The Court also considered that the lien was not confined to an obligation, which is enforceable as a debt.  However, it held that s 15 of the Act did not operate so as to extend the concept of “wages” to include an obligation, which was not enforceable by employees or which was not derived from or associated with a contract of employment or any law relating to the relationship of an employer and employee.  The Court further held that the entitlements of Master and crew as employees subsisted after the sale of the ship and that it would be wrong to contend that the substance of the entitlements of a seafarer discharged ashore in a foreign port must be lost upon cessation of the relationship of employer and employee.  Black CJ (with whom Lockhart and Burchett JJ agreed) observed that it would be a surprising result if a seafarer could be put ashore in a foreign port without any entitlement to be paid wages until departure for the seafarer’s home port within a reasonable time after discharge, together with accommodation expenses pending repatriation.


In addition, as indicated in Jackson, Enforcement of Maritime Claims, 2nd edn, at 501-502, the wages lien is given a high priority in claims against the vessel or the process of sale for reasons of public policy directed to protect the interests of masters and seamen.  However, the wages lien does not confer an absolute right to precedence.  For example, it may be subordinated to a subsequent salvage or damage claim.  However, in the present case there is no suggestion of any salvage or damage lien.


Wages of Master and crew

 

In the present case, the first question is whether the wages of Master and seamen can properly be described as “fees or expenses of the Marshal in relation to the arrest”, within the meaning of r 41 of the Rules.


The question arises in this way.


The application for the arrest warrant was made by a solicitor on behalf of the applicant.  Rule 41 provides:


“Liability for Marshal’s fees and expenses

 

41.       An application for an arrest warrant constitutes an undertaking to a court:

...

(b)       if the application is made by a solicitor on behalf of the applicant - by the solicitor;

to pay to the Marshal, on demand, an amount equal to the amount of the fees and expenses of the Marshal in relation to the arrest.”

Rule 75 provides that a solicitor who fails to comply with an undertaking given to the Court under the Rules is liable for committal.  Rule 78, which confers a discretion on the Marshal to obtain funds, is in the following terms:


Marshal may make interim demands for fees and expenses

 

78        Where a person is liable to pay fees and expenses of a Marshal under these Rules, the Marshal:

(a)       may accept an amount of money as a deposit towards discharging the liability; and

(b)       may make 1 or more demands for interim payments on account of those fees or expenses”

The above provisions enable the marshal to secure the funds necessary to perform the duties and exercise the powers attaching to his office.


The function of the Marshal in relation to the arrest of ships and property is dealt with in r 47 in these terms:


“Custody of arrested ships and property

47(1)   Subject to these Rules, a Marshal who arrests a ship or other property has the custody of the ship or property.

(2)       The Marshal shall, unless the Court otherwise orders, take all appropriate steps to retain safe custody of, and to preserve, the ship or property, including :

(a)       removing from the ship, or storing, cargo that is under arrest;

(b)       removing cargo from a ship that is under arrest and storing it;

(c)        removing, storing or disposing of perishable goods that are under arrest or are in a ship that is under arrest; and

(d)       moving the ship that is under arrest.”  (Emphasis added)

The Marshal’s custody and control of the vessel or property is solely for the purpose of performing his statutory duties and does not give him possession of or any proprietary interest in the property.  This is clearly indicated in the historical outline of the role of the Marshal, which emphasises his or her duty to safe-keep property in custody (as earlier set out in this judgment).


Rule 48 enables a Marshal or a party at any time to apply to the Court for directions with respect to the ship or property.


Rule 49 is concerned with the discharge of cargo from a vessel and the respective powers of the Marshal and the Court in relation to discharge.


Rule 50 provides that the Court may, at any stage of the proceedings, make appropriate orders with respect to the preservation, management or control of a ship or any other property that is under arrest in the proceedings.


The Authorities

 

Counsel have been unable to discover any decision directly on point as to whether post arrest wages of the Master and a crew, not engaged by the Marshal, are within the expression “fees and expenses of the Marshal in relation to the arrest.”


The Marshal’s position in relation to the payment of wages due to the Master and crew after arrest has been touched on, but not examined in any detail, in several English authorities: see “The Mogileff” [1921] 7 Ll L Rep 130; “The General Serret” [1925] 23 Ll L Rep 14; “The Berostar” [1970] 2 Lloyd’s Rep 403 and “The Vasilia” [1972] 1 Lloyds Rep 51.


In Australia, the reasons for judgment of Bollen J in Clausen v The Ship “Om Alqora” (1985) 38 SASR 494, refer to a possible claim by the crew of an arrested vessel for wages.  However, it was not necessary, in that case, to determine whether the Marshal had power, or should as a matter of discretion, demand payment of wages from the arresting party.  His Honour, however, indicated that the Marshal had power to provide for the crew’s immediate predicament arising from arrest of the vessel in a foreign port and that this discretion should be exercised where appropriate.  At 498 his Honour said:

“But the Marshal is concerned that a situation might arise in which the Master of the vessel has no funds from which to buy food for the crew.  The Marshal could, in my opinion, stand off and ignore the plight of the crew if that happens.  But he does not wish to do that. ...  The crew has not been paid wages for some time.  But that is not the subject of any application by the Marshal.  But the Marshal does ask for directions whether he is permitted or required to provide for the crew of the vessel and, in particular, to provide fuel or fresh water and food for them .  That is to say, may he provide money for these.  Any money would no doubt come from the plaintiffs’ solicitors.  As it happens both the Marshal and the plaintiffs are agreed that I should make what is known as a omnibus order which includes the right to ... supply food, fuel and fresh water.”

In the present case, I understand that the Master and crew of each vessel are being given this basic degree of support and assistance.


His Honour considered that any liability incurred by the Marshal in payment incurred for the provision of food, fuel or water for the benefit of the crew was a cost or expense attending the care and custody of the property for the purposes of the Supreme Court Rules of South Australia.


In “The Berostar” [1970] 2 Lloyd’s Rep 403, Brandon J gave the plaintiffs leave to pay three thousand pounds, through the Admiralty Marshal, in order to pay off the Master and crew in order to subrogate their rights to those of the crew in respect of wage arrears.  However, there was no argument in that case to the effect that payment of wages made by the Master was not an expense of the Marshal in relation to the arrest.  It was simply assumed that this was so.  The plaintiff wished to obtain the priority flowing from subrogation.  The application was considered necessary because, if the leave of the court was not obtained, the plaintiff would be in the position of a volunteer and as such would not be entitled to stand in the shoes of the crew in claiming against the proceeds: “The Leoborg” (No. 2) [1964] 1 Lloyd’s Rep 380.


In relation to the payment of wages, the submission for the Masters and crew, in each case, is that the Marshal has the obligation to keep both ships in safe custody and preserve them.  The Marshal must be kept in funds to perform this function.  One way in which this can be done is by appointing a ship’s keeper. In the case of each vessel under arrest in this matter the Master has been appointed as the ship’s keeper.  It is then said that by appointing the Master as ship’s keeper it is “fairly contemplated” that there will be an active and continuing program of maintenance and preservation carried out on the arrested vessel under the supervision of the Master.  Counsel for the Master and crew refers to the evidence concerning the daily tasks, which the crew has continued to perform and which, it is said, contributes to the preservation and safe custody of the vessel.  It is submitted that such work is necessary and appropriate to preserve and maintain the ships whilst in the custody of the Marshal.  It is then said that since this work is being carried out by the Master and crew to the knowledge of the Marshal since it is directed to assist the Marshal  in the performance of his duties, then the fees and expenses of paying their wages is one which can be properly incurred by the Marshal and therefore can be properly characterised as an expense in relation to arrest.  Accordingly, it is submitted that a direction should be given by the Court to the Marshal to demand these funds from the person giving the undertaking, namely the plaintiff’s solicitor, as an expense of the Marshal, and that the solicitor should be required to pay these expenses on demand to the Marshal.


These submissions face several difficulties.


The first is that the present Master and crew, with the exception of the recently engaged engineers, do not have any employment relationship with the Marshal.  Nor was it ever contemplated  that the Master and crew would be engaged by him. The evidence adduced for the Marshal was to the effect that it was made clear to the Master at the time of appointment that the Marshal had no intention of entering into any contractual obligation in relation to the wages or entitlements of the crew.  The appointment of the Master as the ship’s keeper does not amount to an authorisation for the Master as agent of the Marshal to engage crew on behalf of the Marshal.  The position of the Master and crew in this application is to be contrasted with the position of the new contract engineers, who were specifically engaged by the Marshal pursuant to a Court direction to replace those engineers, who left the vessels.  This direction was given in the light of evidence that it was appropriate, in the circumstances, for the Marshal to engage the two substitute engineers on each vessel in order to preserve and maintain the ship and keep it in safe custody pending release or sale.  The evidence presented to the Court, before the new contract engineers were engaged, indicated that there were important and necessary maintenance and supervisory functions to be carried out by these engineers until such time as each of the vessels was layed up or de-manned as a “dead ship”.


The payment of the wages and other employment entitlements of the crew after arrest and up to sale or repatriation is, generally speaking, not the responsibility of the Marshal unless the Marshal considers it appropriate or necessary to enter into an agreement to engage such crew.  The number and nature of the crew to be engaged by the Marshal will vary from time to time depending on the status of particular vessels, such as, for example, whether they are layed-up.  In many cases the vessels will be carrying cargo.  Where this is so the number of crew necessary to man the ship will reflect the need to preserve and exercise custody over the cargo.  The appropriate crew number may also  depend on whether it was necessary to move the vessel in order to effect discharge of cargo or to berth at a suitable location which may vary from time to time as a result of exigencies at the port of arrest.  What is necessary or appropriate in any particular case will depend to a large extent on the nature and quantity of the cargo.


Whilst it is true that work has been done on the vessel by the Master and crew, such work cannot in a realistic sense be said to have been carried out for the benefit of the Marshal, who is the Executive officer of the Court charged with the custody of the vessel pending determination of the proceedings or sale.  In the absence of any engagement between the Marshal, the Master and crew, it cannot be said that the wages of the crew members are fees or expenses of the Marshal in relation to the arrest.


Accordingly, I do not consider that it is appropriate that any direction should be  given in the circumstances of this case as to recovery of post-arrest wages said to be due to the Master and crew of the vessel.

 

Repatriation


The other question raised is whether the costs of the repatriation of the Master and crew can be described as an expense of the Marshal in relation to the arrest.


The relevant circumstances are that as a direct consequence of the arrest of the vessels procured by the plaintiffs, the Marshal assumes custody of vessels with a Master and full complement of crew on board.  If the Master or any member of the crew elect to leave either of the vessels or are discharged from them and are nationals of, or residents, in a foreign country then there is an obvious need, arising from the arrest, for them to be repatriated.  The pertinent questions is: who must pay the expense?


The position, in my view, is that if the Marshal reasonably considers it is appropriate to repatriate the crew and the crew are willing to return to their home port then such an expense can properly be described in the present circumstances as “an expense of the Marshal in relation to the arrest” and can therefore either be the subject of a demand under r 78 in anticipation of the expense being incurred, or can be recovered from the proceeds of sale, after the moneys have been paid.


The words “in relation to” are words of the wide scope: see Smith v Federal Commissioner of Taxation (1987) 164 CLR 513 at 533 and cases there cited.  The connection required by that language may be made out where there is a rational and discernible link between the arrest and the need for repatriation of the foreign crew.


Counsel for the plaintiff points out that where an application is made for sale and the Court  proceeds to make an order for sale, the costs of repatriating the crew can properly be described as an expense of the Marshal in complying with the order for sale.  This is so, it is said, because, as a practical matter, it will normally be necessary to be able to offer control and possession of the vessel to a prospective buyer in order to realise the best price.  All other circumstances being equal, a sale without an ability to give possession will usually result in a lesser price being obtained for the vessel than would otherwise be the case. As a matter of interpretation, the undertaking required to be given by an applicant for sale pursuant to r 69(4), which covers the expenses of the Marshal in complying with the order, is sufficiently general to enable the Marshal to seek payment in advance of expenses in an amount which the Marshal reasonably anticipates might be involved in complying with the order for sale, including repatriation of the crew.  Accordingly, in such circumstances, it is said that the undertaking required of an applicant for an order for sale can be relied on by the Marshal.  Indeed, in “The General Serret” (supra) Hill J directed that the Marshal repatriate the crew and make the cost part of his charges, which would be a first claim against the ship.  Counsel for the plaintiff therefore submits that because repatriation of the crew can be described as a cost of complying with an anticipated order for sale, it should not be treated as a cost of the arrest.


In my view this approach is too restrictive and seeks to rely on a dichotomy, which does not in reality exist.  In practice there may be many circumstances where it may be appropriate for a Marshal to arrange for repatriation of the crew prior to any application being made for sale.  For example, in order to minimise daily running costs of the vessel, which would otherwise be unnecessarily incurred by permitting a full complement of seamen to remain on board when it was neither appropriate nor necessary.  In such a case, if the crew members were discharged or were willing to leave the vessel, and wished to be repatriated, then it may well be appropriate for the Marshal to incur the costs of repatriation and seek, in advance if necessary, from the plaintiff the funds to achieve the repatriation.  There is no universal formula because each set of circumstances may be different.


The need for repatriation of the crew arises as a consequence of the arrest of a vessel with a foreign crew on board, on the application of a plaintiff.  There is an evident and real connection between the arrest and the need to pay repatriation expenses.  Something must be done with respect to the crew.  They should not be permitted or required to remain indefinitely on the vessel regardless of the necessity or appropriateness of their remaining.  Repatriation expenses, in my view, in the present circumstances, are an appropriate expense of the Marshal in relation to the arrest because it is in the interest of all parties concerned to minimise the payment of daily expenses pending a determination of the dispute and where appropriate the sale of the vessels.  In order to minimise costs it is clearly desirable that vessels, the subject of this proceeding, should be de-manned and layed up as soon as practicable.  These considerations do not generally apply in relation to the payment of wages because, as a result of the arrest, the Marshal is not liable to pay wages of the crew in the absence of any employment relationship.


Where the crew are willing to return to their home port and accept repatriation, it is within the discretion and power of the Marshal to arrange for repatriation and make demand on the undertaking given on arrest by the applicant’s solicitor to pay the expenses of the Marshal in advance if necessary.


In the present case, I consider that there is a rational and substantial link between the costs of repatriation and the performance by the Marshal of his functions, such as to justify the treatment of repatriation as an expense of the Marshal in relation to the arrest.

 

General


Counsel for the plaintiff in the case of the “Rangitata” submitted, in the alternative, that the Court should not be directed to make any demand on the plaintiff to meet wages since arrest because the Marshal had taken no steps to require cargo owning interests to remove their cargo and was therefore in breach of the duty imposed upon him by r 47(2)(a) and (b).  It was said that those provisions imposed a statutory duty on the Marshal to take all appropriate steps to retain safe custody and preserve the ship, including removal of the cargo.  Counsel for the plaintiff in the “Rangitata” reasoned that because he had not done so in a timely and reasonable manner, he should not be permitted to demand payment of wages and other expenses because these were unreasonably incurred as a consequence of his failure to perform his statutory duty.  It is said that the Marshal should have taken immediate steps to de-man the vessel and thereby minimise expense.


In view of the conclusion which I have reached that no direction should be made for payment by the plaintiff in either proceeding in respect of the crew’s wages and other related entitlements, it is not necessary for me to consider this question.  However, my decision not to embark on a consideration of this submission should not be taken to suggest that, in my opinion, there is any substance or merit in the submission.  Indeed, my prima facie view is that the submission has no substance because the Act does not operate to impose a duty on the Marshal, which could be said to give rise to any enforceable claim by the plaintiff in the event of non-compliance.  Nor an I persuaded that the Marshal has in any way failed to act other than in an appropriate and timely manner.


Conclusion

 

In the circumstances of this case in respect of each vessel, I am not persuaded that any direction should be given to the Marshal to require the plaintiff to meet the wages and other entitlements of the  Master and crew since the time of arrest.  Moreover, in the circumstances, the claims presently made for wages and other entitlements since arrest are not, in my opinion, properly described as “expenses of the Marshal in relation to the arrest.”  However, I do not consider that it necessarily follows in all circumstances that claims for post-arrest wages by the Master and crew can never be described as an expense of the Marshal in relation to the arrest.  This will depend, for example, on any specific agreements or arrangements entered into between the Marshal and the Master and crew.


In relation to the repatriation expenses, I consider the Marshal should arrange the repatriation of the Master and crew and I direct that the expenses of so doing are part of the Marshal’s expenses in relation to the arrest and can be demanded from the plaintiff or its solicitor in advance, if appropriate, of the Marshal paying or incurring the expenses.


Orders


I will make no orders at present but I direct the parties to bring Short Minutes within seven days to give effect to the above reasons and to deal with costs.


I certify that this and the preceding eighteen (18) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Tamberlin


Associate:


Dated:              5 May 1998



Counsel for the Plaintiff

(“The Turakina”):

Mr G J Nell



Solicitor for the Plaintiff

(“The Turakina”):

Allen, Allen & Hemsley



Counsel for the Plaintiff

(“The Rangitata”):

Mr D A Cowdroy OAM QC,

Ms L Muston



Solicitor for the Plaintiff

(“The Rangitata”):

Conway Leather Shaw



Counsel for the Respondent

(Applicant on Motion)

Mr J B Whittle



Solicitor for the Respondent

(Applicant on Motion)

Levingstons



Counsel for the Admiralty Marshal

Mr P E King



Solicitor for the Admiralty Marshal

Mr Douglas Coleman



Date of Hearing:

23 March 1998



Date of Last Written Submissions:

8 April 1998



Date of Judgment:

5 May 1998