Federal Court of Australia
Bank of New Zealand (Security Trustee) v The vessel MY "Island Escape" (No 3) [2023] FCA 541
ORDERS
BANK OF NEW ZEALAND AS SECURITY TRUSTEE FOR AND ON BEHALF OF BANK OF NEW ZEALAND AND EXPORT FINANCE NORWAY AS LENDERS Plaintiff | ||
AND: | Defendant | |
DATE OF ORDER: |
THE COURT ORDERS THAT:
1. To the extent necessary, the plaintiff have leave to amend its interlocutory application for summary judgement filed on 26 September 2022 to apply for summary judgment in terms of its interlocutory application for leave to amend the writ and for summary judgment filed on 22 December 2022.
2. The plaintiff have leave to amend the writ in the form of the proposed amended writ annexed to its interlocutory application filed on 22 December 2022 and service of the amended writ be dispensed with.
3. Pursuant to section 31A(1) of the Federal Court of Australia Act 1976 (Cth) judgment be entered for the plaintiff against the defendant in the sum of NZD$19,001,438.27 together with the costs of the proceedings, including any reserved costs, to be taxed.
4. The defendant pay the plaintiff’s costs of the interlocutory applications filed 26 September and 22 December 2022 to be taxed.
5. The Marshal publish in Lloyd's List International and Daily Cargo News, as soon as practicable, a notice in accordance with Form 28 of the Admiralty Rules 1988 (Cth) (in
the form of Annexure A hereto) of the Court's intention to determine priorities between the competing claims.
6. Any person having a claim against the proceeds of the net sale of the ship, USD5,362,500 and AUD59,341.07 and any interest thereon, paid into Court who wishes to participate in the proceeding make any claim against the proceeds of sale as set out in Annexure A.
7. The proceeding be listed for further case management on 27 June 2023 at 9:30am (AWST).
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
FEUTRILL J:
Introduction
1 The plaintiff, the Bank of New Zealand as security trustee for and on behalf of the Bank of New Zealand (BNZ) and Export Finance Norway (EFN) as lenders, commenced these proceedings in rem against the ship MY "Island Escape" by filing a writ on 18 August 2022. The ship was arrested at Roebuck Bay, Broome, on 19 August 2022. On 22 August 2022, OSM Offshore AS and on 24 August 2022, Sealanes (1985) Pty Ltd each filed a caveat against release of the ship from arrest. No appearance was entered for the defendant within the 21 day period prescribed in rule 23 of the Admiralty Rules 1988 (Cth), or at all.
2 After arrest, the ship was moved to Fremantle and sold by the Marshal under orders of the Court: see, Bank of New Zealand (Security Trustee) v The vessel MY "Island Escape" [2022] FCA 1230; Bank of New Zealand (Security Trustee) v The vessel MY "Island Escape" (No 2) [2023] FCA 101. On 23 February 2023, that sale was completed and the proceeds of the sale paid into Court.
3 On 1 September 2022, Sealanes, as plaintiff, brought separate proceedings against the ship upon a general maritime claim for debts due in respect of goods supplied to the ship for its operation and maintenance. On 4 May 2023, the Court ordered summary judgment in favour of Sealanes in those proceedings in the sum of $231,976.43 plus interest of $9,896.49 and costs: Sealanes (1985) Pty Ltd v Vessel MY "Island Escape" [2023] FCA 414.
4 On 26 September 2022, the plaintiff filed an interlocutory application for summary judgment against the ship in these proceedings. On 22 December 2022, the plaintiff filed an interlocutory application to amend the writ and for summary judgment. These reasons concern the application for leave to amend the writ and for summary judgment.
5 The plaintiff applied for judgment on its claim pursuant to section 31A(1) of the Federal Court of Australia Act 1976 (Cth) and rule 26.01(1)(e) of the Federal Court of Australia Rules 2011 (Cth), on the ground that there was no reasonable prospect of a successful defence of the claim.
6 In substance, the plaintiff contended that:
(a) the Court has in rem jurisdiction in respect of the plaintiff’s claim, on the ground that it is a proprietary maritime claim;
(b) the proposed amended writ and particulars set out in it, together with the evidence available, demonstrate that Seasons Shipping Limited, as borrower and mortgagor, and Island Escape Cruises (NZ) Limited, as co-guarantor, are indebted to the plaintiff, as security trustee, in the sum of NZD19,001,538.27 or the plaintiff has suffered loss or damage in that sum by reason of breaches of terms of agreements by which they were obliged to pay that sum to the plaintiff; and
(c) for the purposes of summary judgment, neither Seasons Shipping nor Island Escape Cruises has a reasonably arguable defence to the plaintiff’s claim.
7 These are the reasons for orders the Court made on 26 May 2023. The orders published with these reasons have been varied under r 39.05(h) of the Rules to identify amounts paid into Court in respect of the sale of the bunker fuel and lubricants and other property associated with the ship and any interest thereon that was inadvertently omitted from the orders made on 26 May 2023.
Hearing ex parte
8 The plaintiff commenced in rem proceedings against the ship. The writ identified Seasons Shipping as the registered owner and Island Escape Cruises as the demise charterer of the ship and the relevant persons within the meaning of section 3(1) of the Admiralty Act 1988 (Cth).
9 As noted earlier, the writ was issued on 18 August 2022 and served on the ship on 19 August 2022. An application for summary judgment was filed on 26 September 2022. An amended application for summary judgement was filed, without leave to amend, on 7 October 2022. The application to amend the writ and for summary judgment was filed on 21 December 2022 and served on the ship on 23 December 2022. At the oral hearing, the plaintiff proceeded on the basis of the last of the applications. If and to the extent the plaintiff requires leave to amend the original application for summary judgment filed on 26 September 2022, that leave will be granted.
10 Neither Seasons Shipping nor Island Escape Cruises entered an appearance in the proceedings in accordance with rule 23 and Form 9 of the Admiralty Rules. No other potentially interested person entered an appearance on behalf of the ship. Neither Seasons Shipping nor Island Escape Cruises appeared or made any submissions on the application.
11 The evidence before the Court indicated that receivers and managers have been appointed to each of Seasons Shipping and Island Escape Cruises in New Zealand. The plaintiff formally provided the receivers with notice of the writ and its intention to apply for summary judgment. The receivers informed the plaintiff that they did not intend taking any steps in relation to the claim.
12 To the extent that the directors of Seasons Shipping and Island Escape Cruises may have residual power and (or) authority of those companies to defend the proceedings, the evidence indicated that they were provided with notice of the proceedings and the plaintiff’s intention to apply for summary judgment. The directors indicated that they did not intend taking steps to oppose summary judgment based, it appears, on the amount claimed in the amended interlocutory application filed on 7 October 2022. In any event, it was evident that the directors were aware of the proceedings and that the plaintiff intended applying for summary judgment in the sum of, at least, NZD18,753,926.33 and no steps had been taken by them to cause a relevant person to defend the claim against the ship.
13 In these circumstances and considering the nature of the application, I was satisfied that the Court should hear and determine the application in the absence of Seasons Shipping and Island Escape Cruises pursuant to rule 17.04 of the Rules.
14 The plaintiff relied on written submissions filed on 11 October 2022, 23 December 2022 and 22 May 2023. The plaintiff also relied on the following affidavits in support of the application.
(a) Affidavit of Mr Maurice Lynch sworn 18 August 2022.
(b) Affidavit of Ms Susan Kate Ladlow sworn 1 September 2022.
(c) Affidavit of Mr Lynch sworn 9 September 2022.
(d) Affidavit of Mr Lynch sworn 26 September 2022, except paragraphs 11, 12(b) and 17 of that affidavit which were not read.
(e) Affidavit of Mr Lynch sworn 7 October 2022.
(f) Affidavit of Mr Jostein Djupvik affirmed 8 December 2022.
(g) Affidavit of Ms Amanda Jane Warrington sworn 22 December 2022.
(h) Affidavit of Ms Sara Menzies affirmed 15 March 2023.
(i) Affidavit of Ms Menzies affirmed 22 May 2023.
15 For the purposes of hearing and determining the application, each of the affidavits referred to in paragraph 14 were taken to have been read in open Court without objection.
Facts
16 Seasons Shipping was the owner of the ship. Island Escape Cruises was the demise charterer of the ship. There was in evidence a copy of a bareboat charter party dated 22 December 2021 between Seasons Shipping, as owner, and Island Escape Cruises, as charterer. There was also in evidence a first preferred Marshall Islands Mortgage of the ship that identified Seasons Shipping as the registered owner of the ship.
17 EFN, as lender, Seasons Shipping, as borrower, and Pacific Exploring Limited and Island Escape Cruises, as guarantors, made a term loan facility agreement dated 13 October 2021 (EFN Facility). By the EFN Facility, EFN advanced NZD11,250,000 to Seasons Shipping. Seasons Shippings was to repay the principal sum advanced together with interest by quarterly instalments. Seasons Shipping was to pay amounts referred to as a risk premium of 3.25% payable on the outstanding principal at the same time as each quarterly payment of principal and interest. Seasons Shipping was to pay an agency fee of NZD15,000 on each anniversary of the drawdown of the loan (the drawdown was 18 October 2021). Seasons Shipping was to pay an arrangement fee of NZD225,000 in four instalments of NZD56,250 at the end of the first four instalment periods. In the event of a failure to pay any amount due to EFN, Seasons Shipping was to pay a default interest rate of 2% in addition to the standard interest rate. There was a term of the EFN Facility to the effect that it was governed by Norwegian law.
18 By the EFN Facility the standard interest rate was identified by reference to a benchmark referred to as ‘BKBM’ plus a margin of 70 basis points or 0.7%. BKBM was described as the New Zealand bank bill reference rate administered by the New Zealand Financial Markets Association for New Zealand dollars for the relevant period displayed on pages ‘BKBM’ on the Thomson Reuters screen. Mr Djupvik deposed to the BKBM for the periods applicable to the application and the corresponding standard interest rate under the EFN Facility.
19 BNZ, as lender, Seasons Shipping, as borrower, and Pacific Exploring and Island Escape Cruises, as guarantors, made a facility agreement dated 14 October 2021 (BNZ Facility). By the BNZ Facility, BNZ advanced NZD7,500,000 to Seasons Shipping. Seasons Shipping was to repay the principle advanced together with interest by quarterly instalments. Interest was to be calculated on a base rate (defined to mean the base rate for BNZ’s standard asset finance agreement product as determined by BNZ for the relevant interest) plus a margin of 3.25%. Seasons Shipping was also to pay a default interest rate of 2% in respect of any overdue amount under the BNZ Facility. Ms Warrington deposed to the interest rates applicable to the application under the BNZ Facility (including the base rate plus margin). There was a term of the BNZ Facility to the effect that it was governed by the laws of New Zealand.
20 Seasons Shipping, as borrower, Pacific Exploring and Island Escape Cruises, as guarantors, BNZ, as security trustee and as a lender, and EFN, as lender, executed a deed referred to as the Security Trust Deed dated 14 October 2021. Under the terms of the Security Trust Deed, BNZ, as security trustee, held the benefit of the Security Property (defined to include the Mortgage and Composite General Security Deed described later in these reasons) on trust for EFN and BNZ, as beneficiaries and as the lenders. EFN and BNZ irrevocably appointed and authorised BNZ, as security trustee, to enter into the Transaction Documents (defined to include the EFN Facility, BNZ Facility, Mortgage and Composite General Security Deed) and to act as security trustee under the Securities (defined to include the Mortgage and Composite Security Trust Deed). There was a term of the Security Trust Deed to the effect that it was governed by and was to be construed in accordance with the laws of New Zealand.
21 Seasons Shipping, Island Escape Cruises and Pacific Exploring, on the one hand, and BNZ, as security trustee on the other hand, executed a deed referred to as the Composite General Security Deed dated 14 October 2021. By Composite General Security Deed, Seasons Shipping charged its property (including the ship) as security for repayment of the amounts advanced and other amounts payable under the EFN Facility and BNZ Facility. There was a term of the Composite General Security Deed to the effect that it was governed by and is to be interpreted in accordance with the laws of New Zealand.
22 Seasons Shipping, as owner, and BNZ, as security trustee, executed a first preferred mortgage dated 26 October 2021 (Mortgage). By the Mortgage, Seasons Shipping, as mortgagor, mortgaged the ship to BNZ, as mortgagee, for and on behalf of EFN and BNZ as the beneficiaries under the Security Trust Deed. There was a term of the Mortgage to the effect that it was governed by and was to be construed in accordance with the laws of the Republic of Marshall Islands.
23 After paying the first two instalments of principal and interest under each of the EFN Facility and BNZ Facility on 18 January 2022 and 18 April 2022, Seasons Shipping failed to pay the third instalment on 18 July 2022 and has not made any further payment of principal, interest or other amounts payable under the EFN Facility and BNZ Facility. In accordance with the terms of the EFN Facility, non-payment was an event of default (clause 22.1) that entitled EFN, by notice to Seasons Shipping, in effect, to accelerate repayment of the loan, accrued interest, and all other amounts accrued or outstanding under the EFN Facility whereupon the whole amount outstanding would become immediately due and payable (clause 22.15). The BNZ Facility contained terms to the same effect (clauses 20.1 and 20.17). There was no evidence that either EFN or BNZ gave notice to Seasons Shipping of the kind that would result in the whole amount outstanding under the facilities becoming due and payable in accordance with the default and acceleration clauses of each of the EFN Facility and BNZ Facility.
24 Nonetheless, there was a term of the Composite General Security Deed that the ‘Secured Money will, without notice (where the law permits) become immediately due and payable and each Debtor will immediately pay that Secured Money’ ‘[o]n or any time after the occurrence of an Event of Default (which is continuing)’ (clause 12.1 (a)). There was a term of the Mortgage to the same effect (clause 7.2).
25 The Composite General Security Deed also contained a term that obliged Seasons Shipping to indemnify BNZ, at security trustee, on demand all costs and expenses of, amongst other things, any release or discharge of or under the Transaction Documents (clause 21.1(f)).
26 Mr Djupvik deposed facts and matters to the following effect, which I accepted.
(a) As of 18 July 2022, the balance outstanding under the EFN Facility was NZD10,781.250.00.
(b) As of 28 November 2022, there was unpaid accrued interest of NZD220,966.87 under the EFN Facility.
(c) As of 28 November 2022, there was unpaid risk premium amounts of NZD217,047.53 under the EFN Facility.
(d) As of 28 November 2022, there was unpaid arrangement fees of NZD112,500.00 under the EFN Facility.
(e) As of 18 October 2022, the was unpaid agency fees of NZD15,000 under the EFN Facility.
(f) The total of the balance outstanding, unpaid accrued interest and other amounts payable under the EFN Facility as of 28 November 2022 was NZD11,360,503.15.
27 Ms Warrington deposed facts and matters to the following effect.
(a) As of 18 October 2022, the balance outstanding under the BNZ Facility was NZD7,544,714.28.
(b) As at 5 December 2022, there was unpaid accrued interest of NZD84,578.06 under the BNZ Facility.
(c) As at 5 December 2022, there was unpaid accrued default interest of NZD11,642.78 under the BNZ Facility.
(d) BNZ’s standard discharge fee, for the purposes of the indemnity is cl 21.1(f) of the Composite General Security Deed, is NZD100.00.
(e) The total of the balance outstanding, unpaid accrued interest and other amount payable under the EFN Facility was NZD7,641,035.12.
Except for the discharge fee, which I do not accept is a cost or expense that BNZ has incurred and Seasons Shipping or Island Escape Cruises presently has an obligation to pay to BNZ, I accepted the facts to which Ms Warrington had deposed.
Choice of law
28 While the EFN Facility expressly nominated Norwegian law as the law governing that agreement, the Mortgage expressly nominated the law of the Republic of Marshall Islands as the law governing that instrument and the BNZ Facility, Composite General Security Deed and Security Trust Deed expressly nominated the law of New Zealand as the law governing those instruments, there was no evidence before the Court of the laws of Norway, the Republic of the Marshall Islands, or New Zealand. In these circumstances, the Court was to presume that the applicable law and principles of contractual interpretation under the laws governing these instruments is the same as Australian law: e.g., Nielsen v Overseas Projects Corporation of Victoria Ltd [2005] HCA 54; (2005) 223 CLR 331 at [125] (per Gummow and Hayne JJ), [249] (per Callinan J), [267] (per Hayden J).
Amendments
29 The plaintiff applied to the Court for leave to amend the writ in accordance with rule 8.21(1) of the Rules. The Court has a broad discretion, to be exercised having regard to the overarching objects of the civil practice and procedure provisions referred to in section 37M of the Federal Court Act, to amend an originating application ‘for any reason’. The power includes amending to add or substitute a new claim for relief even where such a claim arises ‘in whole or in part, out of facts or matters that have occurred or arisen since the start of the proceeding’: see r 8.21(1)(g)(ii) of the Rules.
30 The proposed amendments to the writ were largely amendments to the particulars of the plaintiff’s claim. These amendments brought the amounts claimed into line with the facts referred to earlier in these reasons concerning the amounts under the EFN Facility and BNZ Facility. The writ also contained amendments that appear to relate to causes of action that had not accrued at the time the writ was issued, had not (or may not have) accrued at the date of the application for leave and have not (or may not have) accrued as of the date of the hearing of the application for summary judgment.
31 To the extent that the proposed amendments to the writ include causes of action that are inchoate, I was not inclined to allow the amendments because, as such, they fail to disclose any reasonably arguable cause of action. However, during the hearing of the application for summary judgment, the plaintiff submitted that it did not press for judgment on any sum that was not due and payable, on the plaintiff’s case, as of the date of the application (22 December 2022). In those circumstances, I granted the plaintiff leave to amend the writ even though it is likely to include inchoate causes of action because summary judgement was not sought to the extent the writ claims (or may claim) sums that were not presently due and payable. Further, it was an unnecessary waste of time, costs and resources to attempt to disentangle the choate from inchoate aspects of the claim as particularised in the amended writ.
Right to proceed in admiralty
32 Notwithstanding the absence of any appearance on behalf of the ship or the relevant persons identified in the writ and of any apparent challenge to the admiralty jurisdiction, the Court must be satisfied that is has such jurisdiction. In order to establish an entitlement to judgment in these proceedings, the plaintiff was to establish that the Court has jurisdiction in rem. Here, the Court has jurisdiction for the following reasons.
33 The Court has jurisdiction conferred upon it under section 10 of the Admiralty Act in respect of proceedings commenced as actions in rem. A party may only proceed in rem as provided in section 14 of the Admiralty Act. Section 16 of the Admiralty Act provides that a proprietary maritime claim may be commenced as an action in rem against the ship. A proprietary maritime claim is defined in section 4(2)(a)(iii) to include a claim relating to the mortgage of a ship, and in section 4(2)(d) a claim for interest in respect of the mortgage claim.
34 In the context of admiralty jurisdiction invoked on a proprietary maritime claim, the Court may be satisfied as to jurisdiction if the claim as set out and particularised has the legal character required in section 4(2)(a) of the Admiralty Act: Owners of Ship Shin Kobe Maru v Empire Shipping Co Inc [1994] HCA 54; (1994) 181 CLR 404 at 426-427.
35 The plaintiff’s claim, as stated and particularised in the writ, as amended, related to the mortgage of a ship and for interest. It follows that the Court has in rem jurisdiction over the claim under section 16 of the Admiralty Act.
Summary judgment
36 The plaintiff contended it was entitled to summary judgment under section 31A of the Federal Court Act and rule 26.01(1)(e) of the Rules. I was satisfied that Seasons Shipping and Island Escape Cruises have no reasonable prospect of successfully defending the proceeding.
37 Assessing the prospects of success of a defence ‘will necessarily require’ the identification and review of, on the one hand, the plaintiff’s case and the evidence supporting its claim for judgment, and on the other, Seasons Shipping’s and (or) Island Escape Cruises’ defence and supporting evidence, if any: Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd [2008] FCA FCAFC 60; (2008) 167 FCR 372 at [126]. An assessment may be made in favour of judgment if the evidence supporting the application reasonably excludes the possibility that facts essential to the success of a defence will be able to be established: Fortron Automotive Treatments Pty Ltd v Jones (No 2) [2006] FCA 1401 at [20].
38 The plaintiff's claim was for the enforcement of a mortgage over the ship in respect of debts and continuing interest secured by the Mortgage. The writ, as amended, in rem set out the nature of the claim and the relief sought. As no appearance was entered by any relevant person or any other person with interest in the ship, the plaintiff was not required to serve a statement of claim: r 22(3)(a) of the Admiralty Rules.
39 Evidence was given, as set out earlier in these reasons, of the following matters:
(a) the Mortgage and its terms, as well as the underlying financing documents giving rise to the obligations secured by the Mortgage;
(b) events of default under the underlying financing documents and Mortgage;
(c) the total amount of principal, interest and other amounts outstanding under the financing documents;
(d) the applicable rates of interest and the base rates upon which they are calculated for each relevant interest period; and
(e) the fact that the total outstanding sums remain unpaid.
40 As noted earlier in these reasons, there was no evidence of the plaintiff sending any letters of demand to Seasons Shipping, as mortgagor, notifying it of the default and triggering the acceleration of the secured obligations under the EFN Facility and (or) BNZ Facility. Nonetheless, in my view, on the proper construction of the Composite General Security Deed and Mortgage, as a consequence of Seasons Shipping's default, the total amount of principal, interest and other amounts payable under each of the respective facility agreements became automatically due and payable. That is the ordinary meaning of the relevant provisions of the Mortgage and Composite General Security Deed. Although these provisions are inconsistent with the terms of the EFN Facility and BNZ Facility, the Mortgage and Composite General Security Deed were entered into by BNZ, as security trustee. BNZ was appointed security trustee under the Security Trust Deed a purpose of which was to bring into existence effective and enforceable security for the loans each of EFN and BNZ had agreed to advance to Seasons Shipping. In that context, I consider the security instruments, manifestly coming after the loan agreements in sequence, are to be taken as amending or prevailing to the extent of any inconsistency with the EFN Facility and BNZ Facility. In any event, it could be said that the issue of the writ and service on the defendant was notice sufficient to satisfy the requirements of the provisions of the EFN Facility and BNZ Facility to trigger acceleration.
41 As to the qualification 'where the law permits' in the automatic acceleration provisions, Senior Counsel for the plaintiff submitted that he was not aware of any applicable principle of Australian law that would otherwise operate to require the plaintiff to give notice of the default to Seasons Shipping before the total of principal, interest and other amounts became due and payable under the Mortgage and Composite General Security Deed, EFN Facility and BNZ Facility.
42 There was no reason to doubt that the Mortgage is valid and enforceable and that the plaintiff has, at the very least, a prima facie claim to the relief set out in the writ, as amended.
43 Despite having had notice of the plaintiff’s claim, the in rem proceedings, and the plaintiff’s intention to apply for summary judgement, neither Seasons Shipping nor Island Escape Cruises has taken steps to appear, or to otherwise defend the plaintiff’s claim. Such notice has been described earlier in these reasons.
44 Putting to one side the non-appearance of Seasons Shipping and Island Escape Cruises, there was no material before the Court as to any factual or evidentiary dispute that may be raised in defence of the plaintiff’s claim.
45 The evidence and the circumstances of the conduct (or absence of conduct) on behalf of Seasons Shipping and Island Escape Cruises revealed no reasonable possibility of a defence being raised to the claim.
46 I was satisfied on the evidence that the Mortgage was valid and enforceable, and that the plaintiff established that it was entitled to repayment in full of the amounts of the outstanding loans, interest and other sums as at 22 December 2022 except for the sum of NZD100 for the alleged BNZ discharge fee. I was also satisfied that the plaintiff was entitled to judgment under section 31A of the Federal Court Act in the sum of NZD19,001,438.27.
Priorities
47 Rules 73(1) and 73(2) of the Admiralty Rules provide that a person who has obtained a judgment in a court against the ship which is enforceable in a court of Australia may apply to the Court for determination of the order of priority of claims against the ship. The Court may, on the application, order that notice of the application in accordance with Form 28, specifying the period within which claims may be notified, be given or published as the Court directs.
48 The plaintiff submitted that if the Court were to order summary judgment in its favour, it would apply for the Court to determine the order of priority of claims against the ship. Although that submission was made before the Court ordered summary judgement, I was satisfied that the Court should, in the circumstances, make an order for the determination of priority of claims against the ship in the exercise of the court’s power under rule 1.35 and (or) rule 1.40 of the Rules upon ordering summary judgment.
49 The plaintiff also submitted, that due to publication of information relating to the arrest of the ship, the absence of any likely salvage claim (as the ship is effectively a new build) and the absence of any likely claim by crew (as the ship was crewed by OSM Offshore), it was highly unlikely that any claims in priority to the plaintiff’s claim exist as no such claim has been made to date. There was significant force in the plaintiff’s submission, however, I was not satisfied that I should depart from the usual practice of giving notice in accordance with Form 28 of the Admiralty Rules. The purpose of these rules is to give potential claimants notice that an application for determination of priorities has been made and to give potential claimants the opportunity to bring forward claim in light of that notice. Accordingly, an order was made for the determination priorities and for notice to be given in accordance with Form 28.
Conclusion
50 Orders were made granting the plaintiff leave to amend the application for summary judgment and the writ. Orders were made for summary judgment in the sum of NZD19,001,438.27 together with costs, including any reserved costs, to be taxed. An order was also made for notice to be given in accordance with rule 73(2) and Form 28 of the Admiralty Rules.
I certify that the preceding fifty (50) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Feutrill. |
Associate:
Date: 29 May 2023
Annexure A
Form 28 Notice of application to determine priorities No: NSD657/2022
(subrule 73 (2))
IN THE FEDERAL COURT OF AUSTRALIA
IN ADMIRALTY
District Registry: WA
Division: General
BANK OF NEW ZEALAND AS SECURITY TRUSTEE FOR AND ON BEHALF OF BANK OF NEW ZEALAND AND EXPORT FINANCE NORWAY AS LENDERS and another/others named in the schedule
Plaintiff
MY ISLAND ESCAPE
Defendant
NOTICE OF APPLICATION TO DETERMINE PRIORITIES
MY "ISLAND ESCAPE"
1. The Ship MY "Island Escape" has been sold and the proceeds of sale, USD5,362,500 (in respect of the ship less the brokerage fees) plus AUD59,341.07 (in respect of unused bunker fuel and lubricant oils and other property and interest less the ship valuation fee), have been paid into Court at the Federal Court of Australia, Western Australia registry.
2. Application has been made to determine the priority of claims against the proceeds of sale and any interest that has accrued thereon.
3. The application will not be determined until after 23 June 2023.
4. Anyone who has a claim against the proceeds of sale should bring that claim by filing and serving a statement of claim in Federal Court proceeding NSD657 of 2022 together with the evidence in support of that claim before 23 June 2023, and if necessary apply to the Court to extend the period within which the order of priorities will not be determined, otherwise an order determining the priority of claims against the ship or proceeds of sale may be made without notice.
