Astrofiel Armadora Sa v. The Owners of the Ship "Chong Bong"

Case No.HCAJ 384/1995

Court

HCAJ

Date06 Jun 1997

Judge—

Case Document

100%Judiciary

HCAJ000384/1995

IN THE SUPREME COURT OF HONG KONG
HIGH COURT
ADMIRALTY JURISDICTION

AJ Folio 384 of 1995

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Admiralty Action in Rem against the Ship "CHONG BONG"

BETWEEN
	ASTROFIEL ARMADORA S.A.	Plaintiffs
	AND
	THE OWNERS OF THE SHIP "CHONG BONG"	Defendants

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Coram: The Hon. Mr. Justice Waung in Court

Date of Hearing: 5 and 6 June 1997

Date of Delivery of Judgment: 6 June 1997

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JUDGMENT

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1. This is an application by the Defendants to set aside:-

(1)	the Ex Parte Order of the Court of Appeal made on the 16th January 1997 extending the validity of this Writ in Rem;
(2)	the service of the Writ in Rem on the ship "Chong Bong";
(3)	the arrest of the Defendants' ship "Chong Bong" and
(4)	for related reliefs.

2. In March 1980, the Plaintiffs (hereinafter referred to as "Greek Owners") who were at the time owners of the ship Agiaparaskevi (hereafter referred to as "the Greek Ship") voyage chartered the Greek Ship to Korean Foreign Transportation Corporation of Pyongynag, North Korea ("hereinafter referred to as the "Korean Corporation") under a Gencon Charterparty which contained a London arbitration clause. There was dispute between the Greek Owners and the Korean Corporation in relation to delay damages and demurrage. The Greek Owners claimed some £77,000 odd and interests from the Korean Corporation. The dispute was referred to arbitration and by his Award dated 25th October 1989 ("the Award"), the Arbitrator Donald Davies awarded to the Greek Owners against the Korean Corporation the sum of £108,374.58. This Award sum was not paid by the Korean Corporation.

3. From October 1989 onwards, some steps were taken by the Greek Owners to enforce the Award but with little success and on 24th October 1995, on the eve of the 6 years anniversary of the Award, a Writ in Rem in this Action was issued by the Greek Owners against the ship Back Ma Kang and some 37 other ships named in the Schedule to the Writ. Included amongst the names of the 38 ships were Chong Bong and Dae Song San, both of North Korean Flag. The Endorsement on Writ in Rem reads:-

"The Plaintiffs' claim is for sums due under an arbitration award of Donald Davies dated 25th October 1989 arising from a charterparty of 10th March 1980 whereby the Plaintiffs' vessel "AGIAPARASKEVI" was let to Korea Foreign Transportation Corporation, which is part of the Government of Democratic People's Republic of Korea alternatively the Plaintiffs' claim for breach of the said charterparty and the Plaintiff's claim damages. interest and costs."

During the one year validity of the Writ (from 24th October 1995 to 24th October 1996), on a number of occasions a few of the 38 vessels named in the Writ visited Hong Kong and in particular the vessel Dae Song San was in Hong Kong during the following periods:-

	25th December 1995 to 13th January 1996 (20 days)
	22nd March 1996 to 26th March 1996 (5 days)
	6th July 1996 to 16th July 1996 (11 days).

The Writ of Rem however was not served during that one year period from 24th October 1995 to 24th October 1996 nor was there any attempt to arrest any of the vessels which came into Hong Kong during that period.

4. By a paper ex parte application to me as the Admiralty Judge supported by Affidavit of May Kit Yi She dated 7th October 1996 ("Renewal Affidavit") to which was exhibited the Affidavit of Mr. Pontikos dated 16th July 1996, the Greek Owners sought a 12 months extension for the validity of the Writ. The Renewal Affidavit stated the following:-

(1)	The Writ in Rem was issued to enforce the Award (paragraph 4);
(2)	The Defendant, namely the Korean Corporation was believed to be the trading arm of the Democratic People's Republic of Korea (hereinafter referred to as "the Korean Republic") and that since the issue of the Writ, steps were taken by those acting for the Greek Owners to establish the link between the Korean Corporation and the Korean Republic (paragraph 4);
(3)	Those acting for the Greek Owners in Hong Kong kept a daily monitoring system of visits to Hong Kong by the 38 vessels set out in the Writ (paragraph 5);
(4)	There were no opportunity to arrest Chong Gen in November 1995 and Kyong Song in May 1996 as the visits made by these 2 vessels were too short to enable the Writ to be served or arrest being made (paragraph 6);
(5)	The visit of Dae Song San from 6th July to16th July 1996 did not result in service of the Writ or arrest because the Affidavit of Mr. Constantine Pontikos ("Pontikos Renewal Affidavit") only came through on the 16th July 1996 by which time the vessel Dae Song San had already left. During the period in July 1996 when the ship Dae Song San was in Hong Kong, steps were taken by those acting for the Greek Owners to ensure the link between the Defendant and the Korean Republic and thus service of the Writ in rem was considered inappropriate. It was considered prudent to wait until such time as and when the link between the Defendant and the Korean Republic was established. This written confirmation of the link finally came in the form of the Affidavit of Mr. Pontikos on 16th July 1996, too late for the arrest of the ship Dae Song San (paragraph 7);
(6)	At the time of the entering into the Charterparty, the Greek Owners were given to understand by the Korean Corporation that the Korean Corporation was part of the Korean Republic (paragraph 4 of Affidavit of Mr. Pontikos);
(7)	Subsequent to the Award, in the negotiation with delegation of North Koreans at the North Korean Embassy in Poland, Mr. Pontikos was made to understand that the Korean Corporation was part of the Korean Republic Government being one of its trading arms (paragraph 7 of Affidavit of Mr. Pontikos).

The Award exhibited in the Pontikos Renewal Affidavit showed clearly the nature of the Award and that the Award was made against the Korean Corporation and not against the Korean Republic which was not even mentioned in the Award.

5. The paper ex parte application for renewal of the Writ was put by Messrs Sinclair Roche & Temperley before the Admiralty Judge. There was no request for an oral ex parte hearing and there was no written submission or skeleton argument placed before the Admiralty Judge. By his Order dated 14th October 1996, the Admiralty Judge refused on paper, the paper ex parte application and in the letter dated 14th October 1996 from the Clerk of Waung, J. to Messrs Sinclair Roche & Temperley, the following reasons for the refusal were given:-

"Application refused. Not satisfied sufficient evidence placed before the Court that there is even a right in rem. Also not satisfied with general circumstances of the case sufficiently explained to the Court specialty as to delay or steps taken worldwide to enforce the claim."

6. By Notice of Appeal dated 22nd October 1996, the Greek Owners appealed against the refusal of Waung, J. to renew the Writ. On 16th January 1997, the Court of Appeal consisting of Nazareth V.P., Bokhary and Liu, JJA. allowed the appeal and ordered that the validity of the Writ of Rem be renewed for 12 months. To avoid prejudicing the future disposal of the action, the Court of Appeal said that looking at the whole of the material before them, they were satisfied that they should order the renewal themselves.

7. On the 15th of April 1997 the ship, namely Chong Bong ("the Ship") was arrested and the renewed Writ in Rem was served on the ship Chong Bong. In support of the Greek Owners application to lead to the issue of the Warrant of Arrest was the 1st Affidavit of Michael Brooks dated 15th April 1997 ("1st Brooks Affidavit"). In the 1st Brooks Affidavit, it was said at paragraph 5 that the Greek Owners are entitled to seek enforcement of the Donald Davies Award. At paragraph 3 of that 1st Brooks Affidavit, it was said that the true defendant liable in personam was the government of the Korean Republic because the delegation of the Korean Republic had represented to Mr. Pontikos that the Korean Corporation was in fact the government of the Korean Republic. The 1st Brooks Affidavit was made because a Warrant of Arrest could only be issued which satisfied the requirements of Order 75 rule 5 of the Rules of the Supreme Court.

8. To seek Judgment in default of Acknowledgment of service, the Greek Owners filed the Statement of Claim dated 29th April 1997. The Statement of Claim pleaded the Charterparty between the Greek Owners and the Korean Corporation, the Arbitration Clause in the Charterparty, the dispute between the Greek Owners and the Korean Corporation and the Award against the Korean Corporation and the non payment by the Defendant, Korean Corporation of the money under the Award. Paragraph 6 of the Statement of Claim pleaded that the Defendant Korean Corporation admitted at the meeting held on 8th October 1990 that it was the Government of the Korean Republic or an organ thereof. The Statement of Claim sought the enforcement of the Award and the payment of the Award sum. By the 2nd Affidavit of Michael Brooks dated 29th April 1997, the Statement of Claim was verified as being true.

9. By the Notice of Motion dated 21st May 1997, the Defendants being the Owners of the arrested Ship, Chong Bong sought the setting aside of the renewal of the Writ, the service of the Writ and the arrest of the Ship on a number of grounds. The Motion was supported by the Affidavit of Mark Morrison dated 21st May 1997 ("1st Morrison Affidavit").

10. At the hearing of the Motion on the 26th May 1997 it was clear that two of the issues raised by the Motion would require detailed Affidavit evidence on North Korean law which would take some time for both parties to place before the Court. As some of the legal issues could be heard separately and fairly quickly, I considered it sensible to give directions for the separate hearing of different issues. As part of the case management for the fair and expeditious hearing of the Motion and with the issues being drafted by Counsel, I made the following directions:-

"	1.	The hearing of the questions and matters raised by issues identified in paragraphs 1,2,3,4 and 5 of the List of Issues attached hereto be adjourned to be heard on 5th and 6th June 1997;
	2.	The hearing of the questions and matters raised by the issues identified in paragraphs 6 and 7 in the attached List of Issues and other issues requiring evidence of Korean law be adjourned some to be determined later if necessary.

LIST OF ISSUES

	1.	Whether the Admiralty Jurisdiction of the Court in rem can be invoked to enforce the Arbitration Award.
	2.	If the Plaintiff's claim is for a breach of the charterparty, whether such cause of action was time barred by the date of the issue of the Writ on 24th October 1995, having regard to:-

	(a)	the Limitation Ordinance.
	(b)	the equitable doctrine of laches.

	3.	Whether the Plaintiff by obtaining an award against the Korean Foreign Transportation Corporation ("KFTC") has elected to proceed against KFTC only.
	4.	Whether the extension of the validity of the Writ should have been granted, having regard to:-

	(a)	the time bar on the cause of action; and/or
	(b)	the Plaintiff's opportunities during the currency of the Writ to serve on and arrest the ships named in the Schedule of the Writ.

	5.	Whether the Plaintiff's claim for breach of the charterparty was abandoned, by reason of the fact that it was not included in the Statement of Claim.
	6.	The precise identity, as a matter of Democratic People's Republic of Korea law, of the relevant person liable in personam on the Plaintiff's claim.
	7.	The precise identity, as a matter of Democratic People's Republic of Korea law, of the beneficial owner of the MV CHONG BONG."

11. At the proper hearing of the Motion yesterday and today, with the assistance of Counsel, the issues which require real resolution by the Court became further clarified and refined. I considered that Issues 2, 3 and 5 could also be deferred and for the expeditious disposal of the dispute on the arrest, I invited Mr. Smith and Mr. Chua to make full submissions only on the following two serious Questions, the resolution of which I considered would result in the fair determination of the Motion:-

Question (A)

The in Rem jurisdiction of the court could not be invoked: -

	(i)	to enforce the Award, because neither the Korean Corporation nor the Korean Republic was at the time when the cause of action of the Award arose, the owner or charterer of, or in possession or in control of the Greek Ship as required by Section 12B(4)(a) and (b) of the Supreme Court Ordinance;
	(ii)	to enforce the Award, because the Affidavit leading to the Warrant of Arrest did not satisfy the requirement of Order 75 rule 5(8)(b)(ii) or the Plaintiffs could satisfy such requirements because neither the Korean Corporation nor the Korean Republic was at the time when the cause of action of the Award arose, the owner or charterer of, or in possession or in control of the Greek Ship;
	(iii)	because the Renewal Affidavit, the Pontikos Affidavit, the 1st Brooks Affidavit and the Statement of Claim dated 29th April 1997 disclosed an in rem claim based on the Award and not an in rem claim based on the breach of charterparty cause of action.

Question (B)

The Writ should not have been renewed because the Greek Owners had opportunities during the currency of the Writ to serve the Writ and arrest the ship Dae Song San which was named in the Writ. The 3 Berny requirements for the renewal of writ in rem had not been satisfied nor was there good reason shown for renewal, as required by the Kleinwort Benson Judgment.

I will consider each of the above Questions in turn.

(A) ENFORCEABILITY OF THE AWARD IN REM

12. Admiralty Jurisdiction in Hong Kong is statutory and is now to be found in the Supreme Court Ordinance. Admiralty Action could be exercised in personam or in rem. Section 12A(2) of the Supreme Court Ordinance provides a list of claims which can be exercised, pursuant to section 12B(1) of the Ordinance, by Admiralty Action in personam. The claim list of Admiralty jurisdiction under section 12A(2) includes claim at (h) for "any claim arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship".

13. Admiralty Jurisdiction in rem may be exercised as provided in section 12B of the Supreme Court Ordinance. Section 12B(4) of the Supreme Court Ordinance provides:-

"In the case of any such claim as is mentioned in section 12A(2)(e) to (q), where-

	(a)	the claim arises in connection with a ship; and
	(b)	the person who would be liable on the claim in an action in personam ("the relevant person") was, when the cause of action arose, the owner or charterer of, or in possession or in control of, the ship,

an action in rem may (whether or not the claim gives rise to a maritime lien on that ship) be brought in the High Court against-

	(i)	that ship, if at the time when the action is brought the relevant person is either the beneficial owner of that ship as respects all the shares in it or the charterer of it under a charter by demise; or
	(ii)	any other ship of which, at the time when the action is brought, the relevant person is the beneficial owner as respect all the shares in it."

14. It is to be observed and this point is not capable of any controversy that in order that the Court may exercise an Admiralty jurisdiction in rem (where there was no maritime lien and this is not a case of maritime lien) the following four conditions must be satisfied:-

(1)	The claim must be within one of the claims in section 12A(2)(e) to (q) ("1st Requirement");
(2)	The 1st Requirement claim must arise in connection with a ship ("2nd Requirement");
(3)	The person liable on the claim in an action in personam was, when the cause of action arose, the owner or charterer of or in possession or in control of that 2nd Requirement Ship ("3rd Requirement");
(4)	The in rem action may be exercised against:-

	(a)	that 2nd Requirement ship if the person liable in personam under 3rd Requirement was, at the time the action is brought, the beneficial owner of that ship, or
	(b)	any other ship which was beneficially owned by the person liable in personam under 3rd Requirement, at the time the action is brought ("4th Requirement").

15. The analysis which has to be carried out to ascertain if the claim under the Award can be exercised in rem is to examine if each of the above 4 Requirements are satisfied. There is no issue between Mr. Smith and Mr. Chua that 1st, 2nd and 4th Requirements (for the limited purpose of deciding this Question (a)) are satisfied. The initial dispute is over the 3rd Requirement namely that the person liable in personam on the Award claim (whether it be Korean Corporation or Korean Republic) at the time when that Award claim cause of action arose (namely in or after October 1989) was not the charterer or owner or person in possession or control of the Greek Ship. However when the full force of the statutory scheme is driven home to Mr. Chua, eventually Mr. Chua admits that the 3rd Requirement was not satisfied and concedes that the Greek Owners could not have any valid claim in rem based on the Award because niether the Korean Corporation nor the Korean Republic (the only 2 candidates for the person liable in persoanm) could possibly be charterer of the Greek Vessel in October 1989. He informs Mr. Smith and the Court that no claim in rem based on the Award would be made.

16. This leaves the question of Order 75 rule 5(4), (8) and (10) which are in the following terms:-

"(4)	A warrant of arrest shall not be issued until the party applying for it has filed an affidavit requesting issue of the warrant together with an affidavit made by him or his agent containing the particulars required by paragraph (8) so, however, that the Court may, if it thinks ...(illegible) , allow the warrant to issue notwithstanding that the affidavit does not contain all those particulars.
	..................

(8)

An affidavit required by paragraph (4) must state:-

(a)

in every case

	(i)	the nature of the claim or counterclaim and that it has not been satisfied and, if it arises in connection with a ship, the name of that ship; and
	(ii)	the nature of the property to be arrested and, if the property is a ship, the name of the ship and her port of registry; and

(b)

in the case of a claim against a ship in rem by virtue of paragraph (10)-

	(i)	the name of the person who would be liable on the claim in an action in personam ("the relevant person"); and
	(ii)	that the relevant person was when the cause of action arose, the owner or charterer of, or in possession of in control of, the ship in connection with which the claim arose; and
	(iii)	that at the time of the issue of the writ the relevant person was either the beneficial owner of all the shares in the ship in respect of which the warrant is required or (where appropriate) the charterer of it under a charter by demise; and

..................

(10)

The claims against a ship in rem coming within the provisions of sub-paragraph (b) (whether or not the claim gives rise to a maritime lies on that ship) are-

..................

(d)

those arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship."

17. As the Greek Owners had conceded that no claim in rem based on the Award could be made or maintained, it is therefore not necessary to dwell on the deficiency of the Plaintiff's Affidavit leading to the Warrant of Arrest. It is however clear and there is no escape from it, that the 1st Brooks Affidavit in support of the issue of Warrant of Arrest did not satisfy the requirements of Order 75 rule 5(8)(b)(ii) of the Rules.

18. What Mr. Chua in his valiant attempt to defend the indefensible did, was to argue that on a fair reading of the Writ, the Renewal Affidavit, the Pontikos Affidavit and the Statement of Claim, the claim of the Greek Owners in rem leading to the renewal of the Writ and the subsequent Arrest of the Ship included a claim for the underlying charterparty cause of action. I certainly accept that in the General Endorsement in the Writ there was a primary claim based on the Award ("Award Claim") and as alternative a claim based on the underlying charterparty breach ("CP Claim"). However, a fair reading of the Renewal Affidavit and the Pontikos Affidavit clearly indicate that when the Renewal was sought, in the Renewal Affidavit there was reference to only an Award Claim and there was no trace of a CP Claim in the Renewal Affidavit. I refer to paragraph 4 of the Renewal Affidavit and paragraph 3 of the Pontikos Affidavit. However the matter is put beyond doubt by paragraph 5 of the 1st Brooks Affidavit (leading to the issue of the Warrant of Arrest) where these were said:-

"The Plaintiffs' claim is for sums due under an arbitration award of Donald Davies dated 25th October 1989 for loss of hire, demurrage and interests and costs and fall within Section 12A(2)(h) of the Supreme Court Ordinance as a claim arising out of an agreement relating to the use or hire of a ship. The Plaintiffs is entitled to seek enforcement of the arbitration award by arrest see The Saint Anna [1983] 1 L.I. L. Rep. 637. Furthermore, the Hong Kong Courts has jurisdiction to enforce the said London arbitration award see The Lady Muriel [1995] 2 HKC 320."

(The reference to The Saint Anna was a misconception of those acting for the Plaintiffs that this case provided the authority for the in rem jurisdiction to enforce an arbitration award. What was not realised was that The Saint Anna turned on not section 12B(4)(b) but section 12A(2)(h) and more critically, it was the charterers award enforcement against the owner's ship and not the owners award enforcement against the charterer's ship.)

Then at paragraph 6 of the Affidavit, Mr. Brooks went on to say that the Award sum remained unsatisfied and invoke the in rem jurisdiction of the Court to enforce the Award.

19. The final conclusive proof however came in the Statement of Claim dated 29th April 1997 which pleaded all the essential causes of action for an Award Claim. There was not a line in that Statement of Claim which could be said to plead a cause of action for a CP Claim.

20. In my view therefore Question (A) must be answered against the Plaintiffs and therefore the question of whether Order 2 rule I discretion should be exercised by the Court because of the non compliance with Order 75 rule 5 does not arise as in my view, the applications for renewal and arrest were made on the basis not of a CP Claim.

21. It follows therefore on my conclusion on Question (A) against the Plaintiffs that the Renewal of the Writ, the Service of the Writ and the Arrest of the Ship must be set aside and that an Order must be made for the immediate release of the Ship.

22. Strictly speaking therefore it is not necessary for me to go on to consider Question (B) but as the matter had been argued and the Plaintiffs wished to persist with resisting the setting aside of the Renewal of the Writ, I will shortly state what are my views on this Question of Renewal.

(B) RENEWAL OF WRIT IN REM

23. Renewal of a Writ in rem in Admiralty has always been regarded as particularly important and presented many unique features not to be found in ordinary actions in personam. The reason for this is that the fundamental nature of action in rem is to obtain security against a ship and that ability to obtain security depends on a number of factors chief of which are the visits if any of a ship into the jurisdiction and the change of ownership of that ship or its sistership after the cause of action had arisen. Monica S. [1960] P. 741 is the foundation in the modern law of legal effect of change of ownership on the statutory right in rem. When a statutory right in rem arises, that right will only be preserved against the offending ship or its sistership if the Writ in rem was issued before the change of ownership otherwise the right in rem against such ships would be lost. It is for these reasons that in Admiralty the need to issue the Writ in rem quickly and to serve it quickly is not dictated only by risk of time bar limitation but powerfully driven by the necessity to obtain early security for the maritime claim, which is the whole raison d'etre of Admiralty Action in Rem.

24. The Berny [1979] 1 Q.B. 80 judgment, by that modern master of Admiralty law, Lord Brandon had always been considered as one of the leading cases in Admiralty and its correctness had never been doubted and of course it addressed itself to the unique problem of renewal of admiralty in rem writs. In Berny, Brandon, J. (as he then was) held the previous practice of renewal on ship by ship basis to be wrong and that renewal should be on an overall basis and only to be granted when it could be demonstrated that there was no sufficient opportunity to effect service (namely obtain security by arrest) during the currency of the Writ. At page 103, Brandon, J. said:-

"In my opinion, when the ground for renewal is, broadly, that it has not been possible to effect service, a plaintiff must, in order to show good and sufficient cause for renewal, establish one or other of three matters as follows: (1) that none of the ships proceeded against in respect of the same claim, whether in one action or more than one action, have been, or will be, present at a place within the jurisdiction during the currency of the writ, alternatively (2) that, if any of the ships have been, or will be, present at a place within the jurisdiction during the currency of the writ, the length or other circumstances of her visit to or stay at such place were not, or will not be, such as to afford reasonable opportunity for effecting service on her and arresting her, alternatively (3) that, if any of the ships have been, or will be, present at a place within the jurisdiction during the currency of the writ, the value of such ship was not or will not be, great enough to provide adequate security for the claim, whereas the value of all or some or one of the other ships proceeded against would be sufficient, or anyhow more than nearly sufficient, to do so."

For the sake of convenience I will hereinafter refer to the three reasons for good cause for renewal as the "3 Berny requirements".

25. What underlies the 3 Berny Requirements is the strong view held by Brandon, J. that it is

"the duty of solicitors, who have issued a writ on behalf of the plaintiffs, to take all reasonable steps to ensure that it is served during its initial currency. If the plaintiffs choose to proceed against a large number of ships concurrently (there is nothing which requires or compels them to do so), they must accept the disadvantages. as well as the advantages of doing so."

Implicit in this statement of Brandon. J. is the assumption that the plaintiff and his solicitor would have satisfied themselves at the time of the issue of the Writ in rem, as to the plaintiff having a good cause of action in rem and being able to effect service of the writ in rem. It follows in my judgment that a plaintiff cannot rely on his own inabilty to satisfy himself that he has a good cause of action in rem as an excuse or justification for not serving his writ in rem and even less so for seeking renewal of the writ. Where inability to seve the writ in rem was self induced, in the sense of being unable to satisfy himself a good cause of action in rem, that inabiltiy cannot in my judgment (subject to possible exceptions which must be very rare) amount to excusable disability, justification or good reason. In my judgment, therefore nothing said in the Affidavits filed by the Plaintiffs therefore show good reason or are capable of amounting to good reason.

26. Mr. Chua placed strong emphasis on the case of Kleinwort Benson v Barbrak Ltd. [1987] A.C. 597. It is of course well known that the Kleinwort judgment and a series of later judgments of the House of Lords laid down the two stage test of requiring good reason to be shown for extending time in stage one and giving the court the discretion to consider the balance of hardship under stage 2. But I do not believe that there is any conflict between Berny and Kleinwort and what was decided in Berny in the context of renewal of admiralty writs in rem is of course of particular relevance to our situation also involving an attempt to renew the writ in rem. Each case must be decided on the individual facts. But I do not believe that applying the Kleinwort principle would yield in any way a different result as I take the primary view that in relation to the renewal of an admiralty writ in rem, the plaintiffs cannot rely on its own inability to prove its own cause of action in rem as a justification for renewing the writ in rem.

27. Based on the above broad principles I have stated in relation to an admiralty writ in rem, it seems to me that I must conclude that no good reasons have been shown for the writ in rem to be renewed and this is by applying either the Berny 3 requirements or the Kleinwort principle.

28. The evidence before the Court shows that:-

(1)	there were at least 3 occasions when the ship Dae Song San stayed in Hong Kong for sufficient periods of time during each visit when arrest and service of the Writ could have been effected;
(2)	that the Renewal Affidavit was more remarkable for what it did not say then what it did say. Following the first requirement of the 3 Berny requirements, it was incumbent upon the deponent to the Renewal Affidavit to say that none of the 38 vessels in the Writ had visited during the one year period except for Chong Gen on 8th November 1995, Kyong Song on 31st May 1996 and Da Song San from 6th July to 16th July 1996. This it did not do. It thus conveniently failed to mention about the previous visits of Da Song San in December 1995 to January 1996 and in March 1996;
(3)	the March 1996 visit of the Da Song San was not referred to in either the Renewal Affidavit or the 5th Affidavit of Mr. Brooks dated 2nd June 1997 and that in relation to that visit, the position must be that there was opportunity to effect service;
(4)	the December 1995 to January 1996 visit of Da Song San as implicity alleged in the 5th Affidavit of Mr. Brooks as having been missed by Sinclair Roche & Temperley must be viewed with some scepticism for the following reasons:-

	(a)	No one directly dealing with the matter either from Sinclair Roche & Temperley or from the Marine Department has deposed on Affidavit;
	(b)	To suggest that daily reports from the Marine Department spanning over 20 days could either not be sent at all (without Sinclair Roche & Temperley noticing it for 20 days) or having been sent but the presence of the ship was not picked up by Sinclair Roche & Temperley for 20 days seem to me to be something which the Court must consider as inherently not credible;
	(c)	the quality of the evidence adduced is not such as to convince the Court that in relation to this visit, good reasons for not effecting arrest had been shown;

(5)

the matter of the previous two visits in December/January and March 1996 are vital because they affect the question of no arrest during the July 1996 visit. The alleged justification or explanation for no arrest in July 1996 would have been discredited if there were December/January 1996 and March 1996 visits known to the Plaintiffs which would have compelled the Plaintiffs to take even more urgent steps as to ensure that arrests would be made in July;

(6)

the solicitors had not taken all steps to effect expeditious service of the Writ and that in so far as the 16th July 1996 Affidavit of Pontikos was concerned, this Affidavit could have been made long before 16th July 1996 and even at the time of the issue of the Writ in October 1995 as everything in that Affidavit was known or could be known to Mr. Pontikos at the time of the issue of the Writ including obtaining the exchange of the two letters between the North Koreans and Mr. Anders in October 1990, specially since there was no suggestion in any of the Affidavits that Mr. Anders the Polish lawyer could not be found or the two letters obtained from him during the period from October 1990 to October 1995, a period of 5 years.

29. In the course of the arguments, the question was put as to whether in law it could be right for vessel after vessel to come to Hong Kong and yet for the Plaintiff not to arrest but rely on its inability yet to be satisfied that it had a good cause of action in rem and on that basis obtain from the Court renewal of the writ. In my experience of the admiralty litigation, there has never been such a bold assertion as made in this case that it was perfectly reasonable, 17 years after the original cause of action had arisen, some 9 months after the Writ in rem had been issued and after a number of vessels had come and gone and still for the solicitors to say that it was excusable not to effect arrest because the Plaintiffs had yet to satisfy themselves they had a good casue of action in rem. It seems to me on the facts of this case, even taking into full account the evidence of the Plaintiffs, by the 12th 13th and 14th July 1996, (even if good reasons might have been shown earlier) it could not possibly be said that it was still reasonable for the Plaintiffs not to effect arrest or that it would be right for the Court to grant renewal of the Writ in rem in October 1996, which document the Plaintiffs had seen fit not to serve in July 1996.

30. Accordingly, I conclude both Questions (A) and Question (B) in favour of the Defendants. I therefore order that the Renewal of the Writ, the Service of the Writ, the Arrest of the Ship must all be set aside and that the Ship is to be released immediately. The Plaintiffs must pay the Defendants the costs of the Motion.

	William Waung
	Judge of the High Court

Representation:

Mr. Clifford Smith for the Defendants instructed by Messrs Clifford Chance

Mr. Chua Guan-Hock for the Plaintiff instructed by Messrs Sinclair Roche & Temperley