Imperial Marine Company v Pasquale della Gatta; Imperial Marine Company v Filippo Lembo

Imperial Marine Company (the shipowner) and Deiulemar Compagnia di Navigazione Spa (the charterer) concluded a long-term NYPE time charter in 2003 for the bulk carrier George T. Disputes arose from 2005 onwards. The charterer supplied bunkers at Yeo Su, Korea that were out of specification, after which the vessel’s main engine suffered serious damage, leading to diversions, delays, and extensive repairs in Greece. Deiulemar treated the vessel as off-hire and commenced London arbitration alleging breaches of the owner’s obligations to deliver and maintain a seaworthy vessel. Imperial Marine disputed liability, blamed the defective bunkers, counterclaimed for unpaid hire, repair costs, and diminution in value. Further disputes arose regarding alleged unsafe port/berth damage at Richards Bay and extensive corrosion (allegedly caused by sulphate-reducing bacteria) discovered during later repairs. While arbitration was pending, Imperial Marine arrested two Deiulemar vessels, the Pasquale della Gatta and the Filippo Lembo, in South Africa under the Admiralty Jurisdiction Regulation Act 105 of 1983 to obtain security for its claims. Deiulemar opposed the arrests and sought counter-security for its own arbitration claims. The Western Cape High Court made mixed orders, prompting appeals and cross-appeals to the Supreme Court of Appeal.

The appeal concerning the Pasquale della Gatta was dismissed, but the cross-appeal succeeded: the arrest and deemed arrest were set aside, counter-security was set aside, and Imperial Marine was ordered to pay costs on an attorney-and-client scale. In respect of the Filippo Lembo, the appeal partially succeeded, resulting in significant reductions to the amounts of security ordered, while the cross-appeal also succeeded in part. Costs were apportioned, with each party bearing its own costs save for shared record preparation expenses.

This judgment is a leading South African authority on the arrest of vessels for security in support of foreign arbitration proceedings. It clarifies the evidentiary standard for establishing a prima facie case, particularly the proper treatment of expert evidence and inferential reasoning. The case is significant for its careful balancing of the protective purpose of maritime arrests against their potentially harsh consequences, reinforcing judicial caution in granting or maintaining such remedies.