Golden Seabird Maritime Inc v Alam Tenggiri Sdn Bhd

The appellants purchased two vessels under construction from the second respondent, alleging that the vessels were contractually intended or represented to be suitable for carrying the corrosive chemical MTBE in all cargo tanks. Disputes arose regarding suitability and alleged misrepresentation, which were referred to arbitration in London. To obtain security for their arbitration claims, the appellants arrested the MV Alam Tenggiri, owned by the first respondent, in South Africa under s 5(3)(a) of the Admiralty Jurisdiction Regulation Act 105 of 1983, alleging it was an associated vessel. The vessel was released upon provision of letters of undertaking and later bank guarantees. The respondents successfully applied in the High Court to set aside the arrest on the basis that the appellants failed to prove association, but the security was not ordered to be returned. The appellants appealed, arguing inter alia that the arrest had lapsed upon release of the vessel and could not be set aside.

The appeal was dismissed with costs, including the costs of two counsel and the costs of the application for leave to appeal.

The case authoritatively clarifies that the deeming provisions relating to arrest and release under s 3(10)(a) of the Admiralty Jurisdiction Regulation Act apply equally to security arrests under s 5(3)(a). It confirms that such arrests do not lapse upon release of the vessel against extra-curial security and reinforces the evidentiary burden resting on a party alleging associated ship status.