Saam Smit Canada Inc. v. Hanjin Vienna (Ship)

Saam Smit Canada Inc. v. Hanjin Vienna (Ship)

Court limited consideration to proceeds of ship (excluding bunker proceeds) and held that sufficient funds must be retained to secure claimants' best reasonably arguable cases; adopting a 30% markup as starting point, the court fixed security at US$4,662,807.30 and, after deducting marshal fees, granted the former owners a partial payment out of US$1,855,908.23 while ordering conversion of US$4,662,807.30 into Canadian currency to be held as security; owners must reduce their priority claim dollar for dollar to receive surplus.

Citation
2017 FC 745
Parties
Plaintiff: Saam Smit Canada Inc.; Plaintiff: Saam Smit Vancouver Inc.; Former Owner / Defendant: Conti 24 Alemania Schiffahrts-GmbH & Co. KG MS Conti Lissabon (former owners of Hanjin Vienna); Claimant: Prince Rupert Port Authority; Claimant: DP World Prince Rupert Inc.; Claimant: Pacific Pilotage Authority; Claimant: Canadian National Railway; Claimant: World Fuel Services Inc.; Claimant: Ali El-Husseini; Claimant: Vancouver Fraser Port Authority; Claimant: GCT Canada Limited Partnership
Court
Federal Court
Jurisdiction
Canada
Judgment Date
31 July 2017
Procedural Posture
Admiralty / Maritime / Interlocutory Motion for Partial Payment Out Following Sale of Arrested Ship
Outcome
Motion granted in part
Legal Topics
Maritime Liens, Arrest and Sale of Ship, Priority of Claims, Security for Claims, Interest on Maritime Claims, Costs, Conversion of Currency, Partial Payment Out
Source Language
English
Admiralty/maritime Law Insolvency/bankruptcy Civil Procedure Contract/interest Law Maritime Liens Arrest and Sale of Ship Priority of Claims Security for Claims +4 more

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Parties

Saam Smit Canada Inc.

Plaintiff

Saam Smit Vancouver Inc.

Plaintiff

Conti 24 Alemania Schiffahrts-GmbH & Co. KG MS Conti Lissabon (former owners of Hanjin Vienna)

Former Owner / Defendant

Prince Rupert Port Authority

Claimant

DP World Prince Rupert Inc.

Claimant

Pacific Pilotage Authority

Claimant

Canadian National Railway

Claimant

World Fuel Services Inc.

Claimant

Ali El-Husseini

Claimant

Vancouver Fraser Port Authority

Claimant

GCT Canada Limited Partnership

Claimant

Procedural Posture

Admiralty / Maritime / Interlocutory Motion for Partial Payment Out Following Sale of Arrested Ship

Legal Issues

  1. 1 Whether proceeds of sale of bunkers should be included in calculating surplus
  2. 2 What are the best reasonably arguable principal amounts of the claims
  3. 3 What are the best reasonably arguable awards for interest

Ratio Decidendi

Court limited consideration to proceeds of ship (excluding bunker proceeds) and held that sufficient funds must be retained to secure claimants' best reasonably arguable cases; adopting a 30% markup as starting point, the court fixed security at US$4,662,807.30 and, after deducting marshal fees, granted the former owners a partial payment out of US$1,855,908.23 while ordering conversion of US$4,662,807.30 into Canadian currency to be held as security; owners must reduce their priority claim dollar for dollar to receive surplus.

Court Disposition

Motion granted in part

Orders

  • Solicitors holding proceeds to pay Conti 24 the sum of US$ 1,855,908.23
  • Solicitors ordered to convert US$ 4,662,807.30 into Canadian currency when the U.S. term deposits become due and hold on same basis as security