Terra Marine SA v MV "Iran Dastghayb" and Others (A148/2005) [2009] ZAKZDHC 47 (29 October 2009)

Terra Marine SA v MV "Iran Dastghayb" and Others (A148/2005) [2009] ZAKZDHC 47 (29 October 2009)

The court found that IRISL, as owner of the defendant vessel, was not a party to the arbitration clause in the ship management agreement between the plaintiff and ECO Shipping Company. There was no legal basis for IRISL to enforce the arbitration clause and seek a stay of the in rem proceedings. The court...

Source-derived case information.

Citation
[2009] ZAKZDHC 47
Parties
Respondent: Terra-Marine SA; Applicant: MV "Iran Dastghayb"; Applicant: Islamic Republic of Iran Shipping Lines; Applicant: ECO Shipping Company (PJS)
Court
Kwazulu-Natal High Court, Durban
Jurisdiction
South Africa
Judgment Date
29 October 2009
Case Number
A148/2005
Procedural Posture
Stay Application / Application for Stay of in Rem Proceedings Pending Arbitration
Outcome
Application for stay of in rem proceedings dismissed with costs.
Judges
Patel
Legal Topics
Admiralty Jurisdiction Regulation Act, Arbitration Clause Enforceability, Associated Ship Liability, Stay of Proceedings
Admiralty and Maritime Admiralty Jurisdiction Regulation Act Arbitration Clause Enforceability Associated Ship Liability Stay of Proceedings

Source-derived case record

Summary, issues, holding and outcome

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Parties

Terra-Marine SA

Respondent

MV "Iran Dastghayb"

Applicant

Islamic Republic of Iran Shipping Lines

Applicant

ECO Shipping Company (PJS)

Applicant

Procedural Posture

Stay Application / Application for Stay of in Rem Proceedings Pending Arbitration

Legal Issues

  1. 1 Whether the owner of the defendant vessel (IRISL) can rely on an arbitration clause in a ship management agreement to stay in rem proceedings brought by the plaintiff.
  2. 2 Whether the South African court is a convenient forum for adjudicating the in rem action.
  3. 3 Whether the claims pursued by the plaintiff are maritime claims enforceable in rem.

Ratio Decidendi

The court found that IRISL, as owner of the defendant vessel, was not a party to the arbitration clause in the ship management agreement between the plaintiff and ECO Shipping Company. There was no legal basis for IRISL to enforce the arbitration clause and seek a stay of the in rem proceedings. The court distinguished the present case from Freightmarine Shipping Ltd v S Wainstein & Co, confirming that only parties to an arbitration agreement may invoke its procedural remedies. The applicants' arguments regarding forum non conveniens and the maritime nature of the claims were not properly raised in the founding papers and would require further evidence, which was not appropriate in motion...

Court Disposition

Application for stay of in rem proceedings dismissed with costs.

Orders

  • The application for a stay of the in rem action against the MV "Iran Dastghayb" is dismissed.
  • The respondent is awarded costs, including the qualifying fees of the expert witness Dr. Iraj Babaei.