In re SS. ARNALDO DA BRESCIA

108-NLR-NLR-V-23-In-re-SS.-ARNALDO-DA-BRESCIA.pdf


( 891 )
[Ik the Colonial Court of Admiralty.]
Present: De Sampayo J.lit re SS. “ ARNALDO DA BRESCIA/
Case No. 2.
No power to arrest a ship belonging to a foreign State—Internationallaw—Skip engaged in ordinary commerce—Objection toy juris-diction may be urged at any time.
A ship belonging to a foreign state cannot be arrested by ourCourts. The foreign state does not lose its immunity from beingproceeded against by the arrest of the ship, even if it employsthe ship in ordinary commerce.
The Court is bound to withhold its hand whenever it appear?that it is without jurisdiction, and cannot refuse to entertain anobjection to the jurisdiction at any stage of the suit.
r| tms facts are set out in the judgment.
Drieberg, K.C. (with him Hayley), for H. M. the King of Italy.
EUiott, K.C. (with him Bartholomeusz), for the plaintiffs.
1 (1921) 2 Oh. Dio., p 22$.
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1988. June 6,1922. DbSampayoJ.—
4. iHSif'rw“ an action in the Supreme Gout exercising jurisdiction a*
aColonial Court of Admiralty in respect of a oollisian. TheplaintifbOte the Edward Steamship Oomp&ny, Limited, the owners of theos, “ Clearway.” The action is one in tern, and the defendant isthe as. “ Aroaldo Da Bresoia.” It appears that on September 17,1920, while the “ Clearway ” was lying at annhor in the Colomboharbour, the “ Arnaldo Da Brescia ” was brought in by a Govern*meat pilot to be berthed, and there was a collision between the twovessels. The plaintiffs then- instituted this action through theirsolicitors, Messrs. Julius ft Creasy, claiming from the “ArnaldoDa Bresoia ” the sum of Bs. 100,000 as damages. The circum-stances leading up to the matter now before me are as follows: Onthe application of the phiatiSa thiB Court issued the usual writ ofsummons and a warrant of arrest, and under tins warrant the“ Arnaldo Da Brescia" ” was arrested in the Colombo harbour onSeptember 17, 1920. The “Arnaldo Da Brescia” was then on avoyage from Europe fffi Australia under the management'of theLloyd Sabaudo, a ship company of Genoa, whose local agents areMessrs. Volkart Brothers of Colombo. On'September 21, 1920,Messrs. F. J. ft G. de Bsiam, as solioitore of the Lloyd Sabando,entered appearance for Lloyd Sabaudo, and stating that tire“Arnaldo Da Bresoia” was owned by the Italian Government,and, therefore, free from arrest, timed Bs. 12,000 as damages forthe unlawful arrest, and Bs. 3,000 per day while the vessel remainedunder arrest. On September 24, 1920, Messrs, de Saram tenderedbail on behalf of Lloyd Sabaudo in Bs. 100,000 to answer judgment,and costs in this action, and in the notice itwaB stated, “it beingunderstood that the bail is given under protest and without pre-judice to any defence which Lloyd Sabaudo may be advised to mate,either on the ground of unlawful arrest or otherwise.” The soli-citors for the plaintiffs having consented to the application, thisCourt allowed bail, and a bail bond for Bs. 100,000 was executedby the Bank of Madras (now Imperial Bank of India) and Messrs.Volkart Brothers. The “Arnaldo Da Brescia” was thereuponreleased from arrest. On October 8, 1920, Messrs, de Saram- entered appearance for His Majesty the Kingof Italy but underprotest, “the said steamship being the property of His Majesty, andnot subject to the jurisdiction of this Court.” On January 25,1921,this Court allowed an application for pleadings to he filed, andaccordingly Messrs. Julius ft Creasy, for the plaintiffs, filed theirpetition, and Messrs, de Saram filed an answer for the King of Italyand the Lloyd Sabaudo. The answer contained a counter-claimfor Bs. 24,000for the unlawful arrestund detention of the “ ArnaldoDa Bresoia,” it bang stated that the vessel was the property of EQbMajesty the Sing of Italy, and was, therefore, not Sable to arrest.
( 383 )
On the application of Messrs, de Saram for the issue of a Com-mission for the examination of witnesses in Italy with regard tothe ownership of the “ Arnaldo Da Brescia ” and. the terms onwhich the Lloyd Babaudo had charge of her, a Commission was, onJuly 20,1921, ordered to be issued by this Court, and was actuallyissued on August 16, 1921, to the British Consul at Genoa forexecution. Among the witnesses examined under the Commissionwere Lieut.-Colonel Lorenzo de Leonardis, Commissary of the RoyalNavy, and Comm. Aw. Papa Carlo, Chief of the Legal Departmentof the General Direction of the Mercantile Marine. By the evidenoeof these witnesses and by a certificate of the Italian Minister of Marine,it is well proved that the “ Arnaldo Da Brescia ” is the ex-Germansteamer “ Sigmaringen,” which was condemned by a sentencepassed by the Commissioner .of War Booty, and thus became theproperty of the Italian Government. It is further proved that shewas entrusted to the State Department of Navigation, whioh gaveover the vessel to the Lloyd Sabaudo, as it was said, “ in commercialmanagement.” It is explained that the Italian Government wantedto use the vessel to bring cargoes of ooal and com for nationalpurposes, and as the Italian Government had no agencies in thevarious commercial ports, the vessel was entrusted to the LloydSabaudo to be employed on their line of steamships from Europeto Australia, principally to bring ooal and com for the Italian State,with the right to use any extra space for conveying generalmerchandise, on the terms stated in the letter B addressed to theLloyd Sabaudo by the Assistant Secretary of State. These tomswill be hereafter referred to more in detailThe evidence so far puts it beyond doubt that the " Arnaldo DaBrescia ” was, at the time of the collision, the property of thesovereign state of Italy, and, according to the rules of internationallaw, was not liable to be arrested by this Court. The plaintiffs,however, urge, in the first place, that the King of Italy had, byappearing to the action, by filing an answer, and more specially bymaking a claim in reconvention jointly with the Lloyd Sabando,submitted to the jurisdiction of the Court and waived the privilege. allowed to a sovereign by international courtesy, of hot beingimpleaded in a foreign court of law. As regards this, I think thecircumstances should bo taken into consideration. According tothe praoticem England, as illustrated by The Jassy,1 the proceedingsin a case of this kind would be simple. The Ambassador or otherdiplomatic representative of-the foreign sovereign would address awritten communication to the Secretary of State for Foreign Affairsstating the bare fact of the ownership of the vessel and the eirenm-stances of the arrest, and requesting that steps might b6 taken torelease the vessel from arrest and to terminate the proceedings.The Secretary of State would communicate with the Registrar of
1 {1906) D. 210,
1922.
De 8uom>J.
In re as.
“ Arnaldo DnBrescia.”
13*
1882.
Db SampavoJ.
In re as.“Arnaldo DaBresoia."
( 394 )
the Admiralty Court on the subject, sending him a copy of thecommunication of the representative of the foreign state. Thesecommunications would be accepted as sufficient verification of theneoessary facts, and the Court would at once release the vessel anddismiss the action. It is not quite possible to follow this course incountries like Ceylon or other British Colonies where there is nodiplomatic representation. But something analogous to it hasbeen done. Tho Acting Consul for Italy, after he had become awareof all the facts, and was in a position to act,‘ addressed a letter toHis Excellency the Governor, stating that he had been instructedby the Italian Government to request the British Government to'decline to exercise, by any of its Courts, any jurisdiction over the“ Arnaldo Da Brescia,” and to direct the bail bond to be cancelledand discharged. The Governor, acting through the ColonialSecretary, forwarded the letter to the Registrar of' this Court. TheRegistrar thereupon gave notice to the parties that he wouldlist the matter to be mentioned in this Court.* The matter thiisbefore mo is an application on behalf of the King of Italy for adeclaration that the “ Arnaldo Da Brescia ” was the property of theItalian State and was employed for public purposes and was notliable to arrest, and for an order cancelling and discharging the bailbond and terminating the action. As regards the appearancealready put in, tbe answer filed, and the proceedings had, it shouldbe noted that there was at the beginning a good deal of obscurityand uncertainty as to the situation. Even as regards the exact,position of the Lloyd Sabando, theiragents, Messrs. Volkart Brothers,who instructed Messrs, de Saram, appear to have been in the dark.They called thoir principals the charterers of the vessel, whereasnow there is a question on that point. In any event the circum-stances did not, in my opinion, amount to waiver of the privilege ofsovereignty and to submission to the jurisdiction of this Court bythe King of Italy. His Majesty’s appearance to the action wasunder protest, and it follows that ths answer filed and tbe othersteps taken were subject to the same reservation and freedom fromprejudice. In this connection the case of The Jassy (supra) isinteresting. There the circumstances were somewhat similar tothose of this case. There a firm of Liverpool solicitors acting forthe vessel, which had been sued in rem under the instructions of amercantile firm, who were the Liverpool representatives of theGovernment of Roumania, the owners of the vessel, gave an under-taking to put in bail, and tbe vessel was released, and an appearancewas entered on behalf of the owners of The,Jassy by the Londonagents of -the Same Liverpool firm of solicitors. The appearance,which was unconditional, was entered by the London solicitors undera misapprehension and without the sanction of the RoumanianGovernment, and waB not considered as amounting to a waiver ofits privilego. In this case tbe appearance was not unconditional.
( 395 )
but “ under protest,” which is the recognized form of appearanceto object to the jurisdiction* The fact that the Italian Governmentwas the owner of the “ Amaldo Da Brescia ” was disolosed at the,very outset by tbe Lloyd Sabaudo. Qfbe Court is bound to with-hold its hand whenever it appears th£t it is without jurisdiction,and cannot refuse to entertain an objection to the jurisdiction atany stage of tbe suit (The Mary Anne,1 The Sultan,2 and TheEfamore)?^
It was next contended on behalf of thp plaintiffs that the ItalianGovernment had either formally chartered the vessel to the LloydSabaudo, or had given them absolute possession and control of thevessel, or were partners of the Lloyd Sabaudo in respect of tbe trade.I shall presently refer to the law on the subject, and deal now withtbe question of fact. I have already mentioned the effect of theoral evidence taken on Commission at Genoa. The dooument B,the letter of the Assistant Secretary of State to tbe Lloyd Sabaudo,containing the terms of the arrangement with him, most now beexamined. It purports to state tbe terms, “ under which tbesteamer ‘ Amaldo Da Brescia ’ is given on oharter to your companyon trade management for the duration of one year.” I am quotingfrom the translation made at Genoa from the original Italian.Tbe expression “ is given on oharter ” is strongly emphasized byMr. Elliott for the plaintiffs. It is a translation of the words“ view affidato,” which after all may mean no more than “ is en-trusted.” In any case tbe nature of the contract must be gatheredfrom the whole document, and not from any isolated word hero orthere, which may or may not have a technical meaning. I shalltherefore give a summary of the document:—
Paragraph 1.—The steamer is to retain her present equipment(staff and crew) “ depending upon tbe General Head Office-Navigation Department (late State Railways), which will behereinafter called Administration.” Lloyd Sabaudo areat liberty to engage an additional crew at their own charges“for the protection of the Company’s interests, and parti-cularly with regard to the relations with the agencies.”
Paragraph 2.—The ship’s “equipment,” wages, and maintenance,&c., “ will be at the care of the Administration.”
Paragraph 3.—The Lloyd Sabaudo will employ tbe steamer onthe Italy-North Europe-Australia line. The various portsat which she s to call on the outward and homeward voyagesare specified and include Colombo* The Lloyd Sabaudo areto arrange for bunker coal abroad, but in tbe Italian portsbunker coal is to be supplied by the Administration.
134. L. J. Adm. 73.> Swat. 50L
8 Br. d>D. 185.
1922.
Da SampayoJ.
In tees.Amaldo DaBrescia.”
( 396 )
1922.
Ob SahpayoJ.
Inrt 89.uAmatdoDaBrwcia.”
Paragraph 4.—The Lloyd Sabaudo are through their agents toget all the trade as in the ease of the other vessels on theabove line on the following terms:—
(a) All freights will be due to the Administration.
(&) Stowage, port charges, and other disbursements, &o.,Sues Canal does, Customs duly, Consular dues, andother similar expenses “are at the chaige of theAdministration.”
Lloyd Sabaudo to pay the commissions to agents, sub-
agents, brokers, &o.
The Lloyd Sabaudo are entitled to 2 per cent, on thegross freights (on goods on Government account).
The Lloyd Sabaudo to be entitled to 10 per cent, on the
gross freights, exclusive of freight for goods on Govern-ment account, “by way of compensation concerningthe management of the steamer,” but with regard togoods on Government account only 2 per cent.Paragraph 5.—The Administration are entitled to load in thehomeward voyage from Australia 1,600 tons of goods, andon the homeward voyage from North Europe the Administra-tion are fully entitled to load coal on Government account.Paragraph d.—The maintenance of the passengers is “ at theoharge and care of the Administration.”
Paragraph 7.—The Lloyd Sabaudo on arrival in Italy to rendera written account, presenting the documents vised by theConsular, and harbour authorities attesting the expensesand receipts. If such authentication is impossible, the LloydSabaudo to make a declaration.
Paragraph 8.—The Administration grant the management of thesteamer " for one year, after which the agreement may berenewed.”
Paragraph 9.—Alterations in the terms of the agreement due“to altered conditions of the contracting parties,” &c.,may be mutually agreed upon.
The expenses, &o., “ will have to be accounted for by tbe mostpossible careful documentary evidence, it being clearlyunderstood that this department is confident that yourCompany will take every care for the strictest protectionof the State’s interests in theirco-partnery (neSa sm compart*ecipazione) to the exercise of the line.”
Taking this document as a whole I think that it does not constitute“ a oharter ” of the kind contended for, that possession and controlare not absolutely given over to the Lloyd Sabaudo, and that, asstated by the witnesses examined on commission, theLIoyd Sabaudowere practioally agents of the Italian Government to manage thesteamer with a small share of the freight as compensation for their
( 307 )
trouble. With regard to the suggestion of a partnership between theItalian Government and the Lloyd Sabaudo, the word “oo-partneiy99in the last sentence of the above agreement has been emphasized.It» however, appears to me to be a reference to the participation ofthe freight, and, in any case, the document, as I said before, should beconstrued according to thefeubstanoe of its contents, and not by theuse made of particular words, especially in a translation. Assuming,however, that the situation was as alleged on behalf of the plaintiffs,it is necessary to consider what the law on the subject is. TheAnnette,* which was oited on behalf of the plaintiffs, is not a good■ case for the present purpose. The chief question in* that case wasas to the status of the Provincial Government of Northern Russia,which it appeared had not been formally reoognized by the BritishGovernment and the Allied Powers, and on the facts the Courtcame to the conclusion that the vessel was not in the possession ofthe provisional Government. I am also referred to the unreportedcase of The Termete, a note of which is given in the Law TimesJournal of March 18, 1922. That was a case of collision. Thevessel which was sued had at the time of the collision belonged tothe Belgian Government, but was sold by that Government toprivate owners after the collision, and the Court held that a maritimelien had attaohed to The Tervaete, and might be enforced againstprivate individuals after she had passed out of the ownership ofthe Belgian Government. This is nothing new; it was decided inthe much earlier case (The Bold Bucdeugh*) that maritime lien.maybe enforced against the vessel in fault even in the hands of aninnocent purchaser and that it travels with the vessel, and in the. case of a proceeding in rem it relates back to the time when it firstattaohed. The cases cited, however, are not relevant to the pointunder consideration. On the other hand, there are several oaseswhich have a more direct bearing on the questions at issue in thiscase, and whioh support the application on behalf of the King ofItaly. In Parlement Beige 8 the Court of Admiralty took the viewthat trading with the property of a.state might render the propertyliable to seizure, but the Court of Appeal dissented from that view,and laid down the general principle that, as a consequence of theabsolute independence of every sovereign state and of internationalcomity, every other sovereign state respects that independence, anddeclines to exercise by means of any of its Courts any of its territorialjurisdiction over the person of the sovereign or over the propertyof the state destined for public uses. The Parlement Beige8 wasthe property of the Belgian State and was a mail packet, and it washeld that the immunity from arrest in a suit in rem for damages for acollision was not lost by reason of the packet also carrying merchan-dise and passengers for hire. That decision fits the circumstances
1 (1919) Prob. 206.* (2862) 7 Moo. P. O. 267.
*(2880)6P.D.197'
1922.
Db Sampavo
J.
Juries,
“ AmaldoDaBreeds.9*
of this ease, In Young v» The Scotia 1 the Lord Chancellor observed:
“ The seizure is intended to be a preliminary to the sale of the ship,and what would be sold would not-be the mere possession, but theproprietary right. If the proprietary right could not be sold byreason of the ship’s belonging to His Majesty, the question of posses-sion may be passed by as immaterial.” The Porte Alexandre 2 wenta. step further. The vessel belonged to the Portuguese Republic,but was not being used at the time in the public service or for publicpurposes. She was, in fact, employed by the Government in ordinarycommerce. The question was definitely raised, whether a foreignstate which owns a ship loses its immunity from being proceeded,against by the arrest of the ship if it is at the time employing theship in ordinary bommeree, and it was decided both in the AdmiraltyCourt and in the Court of Appeal that the question should beanswered in the negative, the principle acted upon being that asovereign state cannot be impleaded by proceeding against itsproperty, and that it does not matter whethertbe vessel is employedin commerce or not. The CJwrkieh* whioh was cited by Mr. Elliott,cannot be regarded any longer as an authority.
On the above authorities it must, I think, be held that the" Arnaldo Da Bresoia ” was not liable to be arrested. Mr. Elliott,for the plaintiffs, however, maintains that, even if this Court shouldso hold, the plaintiffs can still continue the'action against the LloydSabaudo and execute any judgment by realizing the security given.
I do not think that by the mere giving of bail the action in rem was 'converted into one in personam. Whatever the form of the bailbond may be, there is no question that the bail was given for therelease of the vessel from arrest. The Lloyd Sabaudo in tenderingbail did so “ under protest and without prejudice.” They hadalready iptimated that the arrest of the “ Arnaldo Da Brescia ”was unlawful, as she belonged to the Italian State. Rule 48 of therules applicable to the proceedings of this Court provides thatproperty arrested by warrant may be released on one or more bailbonds being filed for the amotmt claimed or for the appraised valueof the property arrested. Rule 40 provides for the form of bailbond whenever bail is required, andtheform No. 14 in the schedule,to which rule 40 refers, has been followed in this oase. The bailbond has, I think, taken the place of the vessel, and if the arrest ofthe vessel is unlawful, the bail bond goes with it, and should bedischarged too.
The proper order, I think, is to set aside the writandall subsequentproceedings, including the bail bond, with costs. I make order_ accordingly.
8 {1920) 122 L. T. 662.
8 (2873) 4 Adm. da Sec. 69.
1 (1908) A. 0. 602.