Waller v The Ship "Aqua Vitae"

IN THE HIGH COURT OF NEW ZEALAND
AUCKLAND REGISTRY
IN ADMIRALTY
CIV2003-404-5025

BETWEEN JOHN ANTHONY WALLER AND RICHARD DALE AGNEW
Plaintiffs

AND THE SHIP "AQUA VITAE"
Defendant

Hearing: 5 September 2003

Appearances: M J Tingey and J Caird for Plaintiffs
No appearance for Respondent

Judgment: 5 September 2003

(ORAL) JUDGMENT OF HEATH J

Solicitors: Bell Gully, PO Box 4199, Auckland
Fax: 916 8801

Introduction

[1] An urgent application has been made to the Court today for an order to arrest the vessel "Aqua Vitae". The application is brought by Mr Waller and Mr Agnew in their capacity as statutory managers appointed pursuant to Orders in Council made under the Corporations (Investigation and Management) Act 1989 [the Act].

[2] Initially, the case was put on the basis that the claim was made in their capacity as statutory managers of Mr Rea individually but the evidence establishes that any claim to beneficial ownership of the vessel rests with International Investment Unit Trust, another of the entities placed in statutory management on 3 July 2003.

[3] On Mr Tingey's oral application I amend the intitulment so that the plaintiffs are shown as claiming in their capacity as statutory managers of International Investment Unit Trust.

[4] I had had an affidavit in support of the application from Mr Waller. I have also heard oral evidence from Mrs Fatupiato, of the firm of PriceWaterhouseCoopers. Mrs Fatupiato is responsible for day to day matters concerning the statutory management.

The claim

[5] The claim is put on this basis. It is said that the evidence establishes that the vessel "Aqua Vitae" was purchased from J and A Winter on 4 December 2002 for a sum of $789,622.40. These funds were provided by the International Investment Unit Trust.

[6] There have been records produced which show correspondence addressed to Mr Rea in respect of the vessel from the Maritime Safety Authority of New Zealand. It appears that interests associated with Mr Rea, to put matters neutrally, were being charged with safety charges for the vessel for the period 1 July 2003 to 30 June 2004 under the Marine Safety Charges Regulations 2000. The importance of evidence to indicate ownership of the vessel by an entity associated with Mr Rea at that time is that s43 of the Act prohibits any "corporation" (in terms of the extended definition of that word in the Act) under statutory management from transferring or removing any property or assets of the corporation except with the consent of the statutory manager.

Admiralty jurisdiction

[7] The Admiralty jurisdiction may be invoked under s4(1)(a) of the Admiralty Act 1973 where any claim as to ownership of a vessel arises. I am satisfied that a claim to ownership of the vessel arises. The issue in this case is whether the statutory managers have title or whether title has been validly transferred subsequent to 3 July 2003 to a Mr Glover who is also shown as an investor in International Investment Unit Trust.

[8] Mrs Fatupiato's evidence was that Mr Glover is an "investor" in the trust to the extent of approximately $500,000. There is a inference open on the evidence that transfer of the vessel has been effected to prefer Mr Glover over other investors.

[9] I am also satisfied that there is a basis for the in rem jurisdiction to be invoked under the first proviso to s5(2) of the Admiralty Act. The availability of a claim in respect of ownership permits the in rem jurisdiction to be invoked.

[10] Mr Glover has not been served with the current application. The real issue for my determination is whether, as a matter of discretion, it is appropriate to issue a warrant of arrest at this stage or to require Mr Glover to be served and for the application to be re-argued on a Pickwick basis: see Pickwick International Inc (GB) Ltd v Multiple Sand Distributors Ltd [1972] 3 All ER 384.

[11] Given that Mr Glover was an investor of International Investment Unit Trust and the evidence shows a strong possibility of transfer after the date of statutory management I am inclined to proceed to consider the application today. It will be open to Mr Glover to set aside a writ of arrest at a later stage. I am influenced in reaching that decision by the absence of any response to the communications through Mrs Fatupiato to Mr Glover both by telephone (to his wife) and in writing.

Result

[12] For those reasons a warrant of arrest will issue in terms of the draft application.

[13] I reserve all questions of costs.