Case: I Congreso del Partido [1978] QB 500
Outcome: cited
it is not necessary or conclusive that a person be registered as owner or hold the legal title to a ship for him or her to be found to be "the owner" within the meaning of ss 17, 18 or 19 of the Act: Cape Moreton 143 FCR at 65 [92], 73 [118], 84 [161]-[162]. And, a person who is the beneficial owner of the arrested res , ordinarily, will have the immediate right to exercise dominion over and to enjoy or control that res : Cape Moreton 143 FCR at 85 [168]; Kent v SS "Maria Luisa" (No 2) [2003] FCAFC 93 ; (2003) 130 FCR 12 at 33-34 [61] - [66] per Tamberlin and Hely JJ; Malaysia Shipyard and Engineering Sdn Bhd v "Iron Shortland" as the Surrogate for the Ship "Newcastle Pride" (1995) 59 FCR 535 at 547D-F per Sheppard J; see too at 547F-548A. Neither party disputed the correctness of the principles relating to the meaning of "the owner" in ss 17, 18 and 19 stated in Iron Shortland 57 FCR 535 ; Cape Moreton [2005] FCAFC 68 ; 143 FCR 43 and Maria Luisa [2003] FCAFC 93 ; 130 FCR 12. The purpose of the Parliament conferring rights to proceed in rem against a ship or other property was to make that res , first, available as property of a wrongdoer or debtor to satisfy a maritime claim and, secondly, because it had been arrested, to cause its owner to appear and subject himself to in personam liability. Therefore, it is critical to construe the expression "the owner" in s 19(b) so as to ensure the effective exercise of the jurisdiction that the section confers. Because "the owner" is not defined for the purpose of s 19(b), the expression identifies someone who holds a sufficient proprietary interest in the res itself, directly or indirectly, that he could sell or dispose of the res or, cause such a sale or disposition, so as to convey a good title to the purchaser. The common law and equity have developed differing indicia and categories of ownership of which legal title and beneficial interest are notable examples. But, in the world of maritime adventures, ownership of a ship is not always easy to ascertain and often will be deliberately obscured. That is why the expression "the owner" in s 19(b) should be given a broad interpretation so as to enable achievement of its purpose of connecting the person who is liable for a maritime claim to a ship or other property that he owns. And he will own the res , if he can sell or cause its sale because of his title to that property. In a valuable discussion, Reyes J (with whom Ma CJHC and Stone J agreed in separate judgments) considered the, perhaps narrower, expression "beneficial owner" as used in s 12B(4) of the Hong Kong High Court Ordinance (Cap 4) in The "Convenience Container" [2007] 3 HKLRD 575. Reyes J concluded that the expression focussed "... simply on matters of title, namely, the right to sell or dispose of a ship": " Convenience Container " [2007] 3 HKLRD at 584 [43]. Reyes J also observed that beneficial ownership was not merely concerned with control or administration of a vessel or even the enjoyment of the proceeds of its sale. He recognised that these may or may not be useful as evidence from which a finding of ownership can be made. But he held that the key question was whether the relevant person in s 19 had title, as "the owner" of the res in order to support its arrest: cp "Convenience Container " [2007] 3 HKLRD at 583-584 [35]-[42]; see too per Ma CJHC at 606-607 [165]-[167] and Stone J at 595-597 [108]-[115]; I Congreso del Partido [1978] QB 500 at 538E-F, 541B per Robert Goff J; The Permina 3001 [1979] 1 Lloyd's Rep 327 at 329 per Wee CJ in the Singapore Court of Appeal; and The "Tychy" [1999] 2 Lloyd's Rep 11 at 20 per Clarke LJ, Otton and Waller LJJ agreeing. In MV "Sea Success I " (AIR 2002 Bombay) at 184 [56] the Court held that it would follow the broad international legal consensus that the test for beneficial ownership of the shares in a ship was whether the person had a right "... to sell, dispose of or alienate the shares in the ship". The Court also refused to lift the corporate veil between parent and subsidiary companies: MV "Sea Success I" (AIR 2002 Bombay) at 181-182 [54]. Earlier, the Court quoted a passage from the reasons of the Supreme Court of India in MV "Elisabeth" (AIR 1993 SC 1014) at [64]-[65] that recognised the procedural theory of Admiralty jurisdiction in India: i.e. the action in rem overcame the difficulty of personal service on a relevant person and either compelled him to appear to furnish security for release of the res or, in default of appearance, to proceed directly against the res .