International Transport, Trade & Energy, Case Note 2, Alina ll - Judgment of the SCA
The Supreme Court of Appeal has clarified the nature of in rem proceedings, where the owner of the defendant vessel, who has a pre existing liability, enters an appearance to defend in rem proceedings. In the Alina II judgement, the Supreme Court of Appeal found that the owner of a defendant vessel who is liable in personam for the debt claimed i.e. has a pre existing liability, submits to the jurisdiction of the court by entering an appearance to defend the in rem proceedings and then pursuing his defence. Such proceedings then continue against the owner in personam.
This judgment follows the English Court's judgment in The Dictator. However, in accordance with the procedural rules of the English Courts, the vessel and all persons who have an interest in her are cited in the summons. The owner, when entering an appearance to defend in England, is already before the court and a judgment in those proceedings can be executed against the owner. Not so in South Africa. In in rem proceedings in South Arica, only the vessel is cited. Therefore, when an owner (with pre existing liability) enters an appearance to defend in South African in rem proceedings, a procedural step is required to amend the pleadings to indicate that the proceedings continue both as in rem proceedings and as in personam proceedings against both the vessel and its owner.
Unlike other jurisdictions, an appearance to defend in South Africa cannot be given conditionally i.e. the owner cannot enter an appearance to defend on condition that it does not become personally liable for the debt claimed. If such an owner is personally liable for the debt claimed (pre-existing liability), he remains personally liable and the proceedings continue against the owner in personam.
Careful consideration must be given when an appearance to defend in rem proceedings is entered by the owner who is personally liable for the debt in circumstances where the debt claimed exceeds the value of the vessel arrested.
Perhaps a third party with an interest in the proceedings, such as a 'necessaries man', should defend the proceedings after obtaining an indemnity for costs from the owner, so that any judgment given in the proceedings can only be executed against the vessel.