In a significant ruling, the High Court of Gujarat at Ahmedabad vacated the wrongful arrest of bunkers on board a commercial vessel following a challenge to the arrest by the time charterers of the vessel.
The case stemmed from the arrest of bunkers on board the vessel MV Alexandros P, which had been arrested at the behest of GML Chartering Pte Ltd., a Singapore-based entity. The claim of GML was in relation to the non-payment of bunkers supplied to another vessel named MV Seamac Nidhi, which was sub-chartered by GML. GML alleged that the Owners of MV Seamac Nidhi settled the bunker supply claim, and they passed the claim to GML and Hlif Shipping LLC FZ, the sub-sub charterers of MV Seamac Nidhi.
Hilf was the charterer of MV Alexandros P, and asserting that Hilf was responsible for the non-payment of bunkers supplied to Seamac Nidhi, GML sought to arrest the bunkers on board MV Alexandros P to secure their claim. A conditional arrest of bunkers was ordered by The High Court of Gujarat on 11.10.2024. However, Hilf challenged the order of arrest.
In Hilf’s arguments, they emphasised that the Court, in the exercise of its admiralty jurisdiction, has no power to arrest bunkers on board a vessel. Further, the arresting party had failed to meet the legal threshold required to initiate a claim under the Admiralty Jurisdiction of the Court. They further contended that the claimant had acted in bad faith by omitting critical facts in the arrest application.
The court found merit in the arguments and endorsed the view that the Court, in the exercise of its admiralty jurisdiction, has no power to arrest bunkers on board a vessel. The court further noted that the arresting party had failed to demonstrate a valid maritime claim or prima facie case for invoking the Admiralty Jurisdiction. In its ruling dated 14.10.2024, the court ordered the immediate release of the vessel.
This case underscores the importance of due process in maritime disputes and highlights the courts’ growing scrutiny of wrongful vessel detentions. With shipping companies increasingly exposed to financial risks from such arrests, the court ruling ruling is expected to have far-reaching implications for the industry. The successful charterers were represented by Senior Advocate Davang Nanavati, instructed by Advocates Pranoy K. Kottaram and Sukumar Mahesh Tirthani.
