Bank of Scotland v. Ship Nel et al., (1997) 140 F.T.R. 271 (TD)

• Court: Federal Court (Canada)
• Case Date: December 03, 1997
• Jurisdiction: Canada (Federal)
• Citations: (1997), 140 F.T.R. 271 (TD)

Bk. of Scotland v. Ship Nel (1997), 140 F.T.R. 271 (TD)

MLB headnote and full text

Temp. Cite: [1998] F.T.R. TBEd. JA.030

Action in rem against the Ship "Nel" and in personam

The Governor and Company of the Bank of Scotland (plaintiff) v. The Owners and All Others Interested in the Ship "Nel" and Oceanprofile Maritime Limited (defendants)

(T-2416-97)

Indexed As: Bank of Scotland v. Ship Nel et al.

Federal Court of Canada

Trial Division

Hargrave, Prothonotary

December 9, 1997.

Summary:

Oceanprofile mortgaged the Nel and three other ships to the plaintiff for $11,250,000 U.S. The Nel loaded a cargo of bulk sulphur destined for Tunisia and then anchored in Vancouver Harbour. Oceanprofile had missed payments to the plaintiff. The plaintiff arrested the Nel. The plaintiff was concerned about likely corrosion damage to the Nel if the sulphur remained in the vessel for a longer than usual period of time. Offloading the cargo in Vancouver would cost $1,330,000 U.S. The plaintiff found a buyer who would purchase the Nel for $5,000,000 U.S. and deliver the cargo to Tunisia. The plaintiff sought approval of the sale pendente lite.

A Prothonotary of the Federal Court of Canada, Trial Division, approved the sale pendente lite.

Admiralty - Topic 8326

Practice - Actions in rem - Sale - Sale before judgment - Oceanprofile mortgaged the Nel and three other ships to the plaintiff for $11,250,000 U.S. - The Nel loaded a cargo of bulk sulphur destined for Tunisia and then anchored in Vancouver Harbour - Oceanprofile had missed payments to the plaintiff - The plaintiff arrested the Nel - The plaintiff was concerned about likely corrosion damage to the Nel if the sulphur remained in the vessel for a longer than usual period of time - Offloading the cargo in Vancouver would cost $1,330,000 U.S. - The plaintiff found a buyer who would purchase the Nel for $5,000,000 U.S. and deliver the cargo to Tunisia - The plaintiff sought approval of the sale pendente lite - A Prothonotary of the Federal Court of Canada, Trial Division, approved the sale pendente lite - Time was critical given the risk of corrosion damage - The price was a fair market value.

Cases Noticed:

Banco Do Brasil S.A. v. Ship Alexandros G. Tsavliris et al. (1987), 12 F.T.R. 278 (T.D.), consd. [para. 12].

Myrto, The, [1977] 2 Lloyd's Rep. 243, refd to. [para. 12].

Canada (Minister of Supply and Services) v. Horizons Unbound Rehabilitation and Training Society (H.U.R.T.S.) (1997), 125 F.T.R. 81 (T.D. Protho.), refd to. [para. 12].

Scott Steel Ltd. v. Ship Alarissa et al. (1994), 89 F.T.R. 137 (T.D. Protho.), refd to. [para. 12].

International Marine Banking Co. v. Dora, The, [1977] 1 F.C. 603 (T.D.), consd. [para. 13].

Authors and Works Noticed:

Tetley on Maritime Liens and Claims (1985), pp. 581, 582 [para. 17, footnote 2].

Counsel:

Peter Bernard, for the plaintiff;

Shelly Chapelski, for the claimant, Canpotex Shipping Ltd.;

Doug Morrison, for the claimant, Shell Canada Ltd.;

John McLean, for the claimant, Aktina S/A.

Solicitors of Record:

Campney & Murphy, Vancouver, British Columbia, for the plaintiff;

Connell, Lightbody, Vancouver, British Columbia, for Canpotex Shipping Ltd.;

Bull, Housser & Tupper, Vancouver, British Columbia, for Shell Canada Ltd.;

Edwards, Kenny & Bray, Vancouver, British Columbia, for Aktina S/A;

McEwen, Schmitt & Co., Vancouver, British Columbia, for Petromarine Products;

Giaschi, Margolis, Vancouver, British Columbia, for Legend Marine Singapore Proprietary PTE Ltd.;

Sproule Castonguay Pollack, Montreal, Quebec, for Alpha Bunkering Co. Ltd.

This matter was heard on December 3, 1997, at Vancouver, British Columbia, before Hargrave, Prothonotary, of the Federal Court of Canada, Trial Division, who delivered the following decision on December 9, 1997.