Striebel v. Sovereign Yachts (Canada) Inc. et al., (2002) 222 F.T.R. 187 (TD)

• Court: Federal Court (Canada)
• Case Date: August 19, 2002
• Jurisdiction: Canada (Federal)
• Citations: (2002), 222 F.T.R. 187 (TD)

Striebel v. Sovereign Yachts Inc. (2002), 222 F.T.R. 187 (TD)

MLB headnote and full text

Temp. Cite: [2002] F.T.R. TBEd. SE.017

Mr. and Mrs. Stephen Striebel (plaintiffs) v. Sovereign Yachts (Canada) Inc., the Owners and All Others Interested in the Motor Vessel Chairman, also known as Sovereign Hull Number 7644 (defendants)

(T-687-02; 2002 FCT 925)

Indexed As: Striebel v. Sovereign Yachts (Canada) Inc. et al.

Federal Court of Canada

Trial Division

Hargrave, Prothonotary

August 30, 2002.

Summary:

The plaintiffs contracted with the defendant (Sovereign) to build a yacht for them. The vessel remained in Sovereign's ownership and the plaintiffs became mortgagees to secure their interest. The plaintiffs lost faith in Sovereign's ability to complete and deliver the vessel. They commenced an action in personam against Sovereign and in rem against the vessel. The plaintiffs went into possession and obtained the court's permission to move the vessel to another shipyard for completion. The court order required the plaintiffs to provide a bond to secure Sovereign's reasonable best case, costs and interest. Sovereign counterclaimed seeking damages of approximately $1.8 million and filed a caveat against the vessel to secure its claim. An unpaid contractor (North West) also lodged a caveat to secure work done and materials supplied to the vessel at Sovereign's request. The plaintiffs and Sovereign could not agree on the amount of security to be provided to secure Sovereign's claim.

A Prothonotary of the Federal Court of Canada, Trial Division, set security at $1 million with $160,000 of that amount being allocated to provide security for North West.

Admiralty - Topic 8268

Practice - Actions in rem - Release of property on bail - Bail bond - Quantum - The plaintiffs contracted with Sovereign to build a yacht for them - The vessel remained in Sovereign's ownership and the plaintiffs became mortgagees to secure their interest - The plaintiffs lost faith in Sovereign's ability to complete and deliver the vessel - They commenced an action in personam against Sovereign and in rem against the vessel - The plaintiffs went into possession and obtained the court's permission to move the vessel to another shipyard for completion - The court order required the plaintiffs to provide a bond to secure Sovereign's reasonable best case, costs and interest - Sovereign counterclaimed for damages of approximately $1.8 million and sought security of $2 million - A Prothonotary of the Federal Court of Canada, Trial Division, held that special circumstances existed where there was a vast difference between the parties' calculations of the cost of completing the vessel - The Prothonotary was satisfied that Sovereign's claim would not succeed as presented and held that to require security for the claim as presented would make the security oppressive - The Prothonotary set security at $1 million.

Cases Noticed:

Nanfri, The, [1978] 2 Lloyd's Rep. 132 (C.A.), refd to. [para. 9].

Adittya Vaibhav, The, [1991] Lloyd's Rep. 573, refd to. [para. 9].

Atlantic Lines & Navigation Co. v. Ship Didymi and Didymi Corp., [1988] 1 F.C. 3; 78 N.R. 99 (F.C.A.), refd to. [para. 9].

Halla Merchant Marine Co. v. Portserv Ltd. et al. (1997), 126 F.T.R. 300 (T.D.), refd to. [para. 10].

Mediterranean Shipping Co. S.A. Geneva v. Sipco Inc. (2001), 211 F.T.R. 248 (T.D.), refd to. [para. 10].

Moschanty, The, [1971] 1 Lloyd's Rep. 37 (Q.B.), refd to. [para. 14].

Brotchie v. Ship Karey T (1994), 77 F.T.R. 71 (T.D. Protho.), refd to. [para. 14].

Atlantic Shipping (London) Ltd. v. Ship Captain Forever et al. (1995), 97 F.T.R. 32 (T.D. Protho.), refd to. [para. 17].

Lundberg v. The Manitou III, [1988] F.C.J. No. 1124 (T.D.), refd to. [para. 18].

Gulf Venture, The, [1984] Lloyd's Rep. 445 (Q.B.), refd to. [para. 19].

Tribels, The, [1985] Lloyd's Rep. 128, refd to. [para. 20].

Amican Navigation Inc. v. Densan Shipping Co. et al. (1997), 137 F.T.R. 132 (T.D.), refd to. [para. 21].

Authors and Works Noticed:

Mayers, Admiralty Law and Practice in Canada (1916), p. 235 [para. 15].

Counsel:

David McEwen, for the plaintiffs;

Murray Clemens and J. MacInnis, for the defendant, Sovereign Yachts (Canada) Inc.;

Wayne Ryan, for the defendant, North West Delta Yacht Services.

Solicitors of Record:

McEwen, Schmitt & Co., Vancouver, British Columbia, for the plaintiffs;

Nathanson Schachter & Thompson, Vancouver, British Columbia, for the defendant, Sovereign Yachts (Canada) Inc.;

Ottho Law Group, Vancouver, British Columbia, for the defendant, North West Delta Yacht Services.

This motion was heard on August 19, 2002, at Vancouver, British Columbia, before Hargrave, Prothonotary, of the Federal Court of Canada, Trial Division, who delivered the following decision on August 30, 2002.