Striebel v. Sovereign Yachts (Canada) Inc. et al., (2002) 225 F.T.R. 146 (TD)

• Judge: Gibson, J.
• Court: Federal Court (Canada)
• Case Date: September 19, 2002
• Jurisdiction: Canada (Federal)
• Citations: (2002), 225 F.T.R. 146 (TD)

Striebel v. Sovereign Yachts Inc. (2002), 225 F.T.R. 146 (TD)

MLB headnote and full text

Temp. Cite: [2002] F.T.R. TBEd. OC.031

Admiralty Action in Rem and In Personam

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

(T-687-02; 2002 FCT 995)

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

Federal Court of Canada

Trial Division

Gibson, J.

September 23, 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, in a decision reported 222 F.T.R. 187, set security at $1 million with $160,000 of that amount being allocated to provide security for North West. Sovereign appealed.

The Federal Court of Canada, Trial Division, dismissed the appeal.

Admiralty - Topic 8267

Practice - Actions in rem - Release of property on bail - Bail bond - Prerequisites (incl. evidence and proof) - A prothonotary set bail for the release of a yacht at $1,000,000 - The yacht builder (Sovereign) appealed, arguing that the prothonotary erred in law in basing his decision upon a wrong principle (i.e., that the prothonotary erred in principle in weighing affidavit evidence that was before him, regarding the yacht builder's reasonably arguable best case, particularly where no cross-examinations had been conducted on that affidavit evidence) - The Federal Court of Canada, Trial Division, held that the prothonotary did not err - The prothonotary was allowed to weigh affidavit evidence regarding a party's reasonably arguable case, whether or not that affidavit evidence had been cross-examined - See paragraphs 11 to 13.

Admiralty - Topic 8268

Practice - Actions in rem - Release of property on bail - Bail bond - Quantum - A prothonotary set bail for the release of a yacht at $1,000,000 - The yacht builder appealed - The Federal Court of Canada, Trial Division, refused to disturb the prothonotary's decision where it was not clearly wrong - See paragraphs 1 to 15.

Cases Noticed:

Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425; 149 N.R. 273 (F.C.A.), refd to. [para. 7, footnote 1].

C.P. Ships (Bermuda) Ltd. v. Ship Panther Max Ex Canmar Supreme et al., [2002] F.T.R. Uned. 609 (T.D.), refd to. [para. 10].

Amican Navigation Inc. v. Densan Shipping Co. et al. (1997), 137 F.T.R. 132 (T.D.), refd to. [para. 11, footnote 3; Schedule, para. 21].

Ship Moschanthy, Re, [1971] 1 Lloyd's Rep. 37 (Q.B.), refd to. [Schedule, para. 14].

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

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

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

Ship Gulf Venture, Re, [1984] 2 Lloyd's Rep. 445 (Q.B.), refd to. [Schedule, para. 19].

Athens Sky Compania Naviera S.A. v. Port Services Corp. (Ship Tribels), [1985] 1 Lloyd's Rep. 128 (Q.B.), refd to. [Schedule, para. 20].

Authors and Works Noticed:

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

Counsel:

David F. McEwen, for the plaintiffs;

Murray A. Clemens, Q.C., for the defendants.

Solicitors of Record:

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

Nathanson, Schachter & Thompson, Vancouver, British Columbia, for the defendants.

This appeal was heard in Vancouver, British Columbia, on September 19, 2002, before Gibson, J., of the Federal Court of Canada, Trial Division, who delivered the following judgment on September 23, 2002.