1. This is a question whether the claim herein is tenable. The claimant states that now that the cargo has left the ship the subject matter is no longer admiralty.
2. The 2nd Respondent begs to differ. There is an order restraining the discharge of cargo. I order the said order be stayed. I have not discharged the same. I have also noted from the record that there are investigations our forgery going on by the relevant bodies.
3. The jurisdiction of this Court is Circumscribed under Section 20 of the Senior Court Act, 1981 of England. The same provides as doth: -
4. Section 20 of the Senior Courts Act, provides for the Admiralty jurisdiction of High Court.
“(1) The Admiralty jurisdiction of the High Court shall be as follows, that is to say—
a. jurisdiction to hear and determine any of the questions and claims mentioned in subsection (2);
b. jurisdiction in relation to any of the proceedings mentioned in subsection (3);
c. any other Admiralty jurisdiction which it had immediately before the commencement of this Act; and (d) any jurisdiction connected with ships or aircraft which is vested in the High Court apart from this section and is for the time being by rules of court made or coming into force after the commencement of this Act assigned to the Queen’s Bench Division and directed by the rules to be exercised by the Admiralty Court.
(2) The questions and claims referred to in subsection (1)(a) are—
(a) any claim to the possession or ownership of a ship or to the ownership of any share therein;
(b) any question arising between the co-owners of a ship as to possession, employment or earnings of that ship;
(c) any claim in respect of a mortgage of or charge on a ship or any share therein;
(d) any claim for damage received by a ship;
(e) any claim for damage done by a ship;
(f) any claim for loss of life or personal injury sustained in consequence of any defect in a ship or in her apparel or equipment, or in consequence of the wrongful act, neglect or default of—
(i) the owners, charterers or persons in possession or control of a ship; or
(ii) the master or crew of a ship, or any other person for whose wrongful acts, neglects or defaults the owners, charterers or persons in possession or control of a ship are responsible, being an act, neglect or default in the navigation or management of the ship, in the loading, carriage or discharge of goods on, in or from the ship, or in the embarkation, carriage or disembarkation of persons on, in or from the ship; (g) any claim for loss of or damage to goods carried in a ship;
(h) any claim arising out of any agreement relating to the carriage of goods in a ship or to the use or hire of a ship; any claim— (i) under the Salvage Convention 1989;
(ii) under any contract for or in relation to salvage services; or
(iii) in the nature of salvage not falling within (i) or (ii) above; or any corresponding claim in connection with an aircraft;]
(k) any claim in the nature of towage in respect of a ship or an aircraft;
(l) any claim in the nature of pilotage in respect of a ship or an aircraft;
(m) any claim in respect of goods or materials supplied to a ship for her operation or maintenance;
(n) any claim in respect of the construction, repair or equipment of a ship or in respect of dock charges or dues;
(o) any claim by a master or member of the crew of a ship for wages (include]ing any sum allotted out of wages or adjudged by a superintendent to be due by way of wages);
(p) any claim by a master, shipper, charterer or agent in respect of disbursements made on account of a ship;
(q) any claim arising out of an act which is or is claimed to be a general average act;
(r) any claim arising out of bottomry;
(s) any claim for the forfeiture or condemnation of a ship or of goods which are being or have been carried, or have been attempted to be carried, in a ship, or for the restoration of a ship or any such goods after seizure, or for droits of Admiralty.
… (4) The jurisdiction of the High Court under subsection (2)(b) includes power to settle any account outstanding and unsettled between the parties in relation to the ship, and to direct that the ship, or any share thereof, shall be sold, and to make such other order as the court thinks fit”
5. The section Applies by dint of Section 4 of the Judicature Act. The same provides as follows: -
“4. High Court is court of admiralty
(1) The High Court shall be a court of admiralty, and shall exercise admiralty jurisdiction in all matters arising on the high seas, or in territorial waters, or upon any lake or other navigable inland waters in Kenya.
(2) The admiralty jurisdiction of the High Court shall be exercisable—
(a) over and in respect of the same persons, things and matters; and
(b) in the same manner and to the same extent; and
(c) in accordance with the same procedure, as in the High Court in England, and shall be exercised in conformity with international laws and the comity of nations.
(3) In the exercise of its admiralty jurisdiction, the High Court may exercise all the powers which it possesses for the purpose of its other civil jurisdiction.
(4) An appeal shall lie from any judgment, order or decision of the High Court in the exercise of its admiralty jurisdiction within the same time and in the same manner as an appeal from a decree of the High Court under Part VII of the Civil Procedure Act (Cap. 21).
6. In its claim filed in November 2023, the Claimant invoked the admiralty jurisdiction of the court. Over Motor vessel Haigui. Methinks it is a motor tanker due to the nature of the cargo.
7. The 1st defendant filed submissions and argued that the court has jurisdiction to hear and determine the case. They stated that the issue is a question of law. They placed reliance and the court agrees with their interpretation regarding jurisdiction as set out in the Supreme Court decision in Samuel Kamau Macharia and Another v. Kenya Commercial Bank Limited & 2 others [2012] eKLR, Application No. 2 of 2011 where the court held:
“A Court’s jurisdiction flows from either the Constitution or legislation or both. Thus, a Court of law can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate itself jurisdiction exceeding that which is conferred upon it by law.”
8. It was their case that the claimant admitted in paragraph 5 of its submissions that this court had jurisdiction to determine the claim filed on 8th November 2023. That claim has not been amended by the claimant. It follows therefore that this court has jurisdiction to determine the claimant’s claim filed on 8th November 2023.
9. They state that the court cannot be deprived of jurisdiction changing the nature of the claim filed on 8th November 2023. 5. Under Section 20 of the Senior Courts Act (the Act), a dispute over the ownership of the cargo is a dispute that the admiralty court can determine.
10. Further they state that claimant, in its claim filed on 8th November 2023, claimed ownership of the motor vessel MT Haigui and the cargo on that vessel. These are questions that this court still has jurisdiction to determine in the present suit.
11. The claimant argued that at the time of filing the Claim, and without prejudice to the submissions, the Court had the jurisdiction to hear the matter under the provisions of Section 4 of the Judicature Act as well as Section 20 of the Senior Courts Page 1 Act, 1981 which donates the admiralty jurisdiction to this Honourable Court in Claims involving the ownership and arrest of Motor Vessels.
12. It is their case that the payers sought in the Claim and the orders of 8th November 2023 were valid as they were made when the Court had the requisite jurisdiction to do so. This changed from an admiralty Claim to t a commercial nature involving the disputed ownership of the cargo as well as the nature of the cargo in question. They rely on the fact that the court in its wisdom, discharged and the ship “MV Haigui” had already left the jurisdiction and in the high seas.
13. The other parties dealt with Applications that were not subject of this Ruling.
14. The dispute related to the claimant as a consignee of cargo, Diesel EN 590 ON BOARD the vessel from the port of Jeddah in Saudi Arabia. The cargo was said to be worth Ksh. 17,000,000,000/=. I gave certain orders and modified them on a later date given the prevailing circumstances.
15. The dispute from the ownership was the ownership of the cargo carried aboard MV HAIGUI. Both the first defendant and the claimant laid claim on the cargo. The dispute remains as it was on day 1, whose cargo was on the tanker. The claimant also lays claim to the ship itself though no other party claims it. Parties state that they have a bill of lading. A bill of lading is a document of title. It is evidence of a contract of carriage. An Admiralty claim relates to a contract of carriage of goods. As the matter stands the court has not Ruled on the ownership of the cargo ordered to be carried on board MV Haigui. To make matters worse the Applicant claimed that the strip was hers.
16. The claimant has authorization on board dated 9/10/2023, and a clean bill of lading, indicating the cargo was shipped on board. For the unschooled, it means the cargo was sold while already on the tanker. It is an international version of hawking. There is a cargo manifest dated 9/102023 for the Vessel Haigui, a Liberian flag ship from Jedda, SA, to Mombasa, Kenya. it is even indicated prepaid.
17. A letter of entrustment was equally signed on 9/10/2023, together with the analytical report NK17-07022.001 and SGS ullage report dated 02-10-2023.
18. None of these circumstances changed. I am aware that there can be Multi-layered and fractional or even time-limited ownership of a ship. This can be through time charters of Charter Parties.
19. The contract of carriage of goods is not terminated upon discharge of cargo. The ship may have its own claims in rem and the dispute relates to cargo then aboard a ship. The dispute did not dispute, after discharge of cargo. I requested the Kenya Revenue Authority to file a manifest in the matter. This will help determine the ownership and lodging of the claim herein. The Kenya revenue Authority filed a Replying Affidavit by Anthony Wekesa dated 13/11/2023 that they received a request for Motor tanker MT Haigui. Vol. 003V E T A 10/10/2023.
20. I was worried earlier when everyone was referring to motor vessel as Oil is always transported in Motor tankers. What they produced is stated to be a manifest as at 23/11/2023.
21. Unfortunately, the manifest that was filed by the Kenya Revenue Authority was produced in a non – impregnable form. It is worthless, in determining the issue at hand. This therefore means that the ownerships of the cargo is still outstanding. There is no way of knowing which of the bills of lading is true without hearing the case. There is therefore a need to ascertain the root of ownership and the contract for carriage. Did the claimant instruct carriage of diesel of Gasoil.
22. To the Court, the two bills of lading relate to different commodities. What was manifested is two types of oil in 19 pages for inland manifest as doth:-
(a) Local Gasoil - 49,0-91.724mt
(b) Transit gasoil – 44,368.736mt.
Total 93,460,460
23. This is in contradiction with 100,000 metric tones of diesel, EN 590.
24. The question in my mind is how manifestly cargo in Mt Haigui for 93,460. Metric Tonnes of Gasoil discharge the obligations over 100,000 MT of EN 590 Diesel.
25. The Court does not see the nexus between the two types of products. As I part, none of the parties tell me who bought or paid for the cargo and which cargo. There are questions I can only answer in the fullness of time if nothing happens in the intervening period. Oil whether diesel or gasoil, that is petrol, is not dished out like manner. There are international payments and several banks in between as intermediaries that it is to know if one wants to know.
26. I decline the invitation to delicate that the dispute is overtaken. If the Plaintiff does not wish to proceed, then they can apply for withdrawal of the claim. However, if is not open for the Court to decide that question. It is the parties who know whether they wish to proceed. If they do, then they need to have the matter set for hearing if not they must do the needful, and withdraw the case, in which event costs shall follow. I am not convinced that this admiralty claim is untenable.
27. It was surprising to see the defendants argue that the case is arguable while the plaintiff states that they had a hopeless case. Nothing in my decision on 14/11/2023 affected jurisdiction. If there is none, it is because it was never there. Justice Nyarangi in S. Lilian stated: -
“Owners of the Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd [1989] eKLR, justice Nyarangi JA, as he then was stated as doth;
“With that I return to the issue of jurisdiction and to the words of Section 20 (2) (m) of the 1981 Act. I think that it is reasonably plain that a question of jurisdiction ought to be raised at the earliest opportunity and the court seized of the matter is then obliged to decide the issue right away on the material before it. Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no jurisdiction, there would be no basis for a continuation of proceedings pending other evidence. A court of law down tools in respect of the matter before it the moment it holds the opinion that it is without jurisdiction. Before I part with this aspect of the appeal, I refer to the following passage which will show that what I have already said is consistent with authority: “By jurisdiction is meant the authority which a court as to decide matters that are litigated before it or to take cognisance of matters presented in a formal way for its decision. The limits of this authority are imposed by the statute, charter, or commission under which the court is constituted, and may be extended or restricted by the like means. If no restriction or limit is imposed the jurisdiction is said to be unlimited. A limitation may be either as to the kind and nature of the actions and matters of which the particular court has cognisance, or as to the area over which the jurisdiction shall extend, or it may partake of both these characteristics. If the jurisdiction of an inferior court or tribunal (including an arbitrator) depends on the existence of a particular state of facts, the court or tribunal must inquire into the existence of the facts in order.”
28. Justice Masime in the same case held as doth: -
“If the claim so lay then the respondent was required to pursue it in accordance with the provisions set out in Section 21 (1) of the Act and Order 75 of the rules of the Supreme Court.
In the instant appeal the appellant questioned the court’s jurisdiction at the first opportunity and in accordance with Order 12 Rule 8 of the Rules of the Supreme Court. This court has in an interlocutory ruling held that the appellant was entitled to so challenge the jurisdiction of the court.
That being so it was incumbent upon the superior court to dispose of that issue forthwith and before entertaining the claim further. A similar issue was raised in The River Rima [1987] 3 All ER 1 (CA) and (1988) 2 LG Rep 193 (HL), whether the plaintiff’s claim fell within the jurisdiction of the Admiralty Court under section 20 (2) (m) of the Act. It was held that it was necessary, to demonstrate a sufficiently direct connection between the agreement relied on and the operation of the ship in order to maintain an action under the section. In that case the plaintiff’s claim did not come within the admiralty jurisdiction and consequently the writ in rem and the warrant of arrest were set aside and the ship ordered to be released from arrest. And in I Congresso del Partido [1978]1 Q. B 500 at 526, B it was stated by Golf J. (as he then was) that:
“Invocation of the Admiralty jurisdiction by an action in rem presupposes the existence of a claim in personam against the person, who, at the time when the action is brought is the owner, of the ship.”
The learned Judge was there dealing with section 3 (4) of the Administration of Justice Act 1956 the substance of which is now comprised in Section 21 (4) of the Act as follows:-
“(4). In the case of any claim as is mentioned in Section 20 (2) (e) to (r), where
(a) the claim arises in connection with a ship; and,
(b) the person who would be liable on the claim in an action in personam (“the relevant person”) was, when the cause of action arose, the owner or charterer of, or in possession or in control of, the ship an action in rem may (whether or not the claim gives rise to a maritime lien on that ship) be brought in the High Court against-
(i) that ship, if at the time when the action is brought the relevant person is either the beneficial owner of that ship as respects all the shares in it or the charterer of it under a charter by demise; or
(ii) any other ship which at the time when the action is brought, the “relevant person is the beneficial owner as respects all the shares in it.”
It was contended by the Appellant that it was not such a “relevant Person” and consequently that the action in rem was brought against it in error as in the circumstances the admiralty jurisdiction could not properly be invoked.
29. The defendant have accepted jurisdiction. We have not proceeded on the acceptance of service. The defendants have to review their positions and see whether to acknowledge service and answer the claim. The applicant cannot challenge the jurisdiction of a claim they filed without a change of circumstances.
30. I find and hold that the Court has the authority to continue with the case. The court shall issue directions immediately after this Ruling. However, parties must name issues. As they do so, they must flag: -
(a) A proper manifest it is usually auto generated not xcel.
(b) Evidence of payment for the contract for shipping. Evidence for the foreign banks will suffice.
(c) There be no order as to costs.
DELIVERED, DATED and SIGNED at MOMBASA on this 15th day of December, 2023. Ruling delivered through Microsoft Teams Online Platform.
In the presence of:
Mr. Ochieng for Kenya Revenue Authority
Kiragu Kimani Sc and Ms Kirimi for the 1st Defendant
No appearance for Plaintiff.
Mr. Mogaka for 2nd Defendant
Mr. Odongo for the 3rd Defendant
Mr. Moriasi for the Claimant
Court Assistant - Brian