Admiralty Law in Bangladesh and Ship Arrest in Bangladesh in 2023

This article will explain in details about admirlty law in Bangladesh and ship arrest procedure with details.

Nature of Admiralty law in Bangladesh

Admiralty Suits and Admiralty law in Bangladesh:

The High Court Division of the Supreme Court of Bangladesh is vested with admiralty jurisdiction. Article 101 of the Constitution of the People’s Republic of Bangladesh provides that the High Court Division shall have such jurisdiction as are conferred on it by the Constitution and by other laws.

Section 3 (1) of the Admiralty Court Act, 2000 proclaims that the High Court Division of the Supreme Court shall be the Court of Admiralty.

Sub-section (2) narrates the jurisdiction of the Court in details. Section 8 of the Act permits the hearing and disposal of admiralty suits by a single bench of the High Court Division. However, the Chief Justice may constitute a Division Bench comprising two or more judges for hearing and disposal of such suits.

Nature of Admiralty Action in Bangladesh:

Maritime law has long allowed a plaintiff to proceed not only in persona (e.g. against a shipowner) but also in rem (against the thing itself, e.g. the ship). Therefore, admiralty action is an action in rem as well as in personam. Admiralty suit is an action in rem generally and cause of action arises due to collision of ships in the seas and/or for causing damage to cargo.

Thus, in admiralty law in Bangladesh, the remedy in an admiralty suit is essentially a remedy by way of compensation in money and that is why the Act of 2000 and Admiralty Rules provide for arrest of ships when it is within the territorial limits of Court.

The Act also provides for the release of an arrested ship on furnishing of adequate security for the claim amount. An action in rem is directed against the ship itself to satisfy the claim of the plaintiff out of the res. The ship is for this purpose treated as a person.

Such an action may constitute an inducement to the owner to submit to the jurisdiction of the court, thereby making himself liable to be proceeded against by the plaintiff in personam.

Proceeding For Ship Arrest in Bangladesh

In admiralty law in Bangladesh, It is however, imperative in an action in rem that the ship should be within jurisdiction at the time the proceedings are started. It is by means of an action in rem that the arrest of a particular ship is secured by the plaintiff.

The arrest of the foreign ship by means of an action in rem is thus a means of assuming jurisdiction by the competent court.

A suit against a foreign ship owned by a foreign company not having a place of residence or business in Bangladesh is liable to be proceeded against on the admiralty side of the High Court Division by an action in rem in respect of a cause of action alleged to have arisen by reason of a tort or a breach of obligation arising from the carriage of goods from a port in Bangladesh to a foreign port. 

A personal action may be brought against the defendant if he is either present in the country or submits to jurisdiction. If the foreign owner of an arrested ship appears before the court and deposits security as bail for the release of his ship against which proceedings in rem have been instituted, he submits himself to jurisdiction.

Procedure of an admiralty suit in Bangladesh:

The procedure for commencing an action on a claim under the admiralty jurisdiction of the High Court Division is as like as filing of a civil suit in a court of original jurisdiction.  

Institution of Admiralty suits in Bangladesh:

Section 6 of the Admiralty Court Act, 2000 of admiralty law in Bangladesh provides for filing of a suit in the Admiralty Court through a plaint in accordance with the provisions of the Code of Civil Procedure. Section 6 reads as: “suit under admiralty jurisdiction to be instituted by a plaint drawn up, subscribed and verified by the claimant as plaintiff according to the provisions of Code of Civil Procedure 1908 of Bangladesh”. Rule 3 of the Admiralty Rules, 1912 provides:

“In admiralty law in Bangladesh, a suit shall be instituted by a plaint drawn up, subscribed and verified according to the provisions of the Code of Civil Procedure, save what if the suit is in rem the defendants may (subject to such variations as the circurnstances may, require) be described as “the owners and parties interested in” the vessel or other property proceeded against instead of  name”.

The plaint must be signed and verified by the plaintiff, if he be an individual, and in the case of a firm by any one of its partners, and, it a corporation, by a director, the secretary or other principal officer. When the claimant seeks to arrest the vessel, the vessel would be named as a defendant. If the owners of the vessel are known they will be impleaded and named as other defendants. In addition, the defendant may also be described as

“the owners and parties interested in the vessel cases, the local agent of the ship is also impleaded as a defendant.

In most the plaint contains the names, description and place of residence of the plaintiff and the defendant/defendants; the statements of facts giving rise to the cause of action to the claimant for the suit and the time when it arose; the nature of claim as well as statements that the suit is maintainable within the admiralty jurisdiction of the court. The plaintiff in the plaint will seek appropriate relief or reliefs, i.e., the decree to be passed in the suit.

 Application for arrest of a ship or for injunction in Bangladesh

An application for arrest of a ship in admiralty law in Bangladesh or application for injunction, or direction requires affirmation. Affirmation is made by swearing an affidavit by the claimant or on his behalf by his authorised agent before the Commissioner of Oaths of the High Court Division. Until an affidavit by the claimant or his agent is filed no warrant of arrest shall be issued.

Rule 4 of the Admiralty Rules, 1912 prescribes that in suits in rem a warrant for the arrest of property may be issued at the instance either of the plaintiff or of the defendant at any time after the suit has been instituted, but no warrant of arrest shall be issued until an affidavit by the party or his agent has been filed.

 The affidavit shall state the name and description of the party at whose instance the warrant is to be issued, the nature of claim or counter-claim, the name and nature of the property to be arrested, and that the claim or counter-claim has not been satisfied.

How the plaintiff moves the plaint:

Upon filing the plaint, the plaintiff moves the same before the Admiralty Court the concerned bench of the High Court Division assigned to hear admiralty matters) and such court normally orders registration and admission of the suit and gives directions for issuing summons upon the defendants, fixing a date for their appearance and for filing the written statement.

Thereafter, the application for arrest of the vessel is. Moved and, if the court is prima facie satisfied with the submission of the plaintiff in favour of the claims, the Court passes an instant order for arrest of the ship and for keeping the same in the custody of the Marshal of the Admiralty Court.

The Marshal is appointed by the Chief Justice to execute the process of the Admiralty Court. The Court would further order that the vessel, the other defendants and the Port Authority, Customs Authority and the Port Police be informed about the order of arrest of the vessel and would also direct that the Port Authority, Customs Authority and the Port Police Authority render all necessary assistance to the Marshal of the Court in securing the arrest of the vessel.

While passing an order for arrest, it is usual for the Court to pass an order that, in the event of the defendants satisfying the Court that the vessel is under no obligation to pay the claimant or in the event of furnishing such security as against the amount to be determined by the Court, the ship may be released from arrest. The necessary orders of the Court admitting the suit and the arrest would be required to be drawn up by the office.

Signing of the Order by the judge:

Thereafter, the order would be signed by the judge presiding over the Admiralty Court and the party at whose instance the arrest order is passed would take out the necessary warrant and summons which shall be served by the Marshal of the Admiralty Court on the vessel, other defendants and the Port and Customs Authorities. 

Sometimes the Admiralty Court, instead of passing an instant order of arrest, will direct the defendants to show cause within a certain period of time, say within three or four days from the date of service of the order, as to why on the allegations of the plaintiff contained in the application for arrest, the vessel should not be arrested, and similar procedures, like those for the service of the warrants of arrest order will be folfowed in respect of the service of the said “show cause” notice on the defendants.

Execution of warrant of arrest:

Service of a warrant against a ship is to be effected by nailing or affixing the original writ or warrant for a short time on the main mast or on the single mast of the vessel and by taking off the process, leaving a true copy of it nailed or affixed in its place.

Normally, upon a warrant of arrest, the Marshal along with his assistants will proceed towards the Port where the ship is anchored for service of the same and the Marshal will go on board the ship and call the Master or in his absence the Officer-in- Charge of the ship and inform him by handing over the warrant of arrest that the vessel is under arrest of the Admiralty Court.

If the Master of, in his absence, the Officer-in-Charge of the ship refuses to accept the warrant, the Marshal will leave the warrant of arrest on board and will submit his report to the Court stating either that the writ has already been served or about the refusal to accept the writ of arrest and the fact of leaving the writ on the vessel because of refusal by the Master to accept it. 

If a writ of arrest is left on board by the Marshal because of the Master’s refusal to accept it, this would be deemed by the Court to amount to a good service of the arrest order. The Port having jurisdiction over the vessel will also be informed and served with the writ of arrest for the purpose of information and, upon receipt of the same, the Port Authority will not give any port clearance to the vessel until a release order is served upon them for the purpose of information.

Similarly, the Commissioner of Customs having jurisdiction over the vessel would also be informed about the arrest of the vessel and be served with the writ of arrest. He also will not grant any clearance to the vessel until a writ of release order is served on him for the purpose of information. The other defendants will also be served with the order of arrest of the vessel.62

Custody of the ship while under arrest

From the time of arrest the ship will be under the custody of the Marshal of the Admiralty Court and any interference with the same might be regarded as contempt. The Marshal requests the Port Authority to keep watch over the ship.

Appearance of defendants:

The defendants immediately upon receipt of the arrest order may cause their appearance in the suit through advocates and file written objections (W.O.) against the order of arrest, giving the grounds in favour of vacating such an order, or may furnish security by way of a Bank Guarantee executed by a local scheduled bank to the extent of the claimed amount, or such amount as determined by the Court for immediate release of the vessel, and file written objections in due course. Written objections are required to be affirmed by an affidavit on behalf of the defendants before the Commissioner of Oaths of the High Court Division.

Statement showing the extent of interest.

In an admiralty suit where a ship has been arrested any person not named in the writ but interested in the vessels may intervene and appear on the filing of an affidavit showing that he is interested in the vessel and may tille a statement showing the extent of his interest. Upon hearing of, the written objections filed by the defendant, if the Court is satisfied that the vessel has no obligation to pay the claimant of that the vessel is not liable to be arrested, the Court may set aside the order of arrest and order the release of the vessel. 

If the defendants furnish a Bank Guarantee through a local scheduled bank, for the immediate release of the vessel, the vessel will be released.

 Upon the furnishing of the Bank Guarantee, the maintainability of the arrest order can be challenged by filing written objections, and the Court may hear such objections and, if satisfied that the vessel is not under any obligation to satisfy the claims of the claimants, may return the Bank Guarantee to the bank concerned for cancellation.

In appropriate cases the Admiralty Court may consider to reduce the quantum of security to be furnished by way of Bank Guarantee for the release of the vessel. Hearing of such application for reduction of security amount may take some time.

Normally, written objections are taken up for hearing by the Court in due course and, unless there appears to be a very strong case in favour of the defendants and for release of the vessel, the Court would order that the objections be taken up at the time of the final hearing.

In a suit where only a notice to show cause as to why the vessel would not be arrested is passed by the trial Court, the defendants would appear and file written objections against such order and, upon hearing, if the Court is satisfied that the vessel is not liable to be arrested, the Court would reject the petition for arrest.

In the event the Court is satisfied that the vessel would be out of jurisdiction without satisfying the claims of the plaintiff, when a decree may be passed in his favour, the Court would order the arrest of the vessel.

Defendants possession as evidence in support of the defence

The defendants are required under the law to file a written statement in their defence in, reply to the allegations contained in the plaint. Where the defendants rely upon documents in their possession as evidence in support of the defence, they can produce and file the same in Court.

The defendants may also file such documents as they consider necessary for the defence before commencing the hearing of the suit. The Court also has the power to direct either the plaintiffs or defendants at any time during the pendency of the suit to produce such documents as are in their possession relating to any matter in question in the suit.

Court fee for admiralty suits in Bangladesh:

Court fee for admiralty suit is an important issue. The Admiralty Court Act, 2000 provides for the application of the Court Fees Act, 1870 in an admiralty suit. First Schedule to the Court Fees Act prescribes the rate of  advalorem fees payable on the valuation of a suit.

Where the suit is valued to an amount below Tk 2 lakh or where the claim amount as stated in the plaint does not exceed the said limit, the court-fee is fixed at Tk 7,100.00. For any amount exceeding taka 2 lakh court fee would be 1% of the exceeding amount plus [15% VAT]° (value added tax) on the total court fee calculated as such.

Maximum advalorem court fee in Bangladesh Admiralty Law

Proviso to section 7 of the Admiralty Act, 2000 provides for a maximum advalorem court fee of taka one lakh for the enforcement of maritime claim or questions. The same proviso provides that, the fees chargeable on a plaint in case of a claim by a master or member of the crew of a ship for recovery of wages shall be taka one hundred. 

Enforcement of judgment and decree:

When a suit is decreed in favour of the claimant and if there is no Bank Guarantee or security in substitution of the vessel, a sale by public auction of the arrested vessel would be ordered by the Court. An order for sale pendente lite of a ship under arrest is very exceptional but can be made in certain serious situations. 

Sale by public auction is conducted by the Marshal of the Admiralty Court. The Marshal of the Admiralty Court for this purpose prepares an inventory of the said vessel and puts the vessel in public auction at a date and time fixed by him.

Notices for auction sale

Notices for such auction sale is generally published in two national dailies one in English and the other in Bengali and also in local papers’ where the ship is arrested. The decree-holder pays the necessary expenses for the preparation of the said inventory by the Marshall and his team, the cost of advertisement in the papers and all other incidental expenses.

All such costs and expenses in connection with or relating to the auction sale of the vessel are considered as the first charge on the sale proceeds of the vessel. The highest bidder at a public auction will be allowed to purchase the vessel. The sale proceeds of the auction sale is deposited in the account of the Court/Marshall as per rules. 

However, such a sale is to be confirmed by the Admiralty Court. If the Court finds that the bid offer is very low, then it may set aside the auction and may direct a fresh auction and, upon sale, the Court will disburse the amount of the claimants. If there is a Bank Guarantee substituting a vessel the decretal amount will be satisfied out of the Guarantee.

The right to arrest a sister ship:

The admiralty jurisdiction of the High Court Division may be invoked by an action in rem not only against the offending ship in question but also against a “sistership’, i.e., a ship in the same beneficial ownership as the ship in regard to which the claim arose. Section 4 (4) of the Admiralty Act, 2000 specifically provides: 

In the case of any such claim as is mentioned in clauses (d) to (g) of sub-section 2 of section 3 of the Act, being a claim arising in connection with a ship, where the person who would be liable on the claim in an action in personam was, when the cause of action arose, the owner or charterer of, or in possession or in control of, the ship, the Admiralty jurisdiction of the High Court Division as the Court of Admiralty may (whether the claim gives rise to a maritime lien on the ship or not) be invoked by an action in rem against-

(a) that ship, if at the time when action is brought it is beneficially owned as respects all the shares therein by that person; or

(b) any other ship which, at the time when action is brought, is beneficially owned as aforesiad.

However, before the enactment of the Act of 2000 the High Court Division in exercising admiralty jurisdiction decided against proceeding in rem where the sister ship of the same owner was not concerned with the cause of action. In Kings Shipping Trading Co. vs. Ms. L.S. Lines & Other of the High Court Division observed:

“Admiralty Court in Bangladesh has been exercising the same jurisdiction as was conferred upon the High Court of Admiralty in England under the provision of Colonial Court of Admiralty Act 1890 and Colonial Courts of Admiralty (India) Act 1891. The High Court Division of the Supreme Court of Bangladesh never exercised Admiralty jurisdiction on the basis of practices of the English Court of Admiralty.

The principles of Administration of Justice Act 1956 extending Admiralty jurisdiction in England cannot be followed in Bangladesh, as the said Act is not applicable in Bangladesh. This Court exercising admiralty jurisdiction has no power to arrest any property or ship of the defendant other than the one which was concerned in the cause of action. The suit in rem is not maintainable, but in personam is maintainable.

Are you planning to file an admiralty related suit in Bangladesh?

Admiralty Suits in Bangladesh and Ship Arrest at Tahmidur Rahman Remura: TLS: The Law Firm in Bangladesh:

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