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National Maritime Safety Authority v The Ship "Dumb Barge Poly 12" & The Ship "Dumb Barge Poly 7" [2022] PGNC 385; N9845 (30 August 2022)

N9845

PAPUA NEW GUINEA
[IN THE NATIONAL COURT OF JUSTICE]

OS NO 407 & 408 OF 2020

BETWEEN:
NATIONAL MARITIME SAFETY AUTHORITY
Plaintiff

AND:
THE SHIP “DUMB BARGE POLY 12” & THE SHIP “DUMB BARGE POLY 7”
First Defendant

AND:
SHARRINGTON LIMITED
Second Defendant

AND:
BISMARCK INDUSTRIES LIMITED
Third Defendant

Kimbe: Manuhu, J.
2022: 16^th & 18^th May, 30^th August

MARITIME LAW – Forfeiture – Seizure of unregistered vessels at log pond – Assuming the PNG national character – ss. 2,5 & 270 of Merchant Shipping Act 1975.

Cases Cited:

Nil
Counsel:

E. Tagu, for the Plaintiff
W. Langap, for the Defendants

30^th August, 2022

1. MANUHU, J.: In this consolidated proceeding, the plaintiff (“NMSA”) seeks forfeiture of two vessels, namely Dumb Barge Poly 7 (“Poly 7”) and Dumb Barge Poly 12 (“Poly 12”), under ss. 2, 5 and 270 of the Merchant Shipping Act 1975 (“The Act”) on the basis that the vessels were found to be unregistered and assuming Papua New Guinea national character. The proceeding is an action in rem which means it is against the vessels.

2. The facts are that on 10^th to 20^th of November 2020, officials from the NMSA commenced a routine field inspection of log ponds at Silovuti, Kandrian and Gloucester, West New Britain Province. The inspectors found the vessels on site.
It was thought that the vessels were owned by Bismarck Industries Limited (“Bismarck”), which failed to produce the vessels’ registration documents to the inspectors. It was confirmed, nonetheless, that both vessels, Poly 7 and Poly 12, were unregistered.

3. After consultation with the senior management at the headquarters, the two vessels were seized and detained pending the outcome of this proceeding. Further investigations revealed that the vessels were owned by Sharrington Limited (“Sharrington”). The vessels were leased to Bismarck, a logging company that was operating at Silovuti where the vessels were found by the inspectors.

4. It is necessary to understand that when inspectors carry out an inspection of a vessel, what they look for includes registration documents and any defect or malfunction on the vessel and its equipment. For instance, the inspection of 30 September 2019 on Poly 7 noted the following discrepancies:

• Certificate of Registry not carried on board
• Cargo Ship Safety Construction Certificate not carried on board
• Cargo Ship Equipment Certificate not carried on board.
• Cargo Ship Safety Radio Certificate not carried on board.
• Minimum Safe Manning Document not carried on board.
• Life Craft Service Certificate not carried on board.
• Fire Extinguisher Service Certificate not carried on board
• Radar Defective.
• Starboard Life Buoy Light not working.
• Crew Documents not available/carried on board to verify qualification.
• Masters Qualification as Master not verified due to absence of Minimum Safe Manning documents.
• Rust Holes on Steering Gear Compartment Bulkhead.
• Water-tight Doors to Engine Room not sealing properly.
• Emergency Tow Hook Release not operational.
• Accommodation Vent Fire Damper seized.
• Engine Room Vent Fire Damper seized.
• Port Main Engine Defective.
• Cargo Ship Safety Certificate not carried on board.
• Navigational Charts not carried on board.

5. It is a registration requirement that the vessels must be seaworthy. The defendants do not deny that both vessels were not registered and not seaworthy but the proceeding was fully defended. They contend that they tried to carry out repair and maintenance on the vessels to prepare them for registration but events beyond their control, such as the Covid 19 pandemic, prevented them from completing the task. It was submitted that NMSA was always aware that Sharrington had already engaged MJ Marine Surveyors (“The Surveyors”) to attend to issues regarding registration and have the vessels registered. It was submitted therefore that forfeiture is unjustified and unwarranted.

6. On the other hand, Mary Kalebo, Ship Registration Officer with NMSA, gave evidence that on 25 April 2019, she met up with Mr Holman of Sharrington regarding registration of the vessels. After the meeting, she sent all the necessary registration forms by email to Mr. Holman. She didn’t receive any feedback from Mr. Holman regarding the registration of the vessels.

7. She then received a survey report from Mr. Holman but the survey report did not satisfy the requirements for registration. She was advised in September 2019 that the Surveyors had been engaged by Sharrington to facilitate registration of the vessels but since then, no registration documents were submitted to her until over a year later when the inspection was carried out in November 2020 at Silovuti.

8. There is no evidence of follow up letters, emails or telephone calls between NMSA and Sharrington regarding registration of the vessels.

9. As earlier stated, the plaintiff seeks forfeiture under ss. 2, 5 and 270 of the Act. Section 2 provides:

“(1) If a person uses the National Flag or assumes Papua New Guinea national character on board a ship owned in whole or in part by a person who is not a qualified person for the purpose of making the ship appear to be a ship registered under this Act, the ship is liable to forfeiture unless the use or assumption has been made for the purpose of escaping capture by an enemy or by a foreign ship of war in the exercise of some belligerent right.

“(2) In any proceeding for the enforcement of the forfeiture of a ship under Subsection (1), the burden of proving a right to use the National Flag or to assume Papua New Guinea national character lies on the person using or assuming that Flag or that character.”

10. Under this section, as the vessels were unregistered, they are liable to forfeiture if they used the National Flag or if they assumed the national character. There is, however, no evidence that the national flag was flown on any of the two vessels. The only question then is whether the vessels assumed Papua New Guinea national character. Except the unregistered status, there is no evidence on assumption of national character. The vessels did not have anything installed, hoisted, or painted by any person which would give the impression that the vessels were registered. As a matter of fact, the vessels were unregistered, unseaworthy and therefore non-operational. Therefore, I am unable to make a finding of liability against the vessels.

11. I find therefore that the vessels are not liable to forfeiture under s.2. Section 5 of the Act provides:

“(1) Where a ship that is required to be registered under this Act is not so registered, the ship shall not be entitled–

(a) to any benefit, privilege, advantage or protection usually enjoyed by a ship registered under this Act; or
(b) to use the National Flag; or
(c) to assume Papua New Guinea national character.

“(2) In the case of a ship to which Subsection (1) applies, the owner and master of the ship shall, in relation to–

(a) the payment of dues; and
(b) the liability to fines and forfeiture; and
(c) the punishment of offences committed on board the ship; and
(d) offences committed by persons belonging to the ship,

be dealt with in the same manner in all respects as if the ship were registered under this Act.”

12. Under subsection (1), an unregistered vessel is not entitled to any benefit, privilege, advantage or protection that are usually enjoyed by a registered vessel. In other words, an unregistered vessel is not entitled to use the National Flag or assume the PNG national character. In this instance, the defendants are not claiming any privilege, advantage or benefit under subs.(1). Neither did the vessels fly the National Flag nor assumed the PNG national character. Therefore, the vessels are not caught by subs. (1).

13. Subsection (2) complements subs. (1). It prescribes the penalties for defaulting owners and ship masters. A vessel can also be forfeited under subs. (2)(b) if there was a breach of subs. (1). However, as I have found that there was no breach of subs. (1), the vessels are not liable to forfeiture under subs. (2)(b).

14. I find therefore that NMSA has failed to establish the basis for forfeiture under s.5.

15. Section 270 of the Act reads:

“(1) Where a ship has become liable to forfeiture under this Act, the Minister or the Authority, as the case may be, may cause the ship to be seized and may detain the ship and may bring the ship for adjudication before the National Court.

“(2) The National Court may, where a ship has been brought before it for adjudication under Subsection (1), on such terms and conditions as it thinks just, order that the ship be forfeited to the State.”

16. This section is not a liability provision on forfeiture. It only defines the authority of the Minister, the procedure for adjudication, and the discretionary powers of the National Court. I find therefore that the vessels cannot be liable to forfeiture under s. 270.

17. I wish there is a provision that clearly states that a ship or vessel that is unregistered for a certain period is liable to forfeiture. It would make my job a little easier. No such provision has been pleaded or brought to my attention. In hindsight, it was probably the intention of the lawmakers that a vessel should not be forfeited solely on the basis that it is unregistered. Maybe forfeiture is necessary only when the vessel, while unregistered, used the National Flag or assumed the national character. I may be wrong but that is my impression.

In the final analysis, NMSA has failed to demonstrate that the vessels, Poly 7 and Poly 12, are liable to forfeiture under ss. 2, 5 and 270 of the Act.
18. As an aside, I would suggest to the parties and stakeholders to have a meaningful and cooperative dialogue to ensure that the vessels are seaworthy and to facilitate registration of both vessels. It is also the plaintiff’s responsibility to maintain and promote the kind of environment, procedures and protocols which would assist ship owners (investors) to register their vessels and do business in the country.

Forfeiture should be used only as a last resort.

19. In the meantime, this proceeding is dismissed with costs which, if not agreed, shall be taxed.

Orders accordingly.
________________________________________________________________
NMSA In-house Lawyers: Lawyer for the Plaintiff
Felix Kua Lawyers: Lawyer for the Defendants