Delica Shipping S.A. Suing Gemadept Shipping Singapore Pte. Ltd. for Affirmation of Maritime Creditor’s Rights
Delica Shipping S.A. Suing Gemadept Shipping Singapore Pte. Ltd. for Affirmation of Maritime Creditor’s Rights
[Keywords]
collision between ships, the Republic of Panama, compensation of damages arising from collision of ships, limitation of liability for maritime claims
[Case summary]
On November 6, 2020, Ship Ken Breeze of Delica Shipping S.A. (“Delica”) collided with Ship Pacific Grace of Gemadept Shipping Singapore Pte. Ltd. (“Gemadept”) in Qiongzhou Straits. The Repulbic of Panama is the flag nation of both ships. After the occurrence of the accident, Gemadept constituted at Haikou Maritime Court a limitation fund for maritime claim liabilities for the compensations that Ship Pacific Grace may bear in this accident. During the announcement period, Delica registered the creditor’s rights at Haikou Maritime Court for the losses that Ship Ken Breeze had suffered in the collision, and filed an action for the affirmation of these rights, requesting to ascertain the amount of losses and get paid by the limitation fund for maritime claims of Ship Pacific Grace.
According to Article 2 of the People’s Republic of China on the Law Applicable to Foreign-Related Civil Relationships, and Articles 273 & 275 of the Maritime Code of the People’s Republic of China, as the accident in question took place between two ships of the same nationality in the internal waters of China, the claim for damages between the two ships shall be governed by the law of the flag nation, i.e., the Republic of Panama, and the part concerning the limitation of liability for maritime claims shall be governed by the law of the place of the court, i.e., the People’s Republic of China. After obtaining the consent of the parties, the court directly adopted the Panamanian laws that other courts had already ascertained in previous cases of the same nature, and based on the actual needs of this case hired the former investigation firm and the same foreign law expert to ascertain any updates and supplements to the Panamanian laws. On the basis of the ascertained Panamanian laws, the court determined in a fair, reasonable way the division of accident liabilities between the two ships, the scope and amount of the loss compensation. Meanwhile, the court, according to the Maritime Code of the People’s Republic of China, decided that the collision losses of the two ships were both creditor’s rights enjoying liability limitation, the principle of “offset before restrtiction” shall apply, and Delica could only have the balance of its deducted creditor’s right paid by the limitation fund for maritime claims of Ship Pacific Grade.
[Verdict]
Gemadept Shipping Singapore Pte. Ltd. paid to Delica Shipping S.A. 14,257,838 yuan for economic losses and interests thereof; Delica Shipping S.A. be paid by the limitation fund for maritime claims set up by Gemadept Shipping Singapore Pte. Ltd. for the balance of its creditor’s rights as it enjoys in Paragraph 1 of this ruling after deducting its debts as determined in (2021) Qiong 72 Min Chu No. 13 lawsuit; and all other requests of Delica Shipping S. A. be dismissed.
[Significance]
As China continues to open up to the outside world, international civil exchanges grow more and more frequent, foreign-related cases increase with each passing day, and scenarios to apply and the requirements to ascertain foreign laws augment fast. To determine on and ascertain precisely the applicable foreign laws is the first question that the courts have to answer in foreign-related adjudicative practice and which is critical to foreign-related adjudication quality. This case is a nice exploration towards the repeated application of ascertained foreign laws in different cases. Efficient and cost-effective methods to ascertain foreign laws play a positive role in improving the mechanism for ascertaining foreign laws, broadening ascertaining channels, benefiting foreign-related adjudication quality and efficiency, and supplying new ideas for the processing of similar cases. This judgement has been recognized by all parties, boosting Hainan’s judicial influence and credibility on foreign-related cases.
