Trans-Tec International, SRL & Anor v The Owners and/or Demise Charterers of the Vessel 'Columbus'

Claims for contractual interest, administrative charges and collection costs arising from the non-payment of bunkers may fall within the Admiralty jurisdiction for claims concerning goods or materials supplied to a ship for her operation or maintenance. The statutory words in respect of are wide and should not be unduly restricted. Where the supply itself falls within the jurisdiction, contractual consequences of non-payment may form part of the same bargain and need not be separated into in rem and in personam claims. The court should distinguish between a contract supplying a single commodity and a diverse contract for goods and services, where separate categories may require individual examination.

The claimants, bunker suppliers, sought default judgment in two in rem proceedings concerning the vessels Columbus and Vasco Da Gama. The vessels had been sold and the claims continued against the proceeds of sale, which were insufficient to satisfy all claims.

The principal sums for bunker supplies were accepted as in rem claims. Carnival Plc and P&O Princess Cruises International Ltd challenged the characterisation of contractual interest, a 5 per cent administrative fee and contractual collection costs as in rem claims. The central issue was whether those items fell within section 20(2)(m) of the Senior Courts Act 1981.

1. Default judgment. The application succeeded. In each case, the principal bunker price, contractual interest, administrative fee and collection costs fell within section 20(2)(m) of the Senior Courts Act 1981 and were proved in the stated sums.
2. The statutory words in respect of are ordinary and wide words. They should not be glossed or given a narrow construction. The approach in The Edinburgh Castle [1999] 2 Lloyd's Rep 362 was followed.
3. The interest, administrative fee and costs provisions were integral parts of the contractual package for supplying the bunkers. Interest and the administrative fee were calculated by reference to the price and arose from non-payment. The costs indemnity was further removed from the price, but remained part of the same bargain. It would be artificial and procedurally wasteful to require separate in rem and in personam claims.
4. The Kommunar [1997] 1 Lloyd's Rep 1 supported the conclusion that interest forming part of the contractual account could be a claim in respect of supplies to a vessel.
5. The Oriental Dragon HCAJ 162/2012 was distinguished. It concerned a contract involving a wide variety of goods and services, where individual categories could properly be examined. It did not justify separating contractual consequences of non-payment where the contract concerned a single commodity unarguably supplied for the ship's operation.
6. US law governed the contractual provisions. Contractual interest was capped at 1.5 per cent for debts below US$500,000. The collection costs were recoverable in full under the contractual indemnity. The registrar invited counsel to submit orders.