ET Timbers PTE Limited v The Owners of the Motor Vessel ‘Dolphin Star’; Starryway Trading & Shipping Company Ltd (Intended Interested Party) [2022] KEHC 17113 (KLR)

ET Timbers PTE Limited v The Owners of the Motor Vessel ‘Dolphin Star’; Starryway Trading & Shipping Company Ltd (Intended Interested Party) (Admiralty Cause E003 of 2021) [2022] KEHC 17113 (KLR) (15 July 2022) (Ruling)

Neutral citation: [2022] KEHC 17113 (KLR)

Republic of Kenya

In the High Court at Mombasa

Admiralty Cause E003 of 2021

MN Mwangi, J

July 15, 2022

Between

ET Timbers PTE Limited

Claimant

and

The Owners of the Motor Vessel ‘Dolphin Star’

Defendant

and

Starryway Trading & Shipping Company Ltd

Intended Interested Party

(Admiralty claim in rem against the owners of the motor vessel ‘Dolphin Star’ of the Port of Panama)

Ruling

1. The application before this Court is by the intended interested party. It was filed on March 11, 2022. It seeks the following orders-a.Spent;b.Spent;c.That this Honourable Court be pleased to grant leave to the intended interested party to appeal against the decision of this Honourable Court delivered on the February 25, 2022;d.This Honourable Court be pleased to stay all proceedings in this Court pending appeal; ande.The cost of this Application Notice be provided for.

2. The background of this case that gave rise to this instant application is that on April 4, 2021, this Court issued an ex-parte warrant of arrest for the motor vessel ‘Dolphin Star’ (hereinafter, ‘the vessel’) which was said to have been in breach of a charter party entered into between the claimant and the owners of the vessel as evidenced by a Fixture Note entered into by the claimant, the defendants, the disponent owners of the vessel, namely Starryway Trading & Shipping Company Limited, with the head owners being Defang Shipping Company Limited.

3. On October 15, 2021, Starryway Trading as an intended interested party, filed an application seeking to be joined into these proceedings so as to exercise its right of lien over the claimant's cargo and for stay of these proceedings until the arbitration proceedings between the intended interested party and the claimant are determined. The Court scheduled the ruling for February 25, 2022.

4. On February 22, 2022, the intended interested party filed an application under certificate of urgency. One of the orders sought was for the Court to arrest and defer the ruling scheduled for February 25, 2022. The application was primarily premised on the grounds that the Arbitral Tribunal had delivered a partial arbitral award on February 11, 2022 regarding several pending issues before this Court. The application was certified urgent and the ruling was arrested pending inter partes hearing and determination of the application. The application came before this Court on February 25, 2022 for inter partes hearing and the Court held that the application dated February 21, 2022 could not be considered on merit until the Court had delivered the ruling on whether the intended interested party should be joined in this cause. This Court noted that the said ruling is what would grant the intended interested party if allowed to join the cause, the right to argue any subsequent application on merit.

5. Subsequently, on March 11, 2022, the intended interested party filed this application seeking leave to appeal the aforementioned ruling.

6. On March 18, 2022 this Court dismissed the intended interested party’s application for joinder to these proceedings.

7. It needs stating that on May 5, 2022, when the application dated March 11, 2022 came up for hearing inter partes, Mr Okello, learned Counsel for the intended interested party withdrew prayer (d) of the said application in which the said party had sought a prayer for stay of proceedings.

8. The application dated March 11, 2022 is premised on the grounds that the Arbitral Tribunal delivered a partial final award with regard to the issues that are pending before this Court and between the parties to these proceedings on the freight due and owing by the claimant to the intended interested party. It is averred that the claimant had not yet paid the freight as ordered by the Arbitral Tribunal.

9. According to the intended interested party, the order made by this Court on February 25, 2022 is an order that requires leave of the Court to appeal. It is further averred that pursuant to the provisions of Rule 75 of the Court of Appeal Rules as read with Order 43 Rule 1(2) of the Civil Procedure Rules, the intended interested party has filed a Notice of Appeal against the said ruling.

10. The reason given for pursuing an appeal is that the said contention is that the intended interested party has obtained an arbitral award of USD 500,000. 00 that has not been made good by the claimant; that the intended interested party has an undoubted right of lien over the claimant’s cargo which right would be defeated if the claimant’s application to sell the vessel is allowed; that the intended interested party’s appeal will be rendered nugatory; and that the Court’s ruling dated February 25, 2022 was erroneous.

11. The application was canvassed by way of oral submissions. Mr Okello, learned Counsel for the intended interested party submitted that the import of the ruling of the London Arbitration is that the intended interested party should have been joined in this cause, and since its application on joinder was not considered, the intended interested party has the right to appeal, and that is the essence of the leave application.

12. Mr Khagram, learned Counsel for the claimant opposed the application. He submitted that the intended interested party has averred that it has arguable grounds of appeal, however, no draft grounds of appeal have been availed. He added that leave to appeal is not granted as a matter of right and in some cases, to avoid frivolous appeals being made.

Analysis And Determination. 13. I have considered the application and the oral submissions made by Counsel for the intended interested party and for the claimant. The issue for determination is whether the intended interested party should be granted leave to appeal.

14. Section 4 of the Judicature Act of Kenya confers on the High Court jurisdiction to hear admiralty matters in the following terms-“(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 theCivil Procedure Act (cap 21)” (emphasis added).

15. The intended interested party averred that the ruling of this Court dated February 25, 2022 was erroneous. It further averred that the intended interested party has an arguable appeal with high chances of success. It did not however annex a copy of a draft memorandum of appeal to enable the Court to determine whether the grounds of appeal are arguable or whether they are vexatious, fanciful and fictitious.

16. This Court is cognizant of the fact that an arguable appeal only needs to raise a single bona fide point worthy of consideration and need not be one that must necessarily succeed. See Co-operative Bank of Kenya Ltd vs Banking Insurance of Finance Union (Kenya)[2015] eKLR).

17. Despite the fact that the intended interested party did not annex a draft memorandum of appeal, it has claimed that the ruling of February 25, 2022 was erroneous, it can be inferred that the intended interested party seeks to appeal against the ruling in its entirety, and the presumption is that the appeal is arguable. Under 50(1) of the Constitution of Kenya, the intended interested party has a right to appeal and a right of access to justice. From the foregoing, I grant the intended interested party leave to appeal the decision of this Court made on February 25, 2022.

18. The costs of the application herein shall be borne by the intended interested party which should have made the present application on the day the ruling in issue was delivered. As such, the claimant is entitled to the costs it incurred in opposing the present application.

It is so ordered.

DATED, SIGNED andDELIVERED atMOMBASA on this15th day ofJuly, 2022. Ruling delivered through Microsoft Teams Online Platform.NJOKI MWANGIJUDGEIn the presence of:Mr. Ondego for the claimantNo appearance for the defendantNo appearance for the intended interested partyMr. Oliver Musundi – Court Assistant.Page 3 of 3 NJOKI MWANGI, J