Conteh v the vessels F/V Nangbeto, F/VAmou, F/VAmoulome, F/V Kawa and F/V Frosty and the owners and all others interested in these vessels (CC978/06 2006 C NO. 63)  SLHC 1 (15 January 2007);
CC978/06 2006 C NO. 63
Manama Conteh PLAINTIFF/APPLICANT
The Owners and / or Persons
Interested in the vessels
F/V Nangbeto, F/VAmou, F/VAmoulome,
F/V Kawa and F/V Frosty DEFENDANTS/ RESPONDENTS
SERRY-KAMAL &CO For The Plaintiff/Applicant
MUSTAPHA S TURAY For the Defendant/ Respondent
RULING DELIVERED THIS 15th DAY OF January 2007.
D.B. EDWARDS, J. By Notice of Motion dated 15th December, 2006 made under action intituled CC978/06 C. NO. 63, the Defendant in the action attempted to apply to this Honourable Court to set aside the warrant of arrest on the grounds inter alia that the plaintiff in their affidavit in support of the application for the issue of the warrant of arrest failed to disclose certain important material fact to the court to wit:
a) that the plaintiff respondent failed to disclose that she had received payments from the defendants/ Applicants herein( and or their agents ) as Agency fees for which she did sign some receipts.
b) that the plaintiff respondent had had a matter with the engineer/ manager of the defendants / Appplicants -Adamtios Kanakousakis, which led to a criminal action being brought against the plaintiff/respondent which said criminal matter is intituled PC/S10,806/06
c) that the Plaintiff /Respondent and the Defendant/ Applicant signed an Agreement dated 4th July 2006, which said agreement mentioned among other things , the agreed Agency fees.
d) that the plaintiff / respondent failed to disclose in her affidavit , a letter dated 16th October 2006, in which she claimed US$12,000 was the outstanding sum due to her as Agency fees
f) that the Plaintiff/Respondent failed to disclose, that she received a letter dated 10th October , 2006 written to her by Spyrodimitris Dimoulas a representative of the defendants / applicants proffering reasons for her termination of the Agency Agreement.
2. That the plaintiff in her affidavit leading to the arrests made certain materially inaccurate statements to wit:
a) She claimed that the agency fee in accordance with the agency agreement is US$1,500.0 per month , when it is clear in the agreement of 4th July 2006, that the rental fee for her premises and agency fees was US $12,000.00 per annum;
b) That the agency agreement of 3rd July 2005 and 19th October 2006 do not have the amount payable as agency fees as alleged by the plaintiff/ respondent, or at all.
3 That the warrant of arrest was in breach of the Court Order of 7th December 2006 which ordered as a condition precedent to the arrest of the above mentioned Vessels that an undertaking as to damages be filed which undertaken was never filed prior to the arrest and as a precondition for the arrest.
4. That this court grants a stay of all further proceedings pending the hearing and determination of this action.
The Application was supported by the affidavit of one ADAMTIOUS KANAKOUSAKIS Engineer for the Defendants / Applicants vessels sworn to on the 15TH day of December 2006 together with the following exhibits attached thereto viz EX"AK1" - The Specially Indorsed writ of summons; EX "AK2A&B" - the Memorandum of Appearance and the Notice of Entry of Appearance; EX "AK3" the Ex parte Notice Of Motion dated 7th December 2006; EX "AK4A", the Affidavit of Mariama Conteh sworn to on the 6th day of December 2006 ; EX "AK4A" the Affidavit of Abdul Franklyn Serry-Kamal sworn to on the 6th day of December 2006; EX "AK5" the Court Order dated 7th December 2006; EX "AK.6" The Warrant Of Arrest dated 7th December 2006; EX "AK 7 " Request for Admiralty Marshall to execute warrant with
undertaken in damages; EX "AK8"an undated Notice of Arrest from the Under sheriff of the High Court ; EX "AK9" Agency agreement for F/V Kozah and F/V Nangbato; EX "AK10" Agency agreement for the 4 other vessels; EX "AK11" a Rental Agreement dated 2nd July 2006; EX "AK12 " Letter from Coastal fishing terminating contract with Kalypso Atlantic Fishing dated 18th October 2006; EX "AK13" Agreement between the Plaintiff and the representative of the Defendant dated 4th July 2005; EX "AK14 A- 14 0" receipts of payments made to Mariama Conteh; EX "AK15a and b" Letter and invoice respectively from Mariama Conteh dated 16th October EX "AK16" notice of cancellation of Agency from representative of the defendants to the plaintiff ; EX "AK17" letter of 10th from the defendant to the Plaintiff proffering reasons for the cancellation of the Agency contract; EX "AK18" Letter of cancellation and termination of agreements for the agency of the vessels and the rental of the premises ; EX "AK19" Criminal summons and information dated 30th October 2006 ; EX "AK20" Letter written by the Plaintiff addressed to the Director of Fisheries and Marine Resources and EX "AK21 "Letter dated 30th November 2006 from Serry Kamal and Co addressed to the representative of the defendants. Attached to the affidavit of Christian Max Macarthy was Ex "CMM1 "a search receipt
The facts of the case as gleaned from all documents before this Court are that the Plaintiff Mariama Conteh was appointed as the Agent for the following ships / vessels Viz F/V Nangbeto and F/V Kozah by an Agency contract dated 3rd July 2005. In a similar vein Mariama Conteh was appointed the Agent and due Agency fees on a second contract dated 19th October 2005. According to the Plaintiff she was due agency fees for both contract at US$1,500.00 per month . Furthermore she claimed, she was unlawfully terminated in that the letter of termination did not state the reasons for her termination as was required by clause 11 of both contracts, the consequence of which she was to recover damages for breach of contract as pleaded . Against this scenario ,on the. 6th of December 2006, she instituted an Admiralty action in rem against the Owners and /or Persons interested in the said shipping vessels, the defendants herein, so as to recover Agency fees US36,000, damages for breach of contract, loss of profits of US 60,000.00 and loss oh the research contract to the tune of US$ 30,000. Further more pursuant to Order 5 rule
16 of the High Court Rules 1960 the Plaintiff applied ex parte to this Honourable Court through motion dated 7th December 2006 for a warrant of arrest to be issued to arrest the said vessels . The Court granted the order for the arrest of the vessels on the precondition that she files an undertaken as to damages in case she fails in her claim or the arre$t turns out to be unjustified.. The Plaintiff however failed to file the undertaken choosing only to file the undertaken given to the Admiralty Marshal. The arrest of the shipping vessels were however effected without the said undertaken and it is this arrest that the defendants after entering appearance have by this their application sought to set aside on the grounds hereinbefore mentioned.
At the hearing of this application counsel for the defendant /Applicant relied on hi(s entire affidavit and submitted that the arrest ought not to have been made in view of the fact that the arrest violated the condition precedent requiring the plaintiff applicant to file an undertaken in damages noting that the undertaken in damages with respect to the Admiralty Marshall ought to have been filed in addition to the undertaken as to damages in case she fails in her claim or the arrest turns out to be unjustified .The defendant also submitted that the affidavit leading to the warrant of arrest did not fulfill the requirement of full and frank disclosure of facts and did in fact contain materially inaccurate statements .He submitted that where a party in an admiralty action in rem by ex parte application obtains an Order for the arrest of the vessel where material disclosures were not made , the party should take immediate steps to bring the correct facts to the Court .He therefore submitted in conclusion that taking in totality the affidavit evidence before this court and the exhibits which have not been challenged by an affidavit in opposition, it would be in the interest of justice for the court to set aside the order of arrest and order the release of the vessels. The defendant applicant relied on the case of the VARNA (1993)Lloyds Law Reports vol. 2 page 253-259
The Plaintiff's Counsel, Mr Serry Kama!, in reacting to the Application noted that the right to arrest a vessel was a statutory right as a result of which those rules which apply as to discretional remedies were not applicable. He noted that the attention of the Court was drawn to Constitutional Instrument No 3 of 2006 and in particular to the amendment to
Order 52 Rule 3 as contained therein and thereon referred the court to page 1439 of the the English Annual Practice l999 under the Rubric " the issue of warrant of arrest is not a discretional remedy" noting that indeed the issue of the arrest of a ship was a statutory remedy and not a discretional remedy . He also referred the court to page 1440 under the rubric " under false or inaccurate statements to lead to warrant of arrest" . He submitted that where the issue depends on disputed facts , the plaintiff ought not to be forced to have the question tried on a motion to set aside the arrest but it may be conveniert after pleadings are closed to try the point on a preliminary issue. He referred the court to the SYLVAN ARROW(1922)LIoyds Law Reports pages 50-52. On these submissions he stated that it was not fatal for them not to have made full and frank disclosure.
I have perused all documents before me. I believe that intricately germane to the out come of this application is whether as per law, with specific reference to Admiralty practice in Sierra Leone, the issue of a warrant of arrest is a discretional remedy or statutory remedy . If it is a Statutory remedy then the issue of full and frank disclosure becomes unnecessary but if is discretionary remedy, then full and frank disclosure was necessary in an exparte affidavit in support leading to the arrest. Interestingly both counsels referred to the case of VARNA which was not surprising in view of the fact that The case of VARNA went up the Court of Appeal . Initially it was the view of the Lower court that the issue of the warrant of arrest was a discretional remedy but following the introduction of an amended Order 75 rule 5 of the English Annual Practicel999, with all its antecedent Rules it was decided that the issue of a warrant of arrest could no longer be a discretional remedy, as the power to issue the warrant was no longer that of the Court on an ex parte application, but that of the plaintiff, after fulfilling certain criteria, thus eroding the powers of the Court to deal exclusively and emphatically on the matter as to whether an application for the arrest fulfilled the requirement of full and frank disclosure. This being the case, the issue of full and frank disclosure becomes of little or no relevance in the issuance of a warrant of arrest in so far as Order 75 rule 5 of the English Annual practice 1999 is concerned . But one needs remind ones self that the application for arrest of the aforesaid vessels was made under Order 5 rule 16 and while both counsels may have found it necessary to make references to order 75 rule 5
these orders are clearly, in the one instance, not the same in terms of the principles they establish on arrest on warrant and both may not be applicable in the High court admiralty Jurisdiction in Sierra Leone . Put simply, one needs to consider whether Order 75 is in fact part of our rules of court through which the admiralty jurisdiction of the High Court could be exercised .
The answer to this inevitable question would be that with regard to the issue of the Admiralty practice in Sierra Leone no attempt has been made to adopt amendments to the English Rules made after lst January 1960 particularly those amendments introduced by several English instruments post 1960 and which have given birth to Order 75 rule 5 and the several more amendments including that done in 1986 (by the Rules of the English Supreme Court (Amendment No3)Order,S.I1986.No2289)which led to the VARNA being finally decided the way it was decided. Prior to the VARNA being decided or even prior to "THE VASSO" (1984) 1 Lloyds Report 235 (A case which catalogued the necessity for full and frank disclosure in an affidavit leading to the arrest of a ship) the right to arrest a ship was a discretional remedy, highly reliant on whether the court was disposed of granting the. issue of the Warrant of Arrest. However as decided in the case of the VARNA, if the statutory requirements set out in Rule 5 of Order 75 are complied with , the plaintiff without more is entitled to issue the warrant of arrest and if there is such compliance there is no further scope for the application of any duty of full and frank disclosure.
This to my mind brings into focus the importance of Order 52 rule 3 as amended by Constitutional Instrument No 3 of 2006 and the extent to which it is applicable?. The full text reads thus;
"Where no other provision is made by these rules, the relevant procedure, practice or forms in the High Court of Justice in England on the 1st day of January 1960 and the 1st day of January 1999 shall so far as they can conveniently be applied , be in force in the High Court"
Again the inevitable questions that flow from counsels reliance on the submission as stated in the VARNA by the court of appeal are firstly whether all provisions contained
in the English Annual Practice 1999 are applicable as rules of the High Court in Sierra Leone, and secondly, whether Order 75 rule 5 as enshrined in the English Annual Practice 1999 forms part of our admiralty practice in Sierra Leone . As stated earlier no attempt was made to adopt amendments to the English Rules made after 1st January 1960 particularly those amendments introduced by several English instrument post 1960 and which has brought into effect Order 75 rule 5. To this end, it is pertinent to note that it is the Rules of Court Committee appointed by successive Courts Act and now by the Constitution of Sierra Leone Act No 6 of 1991 that can and have made Rules regulating to the practice and procedure of Courts in Sierra Leone. Their recent work on the amendment of the High Court Rules did not expressly or impliedly adopt Order 75 rule 5 of the English Annual Practice 1999. This is so for 2 reasons:
a) By virtue of Constitutional Instrument No 3 there is provision in our rules regarding Admiralty practice and this is so contained in the English Annual Practice 1960;
b) If there were not, the provisions as contained in the English Annual Practice 1999 relating to Admiralty Practice would have been expressly adopted such that we would have had a new Order in the Constitutional Instrument dealing with Admiralty proceedings as we have had for procedures such as Summons for Direction , Interrogatories , Discovery and Inspection of documents etc . To buttress this point, one only needs to take a close look at the present practice under 1960 rules to Enter Appearance. As per the English Annual Practicel999 the procedure for entering appearance has been amended but the said amendment is not and has never been the law and practice in Sierra Leone, even with the formulation of or passing into Law constitutional amendment No 3 which saw some portions of these rules being adopted as part of our rules. This is so for the simple reason that at no time was Order 12 as contained in the English Annual practice 1960 expressly repealed and replaced by Order 12 as contained in the English Annual Practice 1999 by express adoption by the Rules of Court Committee established under the Constitution of Sierra Leone, Act No 6 of 1991
Since there is no instrument formulated by the Rules of Court committee expressly adopting Order 75 rule 5 as contained in the English Annual Practice 1999, I think it is safe to conclude that it is not applicable and what is applicable is Order 5 rule 16 . This being the case, it follows that the decision in the VARNA to wit
"if the statutory requirements set out in Rule 5 of Order 75 are complied with , the plaintiff is entitled to issue the warrant of arrest and if there is such compliance there is no further scope for the application of any duty of full and frank disclosure ".
is not applicable . Thus within the Sierra Leone Admiralty practice the issue of full and frank disclosure is very important and so too the need to make materially accurate statements and where the same is not done to make the corrections promptly and frankly.
The contents of the Affidavit of ADAMTIOS KANAKOUSAKIS and the exhibits thereto taken as a whole appear to show:
a) That the plaintiff / respondent failed to disclose that she had received payments from the defendants/Applicant as agency fees for which she did sign some receipts see exhibits AK 14A-0 AND AK17
b)That the Plaintiff/ Respondent and the defendants sign an agreement dated 4th July 2006, which said agreement mentioned inter alia, the agreed Agency fees See Ex AK13
c) that the plaintiff failed to disclose in her affidavit a letter dated 16th October 2006 in which she claimed that US$12,000.00 was the outstanding sum due to her as agency fees See Ex AK 15a and AK15b
The law on the subject as stated in the "THE VASSO" (1984) 1 Lloyds Report 235 is that as a matter of importance a party applying for the arrest of a shipping vessel must give full and frank disclosure of facts At P 243, Col; P 491 of the case of the VASSO, Lord Justice Robert Goff said this:
"It is axiomatic (hat in exparte proceedings there should be full and frank disclosure to the Court of facts known to the applicant and that failure to make such disclosure may result in the discharge of any order made upon the exparte application, even though that with full disclosure an order would have been justified."
In a similar vein the affidavit of ADAMTIOUS KANAKOUSAKIS shows that the plaintiff made materially inaccurate statements to wit:
a) she claimed that the agency fee in accordance with Agency agreements is US$1,500.00 per month, when she knew very well as per her agency agreement of 4th July 2006 signed by her that the Agency fee and rental fee was US$12,000per annum and
b) that the agency agreements failed to state any amount as Agency fees
I could only conclude that the above inaccurate statements being facts which the plaintiff was aware of or ought to be aware of also constitutes failure to make full and frank disclosure . It is impossible to believe that the deponent cum plaintiff would not have been able to recall the facts as stated by Adamtious Kanakousakis as recent as December 2006. The effect of the failure to disclose same and /or making such materially inaccurate statements, it would appear, might have been to create a cause of action where perhaps there is none with a view to leading to an arrest, to create an unfair advantage, if you like. The fact of an affidavit in opposition which states in paragraph 9 " In the light of Exhibit AK 17 I now say I have received part payment for the 1st Agency contract" makes it very difficult for one not to come to this conclusion. At no time before this affidavit did she ever state that she received monies before this motion to set aside and its supporting affidavits.
In the case of the SEA THAND 11 Mbanefo: Nigerian Shipping cases Vol.1 p295, the requirements to be satisfied by affidavit before a warrant of arrest could be ordered were
considered by the Nigeria Federal Revenue court presided over by Okunribido J. where he had this to say:
"It seems clear from the provisions of this rule that the intention is to ensure that whoever applies for a writ to arrest a ship does in fact have a cause of action against the owner of the ship which carries with it a right of arrest ........................................this is why it is essential that all the requisite facts are placed before the court which will enable it to satisfy itself that an application is a proper one in which a writ of arrest ought in fact issue"
From the above, it would appear that the essential and requisite facts were not placed before the court as to enable it to satisfy itself that the application is a proper one in which a writ of arrest ought in fact issue. Was there a cause of action in this matter? The answer would be yes there appeared to be up to the time of arrest, but thereafter, following this motion to set aside and the new undisclosed evidence by affidavit as to the agency fees and the confirmation by the plaintiff as to what she received from the defendant the right of arrest appears to be lost.
My Serry Kamal has argued that on the authority of the SYLVAN ARROW (i922)Lloyds Law Reports pages 50-52, "where the issue depend on disputed questions of fact, the plaintiff ought not be forced to have the questions of facts tried on a motion to set aside the arrest but it may be convenient after pleadings are closed to try the point on a preliminary issue". There can be no doubt that the purport of the affidavit in opposition in paragraphs 9 & 10 is to create a challenge or dispute as to what was the fee payable in the circumstances but the SYLVAN ARROW will not apply. This is so because in that case the matter was whether the action was sustainable or maintainable. In this motion what is before the court is a matter brought clearly on wrong or distorted facts while facts which ought to have been disclosed fail and continue to be undisclosed. There is abundance of affidavit evidence on documents signed by both parties and even in some cases by the plaintiff alone stating clearly that the agency fee was US$12,000 per annum. It is not a trial of the facts that I am conducting; the relevance of fees is so central to the
plaintiff's case and with documents purporting to state those fees it was paramount that the plaintiff disclosed same in Her affidavit. She only stated in her affidavit that the fee was US$ 1,500 per month with no supporting documents. Knowing very well that indeed there was an agreement outside the main agency agreement which did stipulate the fees as agreed and not what she would desire. If for any reason you Juxtapose her receipt of US$16,120 the fact that she should receive only US 12,000 as fees, there may be a case to say that she does not have a cause of action in so far as her claim to US$30,000 as the Agency fees . That apart, as stated in the VASSO the failure to disclose to the court facts known to the plaintiff as applicant may result in the discharge of any order made upon the exparte application, even though that with full disclosure an order would have been justified .
Finally on the issue of full and frank disclosure was the issue of having failed to make the full and frank disclosure she was empowered to make the corrections promptly and frankly. The plaintiff in her affidavit in opposition sworn to on the 21st of December 2006 and filed herein did accept that she received payments in the sum of US$16,120. but in the said affidavit denied that it was in respect of the agency fees for both contracts. How could she with the abundance of documents to the contrary.? I could only conclude that the plaintiff/respondent seemed to have been unconcerned with the misstatement and moreso built her case claim or affidavit on it . She was never prepared to make a clean breath of the transaction between her and the defendants as evinced by the documents before this court by frankly disclosing what had transpired and when confronted with the true facts only bothered to accept it half heartedly as in the same paragraph in which she accepted she had received US 16,120 she also denied the agency fees of US 12,000 per annum for both agreements and the rental amidst the prolixity of documents to this effect. Worse still no application was made to amend the endorsement on the writ of summons . I therefore re-echo the words of Lord Justice Hobhouse. in the Case of the NORDGLIMT (1987) 2LIoyds Report page 474 dealing with the necessity for full and frank disclosure in exparte applications leading to an arrest and the need to make materially accurate statements when he had this to say:
"/ consider that it must be stated, and stated clearly and unequivocally, that where any person finds that he has made a false statement in an affidavit, albeit mistakenly , it is his duty to correct it and to do so promptly and frankly. In the present case that did not occur. The acknowledgement of the error was only made in a later affidavit after the issue of the present summons and in a fashion that can be best described as half-hearted . It is of the greatest importance to the administration of justice that Courts should be able to rely upon the truthfulness and accuracy of affidavits sworn to by solicitors or their employees. It is accordingly essential that such affidavits should be prepared with proper care and that mistakes of the kind which I have described should never occur. It is also essential that lawyers acting for parties and in particular the deponents of such affidavits should attach the greatest importance to their oath and when they find that they have made a false statement on oath they should be at pains to correct it"
In view of what has not been disclosed to this court I find myself unable to rely on the affidavits of the plaintiff.
There is also the issue of the wrongful termination of the agency contract vehemently raised by the plaintiff. I would obviously not want to venture into this area at this stage of the proceedings but of concern I should perhaps note that the termination of the agency contract by fax does not seem to be the only means of termination contemplated by the agency agreement as article 12 thereof would seem to indicate effluxion of time as another means. In View of what has been said with regard to the claim of US$ 30,000 dollars as agency fees the effect of this is there for all to see.
Turning to the issue of the plaintiff's failure to give an undertaken as to damages as a condition precedent and the reason as stated in the affidavit of ABDUL FRANKLYN SERRY KAMAL on the 19th of December 2006 to wit "this undertaken is a surplusage and not envisaged by the Rules" for not complying with the Order, I could only state that it was an Order of the Court which in all circumstances ought to be complied with. More so it was a condition precedent to the arrest and if not complied with should make the arrest unlawful ab initio . Indeed the plaintiff after the arrest had been effected filed an
undertaken as to damages but this was in complete variance or violation of the Order of Court dated 7th December 2006. The undertaken was ordered as a caveat against any would unlawful arrest. There is nothing stopping any Admiralty court in its inherent jurisdiction to order an undertaken as to damages. The very wording of the application seeking in the prayer of the application "Any further or other relief, a consequential order, is invoking or seeking the inherent jurisdiction of the High court; for a consequential order which could include such undertaken and to make it a condition precedent is to ensuring that it is given before any arrest takes place. Furthermore, it is always the case in matters such as exparte injunctions, mareva injunctions and other exparte applications where the right of the other side could be adversely affected using the administration of Justice for the court to order that undertaken as to damages be provided to prevent such a scenario happening. In like applications, there? is the requirement that the plaintiff /applicant gives an undertaken as to damages in case she fails in her claim or the injunction or arrest turns out to be unjustified; and it is for this reason that it was required as a condition precedent to the arrest in the first place which the plaintiff advised herself to ignore .
For reasons as I have strenuously outlined and in the general interest of Justice I therefore order as follows:
1. That the Court Order of 7th December 2006 is set aside forth with.
2.That the vessels F/V Kozah, F/V Nangbeto, F/V Amou, F/VAmoulome, F/V Kawa, and F/V Frosty now lying under arrest within the territorial waters of Sierra Leone are conditionally released on the defendants giving an undertaken in lieu of bail.
3. That the interim stay of all subsequent proceedings is lifted
4. That the cost of this action be cost in the cause.
Hon. Mr. Justice D.B. Edwards J.