Court approved ship sale below appraised value due to crew wage debts and vessel depreciation risks.

[*163] 1981 Nov, 30

(DEMETRLADES J.)

ADMIRALTY JURISDICTION

John French-Paris and Others,

Plaintiffs,

v.

The Ship “ALAGAZERA”, now lying at the port of Limassol,

Defendants.

(AdmiraltyActions Nos.279/79-285/79).

Admiralty - Judgment against ship - Sale of ship in execution of, at appraised value - Highest offer less than appraised value - Application for approval of sale at price below appraised value - History of the proceedings - Dangers for the ship which is not insured

- Judgment debt for wages for members of crew - Sufficient time given to defendants to settle judgment debts - Value of ship will be decreasing - Payment of port dues for further anchorage of ship at harbour - Application granted.

The Marshal present.

L. Papaphilippou, E. Psyllaki (Mrs.), N.Chr.Anastassiades, for the interested parties.

M. Montanios, for the defendant ship.

RULING

The following ruling was delivered by:-

DEMETRIADES, J.: On the 12th June, 1981, the [*164] parties to the present consolidated actions reached the following settlement by which the defendants submitted to judgment in favour of -

Plaintiff in former Action No. 279/79 for £38,500.- Sterling.

Plaintiff in former Action No. 280/79 for £27,500.- Sterling.

Plaintiff in former Action No. 282/79 for 10.870 U.S. Dollars.

Plaintiff in former Action No. 283/79 for 10.400 U.S. Dollars.

Plaintiff in former Action No. 284/79 for 5.000 U.S. Dollars.

Plaintiff in former Action No. 285/79 for 3.100 U.S. Dollars, with £10,000.- Sterling agreed costs of the plaintiffs.

By the settlement reached, the said judgment debts were to be paid on or before the 31st August, 1981. As the defendants failed to satisfy the judgment debts on the day they were payable, the plaintiffs, on the 3rd September, 1981, applied to the Court praying for an order directing the Marshal to seize or attach and sell the ship in execution of the said judgments. On the 16th September, 1981, the Court granted an order to that effect on the following terms:

(a) That the ship ‘ALGAZERA’ be sold by public auction.

(b) That the ship in question be sold by the Marshal by public auction for the highest price that can be obtained for it, but for not less than the sum of C£250,000.- which was its appraised value by Mr. St. Karamontanis on the 16th October, 1980, unless the Court, [*165] on the application of the Marshal, allows it to be sold for a lesser amount. Moreover, the ship in question may be sold by private treaty but in such a case, in any event, only with the approval of this Court.

(c) Immediately upon completion of the sale the gross proceeds thereof should be paid into Court and a statement signed by the Marshal showing the amount so paid, as well as all fees, costs, charges or expenses incurred in carrying out the sale should be furnished to the Registrar of the Court. Such statement should be accompanied by any vouchers necessary to show the amount of the monies expended.

(d) The Marshal to inform the plaintiffs and the defendants, and any other interested party, of the date of the public auction, as well as of any offers for private sale that he may have”.

The public auction for the sale of the vessel was held on the 12th October, 1981 and as the highest offer was for 155.000 U.S. Dollars, the Court did not approve it and ordered a new public auction to he held within 40 days. By the said order the Marshal was directed to take all necessary steps so that the auction was published in as many newspapers as he could. At the same time, the Court allowed the Marshal [*166] to sell the vessel by private treaty at a sum which would be approved by the Court.

On the 18th November, 1981, another public auction was held and the highest offer made was 300.000 U.S. Dollars. As this offer was again below the appraised value of the vessel, the Marshal applied to the Court for directions whether to accept the said offer or not. All interested parties, except the defendants, agreed that the said offer ought to be approved by the Court, but the defendants objected, relying on a number of grounds why they opposed the approval of the offer.

I have carefully considered the report of the Marshal and the arguments put forward by the learned counsel for the defendants and having taken into consideration the history of the proceedings in which the ship was involved, the dangers for the ship, the fact that the vessel is not insured, that the judgment debts are for wages of members of the crew, that sufficient time was given to the defendants to settle the judgment debts and that the value of the ship undoubtedly will decrease as the time goes by, and that port dues should be paid for the further anchorage of the ship in the harbour, I have decided to approve the offer of 300.000 U.S. Dollars and to allow the Marshall to proceed and conclude the sale at that price.

Sale approved.