The appellant sought a stay of execution from the order of the Federal Court (made on a request for an anti-suit interlocutory injunction) that the appellant cause the release of the vessel “Sarah Desgagnes” from conservatory arrest in Belgium, where it is being held to secure the appellant’s claim in proceedings in Italy against the vessel’s subtime charterer  for unpaid bunkering invoices ..

The Federal Court had found that the appellant’s action was vexatious and oppressive because the ship had previously been released from arrest in Canada on an undertaking by the respondents to post bail.

The Federal Court of Appeal granted the stay on the appellant satisfying the thee-pronged test formulated in RJR-MacDonald Inc. v Canada (Attorney General), [1994] 1 S.C.R. 311: that there is a serious question to be decided on the appeal, refusing the stay is likely to cause irreparable harm to the appellant, and that the balance of convenience favours staying the order pending the disposition of the appeal.

The court noted that the law of Belgium appears to permit the arrest of a ship to secure a debt against a time-charterer in circumstances the law of Canada does not

The respondents’ argument that the appellant was already in breach of the Federal Court’s order to release the vessel “forthwith” was not accepted by the Federal Court of Appeal, which said that a judgment of the Federal Court “should not be interpreted, or regarded, as denying a party an effective opportunity to exercise its right of appeal to this Court”.

David Alderson, LL.B, LL.M (Lond.)

Citation: Alpha Trading Monaco Sam v The Ship “Sarah Degagnes” et al 2010 FCA 209


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