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Thursday, June 9, 2011

Korean Ship OSM Areana in murky waters – untold trouble for the crew !!

In Marine Insurance, the Ship that carries cargo, the cargo that is carried on the ship and the freight to be earned by the ship – all can be subject matter of insurance.  The Ship sails in deep sea but can at times find itself ‘all at sea’ in murkier waters just as OSM Areana found itself in.  OSM Areana is a South Korean flagged Bulk carrier cargo ship with IMO No. 8411334 and dimensions of 190 M length and 32 m beam.  Its call sign was DSOC5.

A Sailor would be used to and be inclined  to be away from home land cut off from all communication – all fine when sailing but not to be berthed in the outer sea for months together !  The ship is anchored two nautical miles outside the Chennai port.

The vessel in better times : Photo courtesy :

Quoting Port Offcials, it is reported that the sailors cannot come ashore as Indian immigration rules do not permit shore passes for sailors from vessels in the outer anchorage.   The stranded crew approached the International Transport Workers Federation (ITF) in Chennai for assistance.   The Seafarer welfare observed that they did not have enough food even.  It is pitiful that the  vessel owner declared bankruptcy and even the supply of provisions had stopped.  Port officials who have inspected the vessel say the sailors are living in a highly depressing environment. 

As it often involves trade across the frontiers of Nation, the laws and the jurisdiction can be conflicting and confusing.  There are various enactments and conventions  and there is the Admiralty Law.  There could be proprietary maritime claim relating to : possession of a ship, title or ownership or a share of a ship, mortgage of ship or its freight, claim between the co owners, claim for satisfaction of a  judgment. There would also be general maritime claim such as claim for damage done by a ship, liability o the owner of a ship, claim for loss or life or for personal injury sustained in a ship, an act of omission in connection with loading or unloading of goods, towage, pilotage, salvage and much more.

Admiralty law is that body of law governing maritime offences and activities. It would encompass marine commerce, navigation, shipping, sailors and transportation of passengers and goods by sea.  Marine or for that matter Law is all about terminology. In rem is Latin for “in a thing” – an action ‘in rem’ is towards some specific property rather than being a claim for monetary compensation against a person, which would be ‘in personam’.

An action of a suit on a ship would action in rem.  In rem action, the jurisdiction of Court would be where the property actually is.  The ship owner  is obliged to provide medical care to seaman and provide basic living expenses during the period of convalescence. They owe a duty of reasonable care to passengers as also to goods.  When such an action is contemplated it could also bring about anguish for the crew  as experienced by those of OSM Arena, though not intended.    There are reports that sailors aboard the conflict ridden vessel have not set foot on land and have been living aboard for the past 19 months. 

During Feb 2011, the  Madras high court  ordered the arrest of a Korean ship on the outer anchorage of Chennai port. he 14-member crew of MV OSM Arena, including its Korean captain had approached the court petitioning against non-payment of their salaries since the ship anchored off the Chennai coast in February 2010. The crew members, nine Koreans and five Myanmarese, had been supplies from the land with the help of Madras Port Trust Employees Union. Two Koreans and two Myanmar nationals, however, left for their native lands in September last year.

The crew had been working in the vessel since 2009 and the ship was detained in Oct 2009 at Chennai seas following a Kolkata High court order on a business dispute between the vessel owner and the Kolkata-based cargo owner LMJ International Limited.

The Madras high court  ordered the arrest of a Korean ship, which is stuck in the Chennai port for the past 12 months due to another litigation pending before the Kolkata high court.  The Kolkata high court ordered the ship's arrest in February 2010 but has not ordered its sale so far as the owners have been disputing the claim. The vessel is unable to leave the port as the litigation is still on.

At Madras High Court, Justice V Ramasubramanian ordered the arrest of the ship after advocates submitted that the ship owners had failed to clear wage arrears of over $10,000 to three Myanmarese crew members of the vessel. The total wage arrears payable to the 17-member crew is over $3.5 lakh, they submitted. The ship — OSM Areana — is estimated to be worth over 8 million dollars (about Rs 32 crore)  - the actual remnant value would be known only when the dispute at Kolkatta High court comes to an end.   Besides the wage arrears claim, there could further be claim towards services and supplies extended by Chennai-based shipping agents.

To tide over the crisis, the Court ordered the sale of vessel and tenders were floated for sale in public auction in "as is where is" condition, free of all liens.  The tenderers were to pay EMD of  Rs.25,00,000/- 
Though the deadline is gone , what happened later – whether it was bought is not known.

Regards – S. Sampathkumar


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