Authored by Art Wynberg, Adam Butler and Malcolm Hartwell.
On 4 September 2026, an important decision for cargo owners, insurers and carriers was handed down by the English Court of Appeal which confirmed our view that arresting a vessel to obtain security does not interrupt the one-year time bar under the Hague-Visby Rules. Cargo interests wishing to pursue a claim must initiate substantive proceedings within a year, failing which their claim will be extinguished.
The dispute arose out of the carriage of a cargo of timber. Cargo interests alleged misdelivery by the owners of the vessel and initiated arrest proceedings against a sister ship in Singapore within the one-year time bar imposed by Article III, Rule 6. Security was provided to secure the release of the vessel from arrest and shipowners then obtained a stay of the Singapore proceedings in favour of arbitration in England. The security provided was held as security for the arbitration proceedings.
The arbitration proceedings were only instituted over a year after the alleged misdelivery.
Owners raised the defence that cargo interests’ claim in the arbitration proceedings was out of time pursuant to Article III, Rule 6, which provides that “the carrier and the ship shall in any event be discharged from all liability whatsoever in respect of the goods, unless suit is brought within one year of their delivery or of the date when they should have been delivered.” The question was whether the Singapore proceedings constituted ‘suit’ in circumstances where the substantive claim was not (and could not be) pursued in Singapore. The court effectively held that once the Singapore proceedings were stayed, the arrest was an arrest brought solely to obtain security.
The court agreed with owners, holding that a ‘suit’ under the Hague-Visby Rules must be understood as proceedings that can decide the underlying claim, and that the definition cannot extend to tangential proceedings for security. The purpose of the time bar is to ensure “the prompt making and pursuit of substantive claims”, which would be undermined if cargo interests could arrest a vessel and then defer the substantive claim indefinitely.
The court considered a number of cases where cargo interests had commenced substantive proceedings in a particular jurisdiction within one year and those proceedings were then stayed or set aside, usually for jurisdictional reasons. In those cases, subsequent proceedings brought in the correct jurisdiction were found to be out of time. The fact that security in this case was still standing for the London arbitration proceedings and had been obtained before the one year time bar, did not persuade the courts in this matter to adopt a different approach.
South Africa has an almost unique procedure available to claimants in terms of the Admiralty Jurisdiction Regulation Act. A South African court can grant an order for the arrest of maritime property such as a ship, in order to obtain security for proceedings that are contemplated or have been commenced in any other jurisdiction. Security provided to obtain the ship’s release from arrest is then held pending the outcome of the substantive proceedings in the overseas forum. We have always taken the view that security arrests in South Africa do not interrupt the time bar on the substantive claim.
Claimants must always commence suit in a jurisdiction that has the jurisdiction to decide the merits of the dispute even if there may be aspects of that jurisdiction which are not as favourable to claimants such as tonnage limitations, package limitations or defences available to owners.
This judgment is not binding in South Africa but is likely to be followed by South African courts and tribunals in other common law countries. Cargo interests should therefore ensure that substantive proceedings addressing the underlying claim are initiated within the one-year timeframe in a tribunal that will exercise jurisdiction.
Batavia Eximp & Contracting (S) Pte Ltd v Pedregal Maritime SA [2026] EWCA Civ 1158