How easy is it to get an Order from the Court to remove and sell an abandoned vessel in Queensland?

A Queensland case handed down last week, demonstrates why it is so important to be able to rely on a contractual right to remove a vessel from your marine facility.

In that case, the General Manager of Maritime Safety Queensland (MSQ) was successful in obtaining an order from the District Court of Queensland for the removal, breaking up, disposal and sale of any parts of an abandoned commercial fishing trawler left sunk in the Brisbane River.

The vessel sank on 3 February 2019 and it took Maritime Safety Queensland over 14 months to obtain this order.

Maritime Safety Queensland has rights and powers under the Transport Operations (Marine Safety) Act 1994 (the Act) which are not directly available to marine facility operators.

In the case of Mitchell v Le[1], the Harbour Master had given the owner of the vessel a direction to remove the vessel. The case does not say when that direction was issued so it is indeterminable how long it took before the matter finally got before a Court.

The first order issued by the Court was on 30 January 2020, nearly 12 months after the vessel sank. That Court order was what is known as an enforcement order.

Pursuant to the enforcement order, the owner of the vessel was required to submit to MSQ a written towing and slipping plan for the vessel, and to remove the vessel from Queensland waters in accordance with such a plan.

The owner of the vessel was also ordered to provide a security bond in the amount of $120,000 to the State of Queensland.

At that hearing, MSQ asked for additional orders about what MSQ would be entitled to do if the applicant failed to comply with the Court order. The judge refused to do so because the only legislative authority the Court has to make such an order is if the Court is satisfied that the vessel owner had contravened a previously made enforcement order.

The owner of the vessel did not comply with the enforcement order so MSQ went back to the Court seeking further orders.

When the matter came before the judge on 3 April 2020, the judge was satisfied that the enforcement order had not been complied with. He said that only then, did he have the power under section 183A of the Act, to authorise MSQ to take steps to remove, break up and sell any parts of the vessel. He then made such an order.

MSQ also sought an order that should the costs incurred by MSQ exceed the amount of any forfeited security bond (which the vessel owner never actually paid), MSQ would be able to recover those costs from the owner of the vessel.

In a further demonstration of just how difficult these cases can be, the judge said that had if he been pressed to make such an order, he would not have done so. The judge noted that the General Manager of MSQ was not entitled to any such order in any event and that only the State, not MSQ, has such a right to recover costs of this nature, so the State would have to make a separate application if the State wanted such orders.

Can a marine facility operator use the Act?

Under section 87A of the Act, a Harbour Master of a harbour has the power to give directions to the owner of a ship which is lost, abandoned or stranded. The owner of the vessel is liable for the Harbour Master’s and the State’s expenses in relation to any such direction.

If a person fails to comply with such a direction, the Harbour Master may, to the extent necessary to ensure safety, carry out the direction including by removing a vessel which is obstructing or may obstruct navigation. However, those powers are quite restricted.

A Shipping Inspector under the Act has the power to seize and remove abandoned vessels, but except in the case where the abandoned vessel causes a hazard to ships or navigationbefore doing so, the Shipping Inspector must, among other things, publish a notice in a newspaper circulating in the locality of the abandoned vessel.

Then, the Shipping Inspector has to wait 28 days after the notice is published and if nobody has claimed the abandoned vessel, only then, can the Shipping Inspector seize and remove the abandoned vessel.

The Shipping Inspector is then required to conduct a public auction and if the vessel is sold, the proceeds can be used to pay the expenses of the sale, seizure, removal and storage of the vessel.

As happened in the case referred to, a “prescribed applicant” can commence Court proceedings in the District Court for an enforcement order.

Then, if the person does not comply with that enforcement order, a “prescribed applicant” can again apply to the Court for further orders.

Note that operators of marine facilities are not “prescribed applicants”. The only prescribed applicants in Queensland are the Chief Executive and the General Manager of MSQ and government appointed Harbour Masters.

Conclusion and recommendations

Even if an operator of a marine facility can convince the appropriate authorities to take action and use their powers under the relevant legislation, it can still take at least a year to have an abandoned vessel removed or disposed of.

In practice, it seems that unless there is a genuine environmental risk or risk to navigation, the authorities will not take such action simply to assist a marine facility operator. And, these powers only relate to vessels in the water.

The takeaway lesson for marine facility operators is that the only real solution is to make sure their rights to deal with abandoned boats and boats in relation to which payment has not been received, are clearly set out in enforceable and practicable contracts with the owner of the vessel.

Cornwalls offers to review marine facility operators’ slipping agreements, berthing agreements and hard stand/racking storage agreements to see if they are as good as they can be. In the event they are, there will be no charge. If there is a need to improve the governing documents, to ensure that you do not get stuck with abandoned vessels or have to keep storing vessels for which the rent or fees are not being paid, Cornwalls can provide a fixed fee to update your documents and put you in the best place you can be.

[1] A decision of the District Court of Queensland handed down on 9 April 2020 Mitchell v Le [2020] QDC 55

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Disclaimer

This information and the contents of this publication, current as at the date of publication, is general in nature to offer assistance to Cornwalls’ clients, prospective clients and stakeholders, and is for reference purposes only. It does not constitute legal or financial advice. If you are concerned about any topic covered, we recommend that you seek your own specific legal and financial advice before taking any action.