Liberal approach to enforcement of crew wage claims

Liberal approach to enforcement of crew wage claims
15th September 2018 http://maltawinds.com/2018/09/15/liberal-approach-to-enforcement-of-crew...

Introduction

Following the Federal High Court’s ruling in Assuranceforeningen Skuld v MT “Clover Pride” that claims
for crew wages fall outside its jurisdiction (for further details please see “Claims for unpaid crew wages unenforceable in Federal High Court”), practitioners and other observers are understandably eager for judicial elaboration on the fate of such claims. In light of the provision of the Merchant Shipping Act which designates claims for crew wages as a maritime lien, the question as to the appropriate enforcement procedure for such claims following the court’s decision is highly relevant. Initial reactions to the ruling appear to be that crew wage claims may no longer be enforceable through the adoption of the in rem procedure, as the National Industrial Court (the court declared as having requisite jurisdiction in the ruling) is without doubt incapable of acting in admiralty matters. This article takes a second look at that position and argues that the ruling in MT “Clover Pride”, being merely persuasive, can and should be sidestepped by other Federal High Court judges.
Facts

MT “Clover Pride” was brought in rem against the vessel before the Federal High Court to recover crew wages, repatriation costs and other connected claims. Upon the plaintiff’s application, the vessel was arrested to secure the plaintiff’s claim. The owners of the vessel later intervened in the case and applied for:

the vessel’s release from arrest; and
the suit to be struck out for lack of jurisdiction by virtue of

Section 254C of the Constitution 1999. The shipowners argued that the literal interpretation of Section 254C of the Constitution (as amended) clearly removes the Federal High Court’s jurisdiction in respect of claims relating to and connected with wages, labour and welfare and matters arising from an employee’s workplace. Thus, the court’s admiralty jurisdiction over maritime labour claims was eroded by Section 254C of the Constitution.

Decision

In declining jurisdiction, the Federal High Court held that the implication of Section 254C of the Constitution was to confer exclusive jurisdiction over all employee wages and other labour- related matters on the National Industrial Court. The court therefore held that Section 2(3)(r) of the Admiralty Jurisdiction Act, which conferred the same jurisdiction on the Federal High Court, was void to the extent of its inconsistency with the Constitution. The court also found that even though Section 251 of the Constitution provided for the admiralty jurisdiction of the Federal High Court, the express use of the word ‘notwithstanding’ in Section 254C clearly made the former section subject to the latter. Having declined jurisdiction, the court made a further order discharging the ex parte order of arrest.

Crew wage claims still an admiralty matter

Sections 254C and of the Constitution (as amended) provide as follows:

Notwithstanding the provisions of section 251, 257, 272 and anything contained in this constitution and in addition to such other jurisdiction as may be conferred upon it by an act of the National Assembly, the National Industrial Court shall have and exercise jurisdiction to the exclusion of any other court in civil causes and matters relating to or connected with any labour, employment, trade union, industrial relations and matters arising from workplace, the conditions of service, including health, safety, welfare of labour… and relating to or connected with disputes arising from payment of salaries, wages, pensions, gratuities, allowances, benefits and any other entitlement of any employee.

For clarity, Section 251 of the Constitution grants exclusive jurisdiction to the Federal High Court in admiralty matters. Section 251, like Section 254C, is also made “notwithstanding anything to the contrary contained in this
Constitution”.

The court in MT “Clover Pride” perhaps reached its decision because Section 251 of the Constitution does not specifically mention crew wage claims with regard to the Federal High Court’s admiralty jurisdiction. The section simply states that admiralty jurisdiction is exclusive to the Federal High Court, leaving external sources – namely, the Admiralty Jurisdiction Act, the Merchant Shipping Act and common law – to define the scope and constituents of such jurisdiction.

In this regard, Section 2(3)(r) of the Admiralty Jurisdiction Act provides as follows:

A reference in to a general maritime claim includes a reference to a claim by a master, or a member of the crew of a ship for wages; or an amount that a person, as employer, is under an obligation to pay to a person as employee, whether the obligation arose out of the contract of employment or by operation of law, including by operation of the law of a foreign country.

Again, Section 67 of the Merchant Shipping Act 2007 provides that claims for wages and other sums due to the master, officers and other members of the ship’s complement in respect of their employment on the ship will be secured by maritime liens on the ship. Maritime liens, among other things, have the unique characteristic of being jus in rem (ie, a right against the property). Thus, they attach to a ship irrespective of its owner and will not
be extinguished by a bona fide change in ownership. Maritime liens are thus enforceable only by invocation of the admiralty jurisdiction of the appropriate court, as the underlying doctrine sees the ship and not its owners as the wrongdoer.

From the above, it is clear that no part of Section 254C of the Constitution specifically removes crew wage claims from the rank of admiralty matters. A clearer way of appreciating this point may be to note that had the constitution conferred admiralty jurisdiction on the National Industrial Court, there would be no argument that crew wage claims brought before the court would be properly couched in admiralty.

Conflicting constitutional provisions

The conflict between Sections 251 and 254C of the Constitution is apparent in that while claims for crew wages
retain their admiralty rank under Section 251, Section 254C appears to make them unenforceable in admiralty as no such admiralty jurisdiction is conferred on the National Industrial Court. This therefore leads to the question of whether the drafters of the Constitution intended that where crew wages claims are couched in admiralty, neither the Federal High Court nor the National Industrial Court will have jurisdiction to hear them. The absurdity of this situation is exactly the reason why a reasonable level of liberality is applied in the interpretation of constitutional
provisions. In Bronik Motors Ltd v Wema Bank Ltd, Justice Nnamani noted as follows:

A Constitution is a living document (not just a statute) providing a framework for governance of a country not only for now but for generations yet unborn. In construing it, undue regard must not be paid to merely technical rules for otherwise the objects of its provisions as well as the intention of the framers of the Constitution would be frustrated… a Constitutional instrument should not necessarily be construed in a manner and according to rules which apply to Acts of Parliament. Although the manner of interpretation of a constitutional instrument should give effect to the language used, recognition should
also be given to the character and origins of the instrument. Such an instrument should be treated as sui
generis calling for principles of interpretation of its own suitable to its character without necessary acceptance of all the presumptions that are relevant to legislation of private law.

In light of the above, the court in MT “Clover Pride” should have exercised a degree of liberality and recognised the conflict between Sections 251 and 254C of the Constitution. The judge should therefore have resolved the matter by considering the historical issues that gave rise to the enactment of Section 254C. The Supreme Court adopted a similar approach in Bronik Motors, in which it was called upon to determine whether the Federal High Court’s exclusive jurisdiction over banking matters excluded the State High Court from exercising jurisdiction in all banking cases. The court resolved the matter by holding that the Federal High Court’s jurisdiction, insofar as that case was
concerned, was limited to banking (fiscal) measures and did not cover everything pertaining to banking, such as ordinary day-to- day banking activities between the bank and its customers. The State High Court was thus held to still have jurisdiction in the matter.

Comment

The Federal High Court should have resolved the absurdity caused by interpreting the constitution in a way which leaves litigants without remedy in admiralty matters concerning crew wage claims by ruling that:

it will assume jurisdiction where these matters are couched in such a way as to invoke admiralty jurisdiction; and
the National Industrial Court will have exclusive jurisdiction where this is not the case.

Litigants and their advocates will hopefully not be deterred by the merely persuasive(6) ruling of the court in MT “Clover Pride” and continue to bring claims for crew wages before the Federal High Court. Further, it is hoped that other judges will liberally construe the implicated constitutional provisions and assume jurisdiction in appropriate cases.

Source: Akabogu & Associates Shipping & Transport Nigeria