DEN NORSKE BANK A.S. v. ASSET CENTURY LTD t/a "DAIRY ON CO " AND ANOTHER

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JUDGMENT

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Sir Derek Cons, V. P.:

1. This is an appeal from an Order made by Mayo J. on the 10th September for the sale of the ship "Eastern Splendor" under arrest in Hong Kong.

2. The motion had been filed on the 7th September asking for sale by private tender alternatively, if the tender failed to meet the appraised value of the vessel, by public auction. There was a further request that, in addition to the usual costs of appraisement and implementation of the sale, there should be included in the Bailiff's costs and expenses the cost of advertising and commission payable to any broker who introduced a successful purchaser.

3. The Plaintiff and two Caveators had expressly raised no objection to an Order in those terms; the Defendants had by letter agreed to "whatever steps you (i.e. the Interveners bringing the motion) deem necessary to apply to the High Court for an Order for Sale".

4. In the course of the hearing below the judge was advised that inclusion of advertising costs and commission to brokers was common practice in the Admiralty Court of England. He had also an affidavit to the effect that private sale through brokers was likely, in the opinion of the deponent, (i.e. the solicitor to the Interveners), and his clients, to produce a figure which would more than outweigh the commission payable. Nevertheless his Order was simply for sale by the court, without provision for advertising costs or commission. He seems to have been concerned that this was not the usual practice in Hong Kong and felt that perhaps the Admiralty Users' Committee should first be consulted.

5. We have had handed to us a note made at the time by the solicitors for the Interveners. It has not been approved by the judge and we have no note from counsel. The first paragraph is in these terms, the words being attributed to the judge:

With respect to the judge it is only necessary to read those words for it to be seen quite clearly that he did not exercise his discretion with regard to the particular circumstances of this case as, of course, he should have done.

6. Alternatively, if that is not a true record of his observations, it seems to me that in the actual circumstances of this application and with all respect to him, he was plainly wrong in his decision bearing in mind the evidence that a sale through brokers was likely to produce a figure which would more than offset the broker's commission and the fact that everybody concerned raised no objection to it.

7. For my part therefore I would propose that the appeal be allowed; that the judge's Order be set aside; that a fresh Order be substituted in terms of a draft to be submitted by counsel for the approval of this Court, to include a term that the amount acceptable by way of a sale by private tender should, when the commission is deducted, be not less than the appraised value; and that the costs of the appeal and below be to the Interveners, to be taxed and deducted from the sale price.

Fuad, V. P.:

8. I agree that the appeal should be allowed for the reasons given by My Lord and with the Order that he proposes.

Kempster, J. A.:

9. I also agree.