Tarrant, John Patrick --- "ASP Ship Management Pty Ltd v Administrative Appeals Tribunal" [2006] ANZMarLawJl 6; (2006) 20 Australian and New Zealand Maritime Law Journal 52

• Case Note: ASP Ship Management Pty Ltd v Administrative Appeals Tribunal [2006] FCAFC 23
• Background
• The AAT Decision
• The Appeal
• Conclusion

Case Note: ASP Ship Management Pty Ltd v Administrative Appeals Tribunal [2006] FCAFC 23

John Tarrant^[*]

This case interprets the meaning of the phrase ‘operated by’ in s 10of the Navigation Act 1912(Cth) (the Navigation Act).The Full Court of the Federal Court held that there is a tripartite division of the operations of a ship between commercial operations, technical operations and crewing operations. In interpreting the meaning of ‘operated by’ in s 10 of the Navigation Act it is necessary to determine whether the relevant person was responsible for one or more of these areas of operations.

Background

The proceedings concerned claims for compensation for personal injuries by Gert Bergvall and Shane Kelk. The claims were made pursuant to the Seafarers Rehabilitation and Compensation Act 1992(Cth) (the Seafarers Act). Bergvall was employed by ASP Ship Management Pty Ltd as a crew member on the oil tanker the MT Flinders. The ships owned by Mobil Shipping and Transportation Company but the ultimate management of the shipways with a United Kingdom company, Mobil Shipping Colt. ASP hade ship management agreement with Mobil Shipping in relation to the Flinders. Kelk was employed byMermaid Labour and Management Ltd as a crew member of the pipe laying vessel the MV Lorelay.TheLorelay isowned by a Swiss company and theultimatemanagement of the shipwaswith Allseas Marine Contractors SA. Allseas Marine had a labour and catering agreement with Mermaid.

Both Bergvall and Kelk claimed compensation under the Seafarers Act from their respectiveemployers. Sections 73 and79 of the Seafarers Actsetout the procedure for the determination ofclaims. As both ASP and Mermaid failed to determine the claims within the prescribed timethe effect of s 79 is thatASP and Mermaid are taken to have made a decision disallowing the claims providedthat the relevant ships wereprescribed ships under the Seafarers Act. Section 3 of the Seafarers Act provides that a prescribed ship is a ship towhich Part II of the NavigationAct applies.

The AAT Decision

Bergvall andKelk appliedto the Administrative Appeals Tribunal for a review of the deemeddisallowance of their claims. The immediate question before the Tribunal was whether the deemeddecisions of ASP and Mermaid were reviewable decisionsbefore the Tribunal. InBergvall v ASP Ship Management Pty Ltd1the Tribunal held that they were reviewable decisions.

The critical questionwas whether the ships fell withinthe definition of 10of the Navigation Act. If they did then the applicants were entitled to pursue claims for compensation under the Seafarers Act. Section 10 of the Navigation Act extends the application of Part II of the Navigation Act to ships of which the majority of the crew are residents of Australia provided that the ship is operated by company that is incorporated in Australia whether or not that company operates the ship in association with other persons. ASP and Mermaid are both Australian companies so the issue was whether they were operators of the respective ships.

The Tribunal noted two possible meanings of the verb ‘operate’ relevant to the interpretation of s 10ofthe Navigation Act. The first is concerned with the physical operation of the ship while the second was concerned with the operation of the enterprise in which the ship is engaged.2 The Tribunal concluded that ASP was an operator of the Flinders because of its management role in employing the master of the ship and all of its crew. The Tribunal also reached the conclusion that Mermaid was an operator of the Lorelay despite the fact that the master of the ship was employed by All seas and Mermaid’s contract was a labour and catering contract rather than a management contract. Both ASP and Mermaid appealed. In addition they each commenced proceedings in the Federal Court seeking to prohibit the Tribunal from dealing with the applications before it on the basis that the Tribunal had no jurisdiction to deal with the applications.

The Appeal

In ASP Ship Management Pty Ltd v Administrative Appeals Tribunal³ the Full Court of the Federal Court noted that amendments to the Navigation Act in 1979 introduced into the Act the concept of a ship being operated by someone other than the owner.[4] The Court noted that the Explanatory Notes to the 1979 amendments referred to the intention of the legislation to apply to persons directly responsible for operating a ship so as to make them liable for breaches of the Act. This was particularly relevant where the actual owner of a ship was not within the jurisdiction.[5]

The Court noted that a ship is more than just a chattel; it is a working commercial enterprise.[6] As such there are a number of aspects of operating a ship. The Court noted that those having management and control of a ship have responsibilities ‘concerning the commercial deployment of the ship, the technical safety and adequacy of the ship as a complex integrated working entity, and the choice, supervision, care and discipline of the master and crew on board the ship’.[7] The Court concluded that there is therefore a tripartite division of operations between commercial operations, technical operations and the crewing operations.[8] The Court rejected the contention that the word ‘operator’ or the phrase ‘to operate’, relate ‘only to the entity that has the commercial disposition of the ship or who has the final authority on operational matters.[9]

The Court concluded that the Tribunal had erred because it had concluded that operating a ship meant either the operation of the ship itself or the operation of the ship as a commercial enterprise.[10] The Court in recognising a tripartite division of operations had demonstrated that the relevant concept was wider than that envisaged by the Tribunal.[11]

Because the Tribunal had not made findings of fact as to the extent to which ASP and Mermaid were in a position to exercise control over the identity and qualifications of the masters and crew of the Flinders and Lorelay, the Court held that ‘the Tribunal should not enter upon a consideration of the merits of the applications unless and until it finds, according to law, that the respective ships were being operated by the respective employers’.[12]

Conclusion

The decision in ASP Ship Management highlights the difficulty in interpreting legislation that purports to apply to ‘an operator’ without any definition of who is considered an operator. Given that it impossible to allocate the tripartite operations of a ship amongst a large number of persons it is likely that future cases will arise where a person is responsible for only part of one of the tripartite responsibilities. The Tribunal may in fact determine that ASP and/or Mermaid are not operators of the respective ships because they are only responsible for part of the crewing operations. The tripartite classification is a useful tool in resolving these issues but it would assist interpretation of the Navigation Act if the legislation included a definition of what is required for a person to be considered an operator of a ship.

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* Lecturer,Law School, University of Western Australia.

[1] [2005] AATA 311; (2005) 87 ALD 448.

[2] Ibid, 462.

[3] [2006] FCAFC 23 (Unreported, Black CJ, Emmett and Allsop JJ, 10 March 2006).

[4] Ibid, [15].

[5] Ibid, [27].

[6] Ibid, [98].

[7] Ibid.

[8] Ibid.

[9] Ibid, [106].

[10] Ibid, [109].

[11] Ibid.

[12] Ibid, [115].