War Risks - Arrest proceedings and the meaning of "ordinary judicial process"

Melinda Holdings SA v. Hellenic Mutual War Risks Association (Bermuda) [2011]
Commercial Court, 18 February 2011

While P&I Club war risk rules are intended to insure vessel owners in respect of capture, arrest and restraint, they will ordinarily exclude such losses where there they arise merely in the course of the "ordinary judicial process". Thus, a normal judicial arrest in the context of, for example, a claim for cargo damage, or pollution liability, does not thereby give rise to a war risk loss by arrest or restraint.

The circumstances behind the present case began in 1996, with the grounding of the vessel SAFIR on coral reefs off the Egyptian coast, causing substantial environmental damage. Proceedings were brought by various Egyptian government agencies in the Port Said court against the owners of the SAFIR, Fonderance Overseas Inc ("Fonderance"), and the managers Seama International Shipping ("Seama"), leading to a judgment in December 1996.

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Lawyers Anthony Menzies, James Crabtree, Susannah Wakefield, Peter Kempe, Jonathan Rogers, Dr. Gunbritt Kammerer-Galahn, Franz Janssen, Dr. Astrid Wagner, Claus Peter Knufinke, Wolfgang Schaller, Alain de Foucaud, Christine Flion, Christopher Dixon