Ann Fenech is the Managing Partner of Fenech and Fenech Advocates, and the Head of the Marine Litigation Department. After qualifying in 1986 she joined the shipping and commercial firm of Holman Fenwick and Willan in London where she stayed until 1991 prior to joining New Orleans firm of Chaffe, McCall, Phillips Toler and Sarpy. She is the President of the Malta Maritime Law Association and Vice-Chairman of the Yachting Services Trade Section at the Malta Chamber of Commerce and Enterprise.
Areas of Practice
Ann Fenech deals exclusively with ship related issues and has now gained extensive experience in the handling of the whole spectrum of ship related matters including disputes arising out of Charterparties and Bills of lading both in terms of preliminary issues such as jurisdiction, title to sue, time bar, limitation as well as issues on the merits; Disputes arising out of ship building and ship repair contracts; disputes arising out of salvage, collision, towage and pilotage; the provision of the immediate response and assistance necessary following a casualty and disputes arising out of the casualty; disputes arising out of the carriage of petroleum products and in particular shortage claims, contamination claims, off speck fuel oil etc; handling the pre contractual and contractual negotiations between vendors and purchasers in ship sale and purchase contracts; substantial experience in the arrest of vessels and the issuing of other similar procedures with a view to obtaining security for claims and / or defending claims. She is the President of the Malta Maritime Law Association and vice-Chairman of the Yachting Trade Section of the Malta Chamber of Commerce and Industry.
Recent and current cases in which she is involved include acting for Finaval S.p.a in their action against Scorpio Ship Management in which case the Court of Appeal in July 2010 awarded Finaval S.p.a $22.5 million – being the highest amount of damages ever awarded by a Maltese Court; acting for the Government of Malta together with the Attorney General of Malta in the defence of a case brought by the European Commission against the Republic of Malta claiming an alleged breach by Malta of Regulation 3577 before the European Courts of Justice - this case was decided in October 2010 whereby the claim of the European Commission against Malta was dismissed with costs; acting for the Privatisation Unit of the Government of Malta in the privatisation of Malta Shipyards Limited, Manoel Island Yacht Yard, Malta Superyachts Facilities, and the Ta’ Xbiex and Msida Yacht Marinas; acting for the gas carrier Sichem Pandora in an alleged collision between it and the fishing vessel Klein Familiein the English Channel; acting for the owners of the Coral Water in a collision with Mare Blu fish farm in Malta.
The June 2018 sale of the Indian Empress has attracted the attention of the superyacht community worldwide and international brokers, the international yachting media and potential owners and creditors of the yacht are watching this space very closely. This was the first time that a Maltese court ordered bidders in a judicial sale by auction of vessels to make a cash deposit in court prior to the sale taking place and the first time that a bidder was held liable for the payment of the difference.
The Comite Maritime International (CMI) has been aware that there are challenges relating to the international recognition of judicial sales of ships. As such, the CMI approached the United Nations Committee on Trade Law in order to encourage it to embark on future work on cross-border issues relating to judicial sales. The committee, on its part, encouraged the CMI to hold a colloquium to provide additional information to the commission. This colloquium was recently held in Malta.
The term 'Maritime Malta' perfectly describes Malta – a country which has always had close connections with the sea and maritime sector. In addition to its strategic position, Malta has a stable and reliable legal regime and laws which give investors and their financiers a high degree of confidence. These achievements are a direct result of careful planning, a strong workforce that is prepared to deliver value for money and a 'can do' attitude.
While the arrest of vessels is an exceptionally effective and powerful tool which genuine creditors have every right to use, it is paramount that the rule of law is observed and the law's high standards are maintained. Otherwise, there is a risk of increased lawlessness. The Maltese courts have addressed arresting parties' failure to follow the law in several cases, taking immediate action to correct any misinformation.
A recent case has highlighted a weakness in Maltese law in relation to the right to claim damages resulting from an illegal arrest. Despite finding that the arrest was illegal, the court stopped short of ordering reparations because it held that the defendants' failure to satisfy the criteria outlined in Article 742(D) Code of Organisation and Civil Procedure was not malicious, frivolous or vexatious and thus no damages could be sought.
In 2006 the Organisation and Civil Procedure Code was radically overhauled in relation to the provisions governing Maltese enforcement mechanisms, among other things. The changes to enforcement mechanisms included the introduction of court-approved private sales, under which mortgagees can source private buyers at the highest possible agreed price and, on court approval, sell vessels free and unencumbered.
Following the recent increase in attacks on vessels travelling in the vicinity of Somalia, demand has grown for private maritime security companies that can provide professional armed guards on board a vessel to assist in anti-piracy measures. Malta has therefore recently taken steps to regulate the licensing of such companies to ensure that they meet appropriate standards and employ quality personnel of high integrity.
A Maltese civil court recently further confirmed the rights of mortgagees granted by the law. Despite leaving a number of questions unanswered, this ruling should reassure international financiers of vessels registered under the Malta flag. Provided that the contracts into which they enter are in line with the provisions of the Merchant Shipping Act, financiers can rest assured that their rights will be fully upheld and safeguarded.
Legal history was made recently when a Maltese civil court granted an application requesting approval of a private sale. Court-approved private sales are intended to address the respective disadvantages of private sales and judicial sales by auction. Notwithstanding that this remedy has been on the statute book since 2006, this case represented its first test.
In 2010 the Maltese courts issued their highest-ever damages award in a case involving a failure to transfer shares in a company that was the owner of a new Aframax tanker. An Italian company filed an action against a Monegasque company for breach of a promise to sell shares in a Maltese registered company which had been formed for the purposes of entering into a shipbuilding contract.
The financial crisis has brought with it increased requests from mortgagees about how best to protect their interests. Fortunately for mortgagees of vessels registered in Malta, a mortgage duly registered in the Shipping Register is an executive title and therefore equivalent to a judgment. This means that in case of default, the mortgagee need not prove title or go through any court procedures to enforce the mortgage.
In December 2008 Parliament passed Act XV/2008, which brought into force a number of procedural changes, including the creation of one single warrant of arrest of a seagoing vessel to replace the previous warrant of impediment of departure and warrant of seizure.
As Malta is not a signatory to international arrest conventions, the arrest of ships is governed entirely by domestic law. In order to be arrested in Malta, the vessel must be present in Malta and the claim must exceed LM3,000. The grounds for arrest are equivalent to the grounds upon which Maltese courts exercise jurisdiction either in rem or in personam.
As the term 'ship' is widely defined under the Merchant Shipping Act, all types of vessel (including those under construction) as well as other marine structures (eg, oil rigs and pontoons) may be registered under the Maltese flag. Vessels may be registered under the Maltese flag only if evidence of seaworthiness is established by one of the internationally recognized classification societies.
In Finaval SpA v Scorpio Ship Management SAM the Civil Court awarded Italian-registered company Finaval SPA over LM7 million in damages. Finaval filed a writ against Scorpio Ship Management SAM and others when Scorpio failed to transfer ownership of a newly built ship to Finaval, as set out by an agreement between the two parties.
The Department of Value Added Tax (VAT) has announced an attractive VAT incentive package through new guidelines on the VAT payments applicable to yacht leasing. The guidelines address scenarios where a Maltese company purchases a pleasure yacht and enters into a lease-sale of the yacht with a third party.
Last year the Commercial Yacht Code came into force to regulate the use of commercial yachts. Commercial yachts benefit from paying tonnage tax rather than income tax on the earnings of the owner company. The new regulations have proven to be extremely popular, with a marked increase of European yachts used for commercial purposes registered under the Maltese flag in the first year of operation of the code.
A new section of the Code of Organization and Civil Procedure has finally brought Maltese law on jurisdiction in rem and arrest out of the Victorian era. Further amendments have introduced the concept of court-approved sales and simplified the process of issuing warrants for the arrest of a vessel.
For some time now there have been calls to update the legislation relating to transportation. However, 2006 is due to see the introduction of three new laws that have been outstanding for a number of years. One of these acts is expected to incorporate the Convention on the Contract for the International Carriage of Goods by Road.
A Maltese court recently gave an interim judgment on the issue of whether items supplied to a yacht by the agent qualified as necessaries. Under Maltese law, the court has jurisdiction in rem over a vessel in the case of necessaries supplied to the vessel.
A judgment on actions in rem and debts incurred by bareboat charterers which is diametrically opposed to two earlier decisions has recently been published. The court disregarded the defendant vessel's attempt to distinguish between the grounds on which courts can exercise jurisdiction and the right of a plaintiff to file an action against a vessel in rem for the debts of a bareboat charterer.
In Maltese shipping legal circles the name 'Poker' has become synonymous with the debate over whether an action in rem can be instituted against a vessel for debts incurred by the vessel's bareboat charterer. To date, seven service providers have filed actions in rem against the Poker.