In 2017 South Africa promulgated the International Arbitration Act (IAA) with a view to creating a viable arbitral forum on the African continent to resolve international disputes. Although the IAA is still in its infancy, the Supreme Court of Appeal recently delivered an important judgment which illustrates the tension created by the overlapping boundaries of the IAA and the High Court's well-established admiralty jurisdiction under the Admiralty Jurisdiction Regulation Act.
The Supreme Court of Appeal recently took a hard line regarding an arresting party and delivered a salutary message to pay close attention to establishing a plausible link between the factors justifying a 'genuine and reasonable' need for security and the particular facts and circumstances of the party against which an arrest order is sought. The judgment is a cautionary tale for arresting parties that seek to rely on generalised allegations.
The litigation following the collapse of Hanjin Shipping and coming off the back of the Supreme Court of Appeal judgment handed down in January 2019 is ongoing in the South African courts. The latest decision in this regard hinged on whether, for the purposes of timing, the mere issuing of a writ of arrest was sufficient to commence an admiralty action (having the effect of protecting against a change of ownership) or whether physical service of the writ on the vessel was necessary.
The promulgation of the Companies Act 2008 saw the introduction of a company rehabilitation process termed 'business rescue'. As in many other jurisdictions, a company under business rescue enjoys a temporary moratorium on the prosecution of claims with a view to allowing the distressed company breathing space to reverse its financial difficulties and avoid full-scale liquidation. Against this background, admiralty matters have enjoyed special treatment in the context of claims against insolvent companies.
The recent promulgation of the International Arbitration Act gave the United Nations Commission on International Trade Law Model Law on International Commercial Arbitration the force of law in South Africa. Given the cross-border nature of shipping disputes, the act promises to enhance the attraction of what is already a litigation-friendly jurisdiction.