Governor and Company of the Bank of Scotland v. Nel ( The )
T-2416-97
Hargrave P.
9/12/97
12 pp.
Motion for approval of pre-arranged private sale of arrested ship and bunkers, pendente lite, without court-ordered appraisement-Nel mortgaged to Bank of Scotland, together with three sister ships, for $11,250,000-Arrest of defendant ship at Vancouver harbour by plaintiff after owner failed to make two monthly payments-Followed by claims of oil and necessaries suppliers, and substantial claim by crew members for unpaid wages-At time of arrest, Nel carrying 34,000 tonnes of bulk sulphur destined for Tunisia-Owner abandoned ship and disappeared-Very real danger of disastrously expensive corrosion damage to Nel should sulphur remain in vessel for longer than usual period of time, especially in warm weather, as was case in Vancouver-Off-loading sulphur would have cost US$1,330,000-Plaintiff took initiative of having ship evaluated and of arranging sale of ship and bunkers (for US$5,000,000) to buyer willing to undertake voyage-Given circumstances, time critical, for Nel could well, within weeks and certainly within months, become unsaleable except as scrap or at minimal speculative price-Price obtained by plaintiff fair market value for Nel-Independent valuations of two reputable ship brokers accepted-Very special circumstances mandating approval of expeditious private sale-Otherwise proceeds available to in rem creditors would be smaller, result contrary to objective of any court ordered sale, that of obtaining best fair price for ship in order to protect creditors.