White, Michael --- "The Volga Case: Comment" [2002] MarStudies 32; (2002) 127 Maritime Studies 19

• The Volga Case: Comment
• Endnotes

The Volga Case: Comment

Michael White^[1]

In December 2002 Russia, the flag State of the long-line fishing vessel Volga, brought an application against the arresting State, Australia, in ITLOS^[2] for prompt release of the vessel on payment of a reasonable bond or other financial security. It was the first time in ITLOS for both States. The Volga Case^[3] was the sixth application for prompt release to come before the Tribunal. Of the five previous applications that had been made only three had required the Tribunal to rule on the merits of whether or not the bond or other financial security (the bond) required for release was ‘reasonable’ under Article 292(1) of UNCLOS. The two applications on which the Tribunal did not proceed to judgment on the merits were the Grand Prince Case, where the Applicant failed to establish that the Tribunal had jurisdiction,^[4] and the Chaisiri Reefer 2 Case, where the parties settled the matter themselves prior to the commencement of argument before the Tribunal.^[5] The three applications in which judgment was passed on the reasonableness of the required bond were the Saiga (No.1) Case,^[6] the Camouco Case^[7]

and the Monte Confurco Case.^[8]

In these three judgments the Tribunal grappled with the task of formulating principles that it could apply to determine what was a reasonable bond.

The Volga was a long-line fishing vessel flying the Russian Federation flag, owned by Olbers Co. Ltd, a company incorporated in Russia. The Master, Alexander Vasilkov, was a Russian national.^[9] The fishing licence carried by the Volga entitled it to fish commercially in the Russian EEZ and the ‘open sea and coastal zones of foreign countries’. A condition was ‘observance of the rules governing the fishing industry, the conditions of international agreements, …’.

Australian fishery and military personnel operating from HMAS Canberra boarded the Volga on 7 February 2002 when the vessel was on the high seas just beyond the Australian EEZ and between Heard and McDonald Islands in the Southern Ocean. Australia’s case was that the Volga had been observed fishing illegally in the EEZ and fled into international waters when made aware of the Australian Navy’s presence. Russia’s case was that the boarding was unlawful as it had taken place on the high seas and there was no hot pursuit. The Volga was escorted to the port of Fremantle, where it arrived on 19 February.

The Master and crew were detained under powers in the Fisheries Management Act 1991 (Cth) and the vessel and catch were seized. On 6 March the Chief Mate, the fishing Master and the fishing Pilot, all of whom are Spanish nationals, were charged for unlawful fishing in the Australian Fishing Zone (AFZ)^[10] while the remainder of the crew were released (and later repatriated to Spain). The three members who were charged were allowed bail by order of the Magistrates court for A$75,000 each. Charges laid against the fishing Master required an additional A$20,000 to be provided as bail. On 16 March, sadly, the Russian Master died from an illness despite treatment in an Australian hospital (not having been charged due to his illness). The amount of bail was increased by order of the Supreme Court of Western Australia on an appeal from the Commonwealth DPP.^[11] A further appeal to the Full Court set aside the judgment of the primary judge and restored the Magistrate’s orders while putting in place several conditions.^[12] As the owner had posted the bail monies, and satisfied the conditions imposed by the Court, all three bailed crew members were allowed to return to Spain pending trial.^[13]

Under the Fisheries Management Act 1991 (Cth) the catch, vessel, nets and equipment of the Volga were all liable to forfeiture by order of a court.^[14] The catch, some 131 tonnes of Patagonian toothfish and 21 tonnes of bait, was sold for A$1,932,579.28 and the monies held in trust by the Australian government pending a final court order. It is normal to sell the catch and bait of an arrested vessel because they are perishable. The owner of the Volga, Olbers Co Ltd, instigated proceedings in the Federal Court of Australia seeking to prevent the forfeiture of the vessel and its catch to the Australian government. The forfeiture would have taken place automatically had the proceedings not been commenced.^[15] The Australian government later brought an application for security for costs of the Federal Court proceedings.^[16] The application for security for costs was dismissed as the owner had been placed in the position of a defendant in the matter and security for costs is not usually awarded against a defendant.^[17]

The parties were unable to agree on the amount and terms of a bond or other financial security so the vessel was not released. On 2 December 2002 Russia filed an application in ITLOS (Hamburg court registry) seeking release of the three officers, vessel, catch (value) etc on posting a reasonable bond. Australia appeared to defend and subsequently Statements (pleadings) and other documents were exchanged in compliance with the Rules of the Tribunal and directions given by the Court. Oral hearings were held in Hamburg over 12-13 December. Judgment was delivered on 23 December. Russia had only offered A$500,000 for the value of the vessel, which was well below its agreed value. There was some basis for this as in earlier cases ITLOS had settled on a percentage of the vessel’s value for the bond.

The majority of the judges held that the bond should be in the amount of the value of the vessel A$1,947,460, but that the extra bond sought by Australia as a condition of releasing the vessel was beyond the strict meaning of Article 292, so was rejected. Each State, therefore, had some success and some losses. No order for costs was made. The result was that the bond or other financial security available to Australia was the value of the sold catch (A$1,932,579.28), the value of the vessel (A$1,947,460) and the bond that each of the three officers had to lodge (A$245,000) to enable them to have bail and return to Spain. The substantive case on the arrest of the vessel is still to be heard, which will be in the Federal Court in Perth in due course during 2003. The only further development in this matter at the time of writing is that judgment has been handed down in respect of a motion filed by the shipowner, Olbers, seeking a stay of the proceedings pending the outcome of the criminal charges against the members of the Volga’s crew. The court held there was nothing to suggest that the outcome of Olbers’ action against the Australian government would prejudice the criminal proceedings and Olbers’ motion was dismissed.^[18]

The matter awaits determination in the court in Western Australia as to the legality of the arrest of the vessel and catch and the validity of the charges against the three officers and, if convictions result, the penalties. As mentioned, this is the first occasion for Australia to be in ITLOS but it can be expected that it will occur fairly regularly. Only sovereign States may appear in ITLOS but, so far, many flag States have been agreeable to their names being used by the owners, or other interested parties, for the arrest of vessels to be challenged in the international sphere. The international courts and tribunals do not necessarily have to take account of national legislation so, in many cases, the parties are entitled to a fair hearing on the merits freed of unjust legislation or corrupt or inefficient domestic courts or tribunals, where they exist. There is no doubt that unregulated and illegal fishing of threatened fish stocks, such as the Patagonian toothfish, has to be controlled, but it should be must be done according to law. ITLOS is one of the array of courts and tribunals that has a role to play in this regard.

Endnotes

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^[1] B.Com, LLB, PhD(law), QC. Reader in Law and Executive Director, Centre for Maritime Law, University of Queensland.

^[2] International Tribunal for the Law of the Sea, established under UNCLOS and normally sitting in Hamburg, Germany.

^[3] Judgment may be found at http://www.itlos.org/case_ documents/2002/document_en_215.doc.

^[4] The ‘Grand Prince’ Case (Belize v. France), Prompt Release (2001). See judgment at [93]-[94], ITLOS website, http://www.itlos.org/case_documents/2001/ document_en_88.doc.

^[5] The ‘Chaisiri Reefer 2’ Case (Panama v. Yemen), Prompt Release (2001) See ITLOS Press Release 52, dated 16 July 2001, ITLOS website, http:// www.itlos.org/news/press_release/2001/press_release_52_en.doc.

^[6] The M/V ‘Saiga’ (No.1) Case (Saint Vincent and the Grenadines v. Guinea), Prompt Release (1997). The judgment of the Tribunal in this case can be found at http://www.itlos.org/case_documents/1997/document_en_60.doc. More analysis of this application can be found in ‘The New International Tribunal for the Law of the Sea’ (1999) Maritime Studies March-April 1999 Issue, 1; ‘ITLOS’ The First Two Cases’, 1999, International Law News. In the second Saiga case, M/V ‘Saiga’ (No. 2) Case (Saint Vincent and the Grenadines v. Guinea) (1999), the Tribunal determined the penalty to apply for the wrongful arrest of the Saiga. The judgment of the Tribunal in this case can be found at http://www.itlos.org/case_documents/2001/document_en_68.doc.

^[7] The ‘Camouco’ Case (Panama v. France), Prompt Release (2000). The judgment of the Tribunal in this case can be found at http://www.itlos.org/case_ documents/2001/document_en_129.doc.

^[8] The ‘Monte Confurco’ Case (Seychelles v. France), Prompt Release (2000). The judgment of the Tribunal in this case can be found at http://www.itlos.org/case_ documents/2001/document_en_115.doc.

^[9] The facts are taken mainly from the judgement recorded as the ‘Volga’ Case (Russian Federation v. Australia), Prompt Release (2002) from [30] onwards. As noted above, this judgment may be found at http://www.itlos.org/case_documents/2002/document_en_215.doc.

^[10] The AFZ is coterminous with the Australian EEZ. See s.4 Fisheries Management Act 1991 (Cth).

^[11] Director of Public Prosecutions, who has charge of prosecutions under Commonwealth laws.

^[12] See The Commonwealth Director of Public Prosecutions v Lijo & Ors [2002] WASC 154, Supreme Court of Western Australia, MCS 30 of 2002, judgement delivered 14.06.02, Wheeler J and Lijo & Ors v The Commonwealth Director of Public Prosecutions [2002] WASCA 4, The Full Court of the Supreme Court of Western Australia, FUL 105 of 2002, judgement delivered 16.12.02, Anderson and Templeman JJ with Ollson AUJ.

^[13] The ‘Volga’ Case (Russian Federation v. Australia), Prompt Release (2002) at [37]-[49].

^[14] S.106A Fisheries Management Act 1991 (Cth).

^[15] Fisheries Management Act 1991 (Cth), s.106A and following.

^[16] Olbers Co Ltd v Commonwealth of Australia and Australian Fisheries Management Authority, [2002] FCA 1269, Federal Court of Australia, WA Registry, W 151 of 2002, judgment delivered 16.10.02, French J.

^[17] ibid., at [13] and [19].

^[18] Olbers Co Ltd v Commonwealth of Australia and Australian Fisheries Management Authority (No 2) [2003] FCA 177, Federal Court of Australia, West Australian Registry, W 151 of 2002, judgement delivered 11.03.03, French J.