Sea Malta ships cannot be sold, judge rules

Mr Justice Geoffrey Valenzia, sitting in the First Hall of the Civil Court, yesterday upheld an application filed by 42 Sea Malta Co. Ltd former employees and prohibited the company from selling two vessels.

The men claimed that their employment with the company had been terminated. The company was in liquidation and liquidators had been appointed to dispose of its assets.

However, they said they were still owed money by the company in relation to their salaries and other benefits including termination benefits. They told the court the amount due to them totalled Lm929,804.

The only property owned by the company was two ships, namely MV Maltese Falcon and MV Zebbug, and these could be used to make good the amounts owed to them, the former employees said.

Thus, they asked the court to prohibit the company from selling the vessels or any part of them and also to stop the company from registrating any mortgages or hypothecs on the vessels.

Mr Justice Valenzia dismissed a preliminary plea by the company's liquidator and ruled that the case had been correctly filed by means of an application in terms of the recent amendments to the law governing procedure.

The court added that it did not appear that the amount claimed by the former employees was being contested by the company. However, the court had to decide whether the claim was to be classified as a privileged claim in terms of the Merchant Shipping Act.

Mr Justice Valenzia pointed out that certain debts were to be secured by a special privilege upon a vessel, and that such debts included wages and other sums due to the master, officers and other members of the vessel's complement.

The former employees' claim was therefore a privileged one and so they had a claim on or over the vessels.

The court added that a private sale by the liquidator of the vessels could prejudice the former employees' claim as they would be classified with other creditors who might be paid before them.

The court thus upheld their request and banned the company from selling or transferring the vessels and from registrating any mortgages or hypothecs on the vessels.