Fraser Shipyard and Industrial Centre v. The ‘Atlantis Two

This was an application by Lloyd’s for an order that it be given priority for amounts due to it for classification services rendered to the "Atlantis Two" in 1997 and 1998. At the time of the motion the "Atlantis Two" had been ordered to be sold pendente lite. The Acting Marshall had requested that Lloyd’s make it books and records available to potential purchasers. Lloyd’s refused to do so or to provide further classification services unless the Acting Marshall agreed to pay its outstanding account in full. The Acting Marshall declined to pay the outstanding account and the matter came before the court on the motion by Lloyd’s. At the initial hearing of the motion the Prothonotary urged the parties to attempt to reach a settlement of the dispute. The parties were, in fact, able to achieve a settlement which was ultimately included in an Order. The settlement was that Lloyd’s would make its records available but reserved the right to claim priority for its fees. Notwithstanding the settlement, the Prothonotary issued reasons in which he commented that Lloyd’s came to the court with "unclean hands" and that, under the circumstances, it would have been premature and improper to have granted Lloyd’s immediate priority. The Prothonotary further commented that the English practice of having the Marshall recommend payment of classification society fees at the conclusion of the sale (provided there has been an enhanced sale price as a result of the classification societies cooperation) was a sensible and workable practice.