Northwest Delta Yacht Services Inc. v. Sovereign Yachts et al.

The Plaintiff in this action had installed teak decking on the Defendant yacht pursuant to a contract with the builder. The Plaintiff was not paid by the builder and brought this proceeding in rem against the yacht and in personam against the builder and against the purchasers of the yacht. The statement of claim was served on one of the purchasers but was not served on the other purchaser or on the vessel. The purchaser that was served filed a defence and brought this application to dismiss the entire action. The court allowed the application in part. The in personam action against the purchaser that had been served was dismissed on the grounds that there was no contract between the Plaintiff and that purchaser. With respect to the in rem action a preliminary issue was whether the ship had been validly served. The Plaintiff admitted that the yacht itself had not been served but argued that pursuant to rule 479(1)(d) it could perfect the in rem claim by suing funds deposited into court in a separate action as bail. The court rejected this argument holding that the word “proceeds” used in rule 479(1)(d) referred to proceeds of sale and not money deposited to secure the release of property from arrest. The court, however, refused to dismiss the in rem action or the in personam action against the other purchaser. The court held that the summary judgment rules did not permit one Defendant to move to strike an action against other Defendants who had not been served and had not defended.