A livestock carrier “arrested” at Portland by Australian Government officials for alleged non-payment of bills by its owners is set to be auctioned to recover unpaid funds under an Australian Federal Court order.

Yangtze Fortune, which has regularly carried Australian dairy heifers and breeding cattle loaded in Portland, Victoria, and Napier, New Zealand, to China in recent years, has been the subject of court action since being detained by authorities at the Victorian port in late September last year.

A Federal Court hearing just before Christmas on December 20, 2022, noted that more than 30 crew members from the Philippines were still on board the anchored vessel where it stands under arrest near the Port of Portland, with allegations the stranded crew members had been on board for at least three months at that time with wages unpaid for at least six weeks.

Federal Court proceedings contained allegations the ship had been abandoned by its owners and the ship’s condition was deteriorating, with the owner no longer provisioning the ship and not defending the proceeding or opposing the sale.

In a court order resulting from the 20 December gearing, Federal Court Justice Angus Stewart ordered the Admiralty Marshal engage a ship broker to value and then sell the ship to realise “the best advantage to the body of creditors”.

The 11,600 tonne, 132 metre Yangtze Fortune was built in 2005 as a container vessel, but was later converted to a livestock carrier. The vessel is flagged in Liberia.

The court was the told Yangtze Fortune sailed to Australia from China for the purpose of loading 5200 breeding cattle at Portland, Vic, in September 2022 for carriage to China.

The plaintiff, international ship fuel supplier Dan-Bunkering (Singapore) Pte Ltd, which has offices around the world including in Sydney, was advised that the vessel had sustained a crack in its hull whilst enroute to Portland and, apparently for that reason, did not present for loading.

On November 9, 2022, Australian-based livestock exporter Australasian Global Exports Pty Ltd issued a writ against the ship in the Western Australian registry of the Federal Court, claiming damages of US$2.3 million plus A$1 million for breach of a booking note dated 13 September 2022.

The writ was served on the ship off the port of Portland on 17 November 2022 by an Admiralty Marshal.

On November 11, Dan-Bunkering (Singapore) Pte Ltd issued a writ against the ship in the New South Wales Registry of the Federal Court, claiming US$549,695 plus interest on an invoice dated 6 June 2022 for bunkers supplied to the ship at Zhoushan Port, China.

On December 2, the ship, still anchored off Portland, was arrested by an officer of the Australian Border Force in his capacity as Admiralty Marshal.

RMS Marine Service Co Ltd and RMS Marine & Offshore Service (Singapore) Pte Ltd also commenced proceedings against the vessel in respect of claims of more than $250,000 in services provided to the vessel.

In a court hearing on December 20 Justice Stewart noted that the Marshal’s expenditure on maintaining the custody of the vessel amounted to approximately $270,000 in bunker fuel plus a further approximately $700 per day in respect of the Marshal’s liability insurance. Further costs were likely to “mount quickly in the coming weeks”, he observed.

‘Vultures circling’

Justice Stewart said no party, whether the shipowner or any bareboat charterer or mortgagee, had intervened to maintain the vessel while it was under arrest or even to continue to pay the crew.

“The vessel has all but been abandoned. It continues to deteriorate and the expenses to maintain it continue to mount. It seems that its sale at some point is inevitable, and the sooner that that is ordered and done the better for all concerned.

“I have in mind in particular the highly disadvantageous circumstances of the crew and that the shipowner has not opposed the sale or indicated any willingness to secure the claims.

“In the latter regard, the number and nature of the proceedings against the vessel and caveats against its release from arrest is notable. Clearly, the vultures are circling. I see little to no prospect that the judicial sale of the vessel can be avoided.”

Justice Stewart said a recently carried out temporary repair for the crack in the Yangtze Fortune’s hull appeared to be holding, but said he considered the aging vessel to be deteriorating and saw no other available course than for the sale of the vessel to be ordered.

The court hearing noted that the vessel’s marine hull and machinery insurance was due to expire on December 31, 2022. “If that occurs, all claimants’ security will be imperilled”, the judge said.

Details on plans for the sale of the ship have not yet been released.

The Australian Maritime Safety Authority website notes that in October 2020 the Yangtze Fortune was detained at Portland, with the authority stating the ship’s safe management systems failed to ensure critical operations such as navigation and monitoring of its position could be carried out in a safe manner.

The ship’s registered owner is listed on the AMSA website as Soar Harmony Shipping Ltd, China.

The Yangtze Fortune’s sister ship Yangtze Harmony has been the subject of legal action through the High Court of Singapore since October last year. Court proceedings have focused on allegations by a tug operator that $1.8 million from a bill to tow the vessel to Singapore from eastern Australian remains unpaid.

International Transport Workers Federation working with crew

In a statement following the December 20 court hearing the International Transport Workers’ Federation said it was working alongside AMSA with the Admiralty Marshall to support the crew after the ship’s owner failed to pay their wages or meet its obligations under international maritime law.

The International Transport Workers Federation (ITF) Australian Inspectorate Coordinator, Ian Bray, said that the more than 30 crew members, all of whom hail from the Phillipines, had been abandoned by their employer on the stranded ship.

“After many weeks at anchor near Portland, provisions aboard the ship are running low and many of the crew are desperate to return home but must now stay with the ship while court action and the ship’s sale process unfold,” the ITF statement said.

“These workers are already owed, collectively, more than a quarter of a million dollars in unpaid wages, and while the court action is on foot they must stay with their ship despite the ever-diminishing prospect of receiving what is owed to them,” Mr Bray said.

He said shipboard documentation showed that the crew received only one third of what they were owed in October, and the ITF’s investigation had also revealed that the crew’s wages payments in both September and August were made using monies set aside for workers’ leave entitlements and the company’s provident fund.

ITF Australia’s Assistant Coordinator, Matt Purcell, who was providing support to the crew, said that five members of the crew had already clocked up eight months aboard the vessel and were desperate to return home to their families.

“These vulnerable, exploited crew face the prospect of spending months longer aboard this ship in dreadful conditions just to get what’s already owed to them, or the choice of returning home after 8 or 9 months away with nothing to show for it,” he said.

Further updates will be provided as more details become available.