ARREST OF VESSEL

District court Koper has an exclusive jurisdiction for arrest of vessel in Port Koper. Slovenia is a member of International Convention Relating to the Arrest of Sea-Going Ships 1952. (http://www.admiraltylawguide.com/conven/arrest1952.html).

Arrest of a vessel is part of the process by which Court gains jurisdiction over the subject matter of a law suit. These lawsuits are known as "in rem" actions meaning that the action is again a "thing" rather than a person.

Generally, the vessel, itself, is responsible for payment of liens, mortgages or any other maritime lien that may arise. An arrest of a vessel is the prerequisite for the court to establish jurisdiction. Arrest is the physical process by which, in case of Slovenia, Local harbor master goes aboard the vessel and physically detain all vessel document. The vessel is not allowed to leave the Slovene territory. The Notice of Arrest is given to the master or person in charge, as well as to the owner.

Once the security is accepted, the vessel documents are returned and vessel is free to leave Slovene territory seas, but however the litigation continues with the security as the subject of execution of judgment.
Letters of undertaking are stipulations by the owner or his insurance company to appear and defend any claim that is made, just as if the vessel had been arrested. If a judgment is entered, the owner or the insurer must pay the judgment. This amounts to stipulated jurisdiction for the court and prevents the disruption of the owner's business during the litigation.

If a vessel is not released by the posting of security, the court may order an interlocutory sale. An interlocutory sale, means a sale prior to the completion of the litigation and the entering of a judgment. Regardless as whether the sale is interlocutory or a judgment sale, the purchaser at the auction does not have any right in the vessel, until the sale is confirmed by the court. Once confirmation is received, the buyer receives title which extinguishes all other liens and provided him with a clear title. If the sums received are not sufficient to pay all claims, the claimants pay proportionately to the shortfall.

Unless the claimant/plaintiff who seized the vessel acts in bad faith, the owner of the vessel may not recover damages due to the arrest or for loss of profits