In this case the court had to consider whether the court’s permission was required for the MAIB report of a grounding to be used in arbitration.

Factual background

In June 2017 the vessel “OCEAN PREFECT” twice ran aground in the course of entering the port of Umm Al Quwain in the UAE. The grounding of this British registered vessel caused the Marine Accident Investigation Branch (MAIB), an independent inspectorate within the Department of Transport, to investigate the circumstances of the grounding to see what lessons could be learnt with regard to improving the safety of shipping. The owners alleged that the grounding was caused by a breach of the safe port warranty by the charterers. The owners pursued their claim in arbitration.

The owners wished to refer to the MAIB report in the arbitration. The charterers and the MAIB said that should not happen, arguing that before the MAIB report was admitted into the arbitration, the court had to give permission pursuant to regulation 14(14) of the Merchant Shipping (Accident Reporting and Investigation) Regulations 2012 (the Regulations) and that permission should be refused. The owners said that the court's permission was not required and that any decision as to admissibility of the MAIB report was a matter for the arbitral tribunal. If the court's permission was required then the court should grant permission in the interests of justice.

Legal background

Section 259 of the Merchant Shipping Act 1995 empowers an inspector to require any person who is able to give information relevant to an investigation to answer such questions and to sign a declaration of the truth. Further, no answer is admissible in evidence against that person in any proceedings except proceedings for making a false statement.

Regulation 5 provides that the sole objective of a safety investigation into an accident under the Regulations is the prevention of future accidents through the ascertainment of its causes and circumstances and not to determine liability nor, except so far as is necessary to achieve its objective, to apportion blame.

Regulation 14(14) states that if any part of any document produced as a result of a safety investigation is based on information obtained in accordance with an inspector's powers as above, that part is inadmissible in any judicial proceedings whose purpose is to attribute or apportion liability, unless a court determines otherwise.

Was the arbitration within the definition of 'judicial proceedings'?

If the arbitration proceedings were judicial proceedings within the meaning of the Regulations then the MAIB report could not be admitted into the arbitration unless the court so ordered.

The definition of judicial proceedings in regulation 14(17) was not exclusive. Judicial proceedings were said to ‘include’ any civil or criminal proceedings before any court or person having by law the power to hear, receive and examine evidence on oath.

The context in which the phrase ‘judicial proceedings’ was used was that provided by regulation 14(14), namely, that those parts of the MAIB report that were based upon information obtained in accordance with the inspector's powers were inadmissible in any judicial proceedings whose purpose was to attribute blame, unless a court decided otherwise. If such parts of the report were admissible, then in the future those asked to provide information to the MAIB as to a maritime casualty might be unwilling to do so. That was the reason for the general inadmissibility of the relevant parts of an MAIB report, which applied whether the civil dispute about liability was determined in court or in arbitration. There appeared no sensible reason why the parties should have to seek the permission of the court to refer to the MAIB report if the unsafe port case was heard in court, but not if it was heard in arbitration.

Further, the proceedings before the arbitral tribunal were judicial in character. The arbitral tribunal had a duty to conduct the arbitral proceedings fairly and impartially as between the parties, giving each party a reasonable opportunity of putting its case and dealing with that of its opponent. That duty was characteristic of the judicial function. The judge accepted that the arbitral proceedings were private and consensual proceedings but they remained "judicial" in any event. The arbitrators' powers under the Arbitration Act 1996 could not entitle them to ignore regulation 14(14).

Should the court exercise its discretion in admitting the report?

The question was whether the court was satisfied that the interests of justice in admitting the MAIB report in the arbitration outweighed any prejudice or likely prejudice to any future accident safety investigation or relations between the UK and another state or international organisation. Regulation 13(5) required the court to have regard to the views of the chief inspector. That was probably intended by regulation 14(14) also.

According to the chief inspector, the admission of the MAIB report would be likely to prejudice future accident safety investigations, since it would diminish the MAIB's ability to have candid and detailed conversations with witnesses and to have ready and unqualified access to accident sites. It would diminish the MAIB's ability to fulfil its statutory function and enhance the safety of all those at sea.

Arbitration proceedings were private and confidential. However, a decision of the court admitting the MAIB report would be in the public domain. Possible witnesses to future marine casualties might know of it or be told about it. The chief inspector said that the MAIB went to great lengths to reassure witnesses that their testimony was protected. The MAIB would have to add that the report might be admitted into private arbitrations where fault was at issue. The judge was unable to accept that the private and confidential nature of arbitrations was a complete answer to the chief inspector’s concerns.

As to testing the factual and expert evidence in the arbitration, the court considered the following. Regarding the latter, the experts could be satisfactorily cross-examined were the MAIB report not to be admitted. Counsel would have the opinions and reasoning of their own expert with which to cross-examine the opposing expert. Counsel would not need the MAIB report in order to do so. Therefore, the interests of justice in testing the evidence of the experts did not outweigh the likely prejudice to future accident investigations and the UK's relations with another state or international body.

As to factual evidence, again the interests of justice, in particular, the ability of counsel to cross-examine by reference to the MAIB report, did not outweigh the likely prejudice to future accident investigations and the UK's relations with another state or international body. The court gave two reasons.

First, the likely prejudice was a matter of great public interest. It concerned the safety of life at sea. By comparison, the concern of the owners was restricted to their commercial interests and their ability to recover a loss from the charterers. Their right to damages was significant and the interests of justice required that right to be vindicated, but that private right did not outweigh the likely prejudice to future accident investigations. Second, in this case, it was not as if the owners were unable to challenge the factual evidence in question, if counsel could not refer to the MAIB report.

In the circumstances, the court refused permission to admit the MAIB report into the arbitration proceedings.

Comments

It is interesting to note that this was the first occasion on which the use of MAIB reports in a private and confidential arbitration had arisen for decision by the courts, though the final result is probably unsurprising. The court also emphasised the importance of an application for an order under regulation 14(14) being made long before the hearing, as to avoid the parties having to excise any references to the MAIB report in the factual and expert evidence and to not affect the court’s schedule with last minute urgent applications, as it happened in this case.