Dragage Verreault Inc. v. The Atchafalaya

This matter arose out of a contract for the dredging of a channel. The plaintiff was the head contractor under the dredging contract. The plaintiff subcontracted the job to a company known as B+B Dredging. The contract specified the work was to be done by the "Atchafalaya" which was owned by a company called Proteus and under bareboat charter to B+B. The plaintiff alleged there was delay on the part of the defendants in bringing the "Atchafalaya" on site as a consequence of which the plaintiff incurred liabilities under the head contract. The plaintiff commenced this in rem action and arrested the "Atchafalaya". The owner of the "Atchafalaya" brought this motion to set aside the arrest and strike the in rem action on the grounds that there was no in personam liability of the owner to support the action in rem. The motions Judge however found that there were some representations during the course of the contract negotiations that indicated the principal of B+B (who was also the principal of Proteus) had the authority to contract on the credit of the ship. Accordingly, the motion was refused. (See the associated action Keybank National Assoc. v The “Atchafalaya”, 2010 FC 406)