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Hedge Fund Chief’s Legal Battle Over Salvaged Silver


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Hedge fund manager Paul Marshall loses legal battle with South African government over ownership of USD 43 million worth of silver bars recovered from a World War II shipwreck.

Sir Paul Marshall's company extracted silver from the WW2 wreck of the SS Tilawa, which was torpedoed by the Japanese 

Image Source: CNBC
Sir Paul Marshall’s company extracted silver from the WW2 wreck of the SS Tilawa, which was torpedoed by the Japanese 
Image Source: CNBC 

In a maritime legal saga, a company helmed by hedge fund magnate Sir Paul Marshall has faced a setback in its pursuit of compensation from the South African government. This dispute revolves around USD 43 million worth of silver bars recovered from the wreckage of the SS Tilawa, a casualty of World War II resting in the depths of the Indian Ocean. 

In a recent ruling, the U.K.’s Supreme Court sided with the government of Pretoria, asserting that Marshall’s salvage company is not entitled to payment for silver bars recovered from a shipwreck. These bars, initially purchased by the Union of South Africa from the Indian government in 1942, were discovered and retrieved by Argentum Exploration in 2017. 

The wreck in question is that of the SS Tilawa, which met its demise at the hands of a Japanese submarine while en route to South Africa, resulting in the tragic loss of 280 lives. Argentum, under Marshall’s control, undertook the task of retrieving the bars from the ocean floor, situated at a depth of 2.5km. Initially, the bars were transported to the U.K. with the intent of staking a salvage claim over the valuable cargo, appraised at USD 43 million in 2020. However, Argentum later conceded South Africa’s ownership of the bars but sought compensation for their recovery. 

Argentum Exploration salvages 2,364 bars of silver from the wreck of the WWII passenger ship SS Tilawa. 

Image Source: Financial Times
Argentum Exploration salvages 2,364 bars of silver from the wreck of the WWII passenger ship SS Tilawa. 
Image Source: Financial Times 
Argentum Exploration was attacked and sunk en route to South Africa in 1942. 

Image Source: This is Money UK
Argentum Exploration was attacked and sunk en route to South Africa in 1942. 
Image Source: This is Money UK 

The Supreme Court’s recent ruling upheld South Africa’s sovereign immunity against Argentum’s claim, overturning previous judgments by both the High Court and Court of Appeal. While the Court of Appeal had determined that the silver was “in use” for commercial purposes, thereby negating South Africa’s legal immunity, the Supreme Court unanimously disagreed. 

In their judgment, they stated, “The exception to immunity… does not apply because the silver was not, at the time when the cause of action arose, in use or intended for use for commercial purposes.” Despite this legal setback, the two parties have reached an independent settlement. 

Jonathan Goulding, a senior associate and mariner at law firm HFW, who represented the Republic of South Africa in the case, disclosed, “A confidential settlement was reached between the South African government and Argentum just before the judgment was delivered, so I’m unable to provide information on the current whereabouts of the silver.” 

He added, “This ruling could potentially reshape the approach to salvaging historical wrecks. Those seeking to claim ownership of cargo retrieved from wrecks and brought to the U.K. should prioritize identifying the original owner and establishing contractual agreements for recovery. Otherwise, there’s a risk that if the cargo, owned by a government and intended for state use, is brought to the U.K., it may need to be surrendered without compensation.” 

Marshall, the head of Marshall Wace, one of the world’s largest hedge funds managing USD 65.4 billion in assets and with a significant stake in GB News, controls Argentum Exploration, incorporated in 2012. 

The salvaged silver bars from the WW2 wreck of the SS Tilawa were valued at USD 43 million. 

Image Source: Bloomberg
The salvaged silver bars from the WW2 wreck of the SS Tilawa were valued at USD 43 million. 
Image Source: Bloomberg 

Ross Hyett, managing director of Argentum, remarked, “The Supreme Court’s decision overturns both the High Court and Court of Appeal rulings, offering clarity on sovereign immunity. The involved parties have now settled, bringing closure to the matter.” 

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