| Admiralty law |
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| History |
| Features |
| Contract of carriage/Charterparty |
| Parties |
| Judiciary |
| International conventions |
| International organisations |
A maritime lien, in English and US law and elsewhere, is a specific aspect of admiralty law concerning a claim against a ship for services rendered to it or injury caused by it. [1]
The maritime lien is one of three in rem claims capable of being brought under UK admiralty law. Whilst being a common law instrument, it has been codified under s.21(3) of the Senior Courts Act 1981 [2] along with s.21(2) [3] and s.21(4), [4] its statutory counterparts. Maritime lien and ship mortgage have a single corresponding term in the civil law, namely the ship hypothec .
The maritime lien is a proprietary instrument meaning it concerns the property: the res. This includes the vessel (also covering its appurtenances and equipment), services rendered to it or injuries caused by that property. For example, a 2006 US case named the vessel (M/V Henrich S) and "her engines, tackle, nets, gear, apparel, appurtenances, etc., in rem" as defendant. [1] The rights include jus in re (right on the property) and jus in rem (right against the property). This means the lien treats the ship as the wrongdoer; however, the lien is said to "implede" [5] the owner into representing the res.
The maritime lien is a privileged claim upon maritime property which attaches to the res from the moment a cause of action arises. It remains "inchoate" [6] until the issuing of a writ. By remaining invisible from the moment of attachment, the lien is capable of surviving a change of ownership, even by a good faith purchaser.
Two significant differences between maritime liens, which only exist in admiralty law, and the right to keep that exist in general civil law are (1) that in general civil law, "Prior in time is prior in right", i.e., the rights of the lienholder with the earliest lien are superior to those of later lienholders, whereas in maritime law the rights of the most recent lienholder are superior, and (2) all maritime liens are superior to all non-maritime liens. For instance, in the United States, a federal tax lien, which is a non-maritime lien, is subordinate to every lien for supplies, fuel, repairs, etc., which are all maritime liens.
Normally, a maritime lien relates to the different marine transactions in the admiralty jurisdiction and creates the maritime claims. It will be created by the statute such as the Ship Mortgage Act.
The characteristics of maritime lien are as follows:
Although there is a list recognized by the admiralty jurisdiction, the definitions and criteria are not the same under the maritime law of differing jurisdictions. For example, bunker suppliers are not protected by maritime lien under UK law. However, the supplier of bunker goods might have the right of lien in the US if it can satisfy all statutory requirements. In the UK there is a closed list of situations where a maritime lien arises, being; salvage, [7] seamen's wages, [8] damage done by a ship due to wrongful act of manoeuvre, [9] bottomry (although this no longer is used) and masters remunerations and disbursements. [10]
A shipowner's lien is a possessory lien which is the major difference between it and other maritime liens. The right to this lien can be applied only on the goods which are delivering by the shipowner when the shipper is the contractual party. It may entitle the shipowner to retain the cargoes as security for the payment of a debt. The contractual shipowner's lien is currently found in all contracts for carriage of goods by sea nowadays, and may be claimed if the shippers fail to pay the due on time. However, some authorities state that there is no difference between shipowner's lien and maritime lien.
Action in rem (property) is an action separated from the action in personam. The action is against the maritime property such as vessel, cargo or freight, but not against the owner. This concept is why such an action is said to be against “all the world”.
Claimants take advantage of the action in rem, rather action in personam, because an action in rem is easier and convenient to institute. It is more difficult, in an action in personam, to summon the defendant via writ outside the jurisdiction unless the defendant is a resident of EU or EFTA countries. Besides, the processes to find the rightful shipowner, the defendant, are very complicated and time consuming due to the complex and inconsistent ship registration in different countries. An action with respect to a bareboat ship will frequently encounter this problem.
The Admiralty action in rem will concern when the claims and ship are put within the Admiralty Jurisdiction, an adequate and secure place for the claimants to ask for compensation. If the defendant does not provide enough security as compensation, the court may sell the “res” in order to achieve the satisfaction for the claim.
There are two distinct advantages to an admiralty action in rem in England.
1) Bringing the claim in England secures jurisdiction of the English Admiralty Court, though it can be disputed. [11] London is world renowned for its fair, efficient, and consistent application of maritime law. It also promotes the certainty that commercial law demands. The claim can be brought against foreign ships. [12]
2) It has the effect of turning the claimant into a secured creditor so upon insolvency the claimant will be preferred over other crediting parties thereby securing priority financial redress. [13] Furthermore, a maritime lien will rank above other secured creditors and only is after the costs arising from the arrest and sale of the ship.
Although the maritime lien is attached to the maritime property whoever the shipowner is, it is possible to discharge or eliminate the lien by several ways. They include payment of the claims, waiver, laches, foreclosure, and sale or destruction of the res.
The lienholder could give up the right of maritime lien either by expressed or implied intention. The intention to waive the lien should be shown clearly required by the court and the credit of the lienholder will be considered.
Laches is a form of estoppel for delay. A person fails to arrest the ship within a reasonable time may result in cancellation of the original claim. The time of delay will be determined on a case-by-case basis. The idea is that the holder must show diligence exercising the lien.
Another method is an execution sale in a rem. This also removes the attachment of the lien. The new shipowner will get the vessel with clear title. This rule could be applied in case of an international judicial sale, such as an action in rem.
Destruction of the res results in the extinction of the lien. In this case, the lien is eliminated when the whole ship is destroyed. However, partial destruction of the vessel will not remove the lien and the lien will be attached to the remaining part of the vessel.
“Proper law” is the decision as to which territorial law is to govern the contract, defines the obligations of the contractual parties and determines whether the contract is valid and legal. It also determines the effects and conditions of discharge. Selection of the “proper law” to adjudicate the marine contract is a difficult task in Admiralty Jurisdiction because the issue of whether enforcement of the maritime lien is allowed by international law may turn on interpretation of the law of the country where the litigation is. So, the question is over the priority of the law where the lien was created ( lex loci ), as opposed to the law of where the court exercising jurisdiction ( lex fori ).. For example, in the Republic of Korea, Korean Courts shall look to the law of the country of the vessel. [14]
The answer is found in the application of a multiplicity of contract analysis process. The court will weight and analyze all related factors between the transaction and the respective legal systems by a case-by-case analysis. The factors may include: (a) the need of the international system; (b) the protection of justified expectation; (c) ease in determination and application of the law to be applied; (d) relevant policies of other interested states; (e) the place of the wrong; (f) the law of flag; (g) the allegiance or domicile of the injured party; (h) the law of forum; (i) the place of the contract; (j) the allegiance of the defendant shipowner and so on. The prefect decision will result from a balance between the relevant factors.
However, the US courts will choose the factors which could be applied to protect the American. If the relevant factors direct to select international law, the case may be dismissed on the grounds of forum non conveniens . If the choice of law is to apply the US law, the court will retain jurisdiction. The reason for this is that Federal Maritime Lien Act is used to protect Americans, not the foreigners.
Personal jurisdiction is a court's jurisdiction over the parties, as determined by the facts in evidence, which bind the parties to a lawsuit, as opposed to subject-matter jurisdiction, which is jurisdiction over the law involved in the suit. Without personal jurisdiction over a party, a court's rulings or decrees cannot be enforced upon that party, except by comity; i.e., to the extent that the sovereign which has jurisdiction over the party allows the court to enforce them upon that party. A court that has personal jurisdiction has both the authority to rule on the law and facts of a suit and the power to enforce its decision upon a party to the suit. In some cases, territorial jurisdiction may also constrain a court's reach, such as preventing hearing of a case concerning events occurring on foreign territory between two citizens of the home jurisdiction. A similar principle is that of standing or locus standi, which is the ability of a party to demonstrate to the court sufficient connection to and harm from the law or action challenged to support that party's participation in the case.
Admiralty law or maritime law is a body of law that governs nautical issues and private maritime disputes. Admiralty law consists of both domestic law on maritime activities, and private international law governing the relationships between private parties operating or using ocean-going ships. While each legal jurisdiction usually has its own legislation governing maritime matters, the international nature of the topic and the need for uniformity has, since 1900, led to considerable international maritime law developments, including numerous multilateral treaties.
A lien is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation. The owner of the property, who grants the lien, is referred to as the lienee and the person who has the benefit of the lien is referred to as the lienor or lien holder.
Interpleader is a civil procedure device that allows a plaintiff or a defendant to initiate a lawsuit in order to compel two or more other parties to litigate a dispute. An interpleader action originates when the plaintiff holds property on behalf of another, but does not know to whom the property should be transferred. It is often used to resolve disputes arising under insurance contracts.
In personam is a Latin phrase meaning "against a particular person". In a lawsuit in which the case is against a specific individual, that person must be served with a summons and complaint to give the court jurisdiction to try the case, and the judgment applies to that person and is called an "in personam judgment".
In rem jurisdiction is a legal term describing the power a court may exercise over property or a "status" against a person over whom the court does not have in personam jurisdiction. Jurisdiction in rem assumes the property or status is the primary object of the action, rather than personal liabilities not necessarily associated with the property.
The Federal Rules of Civil Procedure govern civil procedure in United States district courts. They are the companion to the Federal Rules of Criminal Procedure. Rules promulgated by the United States Supreme Court pursuant to the Rules Enabling Act become part of the FRCP unless, within seven months, the United States Congress acts to veto them. The Court's modifications to the rules are usually based upon recommendations from the Judicial Conference of the United States, the federal judiciary's internal policy-making body.
Forum non conveniens (FNC) is a mostly common law legal doctrine through which a court acknowledges that another forum or court where the case might have been brought is a more appropriate venue for a legal case, and transfers the case to such a forum. A change of venue might be ordered, for example, to transfer a case to a jurisdiction within which an accident or incident underlying the litigation occurred and where all the witnesses reside.
A quasi in rem legal action is a legal action based on property rights of a person absent from the jurisdiction. In the American legal system the state can assert power over an individual simply based on the fact that this individual has property in the state. Quasi in rem jurisdiction does not have much function in the United States any longer. However, in very specific cases, quasi in rem jurisdiction can still be effective.
Vice Admiralty Courts were juryless courts located in British colonies that were granted jurisdiction over local legal matters related to maritime activities, such as disputes between merchants and seamen.
In admiralty law prizes are equipment, vehicles, vessels, and cargo captured during armed conflict. The most common use of prize in this sense is the capture of an enemy ship and her cargo as a prize of war. In the past, the capturing force would commonly be allotted a share of the worth of the captured prize. Nations often granted letters of marque that would entitle private parties to capture enemy property, usually ships. Once the ship was secured on friendly territory, she would be made the subject of a prize case: an in rem proceeding in which the court determined the status of the condemned property and the manner in which the property was to be disposed of.
A charterparty is a maritime contract between a shipowner and a "charterer" for the hire of either a ship for the carriage of passengers or cargo, or a yacht for leisure.
Affreightment is a legal term relating to shipping.
Admiralty law in the United States is a matter of federal law.
The law of salvage is a principle of maritime law whereby any person who helps recover another person's ship or cargo in peril at sea is entitled to a reward commensurate with the value of the property saved.
Rule B attachments are issued under Rule B of the Supplemental Rules for Certain Admiralty and Maritime Claims of the Federal Rules of Civil Procedure. Under that provision, the court is allowed to attach a defendant's property up to the value of the suit. Although these claims are filed during in personam actions, they are in rem in nature, as the Court is attaching property to the suit. This has been described as a "remedy quasi in rem."
In admiralty law, barratry is an act of gross misconduct committed by a master or crew of a vessel resulting in damage to the vessel or its cargo. These activities may include desertion, illegal scuttling, theft of the ship or cargo, and any act carried out against the best interests of the shipowner.
Canadian maritime law is based on the field of "Navigation and Shipping" vested in the Parliament of Canada by virtue of s. 91(10) of the Constitution Act, 1867.
United States v. 422 Casks of Wine, 26 U.S. 547 (1828), is an 1828 United States Supreme Court civil forfeiture case between the United States and 422 casks of Malaga wine. The case was brought after the United States moved to seize the wine on the grounds that it had been deliberately mislabeled as sherry to get a tax drawback, and the buyers objected. The original trial was ruled in favor of the United States but was ordered to be retried after errors were discovered concerning jurisdiction. In the subsequent retrial, the Supreme Court ruled against the United States; however, they did grant them a certificate of seizure on probable cause.
The Maritime Court of Ontario was an admiralty court in Ontario. It was created in 1877 by a federal statute. The Exchequer Court of Canada succeeded the Maritime Court by a statute passed in 1891. The Exchequer Court continued in 1971 as the Federal Court of Canada.