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Thursday, 10 December 15
LIENING CARGO - WHICH LIEN CLAUSE APPLIES TO THE BILL OF LADING? : WIKBORG REIN | HELLENIC SHIPPING NEWS
 KNOWLEDGE TO ELEVATE
In a dry bulk market where a charterer is not paying freight or hire, its counterparty is often left to consider whether it can lien the cargo on board the chartered vessel to obtain payment voluntarily, or by court sale if necessary.
This often involves looking at a Congenbill bill of lading and establishing whether a charterparty lien clause applies via Clause (1) on the reverse, which incorporates all “terms and conditions, liberties and exceptions of the Charterparty, dated as overleaf”. Problems arise when:
- there is no date overleaf and there are a number of charterparties in a chain, any of which could apply; or
- there are a number of charterparties in the chain with the same date as overleaf.
The question then becomes which charterparty lien clause to apply and to what debt to apply it.
Charterparty liens under English law
As a matter of English law, the absence of a date overleaf on the face of the Congenbill does not prevent a charterparty from being incorporated. Where there is only one charter, direct with the head owner, there is no doubt as to its application. However, the situation becomes complicated if there is:
- a head time charter;
- a sub-time charter;
- a head voyage charter; and
- a sub-voyage charter.
Which of these four charters is to be incorporated? An owner will normally assert that the head charter should be incorporated (ie, because it has signed it). Likewise, a receiver under the bill will usually argue for the sub-voyage charter – again, because this was the contract that it knew of when arranging the shipment. However, English law points in a different direction.
The starting point is that under a time charter, the time charterer has power over the issue of the bill of lading, provided that this reflects the mate’s receipts. The time charterer also has the authority to give orders to the master and direct the vessel in its commercial business. As such, the charterparty of greatest influence on the voyage is likely to have a time charterer as one of the parties.
However, insofar as the Congenbill concerns only a single voyage, the charterparty likely to be most relevant will be a voyage charter. As such, English law hesitantly arrives at the position that the applicable charterparty is that in which a time charterer is acting as disponent owner, with the head voyage charterer as its counterparty. In other words, in the above scenario, the terms of the head voyage charter between the sub-time charterer and the head voyage charterer will be incorporated into the Congenbill.
This raises a further question: if the bill of lading is an owner’s bill made between the head owner and receiver, how can a lien in the head voyage charter be applied to that bill when it refers to freight due to the sub-time charterer, which is not a party to the bill? Does the fact that the freight subject to the lien will not be paid to the head owner bar exercise of the lien? English law suggests not. Provided that the freight is still due to be paid by the head voyage charterer to the sub-time charterer, the sub-time charterer can direct the head time charterer to direct the head owner to exercise the lien on its behalf (against its indemnity for the costs, expenses and potential liabilities involved). The head owner acts as a form of trustee in such a lien and accounts to the time charterer for any payments received as a consequence of the lien.
Persuading the head owner to take such steps can be difficult, particularly if it has been paid hire in full and has no personal interest in collecting the freight for the time charterer.
However, if the head owner does not exercise a formal lien, it might face an order from the time charterer to stop the vessel in an attempt to obtain payment. The head owner might argue that this puts it in breach of the Congenbill as against the receiver, to which the time charterer might reply that it has the right to give orders (including the right to order the head owner on how to exercise rights under the bill of lading), so if the head owner refuses, it is in breach. The respective rights and wrongs of such a showdown would be complex; but faced with this situation, a head owner may prefer to exercise the lien itself as trustee to protect itself from claims under the bill of lading from the receiver – particularly if it obtains an indemnity from the time charterer in the process.
Comment
As in all charterparty matters, generalisations are interesting, but the individual circumstances of each dispute must be carefully checked to see whether they apply. Bearing that in mind, when it comes to liening cargo under a Congenbill, it seems that English law will look first to the head voyage charterparty as the source of relevant terms to be incorporated into the Congenbill (unless another charter is expressly identified), and this is likely to lead to a less-than-obvious outcome.
Source: Wikborg Rein | Hellenic Shipping News
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Tuesday, 15 March 16
PORT OF NEWCASTLE SHIPPED 12.78 MMT OF COAL IN FEBRUARY 2016
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port has shipped AU$1,110.5 mi ...
Tuesday, 15 March 16
ADARO ENERGY LOWERED ITS COAL CASH COST BY 16% TO US$ 27.98 PER TONE IN 2015
Difficult Coal Market Condition Persists in 2015, Adaro Lowers Costs, Reduces Capital Spending and Maintains Solid Liquidity.
PT Adaro E ...
Monday, 14 March 16
THE CS 50 INDEX ROSE $0.16 OR, 0.41% TO $38.82 A TON
COALspot.com: Average 5000 GAR coal index of Indonesian origin rose 0.41 percent week over week to averaging $38.82 per ton on this past Friday, ac ...
Monday, 14 March 16
THE BALTIC EXCHANGE CONTINUED TO ROSE THIS PAST WEEK
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities continued to rise this week helped by higher rates for pa ...
Saturday, 12 March 16
PLN, COAL COMPANIES IN TALKS ABOUT PRICES - THE JAKARTA POST
Following a study that predicted that Indonesia would struggle to provide coal for its power stations in the near future, the government will facil ...
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- The State Trading Corporation of India Ltd
- Ministry of Finance - Indonesia
- Siam City Cement PLC, Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Barasentosa Lestari - Indonesia
- GMR Energy Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Global Coal Blending Company Limited - Australia
- Altura Mining Limited, Indonesia
- Eastern Coal Council - USA
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Parliament of New Zealand
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Energy Link Ltd, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Goldman Sachs - Singapore
- Mjunction Services Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Independent Power Producers Association of India
- Holcim Trading Pte Ltd - Singapore
- TeaM Sual Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Maharashtra Electricity Regulatory Commission - India
- Coastal Gujarat Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Tamil Nadu electricity Board
- Aditya Birla Group - India
- Anglo American - United Kingdom
- GAC Shipping (India) Pvt Ltd
- PetroVietnam Power Coal Import and Supply Company
- Pendopo Energi Batubara - Indonesia
- Orica Australia Pty. Ltd.
- Gujarat Sidhee Cement - India
- Billiton Holdings Pty Ltd - Australia
- Mercator Lines Limited - India
- Electricity Authority, New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Tata Chemicals Ltd - India
- Iligan Light & Power Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Ceylon Electricity Board - Sri Lanka
- Riau Bara Harum - Indonesia
- Sical Logistics Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Indian Energy Exchange, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Star Paper Mills Limited - India
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- New Zealand Coal & Carbon
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Indian Oil Corporation Limited
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Vedanta Resources Plc - India
- Vizag Seaport Private Limited - India
- Sakthi Sugars Limited - India
- Power Finance Corporation Ltd., India
- Samtan Co., Ltd - South Korea
- Central Electricity Authority - India
- OPG Power Generation Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Cement Manufacturers Association - India
- Renaissance Capital - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Edison Trading Spa - Italy
- Directorate Of Revenue Intelligence - India
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Commonwealth Bank - Australia
- Wilmar Investment Holdings
- Marubeni Corporation - India
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Meralco Power Generation, Philippines
- Latin American Coal - Colombia
- McConnell Dowell - Australia
- Coal and Oil Company - UAE
- GVK Power & Infra Limited - India
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- VISA Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Asam (Persero) Tbk - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Antam Resourcindo - Indonesia
- MS Steel International - UAE
- Alfred C Toepfer International GmbH - Germany
- Miang Besar Coal Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Simpson Spence & Young - Indonesia
- Sindya Power Generating Company Private Ltd
- Makarim & Taira - Indonesia
- Karaikal Port Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- Bhatia International Limited - India
- The Treasury - Australian Government
- Mintek Dendrill Indonesia
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- Indika Energy - Indonesia
- Economic Council, Georgia
- Sojitz Corporation - Japan
- Cigading International Bulk Terminal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Thai Mozambique Logistica
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- Sarangani Energy Corporation, Philippines
- Romanian Commodities Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Africa Commodities Group - South Africa
- Borneo Indobara - Indonesia
- LBH Netherlands Bv - Netherlands
- Merrill Lynch Commodities Europe
- Maheswari Brothers Coal Limited - India
- Energy Development Corp, Philippines
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- Port Waratah Coal Services - Australia
- Metalloyd Limited - United Kingdom
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Deloitte Consulting - India
- Kapuas Tunggal Persada - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Agrawal Coal Company - India
- Australian Commodity Traders Exchange
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Ambuja Cements Ltd - India
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- PTC India Limited - India
- Formosa Plastics Group - Taiwan
- Indonesian Coal Mining Association
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- White Energy Company Limited
- Standard Chartered Bank - UAE
- Therma Luzon, Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Siam City Cement - Thailand
- Carbofer General Trading SA - India
- Intertek Mineral Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- PowerSource Philippines DevCo
- European Bulk Services B.V. - Netherlands
- Toyota Tsusho Corporation, Japan
- Coalindo Energy - Indonesia
- Medco Energi Mining Internasional
- Orica Mining Services - Indonesia
- Semirara Mining Corp, Philippines
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- Singapore Mercantile Exchange
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Ministry of Mines - Canada
- Essar Steel Hazira Ltd - India
- Uttam Galva Steels Limited - India
- Bhushan Steel Limited - India
- Global Green Power PLC Corporation, Philippines
- India Bulls Power Limited - India
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Kideco Jaya Agung - Indonesia
- Bayan Resources Tbk. - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- San Jose City I Power Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Interocean Group of Companies - India
- Rio Tinto Coal - Australia
- Kumho Petrochemical, South Korea
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