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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, 01 March 16
CAN BULKCARRIER SUPPLY CUTS RESTORE SOME BALANCE? - CLARKSONS
The easing in bulkcarrier deliveries and the accelerated pace of demolition in recent years has seen bulkcarrier fleet growth slow from a rapid 17% ...
Monday, 29 February 16
BALTIC INDEX INCHES UP THIS PAST WEEK AS SMALLER VESSELS LEND SUPPORT
COALspot.com: The freight markets rose slightly this past week.
The Baltic Dry Index (BDI) of dry-bulk shipping freights, a measure of global ...
Monday, 29 February 16
LOSS OF EARNINGS IN THE WAKE OF A COLLISION - GARD
KNOWLEDGE TO ELEVATE
A shipowner’s loss of earnings can form a significant part of a collision claim. Awareness of the ways of calculati ...
Friday, 26 February 16
U.S WEEKLY COAL PRODUCTION UP SLIGHTLY
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 13.4 million shor ...
Thursday, 25 February 16
DRY BULKERS ARE SCRAPPED AT RECORD PACE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The newbuilding market is at a lull these days, as ship owners are focusing on two fronts, getting rid of excess dry bulk tonnage and snapping up b ...
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- Manunggal Multi Energi - Indonesia
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- The State Trading Corporation of India Ltd
- Iligan Light & Power Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Mintek Dendrill Indonesia
- Ministry of Mines - Canada
- Directorate Of Revenue Intelligence - India
- Therma Luzon, Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Wilmar Investment Holdings
- Energy Link Ltd, New Zealand
- Tamil Nadu electricity Board
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Intertek Mineral Services - Indonesia
- Merrill Lynch Commodities Europe
- Indonesian Coal Mining Association
- Ceylon Electricity Board - Sri Lanka
- PTC India Limited - India
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- Sindya Power Generating Company Private Ltd
- Thai Mozambique Logistica
- Alfred C Toepfer International GmbH - Germany
- Indian Oil Corporation Limited
- Madhucon Powers Ltd - India
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Mercator Lines Limited - India
- Semirara Mining Corp, Philippines
- Thiess Contractors Indonesia
- Gujarat Sidhee Cement - India
- Antam Resourcindo - Indonesia
- Carbofer General Trading SA - India
- Bharathi Cement Corporation - India
- Latin American Coal - Colombia
- ICICI Bank Limited - India
- Global Coal Blending Company Limited - Australia
- Jaiprakash Power Ventures ltd
- Chettinad Cement Corporation Ltd - India
- Rio Tinto Coal - Australia
- Samtan Co., Ltd - South Korea
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- Karaikal Port Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- India Bulls Power Limited - India
- PowerSource Philippines DevCo
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- Coal and Oil Company - UAE
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Kaltim Prima Coal - Indonesia
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Petron Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- GMR Energy Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- Straits Asia Resources Limited - Singapore
- Kepco SPC Power Corporation, Philippines
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Makmur.PT - Indonesia
- Parry Sugars Refinery, India
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement - Thailand
- Georgia Ports Authority, United States
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- CNBM International Corporation - China
- European Bulk Services B.V. - Netherlands
- GVK Power & Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Chamber of Mines of South Africa
- ASAPP Information Group - India
- Independent Power Producers Association of India
- Krishnapatnam Port Company Ltd. - India
- AsiaOL BioFuels Corp., Philippines
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- VISA Power Limited - India
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Edison Trading Spa - Italy
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Bangladesh Power Developement Board
- Bhoruka Overseas - Indonesia
- Global Green Power PLC Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- Baramulti Group, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Heidelberg Cement - Germany
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- Bhatia International Limited - India
- Attock Cement Pakistan Limited
- Africa Commodities Group - South Africa
- London Commodity Brokers - England
- Malabar Cements Ltd - India
- Mjunction Services Limited - India
- Indika Energy - Indonesia
- Orica Mining Services - Indonesia
- Pendopo Energi Batubara - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Transport, Egypt
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Indian Energy Exchange, India
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Electricity Generating Authority of Thailand
- Planning Commission, India
- Posco Energy - South Korea
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Vedanta Resources Plc - India
- Indo Tambangraya Megah - Indonesia
- Kartika Selabumi Mining - Indonesia
- Jindal Steel & Power Ltd - India
- Anglo American - United Kingdom
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Deloitte Consulting - India
- Standard Chartered Bank - UAE
- Global Business Power Corporation, Philippines
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- White Energy Company Limited
- Marubeni Corporation - India
- Coalindo Energy - Indonesia
- Trasteel International SA, Italy
- Metalloyd Limited - United Kingdom
- Kideco Jaya Agung - Indonesia
- IEA Clean Coal Centre - UK
- Bukit Baiduri Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- Formosa Plastics Group - Taiwan
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Simpson Spence & Young - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Power Finance Corporation Ltd., India
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Ambuja Cements Ltd - India
- Ministry of Finance - Indonesia
- Vizag Seaport Private Limited - India
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Bhushan Steel Limited - India
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