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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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Friday, 19 February 16
INDONESIAN HBA HITS A NEW LOWS BELOW $51 A TON AS OVERSUPPLY, LOW DEMAND WOES PERSIST
COALspot.com: Low coal demand and excess supplies sent Indonesian benchmark coal price further deep in February 2016. HBA has slumped second time t ...
Friday, 19 February 16
U.S. WEEKLY COAL PRODUCTION ROSE 2.6% FROM LAST WEEK - EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 13.2 million shor ...
Thursday, 18 February 16
INDIA NEEDS INTERNATIONAL SUPPORT ON HIGH EFFICIENCY COAL - WORLD COAL ASSOCIATION
Speaking at a conference in New Delhi today, World Coal Association Chief Executive Benjamin Sporton said the critical role of coal in driving econ ...
Thursday, 18 February 16
CHINA COAL SECTOR - 2015 RESULTS BLEAK, 2016 UNLIKELY TO BE ANY BETTER - FITCH
COALspot.com: China Coal Sector’s Financial Woes to Worsen in 2016.
Fitch Ratings says that the 2015 full-year result previews issued by ...
Thursday, 18 February 16
PANAMAX RATES OUT OF ECSA WERE STILL GAINING A PREMIUM OVER THE REST OF THE MARKET - INTERMODAL
The BDI moved further down last week, fact that hardly took anyone by surprise as the lunar year holidays in Asia on top of the already depre ...
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- Gujarat Electricity Regulatory Commission - India
- Karbindo Abesyapradhi - Indoneisa
- Kobexindo Tractors - Indoneisa
- Romanian Commodities Exchange
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- ICICI Bank Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- SMG Consultants - Indonesia
- Petron Corporation, Philippines
- Coal and Oil Company - UAE
- Samtan Co., Ltd - South Korea
- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- GAC Shipping (India) Pvt Ltd
- Indo Tambangraya Megah - Indonesia
- Malabar Cements Ltd - India
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- Attock Cement Pakistan Limited
- Kepco SPC Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Simpson Spence & Young - Indonesia
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Sakthi Sugars Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Sindya Power Generating Company Private Ltd
- PowerSource Philippines DevCo
- Coalindo Energy - Indonesia
- Energy Development Corp, Philippines
- Georgia Ports Authority, United States
- Indian Oil Corporation Limited
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Interocean Group of Companies - India
- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- Bulk Trading Sa - Switzerland
- Rio Tinto Coal - Australia
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- San Jose City I Power Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Medco Energi Mining Internasional
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- Wilmar Investment Holdings
- Latin American Coal - Colombia
- Savvy Resources Ltd - HongKong
- Bank of Tokyo Mitsubishi UFJ Ltd
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- Intertek Mineral Services - Indonesia
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Anglo American - United Kingdom
- Kaltim Prima Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Ministry of Mines - Canada
- Aditya Birla Group - India
- Coastal Gujarat Power Limited - India
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- Meenaskhi Energy Private Limited - India
- Indian Energy Exchange, India
- Chamber of Mines of South Africa
- Central Java Power - Indonesia
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Xindia Steels Limited - India
- Orica Australia Pty. Ltd.
- Posco Energy - South Korea
- Eastern Energy - Thailand
- Karaikal Port Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Ministry of Transport, Egypt
- Independent Power Producers Association of India
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Mercuria Energy - Indonesia
- Sical Logistics Limited - India
- IHS Mccloskey Coal Group - USA
- Binh Thuan Hamico - Vietnam
- Uttam Galva Steels Limited - India
- Baramulti Group, Indonesia
- Dalmia Cement Bharat India
- Global Business Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- SMC Global Power, Philippines
- Straits Asia Resources Limited - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Vizag Seaport Private Limited - India
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- CNBM International Corporation - China
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Formosa Plastics Group - Taiwan
- Minerals Council of Australia
- Jaiprakash Power Ventures ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bangladesh Power Developement Board
- Ambuja Cements Ltd - India
- ASAPP Information Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- PTC India Limited - India
- CIMB Investment Bank - Malaysia
- Salva Resources Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- India Bulls Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement PLC, Thailand
- Rashtriya Ispat Nigam Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GVK Power & Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Mjunction Services Limited - India
- Makarim & Taira - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kideco Jaya Agung - Indonesia
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Siam City Cement - Thailand
- Goldman Sachs - Singapore
- South Luzon Thermal Energy Corporation
- Commonwealth Bank - Australia
- Tata Chemicals Ltd - India
- The University of Queensland
- Merrill Lynch Commodities Europe
- Essar Steel Hazira Ltd - India
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- Barasentosa Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Port Waratah Coal Services - Australia
- Sojitz Corporation - Japan
- Directorate General of MIneral and Coal - Indonesia
- Thai Mozambique Logistica
- Marubeni Corporation - India
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Mintek Dendrill Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Central Electricity Authority - India
- Bhushan Steel Limited - India
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Trasteel International SA, Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Sree Jayajothi Cements Limited - India
- Bukit Baiduri Energy - Indonesia
- Wood Mackenzie - Singapore
- Lanco Infratech Ltd - India
- Cigading International Bulk Terminal - Indonesia
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