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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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Monday, 14 December 15
CFR SOUTH CHINA COAL SWAP IS STILL SLIDING
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2016 delivery declined US$ 0.93(2.18%) per ton month over month.
A commodity swap ...
Sunday, 13 December 15
THE LOW VESSEL DEMANDS PUSHED DOWN BALTIC DRY INDEX FURTHER DOWN
COALspot.com: The low vessel demand across nearly all vessel sizes pushed the Baltic Exchange’s main sea freight index further down in this F ...
Sunday, 13 December 15
DRY BULK RATES KEEP ON FALLING AS LOW VESSEL DEMAND IS STILL THE NORM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market nowadays is in an endless downward spiral, which as it turns out is unable to recover, at least as long as the current balance ...
Friday, 11 December 15
US COAL PRODUCTION UP 7.7% IN WEEK ENDED DECEMBER 5, 2015
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 16.1 million shor ...
Thursday, 10 December 15
CANADIAN MINER TECK ANNOUNCES LNG HAUL TRUCK PILOT PROJECT
Teck Resources Limited is piloting the use of liquefied natural gas (LNG) as a fuel source in six haul trucks at its Fording River steelmakin ...
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- Sical Logistics Limited - India
- Georgia Ports Authority, United States
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- MS Steel International - UAE
- Indika Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- ASAPP Information Group - India
- India Bulls Power Limited - India
- Trasteel International SA, Italy
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Bukit Baiduri Energy - Indonesia
- Aditya Birla Group - India
- IHS Mccloskey Coal Group - USA
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- McConnell Dowell - Australia
- Global Business Power Corporation, Philippines
- Petron Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Pendopo Energi Batubara - Indonesia
- CIMB Investment Bank - Malaysia
- Formosa Plastics Group - Taiwan
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Electricity Generating Authority of Thailand
- Karbindo Abesyapradhi - Indoneisa
- Bukit Makmur.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- Agrawal Coal Company - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- TeaM Sual Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- PetroVietnam Power Coal Import and Supply Company
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Directorate Of Revenue Intelligence - India
- Manunggal Multi Energi - Indonesia
- Therma Luzon, Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indo Tambangraya Megah - Indonesia
- Singapore Mercantile Exchange
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Tata Chemicals Ltd - India
- London Commodity Brokers - England
- Jaiprakash Power Ventures ltd
- Latin American Coal - Colombia
- Price Waterhouse Coopers - Russia
- Parliament of New Zealand
- Siam City Cement PLC, Thailand
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Metalloyd Limited - United Kingdom
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Savvy Resources Ltd - HongKong
- Global Coal Blending Company Limited - Australia
- Borneo Indobara - Indonesia
- Videocon Industries ltd - India
- Krishnapatnam Port Company Ltd. - India
- Meenaskhi Energy Private Limited - India
- Karaikal Port Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- Minerals Council of Australia
- Madhucon Powers Ltd - India
- Mjunction Services Limited - India
- Energy Link Ltd, New Zealand
- South Luzon Thermal Energy Corporation
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bhushan Steel Limited - India
- Bulk Trading Sa - Switzerland
- Vijayanagar Sugar Pvt Ltd - India
- SMC Global Power, Philippines
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Central Java Power - Indonesia
- GMR Energy Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Economic Council, Georgia
- Australian Coal Association
- Port Waratah Coal Services - Australia
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- Renaissance Capital - South Africa
- Orica Mining Services - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Altura Mining Limited, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- Ind-Barath Power Infra Limited - India
- Posco Energy - South Korea
- Vizag Seaport Private Limited - India
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Orica Australia Pty. Ltd.
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Indonesian Coal Mining Association
- Merrill Lynch Commodities Europe
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Central Electricity Authority - India
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Bangladesh Power Developement Board
- SN Aboitiz Power Inc, Philippines
- PowerSource Philippines DevCo
- Mercuria Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Toyota Tsusho Corporation, Japan
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- Medco Energi Mining Internasional
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Wilmar Investment Holdings
- Africa Commodities Group - South Africa
- PTC India Limited - India
- Chettinad Cement Corporation Ltd - India
- Gujarat Sidhee Cement - India
- Ministry of Transport, Egypt
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Marubeni Corporation - India
- Eastern Coal Council - USA
- CNBM International Corporation - China
- Power Finance Corporation Ltd., India
- Banpu Public Company Limited - Thailand
- Indogreen Group - Indonesia
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Vedanta Resources Plc - India
- Bharathi Cement Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Global Green Power PLC Corporation, Philippines
- The Treasury - Australian Government
- TNB Fuel Sdn Bhd - Malaysia
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