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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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- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- CIMB Investment Bank - Malaysia
- Formosa Plastics Group - Taiwan
- Binh Thuan Hamico - Vietnam
- Trasteel International SA, Italy
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tata Chemicals Ltd - India
- Coastal Gujarat Power Limited - India
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- GVK Power & Infra Limited - India
- Goldman Sachs - Singapore
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- Merrill Lynch Commodities Europe
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Anglo American - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aditya Birla Group - India
- Bangladesh Power Developement Board
- Independent Power Producers Association of India
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Bhushan Steel Limited - India
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Bharathi Cement Corporation - India
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- Riau Bara Harum - Indonesia
- Madhucon Powers Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Orica Mining Services - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- MS Steel International - UAE
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- India Bulls Power Limited - India
- Indian Oil Corporation Limited
- Indo Tambangraya Megah - Indonesia
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- PetroVietnam Power Coal Import and Supply Company
- The University of Queensland
- Parry Sugars Refinery, India
- Sojitz Corporation - Japan
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Attock Cement Pakistan Limited
- OPG Power Generation Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Posco Energy - South Korea
- Bulk Trading Sa - Switzerland
- Kobexindo Tractors - Indoneisa
- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- Therma Luzon, Inc, Philippines
- Central Electricity Authority - India
- Ministry of Transport, Egypt
- Baramulti Group, Indonesia
- Tamil Nadu electricity Board
- Marubeni Corporation - India
- Electricity Generating Authority of Thailand
- Mjunction Services Limited - India
- Semirara Mining and Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Petron Corporation, Philippines
- Thai Mozambique Logistica
- Karaikal Port Pvt Ltd - India
- Vedanta Resources Plc - India
- Power Finance Corporation Ltd., India
- Kohat Cement Company Ltd. - Pakistan
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Gujarat Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Uttam Galva Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- Singapore Mercantile Exchange
- Indika Energy - Indonesia
- Minerals Council of Australia
- Iligan Light & Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Essar Steel Hazira Ltd - India
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bukit Makmur.PT - Indonesia
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Lanco Infratech Ltd - India
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- ICICI Bank Limited - India
- Manunggal Multi Energi - Indonesia
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- Straits Asia Resources Limited - Singapore
- Holcim Trading Pte Ltd - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- The Treasury - Australian Government
- Kumho Petrochemical, South Korea
- Timah Investasi Mineral - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Antam Resourcindo - Indonesia
- Siam City Cement PLC, Thailand
- Medco Energi Mining Internasional
- Videocon Industries ltd - India
- San Jose City I Power Corp, Philippines
- Mercuria Energy - Indonesia
- Vizag Seaport Private Limited - India
- Siam City Cement - Thailand
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Mercator Lines Limited - India
- Cigading International Bulk Terminal - Indonesia
- Australian Commodity Traders Exchange
- McConnell Dowell - Australia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- The State Trading Corporation of India Ltd
- Altura Mining Limited, Indonesia
- Central Java Power - Indonesia
- LBH Netherlands Bv - Netherlands
- Planning Commission, India
- Coal and Oil Company - UAE
- Bayan Resources Tbk. - Indonesia
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- Coalindo Energy - Indonesia
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Bukit Baiduri Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- PTC India Limited - India
- Interocean Group of Companies - India
- Orica Australia Pty. Ltd.
- Electricity Authority, New Zealand
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Jaiprakash Power Ventures ltd
- Heidelberg Cement - Germany
- Cement Manufacturers Association - India
- ASAPP Information Group - India
- Asmin Koalindo Tuhup - Indonesia
- Commonwealth Bank - Australia
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Maheswari Brothers Coal Limited - India
- Metalloyd Limited - United Kingdom
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Wilmar Investment Holdings
- Wood Mackenzie - Singapore
- PNOC Exploration Corporation - Philippines
- New Zealand Coal & Carbon
- Makarim & Taira - Indonesia
- Price Waterhouse Coopers - Russia
- Krishnapatnam Port Company Ltd. - India
- Bhatia International Limited - India
- Port Waratah Coal Services - Australia
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Indonesian Coal Mining Association
- White Energy Company Limited
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Global Coal Blending Company Limited - Australia
- GMR Energy Limited - India
- Kepco SPC Power Corporation, Philippines
- Malabar Cements Ltd - India
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
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