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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, 27 November 15
FOB RICHARDS BAY COAL SWAPS UP FROM LAST WEEK
COALspot.com: API4 FOB Richards Bay Coal swap for delivery Q1’ 2016 up week over week and month over month.
The Q1’ 2016 swa ...
Thursday, 26 November 15
ITALY'S STEAM COAL IMPORTS EXPECTED TO REACH 16 MILLION TONS AND COKING COAL IMPORTS TO AMOUNT TO 4 MILLION TONS - ASSOCARBONI
ASSOCARBONI LOOKS AT COAL FROM A DIFFERENT ANGLE
- “Coal has made huge steps towards environmental sustainability, making itself t ...
Thursday, 26 November 15
DRY BULK MARKET WILL REBOUND EVENTUALLY, BUT THINGS WILL BECOME EVEN WORSE BEFORE THEY IMPROVE SAYS SHIPBROKER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
As the dry bulk market’s benchmark, the Baltic Dry Index (BDI) reached an all-time late last week and has failed to rebound significantly eve ...
Thursday, 26 November 15
Q3'16 FOB NEWCASTLE COAL SWAP FALLS 27.5% SINCE 20 FEB 2015
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2016 delivery slid $5 per ton (12.05%) month over month to US$ 36.50 per ton. The s ...
Wednesday, 25 November 15
INDIA'S POWER GENERATORS FACE LOW, FALLING UTILISATION RATE - FITCH
COAlspot.com: Fitch Ratings says in a new report that the utilisation rate of India's thermal power generation capacity continued to decline in ...
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- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- Krishnapatnam Port Company Ltd. - India
- Economic Council, Georgia
- Maharashtra Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GMR Energy Limited - India
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Savvy Resources Ltd - HongKong
- Petrochimia International Co. Ltd.- Taiwan
- GVK Power & Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Trasteel International SA, Italy
- Sree Jayajothi Cements Limited - India
- Indonesian Coal Mining Association
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Goldman Sachs - Singapore
- Medco Energi Mining Internasional
- Tamil Nadu electricity Board
- Independent Power Producers Association of India
- Bhatia International Limited - India
- Renaissance Capital - South Africa
- Sindya Power Generating Company Private Ltd
- IEA Clean Coal Centre - UK
- Singapore Mercantile Exchange
- European Bulk Services B.V. - Netherlands
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- GN Power Mariveles Coal Plant, Philippines
- Xindia Steels Limited - India
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ind-Barath Power Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Marubeni Corporation - India
- Vedanta Resources Plc - India
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Larsen & Toubro Limited - India
- SMC Global Power, Philippines
- San Jose City I Power Corp, Philippines
- Heidelberg Cement - Germany
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Baramulti Group, Indonesia
- Gujarat Sidhee Cement - India
- Vizag Seaport Private Limited - India
- Mercator Lines Limited - India
- Wood Mackenzie - Singapore
- VISA Power Limited - India
- Meralco Power Generation, Philippines
- Parliament of New Zealand
- Ambuja Cements Ltd - India
- Minerals Council of Australia
- Essar Steel Hazira Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Electricity Authority, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Central Java Power - Indonesia
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Pipit Mutiara Jaya. PT, Indonesia
- Riau Bara Harum - Indonesia
- Bharathi Cement Corporation - India
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Videocon Industries ltd - India
- Rio Tinto Coal - Australia
- Semirara Mining Corp, Philippines
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Oldendorff Carriers - Singapore
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Sakthi Sugars Limited - India
- South Luzon Thermal Energy Corporation
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- CNBM International Corporation - China
- Bhushan Steel Limited - India
- Anglo American - United Kingdom
- Altura Mining Limited, Indonesia
- Kobexindo Tractors - Indoneisa
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Simpson Spence & Young - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Coal and Oil Company - UAE
- Gujarat Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Orica Mining Services - Indonesia
- Bhoruka Overseas - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Electricity Generating Authority of Thailand
- Uttam Galva Steels Limited - India
- SMG Consultants - Indonesia
- Parry Sugars Refinery, India
- Chettinad Cement Corporation Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Straits Asia Resources Limited - Singapore
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Leighton Contractors Pty Ltd - Australia
- Wilmar Investment Holdings
- Thai Mozambique Logistica
- Coastal Gujarat Power Limited - India
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- Price Waterhouse Coopers - Russia
- The State Trading Corporation of India Ltd
- Coalindo Energy - Indonesia
- Indogreen Group - Indonesia
- Indian Energy Exchange, India
- Indika Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Tata Chemicals Ltd - India
- Bayan Resources Tbk. - Indonesia
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- AsiaOL BioFuels Corp., Philippines
- Eastern Energy - Thailand
- ASAPP Information Group - India
- MS Steel International - UAE
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- Globalindo Alam Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Indo Tambangraya Megah - Indonesia
- Australian Coal Association
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Makarim & Taira - Indonesia
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Borneo Indobara - Indonesia
- IHS Mccloskey Coal Group - USA
- Intertek Mineral Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- White Energy Company Limited
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Bangladesh Power Developement Board
- Deloitte Consulting - India
- Energy Development Corp, Philippines
- Orica Australia Pty. Ltd.
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Gujarat Mineral Development Corp Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Binh Thuan Hamico - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Mintek Dendrill Indonesia
- Siam City Cement - Thailand
- Neyveli Lignite Corporation Ltd, - India
- McConnell Dowell - Australia
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- Kaltim Prima Coal - Indonesia
- Chamber of Mines of South Africa
- Agrawal Coal Company - India
- Central Electricity Authority - India
- Bukit Asam (Persero) Tbk - Indonesia
- The University of Queensland
- Kohat Cement Company Ltd. - Pakistan
- Jindal Steel & Power Ltd - India
- Power Finance Corporation Ltd., India
- International Coal Ventures Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
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