Maritime Liens

Maritime Liens

Maritime liens are the legal concepts denoted by the terms Maritime Lien and Droits Privilégiés, which are used, respectively, in the maritime law systems of Anglo-Saxon countries and in France, as well as in countries such as Belgium, the Netherlands, and Switzerland whose maritime law is derived from French maritime law. In codified legal systems, privileged rights are recognized as a well-established legal principle. This principle entered English law in the nineteenth century and was incorporated into the Anglo-Saxon legal system.

Today, maritime liens are integral to domestic law in the United Kingdom. In this field, the United Kingdom has enacted comprehensive regulations and has established specialized admiralty courts to adjudicate maritime disputes. Judicial practice in these courts demonstrates that reliance on such jurisprudence has resolved many of the legal challenges arising from maritime transport. The decisions of these courts play a significant role in assisting judges and arbitrators exercising jurisdiction in various legal systems.

Priority of Maritime Liens in the Arrest and Sale of Ships

Under the legal system of the United Kingdom, maritime claims are generally divided into two main categories:

• Claims based on maritime liens.
• Statutory actions in rem, which may be enforced only if the person liable for the debt is the owner of the ship at the time judgment is rendered.

Claims Based on Maritime Liens

A maritime lien constitutes a proprietary right against the vessel itself and against any freight that may be due to the vessel. The holder of such a right may exercise the lien by arresting the ship and, where necessary, selling it and satisfying the claim from the proceeds of sale. Where the ship falls within the jurisdiction of the admiralty courts of the United Kingdom, the maritime lien may be enforced through judicial arrest.

Maritime liens represent one of the most effective legal mechanisms by which an injured party may secure its claim by taking control of the vessel as security for the enforcement of its rights. The existence of a maritime lien is independent of the ownership of the vessel and continues to attach to the ship itself. A change in ownership does not affect the validity of the lien. Likewise, the bankruptcy of the shipowner does not affect the existence of the maritime lien, which remains enforceable in favor of its holder.

Upon the sale of the vessel and distribution of the proceeds among creditors, the holder of a maritime lien enjoys priority over other creditors.

The origin of maritime lien claims lies in customary maritime law. Their principal categories include the following:

• Claims arising from damage caused by a vessel, although it appears unlikely that claims for oil pollution are accepted under this category.
• Salvage claims.
• Claims relating to the wages and remuneration of seafarers.
• Claims relating to the wages of the ship’s master and other expenses incurred by the master on behalf of the vessel.

Categories of Maritime Liens

Maritime liens may be classified into several categories:

• Contractual Maritime Liens: Contractual maritime liens arise from payments made pursuant to contractual obligations. Examples include mortgages over vessels and freight, liens over cargo to secure voyage expenses, salvage expenses, wages and remuneration of the crew, and claims by the ship’s master for reimbursement of expenses incurred for the vessel.
• Maritime Liens for Damage: Maritime liens for damage generally arise from losses resulting from vessel collisions. The exercise of such liens is subject to the following conditions:

• • The damage must have been caused by the vessel.
  • Although the damage must be caused by the vessel, a maritime lien will not arise solely to support a personal action unless, in the event of litigation, the wrongful act or fault of the owner or the owner’s servant is established.

Important Note

The enforcement of a maritime lien must take place within the statutory limitation period and before the expiry of the applicable limitation of actions.

A maritime lien is a right in rem, meaning a right against the property itself, rather than a right against the owner of the property. Accordingly, it must be noted that certain maritime rights exist by operation of law in relation to vessels or property which are not classified as maritime liens and are instead regarded as statutory actions in rem.

Frequently Asked Questions Regarding Maritime Liens