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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, 01 December 23
COAL MINERS GROUP EXPECTS INDONESIA’S 2023 COAL OUTPUT TO SURPASS TARGET - REUTERS
The Indonesian Coal Mining Association (ICMA) expects the country’s 2023 coal output to surpass the official target of 695 million metric ton ...
Friday, 24 November 23
COAL IMPORTS TO INDIA IN OCTOBER 2023 REACHED HIGHEST LEVELS IN NEARLY A YEAR AND A HALF - VESSELSVALUE, VESON NAUTICAL
In October, coal imports to India reached 13.8 mt in October 2023, according to Oceanbolt, a Veson Nautical solution, the highest level since May 2 ...
Friday, 24 November 23
COAL SHIPMENTS TO ADVANCED ECONOMIES DOWN 17% SO FAR IN 2023 - BIMCO
In the first ten months of 2023, coal shipments to advanced economies fell by 17% y/y, as demand for electricity declined and the share of electric ...
Friday, 24 November 23
INTELLIGENT COAL MINES CONTRIBUTE TO IMPROVING SAFETY STANDARDS - CHINA DAILY
Mechanization, automation and intelligent upgrades have contributed to improved safety in coal mines, though the level of development of intelligen ...
Friday, 24 November 23
WHY AUSTRALIA'S COAL MINES ARE GETTING BIGGER - IEEFA
Australia’s largest coal mines are getting larger. Mines in New South Wales (NSW) are ramping up production following the state’s recov ...
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- Vedanta Resources Plc - India
- IEA Clean Coal Centre - UK
- Eastern Coal Council - USA
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- Lanco Infratech Ltd - India
- Samtan Co., Ltd - South Korea
- Bayan Resources Tbk. - Indonesia
- Timah Investasi Mineral - Indoneisa
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
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- Romanian Commodities Exchange
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- London Commodity Brokers - England
- Kumho Petrochemical, South Korea
- Therma Luzon, Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Makarim & Taira - Indonesia
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- Sojitz Corporation - Japan
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- Bank of Tokyo Mitsubishi UFJ Ltd
- India Bulls Power Limited - India
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- Mintek Dendrill Indonesia
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- Price Waterhouse Coopers - Russia
- Posco Energy - South Korea
- Eastern Energy - Thailand
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- Maharashtra Electricity Regulatory Commission - India
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- Goldman Sachs - Singapore
- White Energy Company Limited
- Australian Coal Association
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- Economic Council, Georgia
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- Port Waratah Coal Services - Australia
- Central Electricity Authority - India
- Videocon Industries ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chamber of Mines of South Africa
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- The University of Queensland
- GMR Energy Limited - India
- Dalmia Cement Bharat India
- SMC Global Power, Philippines
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- Semirara Mining and Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- Medco Energi Mining Internasional
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- Power Finance Corporation Ltd., India
- Bhatia International Limited - India
- Billiton Holdings Pty Ltd - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tata Chemicals Ltd - India
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- Trasteel International SA, Italy
- Star Paper Mills Limited - India
- Maheswari Brothers Coal Limited - India
- Coal and Oil Company - UAE
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Coalindo Energy - Indonesia
- Siam City Cement PLC, Thailand
- Attock Cement Pakistan Limited
- Aditya Birla Group - India
- Directorate Of Revenue Intelligence - India
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- VISA Power Limited - India
- Bukit Makmur.PT - Indonesia
- Pendopo Energi Batubara - Indonesia
- Parliament of New Zealand
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- Ministry of Transport, Egypt
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- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- Thai Mozambique Logistica
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- International Coal Ventures Pvt Ltd - India
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- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Wood Mackenzie - Singapore
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- Standard Chartered Bank - UAE
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- Tamil Nadu electricity Board
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- The State Trading Corporation of India Ltd
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- Karbindo Abesyapradhi - Indoneisa
- MS Steel International - UAE
- PowerSource Philippines DevCo
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- Antam Resourcindo - Indonesia
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- San Jose City I Power Corp, Philippines
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Savvy Resources Ltd - HongKong
- McConnell Dowell - Australia
- Global Business Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Global Coal Blending Company Limited - Australia
- Deloitte Consulting - India
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- Parry Sugars Refinery, India
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Larsen & Toubro Limited - India
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- European Bulk Services B.V. - Netherlands
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Orica Australia Pty. Ltd.
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Rio Tinto Coal - Australia
- Planning Commission, India
- Energy Development Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Iligan Light & Power Inc, Philippines
- Latin American Coal - Colombia
- Sarangani Energy Corporation, Philippines
- Baramulti Group, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- TeaM Sual Corporation - Philippines
- Gujarat Sidhee Cement - India
- Ambuja Cements Ltd - India
- Bhushan Steel Limited - India
- Africa Commodities Group - South Africa
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- Heidelberg Cement - Germany
- Petrochimia International Co. Ltd.- Taiwan
- Merrill Lynch Commodities Europe
- Holcim Trading Pte Ltd - Singapore
- Singapore Mercantile Exchange
- Marubeni Corporation - India
- Indika Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Rashtriya Ispat Nigam Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Sakthi Sugars Limited - India
- Alfred C Toepfer International GmbH - Germany
- GAC Shipping (India) Pvt Ltd
- PTC India Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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