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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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Sunday, 10 January 16
LNG BUNKERING IN ASIA: FUELING A PROMISING FUTURE? - REED SMITH
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Saturday, 09 January 16
BALTIC DRY INDEX SINKS 10% WEEK OVER WEEK TO AN ALL-TIME LOW OF 429 POINTS
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Friday, 08 January 16
FOB INDONESIA COAL SWAP FOR DELIVERY H1'16 REMAIN FLAT AS DEMAND DROPS OFF
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Friday, 08 January 16
FOB RICHARDS BAY COAL SWAP FOR Q2'16 DELIVERY CLOSED UP $0.13 AT $45.50 PER TON
COALspot.com: Q1’ 2016 API4 FOB Richards Bay Coal swap decline month over month and slightly up week over week.
The Q1’ 2016 FOB R ...
Friday, 08 January 16
WEEKLY US COAL PRODUCTION DECLINES 1.6% TO 11.7 MMST, SAYS EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 11.7million short ...
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- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Globalindo Alam Lestari - Indonesia
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Bharathi Cement Corporation - India
- Latin American Coal - Colombia
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Sindya Power Generating Company Private Ltd
- Mintek Dendrill Indonesia
- PTC India Limited - India
- Star Paper Mills Limited - India
- Jindal Steel & Power Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Electricity Regulatory Commission - India
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Therma Luzon, Inc, Philippines
- Orica Australia Pty. Ltd.
- Planning Commission, India
- Bhushan Steel Limited - India
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Kaltim Prima Coal - Indonesia
- San Jose City I Power Corp, Philippines
- Leighton Contractors Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Karaikal Port Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Parliament of New Zealand
- Kumho Petrochemical, South Korea
- White Energy Company Limited
- Kobexindo Tractors - Indoneisa
- Straits Asia Resources Limited - Singapore
- Binh Thuan Hamico - Vietnam
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- Electricity Authority, New Zealand
- Australian Coal Association
- Mjunction Services Limited - India
- Iligan Light & Power Inc, Philippines
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Videocon Industries ltd - India
- Independent Power Producers Association of India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- The University of Queensland
- Wilmar Investment Holdings
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- IEA Clean Coal Centre - UK
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- McConnell Dowell - Australia
- Wood Mackenzie - Singapore
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Sree Jayajothi Cements Limited - India
- Attock Cement Pakistan Limited
- Madhucon Powers Ltd - India
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Holcim Trading Pte Ltd - Singapore
- Gujarat Sidhee Cement - India
- Sical Logistics Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Indonesian Coal Mining Association
- Standard Chartered Bank - UAE
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- European Bulk Services B.V. - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- Ind-Barath Power Infra Limited - India
- Posco Energy - South Korea
- CNBM International Corporation - China
- Jaiprakash Power Ventures ltd
- Cement Manufacturers Association - India
- Thai Mozambique Logistica
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Global Business Power Corporation, Philippines
- Romanian Commodities Exchange
- Australian Commodity Traders Exchange
- GAC Shipping (India) Pvt Ltd
- Sakthi Sugars Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Baramulti Group, Indonesia
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- MS Steel International - UAE
- Commonwealth Bank - Australia
- Barasentosa Lestari - Indonesia
- Interocean Group of Companies - India
- Carbofer General Trading SA - India
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Makarim & Taira - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ambuja Cements Ltd - India
- Goldman Sachs - Singapore
- Coal and Oil Company - UAE
- Ministry of Mines - Canada
- Kepco SPC Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Meralco Power Generation, Philippines
- ICICI Bank Limited - India
- Ministry of Finance - Indonesia
- VISA Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Indian Oil Corporation Limited
- Krishnapatnam Port Company Ltd. - India
- Samtan Co., Ltd - South Korea
- Africa Commodities Group - South Africa
- Global Green Power PLC Corporation, Philippines
- Minerals Council of Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Intertek Mineral Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Chamber of Mines of South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Agrawal Coal Company - India
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Bukit Makmur.PT - Indonesia
- Parry Sugars Refinery, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Cigading International Bulk Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- CIMB Investment Bank - Malaysia
- Ceylon Electricity Board - Sri Lanka
- Pipit Mutiara Jaya. PT, Indonesia
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Singapore Mercantile Exchange
- Eastern Energy - Thailand
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Bhatia International Limited - India
- Central Electricity Authority - India
- Petron Corporation, Philippines
- Grasim Industreis Ltd - India
- Central Java Power - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- SMC Global Power, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Heidelberg Cement - Germany
- New Zealand Coal & Carbon
- Price Waterhouse Coopers - Russia
- Xindia Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Deloitte Consulting - India
- OPG Power Generation Pvt Ltd - India
- Lanco Infratech Ltd - India
- SMG Consultants - Indonesia
- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Renaissance Capital - South Africa
- Uttam Galva Steels Limited - India
- Riau Bara Harum - Indonesia
- Siam City Cement PLC, Thailand
- Essar Steel Hazira Ltd - India
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
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