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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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Thursday, 31 December 15
2016 FOB NEWCASTLE COAL SWAP RALLY TO CLOSE AT $37.98/TON
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2016 delivery rose another $1.48 per ton (4.05%) this past week compared to the sam ...
Wednesday, 30 December 15
FINAL DEALS OF THE YEAR TAKING PLACE, AS SHIP OWNERS PREPARE FOR 2016 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The Holidays’ investment lull has taken a grip over the newbuilding and S&P market for second hand vessels, as shipbrokers are reporting ...
Tuesday, 29 December 15
CFR SOUTH CHINA COAL SWAPS ROSE MONTH OVER MONTH
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2016 delivery rose US$ 0.68 (1.64%) per ton month over month.
A commodity swap is ...
Monday, 28 December 15
Q2' 15 U.S. STEAM COAL EXPORTS TOTALED 7.0 MMST; DOWN 16.9% FROM Q1 2015 - EIA
COALspot.com: U.S. coal production during second quarter 2015 totaled 211.1 million short tons.
According to EIA’s preliminary quarterly ...
Monday, 28 December 15
NOVEMBER NEWCASTLE COAL EXPORTS DECLINED 11.87%; THE AVERAGE PRICE OF COAL EXPORTS ROSE 1.37%
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port has shipped $1.120 billio ...
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- Vijayanagar Sugar Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
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- International Coal Ventures Pvt Ltd - India
- Thai Mozambique Logistica
- Kohat Cement Company Ltd. - Pakistan
- Energy Link Ltd, New Zealand
- Maheswari Brothers Coal Limited - India
- Barasentosa Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Kartika Selabumi Mining - Indonesia
- Meralco Power Generation, Philippines
- Orica Mining Services - Indonesia
- Parliament of New Zealand
- The State Trading Corporation of India Ltd
- Coal and Oil Company - UAE
- Bhoruka Overseas - Indonesia
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- Manunggal Multi Energi - Indonesia
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- Maharashtra Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Meenaskhi Energy Private Limited - India
- VISA Power Limited - India
- Agrawal Coal Company - India
- Directorate Of Revenue Intelligence - India
- CNBM International Corporation - China
- Mercator Lines Limited - India
- Leighton Contractors Pty Ltd - Australia
- Mjunction Services Limited - India
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- Antam Resourcindo - Indonesia
- Medco Energi Mining Internasional
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Semirara Mining and Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mercuria Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- IHS Mccloskey Coal Group - USA
- Bukit Makmur.PT - Indonesia
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- Sarangani Energy Corporation, Philippines
- Interocean Group of Companies - India
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- GN Power Mariveles Coal Plant, Philippines
- GAC Shipping (India) Pvt Ltd
- Simpson Spence & Young - Indonesia
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- Tamil Nadu electricity Board
- OPG Power Generation Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Standard Chartered Bank - UAE
- Timah Investasi Mineral - Indoneisa
- Borneo Indobara - Indonesia
- White Energy Company Limited
- PTC India Limited - India
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Grasim Industreis Ltd - India
- MS Steel International - UAE
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- Latin American Coal - Colombia
- Gujarat Mineral Development Corp Ltd - India
- Sojitz Corporation - Japan
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Romanian Commodities Exchange
- McConnell Dowell - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ambuja Cements Ltd - India
- Star Paper Mills Limited - India
- Kepco SPC Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Aditya Birla Group - India
- Oldendorff Carriers - Singapore
- Tata Chemicals Ltd - India
- Dalmia Cement Bharat India
- Wilmar Investment Holdings
- Savvy Resources Ltd - HongKong
- Sindya Power Generating Company Private Ltd
- Rio Tinto Coal - Australia
- Bayan Resources Tbk. - Indonesia
- Global Business Power Corporation, Philippines
- Renaissance Capital - South Africa
- Toyota Tsusho Corporation, Japan
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Rashtriya Ispat Nigam Limited - India
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- SMC Global Power, Philippines
- Africa Commodities Group - South Africa
- Intertek Mineral Services - Indonesia
- Edison Trading Spa - Italy
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Attock Cement Pakistan Limited
- Price Waterhouse Coopers - Russia
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Thiess Contractors Indonesia
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- LBH Netherlands Bv - Netherlands
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Bangladesh Power Developement Board
- Australian Coal Association
- Bahari Cakrawala Sebuku - Indonesia
- India Bulls Power Limited - India
- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
- GVK Power & Infra Limited - India
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Uttam Galva Steels Limited - India
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- Globalindo Alam Lestari - Indonesia
- Parry Sugars Refinery, India
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Marubeni Corporation - India
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- Eastern Energy - Thailand
- Ministry of Transport, Egypt
- South Luzon Thermal Energy Corporation
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- Semirara Mining Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Global Coal Blending Company Limited - Australia
- Kaltim Prima Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Merrill Lynch Commodities Europe
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Authority, New Zealand
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- Ministry of Mines - Canada
- Indogreen Group - Indonesia
- Aboitiz Power Corporation - Philippines
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- SN Aboitiz Power Inc, Philippines
- Vedanta Resources Plc - India
- Vizag Seaport Private Limited - India
- Baramulti Group, Indonesia
- Kapuas Tunggal Persada - Indonesia
- SMG Consultants - Indonesia
- Indika Energy - Indonesia
- Posco Energy - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Energy Development Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Power Finance Corporation Ltd., India
- Directorate General of MIneral and Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Central Electricity Authority - India
- Sakthi Sugars Limited - India
- Cement Manufacturers Association - India
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- Miang Besar Coal Terminal - Indonesia
- Coalindo Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Banpu Public Company Limited - Thailand
- Riau Bara Harum - Indonesia
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Petron Corporation, Philippines
- Malabar Cements Ltd - India
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- Indonesian Coal Mining Association
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