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