Services of Maritime liens
III.
Maritime Liens as Sources of Conflicts of Law
In order to understand conflicts of law in the realm of maritime liens and related
maritime claims, one must first become a “comparativist”, in order to grasp the
differences between the competing national laws. In fact, any study of the conflict of laws
presupposes a comparative law analysis. Similarly, comparative law cannot be studied
exhaustively without examining the conflicts rules of the jurisdiction in question, because
those rules are themselves part and parcel of that national law.18 Conflicts of maritime
lien laws are easy to perceive through the lens of comparative law.
1)
The differing scope of “maritime liens”
In England and Commonwealth countries, the term “maritime lien” applies only
to a select group of maritime claims, being seamen’s wages, master’s wages, master’s
disbursements, salvage, damage (caused by the ship), bottomry and respondentia. These
are known as “traditional maritime liens”.19
16 [1946] P. 135 at p. 150 (C.A.).
17 Tetley, M. L. & C., 2 Ed., 1998 at pp. 59-60.
18 In this regard, it is noteworthy that Dicey’s first edition of 1896 was not entitled Conflict of Laws, but
rather A Digest of the Law of England with Reference to the Conflict of Laws, Stevens & Sons, London,
- 19 See this classic enumeration given by Gorrell Barnes, J. in The Ripon City [1897] P. 226 at p. 242. See
also Tetley, Int’l Conflict, 1994 at p. 539. Bottomry and respondentia are obsolete today, however, because
- 8 –
Other maritime claims resulting from services supplied to the ship or damages
done by the ship, notably claims for “necessaries” provided to the vessel (e.g. bunkers,
supplies, repairs, and towage), as well as claims for cargo damage, for breaches of
charterparty and for contributions of the ship in general average, do not give rise to
“traditional maritime liens” in the U.K. and Commonwealth countries, but only to
“statutory rights in rem”.20 The latter are simply rights granted by statute to arrest a ship
in an action in rem for a maritime claim. Unlike traditional maritime liens, statutory
rights in rem do not arise with the claim; they do not “travel with the ship” (i.e. they are
expunged if the vessel is sold in a conventional sale before the action in rem is
commenced on the claim concerned); and they rank after, rather than before, the ship
mortgage in the distribution of the proceeds of the vessel’s judicial sale.21
In the United States and civil law jurisdictions (e.g. France), however, claims for
necessaries, cargo damage and general average, among others, are granted full status as
maritime liens by the relevant national legislation,22 and/or by international conventions
modern communications normally make it unnecessary for the master of the vessel to borrow money on the
credit of the ship (bottomry) or of the cargo (respondentia) while away from the ship’s home port in order to
preserve the ship or complete the voyage.
20 Tetley, Int’l Conflict, 1994 at p. 539; Tetley, M. L. & C., 2 Ed., 1998 at pp. 445-446 (general average
contributions); pp. 555-562 (necessaries – U.K.) and pp. 577-578 (necessaries – Canada), p. 646 (repairs –
U.K.) and p. 652-654 (repairs – Canada); pp. 703-708 (towage); pp. 732 and 739 (cargo damage), p. 732
(breach of charterparty).
21 See Tetley, “Arrest, Attachment and Related Maritime Law Procedures” (1999) 73 Tul. L. Rev. 1895 at
pp. 1910-1911.
22 Necessaries claims are secured by a maritime lien in U.S. maritime law, by virtue of the Commercial
Instruments and Maritime Liens Act, 46 U.S.C. 31301 et seq., at sect. 31301(4) and 31342(a). Where they
arise before the filing of a “preferred ship mortgage” on the vessel in question, claims for necessaries
constitute “preferred maritime liens” by virtue of 46 U.S.C. 31301(5)(A) and as such outrank the preferred
ship mortgage by virtue of 46 U.S.C. 31326(b)(1). Cargo damage gives rise to a “preferred maritime lien”
under 46 U.S.C. 31301(5)(B) (“damage arising out of maritime tort”). General average claims are secured
by a preferred maritime lien by 46 U.S.C. 31305(E). For necessaries claims in France, see Law No. 67-5 of
January 3, 1967, art. 31(6). Note, however, that in France, in order to give rise to a “privilège maritime”
(maritime lien), necessaries must be ordered by the master, within the scope of his authority, while the
vessel is away from its home port, and for the purpose of preserving the ship or continuing the voyage. A
maritime lien for cargo damage are granted by art. 31(5), and a lien for general average by art. 31(4). - 9 –
binding those States,23 thus resulting in conflict of laws when such claims are asserted in
maritime proceedings before United Kingdom and Commonwealth courts, where they
have no maritime lien status according to the lex fori.
2) Other maritime claims
To understand maritime lien conflicts, one must also be familiar with a few other
categories of maritime claim.
First come “special legislative rights”, a category of claim (not always recognized
by maritime law authors) arising under modern national statutes, particularly with respect
to harbour and dock dues, wreck removal and pollution.24 These statutes confer upon
governments or their agencies special rights such as detention and sale of the ship, often
coupled with a right of priority on the sale proceeds. In other cases, the statutes provide
expressly for certain claims to be secured by a maritime lien with a very high priority.
Such rights usually outrank even the costs of arresting and selling the ship, as well as the
“traditional” maritime liens. they are also sanctioned by international conventions on
maritime liens and mortgages.25
23 The International Convention for the Unification of Certain Rules Relating to Maritime Liens and
Mortgages, 1926, 120 L.N.T.S. 187, adopted at Brussels, April 10, 1926, and in force June 2, 1931,
provides a list of maritime liens at art. 4. France, as a party to that Convention, provides for similar
maritime liens at art. 31 of its Law No. 67-5. Many other civilian countries (including, inter alia,
Argentina, Belgium, Brazil, Italy, Portugal, Spain and Turkey) are also party to that Convention, or have
legislation modeled on it, and therefore have similar maritime liens. For the text of the Convention, see
Tetley, M.L. & C., 2 Ed., 1998, Appendix “A” at pp. 1413-1420.
24 For examples of “special legislative rights”, see Tetley, M. L. & C., 2 Ed., 1998, chap. 2 (“Special
Legislative Rights”), chap. 3 (“Dock, Harbour and Canal Charges”), chap. 4 (“Wreck Removal”) and Chap.
5 (“Pollution”). Another type of “special legislative right” is the right of governments to confiscate vessels,
which is a penal sanction frequently imposed for the violation of national laws on subjects such as narcotics
trafficking, fisheries, customs, immigration, piracy and arms trading. See Tetley, ibid., chap. 6 (“Forfeiture
for Drug and Related Offences”).
25 The Maritime Liens and Mortgages Convention 1926, supra, note 23, provides, at para. I(2) of its
Protocol of Signature, that it is understood that the legislation of each State remains free “to confer on the
authorities administering harbours, docks, lighthouses and navigable ways, who have caused a wreck or
other obstruction to navigation to be removed, or who are creditors in respect of harbour dues, or for
damage caused by the fault of a vessel, the right, in case of non-payment, to detain the vessel, wreck or
other property, to sell the same and to indemnify themselves out of the proceeds in priority to other - 10 –
Another type of maritime claim consists of the costs of seizing or arresting the
ship and of preserving it pending the completion of the suit and its judicial sale. In
France, such law costs (frais de justice), as well as the costs of the judicial sale and the
distribution of the proceeds, and the costs of maintenance of the vessel under seizure
(custodia legis), are treated as conferring a privilège maritime (maritime lien) superior to
other maritime liens enumerated in Law No. 67-5.26 In the U.K., Canada and the U.S., on
the other hand, costs of arrest and sale and expenses in custodia legis do not constitute
“traditional” maritime liens, but are understood as a separate class of maritime claim,
outranking such liens.
And, of course, there are ship mortgages, which almost always compete with the
other categories of maritime claim for priority when a ship is sold in a judicial sale.
3) Different ranking of maritime liens and claims
The ranking of maritime liens inter se, and with respect to other categories of
maritime claims, differs from country to country and is the principal cause of the
conflicts of law in this field.
The traditional ranking of maritime liens in the U.K. and Canada is as follows:
claimants.” The International Convention for the Unification of Certain Rules Relating to Maritime Liens
and Mortgages, 1967, adopted at Brussels, May 27, 1967, but not in force (for text, see Tetley, M.L & C., 2
Ed., 1998, Appendix “B” at pp. 1421-1428), grants a maritime lien on the vessel for port, canal and other
waterway dues and pilotage dues (art. 4(1)(ii)), as well as for claims for wreck removal (art. 4(1)(v)).
Pollution claims would also fall under the maritime lien granted by art. 4(1)(iv), securing claims against the
owner based on tort. The International Convention on Maritime Liens and Mortgages, 1993, adopted at
Geneva, May 6, 1993, but not in force, (for text, see Tetley, ibid., Appendix “C” at pp. 1429-1438) also
grants a maritime lien for claims for port, canal, and other waterway dues and pilotage dues (art. 4(1)(d)),
permits maritime liens by national law (art. 6) to secure claims not mentioned in art. 4, and recognizes the
right of States party to the Convention to provide in their laws for a right to be paid, in priority to other
maritime lien claims, out of the proceeds of the “forced sale” (i.e. judicial sale) of a stranded or sunken
vessel following its removal by a public authority in the interest of safe navigation or the protection of the
marine environment (art. 12(3)).
26 Loi no. 67-5 portant statut des navires et autres bâtiments de mer of January 3, 1967 (J.O. January 4,
1967 at p. 106) at art. 31(1) and (2). For text of Law No. 67-5 and accompanying Decree No. 67-967 of
October 27, 1967, see Tetley, M.L. & C., 2 Ed., 1998, Appendix “G” at pp. 1479-1486. - 11 –
1) Special legislative rights;
2)
3)
4)
5)
Court costs (e.g. costs of seizure and judicial sale) and custodia legis;
Maritime liens (i.e. “traditional” maritime liens):
salvage,
damage (e.g. collision),
wages (masters’ and seamen’s and master’s disbursements).
Ship mortgages (registered);
Necessaries give statutory rights in rem:
a)
Do not follow the ship when sold,
b)
Only the owner or the “beneficial owner” may bind the ship in
Canada for statutory rights in rem.
c)
In U.K., the owner, beneficial owner or demise charterer may bind
the ship for statutory rights in rem.
d)
e)
For bunkers, repairs, supplies, towage, etc.
There is no statutory right in rem for stevedores in the U.K., but
there is in Canada.
f)
Necessaries in Canada extend to goods and materials as well as
services and insurance. Necessaries in the U.K. extend to goods and
materials.
g) Statutory rights in rem arise in U.K. upon issue of the writ (now called an
“in rem claim form”).
h) Statutory rights in rem arise in Canada upon arrest of the ship.
By comparison, the United States has its own original ranking system, which is
out of step with the rest of the world. Under the American system, the priorities in
maritime claims are as follows:
1)
2)
3)
Special legislative rights (of governments) (wreck removal; St. Lawrence
Seaway and Panama Canal tolls and damages; rights of detention, removal
and destruction for pollution); rights of forfeiture and sale for various
federal statutory offences (e.g. drug trafficking, illegal immigration, etc.);
Custodia legis and some court costs (e.g. costs of seizure and judicial sale
and attorney’s fees);
Preferred maritime liens:
a)
Wages of master and crew (including maintenance and cure),
b)
c)
d)
e)
Salvage (including contract salvage) and general average (cargo
against the ship)
Maritime torts (e.g. collision), including personal injury and death,
property damage and cargo tort liens;
Longshoremen (individuals, not stevedore company).
U.S. contract maritime liens (necessaries) entered into before the
filing of a U.S. preferred mortgage. This includes repairs, supply
of bunkers, supplies, stevedores, towage, contract cargo damage - 12 –
liens and charterer’s liens, etc. (and also including statutory
maritime liens, e.g. for civil penalties);
4)
5)
6)
7)
8)
Preferred U.S. ship mortgage liens, as of the date of filing, as well as
preferred ship mortgages on foreign ships whose mortgages have been
guaranteed under Title XI of the Merchant Marine Act, 1936 (46 U.S.
Code Appx. sect. 1101 et seq. at sect. 1271 et seq.);
U.S. contract liens (necessaries) arising after the filing of the U.S.
preferred ship mortgage (these are not preferred maritime liens);
Foreign ship mortgages (not guaranteed under Title XI of the Merchant
Marine Act, 1936);
U.S. contract liens (other than necessaries) (e.g. contract cargo damage
liens and charterers’ liens) accruing after foreign ship mortgages;
Unregistered (i.e. non-preferred) mortgages and perfected, non-maritime
liens (including tax liens and other Government claims which are
subordinate to maritime liens); state chattel mortgages and liens and liens
for maritime attachment; and foreign contract liens (e.g. U.K. or Canadian
statutory rights in rem).
Because of these different systems of priorities, a court confronted with a claim
that, under its proper law, is a maritime lien but is not a maritime lien under the law of
the forum, has two fundamental decisions to take. The court must first decide whether or
not to recognize that foreign maritime lien as a maritime lien, despite the fact that a
corresponding claim arising within the court’s own territorial jurisdiction would not
constitute a maritime lien. Secondly, if the court decides to recognize the foreign
maritime lien as a maritime lien, it must then decide how to rank the underlying claim in
the distribution of the judicial sale proceeds.
The solutions given these two questions in national conflict of law rules differ
radically as between countries, and notably as between the United Kingdom, on the one
hand, and the United States and Canada, on the other.