HONG KONG SAR, CHINA Law and Practice Contributed by: Christopher Andrew Potts, Crump & Co
that bring a ship under the court’s admiralty jurisdic - tion and govern how the court exercises its jurisdic - tion, allowing action in rem against the vessel in ques - tion – or a sister ship for certain claims. Rules of the High Court (Chapter 4A) govern the pro - cedural aspects, such as lodging writs, affidavits and warrants for arrest. 5.2 Maritime Liens Maritime Liens in Hong Kong Hong Kong recognises traditional maritime liens under common law, typically for: • damage caused by a ship; • salvage; • seamen’s wages; • master’s wages and disbursements; and • bottomry (a form of ship/cargo pledge for loans). Maritime lien for crew injury indemnities? Crew injury claims generally give rise to maritime claims but not maritime liens. A vessel can be arrested for the claim, but the claim is not fixed to the ship like wages or salvage. Maritime Liens Versus Maritime Claims Maritime lien is a proprietary right in rem (against the ship itself) that attaches automatically to the vessel and travels with the ship, surviving change of owner - ship and ranking ahead of mortgages and most other claims. Maritime claim is a statutory category of claim that does not attach automatically. Defined under the High Court Ordinance (Chapter 4), it includes a wide range of contractual and statutory claims, allowing action against that specific ship or another of the defend - ant’s ships, but often defeated by a sale to a new owner. Arrest depends on statutory conditions being satisfied. Liabilities like unpaid charter hire (eg, time or voyage charter) will create maritime claims that allow for ship arrest. Arrestable Maritime Claims A vessel may be arrested for maritime liens, and for statutory maritime claims, under Sections 12A–12B of the High Court Ordinance (Chapter 4).
Maritime liens (eg, damage done by a ship, salvage, seamen’s wages, master’s wages and disbursements) attach automatically to the vessel and are enforceable in rem without further ownership conditions. In addition, a vessel may be arrested for statutory maritime claims, even though these do not constitute maritime liens. These include claims relating to: • possession or ownership of a ship; • mortgages or charges over a ship; • cargo, freight or hire (including loss of or damage to cargo); • charterparty disputes; • questions between co-owners as to the posses - sion, employment or earnings of the ship; and • towage, pilotage, bunkers, port charges and crew claims. Arrest may be against the offending ship or a sister ship, subject to statutory ownership requirements. Time Bars and Validity Maritime liens These arise immediately when the cause of action occurs and have no fixed time bar. They must be enforced whilst the ship remains a ship to retain pri - ority, and may be lost or extinguished when: • there is full payment of the underlying debt; • there is a judicial sale of the vessel; • the underlying claim becomes time-barred; • waiver, destruction or abandonment occurs; or • in case of laches (unreasonable delay), there is a failure to act diligently to enforce the lien, causing prejudice to the other party. Maritime claims The right to arrest for statutory claims (like charter hire) requires action within time limits or risks los - ing priority; this is governed by applicable statutory or contractual limitation periods (one year under the Hague-Visby Rules for cargo claims, six years for charterparty claims, etc). The right to enforce a mari - time lien through waiver (relying on owner’s credit and contract terms), laches (unreasonable delay causing prejudice), sale/destruction of the ship or payment will be lost/expired, though specific time limits (often one
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