ITALY LAW AND PRACTICE Contributed by: Giorgio Berlingieri, Alberto Massimo Rossi, Alfredo Lizio, Alberto Torrazza, Simone Gaggero and Filippo Cassola, ADVANT Nctm
autonomy to the expert in the practical stages of the procedure of sale. The guidance and control of all the procedure remains in the hands of the judge. Maintenance of the arrested vessel is the responsibility of the ship-owner, who is the per - son in possession of the vessel and in charge of its maintenance and operation. However, in spe - cial circumstances, such as the abandonment of the vessel, the maintenance will be entrusted to a custodian appointed by the court, in line with Article 676 of the Italian Code of Civil Procedure. The priority ranking of claims is as follows: • legal costs related to the entire proceedings for the sale of the vessel; • creditors with privileges or maritime liens; • mortgagees; • unprivileged or unsecured creditors interven - ing promptly in the proceedings; • non-privileged or unsecured creditors not intervening promptly in the proceedings; and • all other unsecured claims. In June 2024, Italy signed the UN Convention on the International Effects of Judicial Sales of Ships, adopted by the UN General Assembly in New York on 7 December 2022. Under the rules of the Convention, it is provided that the judicial sale of ship will grant the buyer a valid title in all signatory States to the Convention through the issuance of a certificate of judicial sale enforcea - ble in any signatory State. The Italian Parliament should now proceed to ratify the Convention providing the relevant legislative instruments. 4.11 Insolvency Laws Applied by Maritime Courts The Italian Bankruptcy Law states that, unless otherwise provided by law, as of the day of the
bankruptcy declaration, no individual enforce - ment or precautionary action, including for claims accrued during the bankruptcy proceed - ings, may be commenced or continued on the assets included in the bankruptcy itself. How - ever, in a recent case concerning a claim sup - ported by a lien against the bareboat charterer of an arrested vessel, the court ordered the arrest of the vessel concerned anyway, even though the debtor was a bankrupt company. 4.12 Damages in the Event of Wrongful Arrest of a Vessel The plaintiff may be held liable for damages for wrongful arrest in cases where the claim on which the arrest is based does not exist and where the plaintiff has brought a reckless law - suit, acting in bad faith. A leading case (2014 judgment of the Court of Appeal of Genoa) stated that the total amount of damages for wrongful arrest were to be cal - culated in that specific case as the arithmetical average of: • notional gains that could have resulted from the employment of the vessel on a voyage- charter basis (amount calculated in relation to the number of voyages the vessel could have performed in that period); • notional gains that could have resulted from the employment of the vessel on a timechar - ter basis; and • demurrages that could have been earned during the period the vessel remained under arrest. The same judgment stated that any such dam - ages had to be calculated on the basis of the market timecharter rate for the period during which the vessel remained under arrest.
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