NORWAY Law and Practice Contributed by: Kristian Lindhartsen, Lilly Kathrin Relling and Tobias Kilde, Kvale Advokatfirma DA
Chapters 11 and 12 of the Norwegian Enforce - ment Act establish the rules regulating a forced sale. In short, the claimant must have a final and binding court decision on the claim itself (the main proceedings) before proceeding with a judicial sale. The claimant must also obtain an attachment of the vessel. It is important to note that the claimant’s claim has priority from the time of the arrest, even if the final judgment and the execution lien are established later (except where sale proceedings have not been com - menced within one year of the arrest), so the arrest may be an important tool for the claimant to establish priority. In accordance with Sections 11-20 and 11-21 of the Enforcement Act, all claims with higher prior - ity than the claimant’s claim will be covered in full before the claimant receives any funds. This means that the court cannot accept a bid unless it is sufficient to cover all claims with a higher priority than that of the claimants. The sale pro - ceeds shall be distributed in the following order: • court fees and the court-appointed adminis - trator’s remuneration; • costs in connection with the accession that the buyer shall not cover itself, such as docu - ment and registration fees (unless the buyer has agreed to cover such fees); • maritime liens – in the order and priority contained in Sections 51 and 52 of the Nor - wegian Maritime Code, mortgages, similar registered encumbrances based in contract and enforcement liens (including interest); and • unsecured debts. 4.11 Insolvency Laws Applied by Maritime Courts Under Norwegian law, insolvency is regulated by the Debt Negotiation and Bankruptcy Act (the DNB-Act) and the Recovery Act. The Mort -
gage Act and the Norwegian Maritime Code are also important when considering the priority of claims. Parts of the DNB-Act build on the same prin - ciples as the US “Chapter 11” procedure, but it does not go as far in providing the court with flexibility to steer the process to a result that is seen as being acceptable by all involved. As the Norwegian court system does not have special - ised courts, bankruptcy proceedings would be submitted to the civil courts. Please see 4.10 Procedure for the Judicial Sale of Arrested Ships regarding the judicial sale of a vessel. 4.12 Damages in the Event of Wrongful Arrest of a Vessel A claimant may be held strictly liable for all of the defendant’s economic loss if the claim did not exist at the time of arrest (Section 32-11 of the NDA). Furthermore, a claimant who gives wrong - ful or misleading information concerning the grounds for the arrest, by negligence or intent, will be liable for the losses incurred. 5. Passenger Claims 5.1 Laws and Conventions Applicable to the Resolution of Passenger Claims Maritime passenger claims are regulated by Chapter 15 of the Norwegian Maritime Code, in Sections 405–432. These provisions are based on the 1974 Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea (PAL), the EEA Agreement Appendix XIII No 56x (Regulation EC No 392/2009), the 2002 Ath - ens Protocol and the EEA Agreement Appendix XIII No 56y. The limitations of liability for personal injury, death or luggage claims are included in Chap -
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