USA Law and Practice Contributed by: Seward & Kissel LLP, Seward & Kissel LLP
4. Maritime Liens and Ship Arrests 4.1 Ship Arrests The United States is not a signatory to interna - tional conventions that govern ship arrest. Rath - er, ship arrests are governed under substantive federal law and the Federal Rules of Civil Pro - cedure. 4.2 Maritime Liens With certain very limited exceptions, any person providing “necessaries” to a vessel on the order of the owner, or a person authorised by its own - er, is entitled to a maritime lien claim enforceable by a civil action in rem in the federal courts. As in other areas of the law, each asserted claim must be independently examined in the context in which it arises; however, as a general rule, the supplier of goods and services to a vessel essential for the operation and navigation of that vessel is likely to have a lien for the supply of necessaries. It is important to note that, in many circumstances, the US courts will look to the law of the jurisdiction in which the claim arose to determine the existence of the lien. Hence, notwithstanding the foregoing, if the jurisdiction where fuel oil was supplied to a vessel does not grant the supplier a lien under local law, the fed - eral courts might not recognise it. Other liens commonly recognised under US law include: • those for the wages of the Master and the crew of a vessel and for any stevedore employed directly by a vessel; • liens for damages arising out of a maritime tort; • liens for general average; and • liens for salvage, including contract salvage.
The maritime liens listed above will have prior - ity over a ship mortgage, as will expenses for a vessel while in possession of a court during a foreclosure proceeding. Additionally, a lien for necessaries supplied in the USA has priority over the lien of a preferred mortgage on a foreign- flagged vessel. Other maritime liens include con - tract liens for breach of a charterparty, which will be subordinate to preferred mortgage liens if incurred subsequent to the recordation of the mortgage. 4.3 Liability in Personam for Owners or Demise Charterers There is no requirement of an in personam owner or demise charter liability in order for a vessel to be arrested. Under the Commercial Instruments and Maritime Lien Act (46 USC Section 31301 et seq), vessel arrests may proceed in rem against the vessel as long as necessaries are supplied on the order of the owner or a person authorised by the owner. Under the statute, charterers are generally presumed to have authority to procure necessaries for the vessel, and suppliers of nec - essaries are also generally presumed to rely on the credit of the vessel and will typically be enti - tled to a maritime lien unless they have actual notice of a “no lien” clause in the charter. Ves - sels are routinely arrested to enforce necessar - ies liens and many ship mortgage foreclosures are commenced by such suppliers rather than mortgage banks. 4.4 Unpaid Bunkers Arrest proceedings commenced in rem against the vessel provide a vehicle for an unpaid sup - plier of bunkers – who provided necessaries on the order of the owner or a person authorised by the owner – to seek recovery of the reasonable value of the necessaries supplied.
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