Maritime Lien

As a matter of Thai law, maritime lien is governed by the provisions of the Ships Mortgage and Maritime Lien Act B.E.2537. Part of maritime lien in the said Act commences from Section 22 to Section 28.

Actually, the provisions in respect of maritime lien under the said Act do not deal with the matter of right of retention or 'lien' under English law. In fact, it provides the preferential ranks among the creditors who have the rights of claim involving a ship.

1. Ranks of Maritime Liens:
The rank of maritime lien are subject to the nature of right of the creditor's claim and are ordered as follows:-

(1) a right of claim arising from working as the Master, a ship personal or a crewmember of the ship;
(2) a right of claim concerning loss of life or injury with respect to any person but arising from operation of the ship;
(3) a right of claim for remuneration for salvage of the ship;
(4) a right of claim on a basis of wrongful act arising from operation of the ship, but this does not include a right of claim concerning the loss of or damage to cargo and things of passengers on board such ship.

However, it should be noted that despite the above ranks of maritime lien, it is stipulated under Section 25 of the same law that fees and expenses involving ship arrest or seizure shall be paid for prior to any other maritime liens. Section 25 is quoted as follows:-

'In the enforcement of maritime liens, the money derived from the sale of ship shall be first applied to the court costs, the expenses in arrest or seizure of the ship and her sale, the expenses in looking after the ship as from the time of her arrest or seizure, the expenses in repatriating the ship personnel to her domicile, and the expenses in allocating the money, in that order, and then the balance shall be paid to the creditor(s) with maritime lien.'

Another point to be noted is the mortgage right. Such right is another kind of preferential right but comes after the maritime liens enumerated in the above (1)-(4) ranks. In other words, the mortgage right is in the fifth rank.

2. Claims which do not give rise to Maritime Liens:

2.1 cargo claims;
2.2 claims under 1.(2) and 1.(4) in the above, arising from pollution by oil, radiation, radioactive and material and nuclear material.

3. Special Characteristics of Maritime Liens:

3.1 a maritime lien is always attached to the ship irrespective of whether or not a debtor under the right of claim is the owner of the ship and will not be extinguished by the transfer ownership over the ship;
3.2 a maritime lien is established by the effects of law and is not required to register the lien.

4. Extinguishment of Maritime Liens:

4.1 In case the ship is sold; if the creditor with the maritime lien fails to submit his claim to the transferee of the ship within a stipulated period which shall not be less than 60 days from the date of notice calling for submission of the claim being published in a daily newspaper, the maritime lien will be extinguished.
4.2 In other cases, a maritime lien shall be extinguished upon;

(1) one year having elapsed from the date the maritime arose;
(2) the ship being sold by court order, in which case the proceeds from the sale shall be subject to the enforcement of the maritime lien instead;
(3) the mortgage foreclosing the ship mortgage; or
(4) a final judgment or order of the court to confiscate the ship.

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The information is prepared in cooperation with Pramuanchai Law Office.

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