Law of Ship Mortgages
Page 587
INDEX
Page 587
INDEX
- Acceleration on default 229, 230, 286, 565
- Administrative receivership
- Administration
- Admiralty jurisdiction of High Court 340–346
- Admiralty Marshal
- Admiralty Marshal’s Conditions of Sale 583–586
- Agreed priority 149–152
- Aircraft
- WD Fairway case 111–112
- Amendment 198
- Appurtenances
- meaning 135
- Arrest
- Arrest and court sale 338–377
- Admiralty jurisdiction of High Court 340–346
- Admiralty Marshal, and 350–351
- advantages 338–339
- caution 348
- claim form 346–347
- damages, and 348
- dealing with cargo laden on board ship under arrest 353–355
- English law 339
- Forms 347–8
- insurance of ship whilst under arrest 352–353
- insurance of warrant as of right 349
- moving ship for safety, repairs or lay up 351–352
- payment and repatriation of ship’s crew 355–357
- procedure 346–357
- search of Registry 348
- Assignment
- Bailment
- concept of 322
- Bareboat charter 319–326
- see also Demise charters
- Beneficial ownership 18–21
- Beneficial interest
- meaning 58
- Bills of Sale Acts 17–18
- Blue Sky litigation 110–112
- Bottomry 4, 344
- Bottomry bond 59–60
- Brazil
-
Page 588
- Builder’s certificate 29
- Bunkers
- Cargo 299–319, 353–5
- Cargo interests 299–319
- Caveat 223, 348
- Certificate of registry 29–30
- Change of obligations 128–131
- Change of parties 127
- Charge
- section 859 Companies Act 2006 144
- Charterparty 494–499
- Classification societies 189–190
- COFR 188, 471
- Collateral advantage
- meaning 134
- Collateral deed of covenant
- see Deed of covenant
- Collateral security
- Common law 1–2
- Common law liens 208–209
- Common law mortgages 43, 50–52
- Company voluntary arrangement
- UK 403
- COMI 386–390
- Conditional sale agreement 43, 44
- Conflict of laws 67–119
- aircraft 69
- analogies 116
- Blue Sky litigation 110–112
- cases of ownership and arrest jurisdiction 86–89
- court’s protection of mortgagor, and 295–296
- English position 69
- foreign government action 80–83
- foreign judicial proceedings, and 75–79
- foreign law not confiscatory 81
- foreign ship mortgages 83–86
- FPSO OSX3 in brazil 112–116
- fraud upon mortgages, and 78
- general maritime law 76, 108–109
- insurance, and 461–462
- international conventions 105–108
- international insolvency 109–110
- law of ship’s register 67–68
- lex maritima 68
- lex situs see situs
- lex situs, conclusions on 116–119
- Louisiana law, and 76–77
- metaphors 116
- mid-nineteenth century cases 74–80
- power of requisition of British ships 82
- priority issues 89–97
- review of issues 70
- rights acquired under laws of foreign states 79–80
- security over earnings and charterparties 488–489
- situs 68, 69–70, 79
-
WD Fairway litigation 97–105
- British Register 104
- British ships belonging to port of registry 105
- Exception1 to Dicey’s Rule 133 103–104
- facts 97
- geographical fiction 105
- issues for determination 97–98
- lex situs 98–99
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Page 589
- renvoi 101, 103
- transaction defrauding creditors 102
- Consents 194–196
- Consolidation 205–206
- Contract of affreightment 479
- Court sale procedure 357–370
- Admiralty Marshal’s costs and expenses 371–372
- application for sale ‘pendente lite’ 358–359
- costs and disbursements 372–373
- delivery of ship to successful tenderer 366–370
- determination of priorities 370–377
- maritime lien claims 373–375
- mortgage claims 375
- mortgagee’s application for determination of priorities 370–371
- mortgagee’s application for judgment in default 359–360
- order for sale 368–369
- order of priorities disturbed, when 376–377
- ordered to direct buyer without tender or appraisement 361–362
- payment of purchase price into court 366–370
- payment out 370–377
- possessory lien claims 375
- steps taken by Admiralty Marshal after order 364–366
- Courts’ protection of mortgagor 266–296
- conflict of laws 295–296
- derivative liability to relevant parties 290–293
- excluding duties 293–294
- general law 266
- intermeddling 294–295
- mortgage in possession’s duties to mortgagor 268–272
- mortgagee’s exercise of power of sale 272–277
- right to redeem 267–268
- sales to self or favoured buyers 277–286
- self-help, and 266
- ship and land mortgages compared 286–290
- Covenant defaults 223
- Cross-Border Insolvency Regulation 419–424
- Cross-border jurisdictional issues insolvency, and 390–391
- CVA see company voluntary arrangement
- Debt subordination 178–180
- Deed
- common law mortgage 52
- Deed of covenant 184–187
- Default
- Demise charters 39–40
- Derivative liability to relevant parties 290–293
- DIP financing 427
- Discharge 202–205
- Discretions 194–196
- Disguised mortgages 53–54
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Page 590
- Duties and liabilities of mortgagee to third parties 297–337
- demise (bareboat) charters 319–326
- history of ship mortgages, and 297–299
- issues arising under Partnership Act 1890 330–332
- lender liability summary 335–337
- mortgagee in possession 328–329
- non-demise charters and cargo interests 299–319
- third party property 329–330
- wider lender liability risks 332–334
- Earnings 63, 71, 87, 132, 134–5, 142, 146, 151, 153–4, 156–7, 178, 200, 205, 216, 218, 224, 242, 248, 256, 258–9, 262–3, 307, 317, 330, 344, 358, 395, 399, 427, 473–508
- Effect of registration 30–33
- Enforcement 233
- Admiralty Court, competency 345–6
- ancillary equipment, and 188
- application of proceeds of sale 255–256
- arrest procedure 346–350
- bareboat charter, and 187, 189
- claims 341–5
- collateral security, of 262–263
- common law right to take possession 233–239
- courts’ protection of 284–285, 295
- default in payments, and 62
- double mortgagee, and 169–170
- earnings account 499–500
- exercise of 293
- factors relevant to decision to take possession 242–248
- foreclosure 260–261
- foreign judgments 71
- joint and several borrower, and 173
- judicial sale 357–370
- law of place at time of 114
- liability to third parties 323, 326, 334–5
- liens, and 207, 213
- marshalling, and 168, 174–175
- mechanics and effect of mortgagee’s private sale 252–253
- method of taking possession 239–242
- mortgagee’s expenses of sale 253–255
- mortgagee’s rights 475, 480, 496
- penalties, and 133
- rights of mortgagees in possession 248–249
- sale of mortgaged ship 249–252
- second mortgagee, and 151–152
- security over shares, of 264–265
- step-in rights 494–499
- subordinate mortgagees 261–262
- time charter, and 187
- unfavourable jurisdiction 151–152
- Equitable charge 42, 58–61
- Equitable liens 209
- Equitable mortgages 42, 54–58
- Equitable subordination 334–335
- Equity 2
- De Mattos v Gibson 309
- EU Insolvency Regulation 386–390, 414–419
- Execution 120–121
- Expiry of registration 34
- Extortionate credit transactions 412–413
- Factors relevant to mortgagee’s decision to take possession 242–248
- limiting liability for bunker spills 247–248
- limiting liability for loss of life, collision and non-oil pollution claims 246
- limiting liability for oil pollution claims 247
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Page 591
- mortgagee’s liabilities to third party containable, whether 245–248
- reasons for 243–245
- Financial collateral arrangements 501
- Fishing vessels
- Flag 8, 20, 22–24, 35, 84–86, 102, 107, 113, 114–115, 175, 190, 243–244, 313, 335, 339, 346, 352, 356, 360, 369, 407, 432–433, 466, 468, 472
- Floating charge 58
- Foreclosure 14, 260–26
- Foreign judgments 71
- Form MSF 4736 122, 124, 529–535
- Form MSF 4737 122, 536–541
- Form 4739 542, 543
- Form of mortgage 122–124
- FPSO OSX3 in Brazil 112–116
- Illegality
- Insolvency 378–429
- challenge to ship mortgage 404–414
- COMI 386–390
- consensual restructurings 378, 381–383
- Cross-Border Insolvency Regulation 419–424
- cross-border jurisdictional issues 390–391
- effect of EU Insolvency Regulation 414–419
- EU Insolvency Regulation 386–390
- European regimes 414
- Germany 414
- Greece 414
- liquidation 391–395
- scheme of arrangement under Companies Act 2006 383–386
- UK administration 395–401
- UK administrative receivership 401–402
- UK company voluntary arrangement 403
- UK winding up 391–395
- UNCITRAL Model Law on Cross-Border Insolvency 419–424
- United States Bankruptcy Code, Chapter 11 424–429
- Institute mortgagees’ interest clauses – hulls 577–581
- Insurance 430–472
- assignment 442–452
- beneficial interest 446–447
- clubs 455–456
- equity, intervention of 450–451
- event of default, and 449, 451
- legal or equitable 443
- loss payable provisions 445–446
- mutual associations 455–456
- notice, effect of 453–455
- potential impact of insolvency 452
- present and future claim 448
- registration 452
- statutory provisions 443–444
- timing of notice 449–451
- assignments of reinsurances 464–465
- brokers 277, 361–363, 372, 437, 438, 442, 453, 454, 455, 456, 457, 458, 459, 460
- claims 461
- commercial interest of mortgagee 430–431
- composite interest 438–442
- conflict of laws 461–462
- illegality risk 462–464
- international regulation 432–433
- letters of undertaking 457–460
- loss payable clauses 456–457
- MII 465–470
- mortgagees’ additional perils 471
- mortgagees’ interest 465–470
- nature and structure of 431
- nature of mortgagee’s interest 433–436
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Page 592
- P&I clubs 432
- pollution 471
- repossession 471–472
- risks to mortgagee 436–438
- statutory underpinning 430
- warranty 440
- assignment 442–452
- Interference with third party property 329–330
- Intermeddling
- International conventions
- conflicts of law, and see Conflicts of law
- International insolvency
- Invalidity
- priority, and 175
- Issues in owners’ undertakings 186–191
- JOL 43
- JOLCO 43
- Jurisdiction 1, 3–4, 9–10, 20, 24, 33, 37, 43, 49, 70, 76, 82–83, 85–89, 91, 93, 96–97, 106, 115, 137, 151, 174–175, 181, 209, 219, 242, 244, 288, 314–315, 339, 340, 347, 351, 384–391, 395, 461
- Leasing arrangements 43
- Legal mortgage 42
- see also Common law mortgages
- Legal ownership 16–18
- Legislative reform 7–10
- Letters of undertaking 368, 437, 457–460
- Liabilities of mortgagee in possession to third parties 328–329
- Liability to demise (bareboat) charterers 319–326
- Liability to non-demise charterers and cargo
- interests 299–319
- applicable law 315–318
- bill of lading holder, and 315–316
- economic torts, and 319
- entitlement to ship’s earnings 307–308
- equitable relief 305–306
- impairment of security 312–313
- modern cases 308–309
- principles 310–311
- remedies 311–312
- statutory mortgage, and 302–303
- wrongful interference with contracts 314
- Liens 207–215
- Liquidation 391–395
- Loss payable clauses 263, 451, 456–457
- MAC 219–222
- MAE 219–222
- Maritime law
- Maritime liens 209–213
- Marshalling 167–175, 294
- Merchant Shipping Act 1854 9
- Merchant Shipping Act 1995, Part II
- Merchant Shipping Act 1995, Schedule 1
- Merchant Shipping (Registration of Ships) Regulations 1993
- Method of taking possession 239–242
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Page 593
- Mortgagee’s exercise of power of sale 272–277
- Mortgagee’s expenses of sale 253–255
- Mortgages
- Mortgages of unregistered ships 15
- Mortgagor’s obligations and undertakings 182–197
- consents 194–196
- deed of covenant see Deed of covenant
- discretion 194–196
- imperilling or prejudicing security, and 183
- issues on owners’ undertakings 186–191 see also Issues on owners’ undertakings
- principal rights 182–183
- protection of security 196–197
- rights or incidents of ownership 183
- sanctions 191–194
- Mortgagee’s private sale 252–253
- Multiple obligations 124–127
- P&I clubs 432
- Parties 120
- change of see Change of parties
- Parties to subordination or priorities
- agreement 181
- Partnership Act 1890
- Payment defaults 218–219
- Penalties, rule against 132–133
- Port authority
- Port state control 35, 243
- Possession
- Possessory lien 43
- Power of attorney 62–63, 78, 121, 141, 152, 153, 189, 214, 244, 252–253, 300, 461, 498, 570–571
- Preferences 409–411
- Priority 149–181
- agreed 149–152 see also Agreed priority
- conflict of laws, and see Conflict of laws
- courts’ approach 175–177
- equitable mortgages and charges 155
- failure to register mortgage 154–155
- floating charges 156–159
- invalidity, and 175
- marshalling see Marshalling
- mortgages of foreign-registered ships 159
- mortgages of unregistered ships 155
- parties to subordination or priorities agreement 181
- registered statutory 149
- security over collateral assets 153–154
- tacking of further advances 160–166 see also Taking of further advances
- Proceeds of sale
-
Page 594
- Property in registered aircraft under English
- Property in ships under English domestic
- Purchase option see Third party purchase options
- Receivership 256–260
- Rectification 199–200
- Refusal of registration 34
- Register 25–27 see also flag
- Registering of British Vessels Act 1845 13, 18, 31, 49, 57, 63
- Registering of Vessels Act 1823 7–8, 42
- Registration 22–24
- Application to Register 29–30
- Declaration of Eligibility 29
- demise charters 39–40
- deterioration in physical condition 185
- effect 30–33 see also Effect of registration
- fishing vessels 27–28
- function 22
- Merchant Shipping Act 1988 23–24
- name of ship 29
- Navigation Act 1660 22
- ownership, and 22–23
- Part III of Register 30
- parts 25
- procedure 29–30
- qualified owners 26
- representative person 27
- shares in ship 26–27
- ship with no nationality 24
- small ships 28
- statutes 22–23
- United Kingdom ship 25–26
- Registration of mortgages 138–148
- Bills of Sale Acts 147–148
- Companies Act 2006 141–147
- amendment 142–143
- certificate 142
- change of chargee 145
- consequence of failure to register 142
- disclosure of negative pledges 145
- documentation 141–142
- financial collateral arrangement 141
- further security 145
- inspection by search 145
- limited liability partnership 145
- overseas companies 145–146
- receiver or manager 145
- rectification 142
- release 143
- time limit 143
- effect 140
- evidencing 139
- Merchant Shipping Act 1995 139–141
- reform of system 148
- registries 138
- Shipping Registrar 138
- Renvoi 69, 98, 101–103, 111–112
- Requisition
- Right to redeem
- Right to take possession at common law 233–239
- Rights of mortgagee in possession 248–249
- Risks 184–185
- Roman law 1
-
Page 595
- Sale of Goods Act 1979 16, 18
- Sale of mortgaged ship 249–252
- Sales to self or favoured buyers 277–286
- Salvage 36, 109, 210, 212, 344, 351, 373–4, 471, 506, 526–527
- Sanctions 191–194
- Schemes of arrangement under Companies
- Security interests in ships 41–66
- Security over earnings and charterparties 473–508
- assignment 475–476
- bareboat charter 476–477
- charterparties 494–499
- commercial background 475–479
- conflict of laws 488–489
- demise charter 476–477
- distinction between legal and equitable assignment 478–479
- earnings account 499–500
- equitable assignments 483–484
- financial collateral arrangements 501
- freight 474
- future rights 479–481
- legal assignments 483–484
- legal issues 477–478
- liens on sub-freights 492–493
- notice of assignment 484–485
- partial assignments 481–483
- pooling arrangements 500–501
- present rights 479–481
- requisition compensation 501–508
- restrictions on assignment 489–492
- set-off issues 484–488
- step-in rights 494–499
- suspensory assignments 481–483
- time charters 475–476
- Security over shares 263–265
- Self-help remedies 217
- Senior Courts Act 1981, section 20(2) text 526–527
- Share in ship, mortgage of 63
- Ship
- Ship mortgages
- Ships under construction, mortgage of 63–66
- Small ships
- registration 28
- Special fees 132–135
- Statutory mortgages
- central public register 46
- competing claims of mortgagee 44
- current form 48–50
- definition 41
- detailed formal agreements 50
- effect of registration 45–46
- endorsement 13
- Merchant Shipping Act 1854 46–47
- Merchant Shipping Act 1995 48
- nationality requirements, and 11–12
- primacy of registration 44–48
- priority 12–13, 49
- registration 48–49
- statutory charge, whether 14
- sub-mortgages, and 62
- transfer of title, and 10–11, 50
- unique significance of system 47
- Status defaults 219–223
- Statutory liens 213–215
- Statutory possessory liens 215
- Step-in rights 475, 478, 494–499
- Sub-freights
-
Page 596
- Submortgages 61–63
- Syndicated loans 125, 126, 388
- Tabula in naufragio 66
- Tacking of further advances 160–166
- Termination of registration 34
- Third Parties (Rights against Insurers) Act 2010 430, 452
- Third party purchase options 326–327
- Time charter
- Transactions at undervalue 407–409
- Transactions defrauding creditors 404–407
- Transfer 200–202
- UK administration 395–401
- UK winding up 391–395
- UNCITRAL Model Law on Cross–Border
- United Kingdom ship 25–26
- United States Bankruptcy Code, Chapter 11 424–429
- Upside sharing arrangements 132–135
- Usual terms of mortgage 131–132