Shipping Law

When a ship is charged with a maritime TORT, or when services have been rendered to it to facilitate its use in navigation and the shipowner has not paid for the services, a maritime lien can be placed on the ship. A maritime lien is a special property right in a ship given to a creditor by law as security for a debt or claim. The ship may be sold and the debt paid out of the proceeds.

The Maritime Lien Act (46 U.S.C.A. §§ 971–975 [2000]) provides that an action can be brought in rem, against the vessel, cargo, or freight itself. Under the act, the ship is personified to the extent that it may sometimes be held responsible under circumstances in which the shipowner would not be liable. For example, where a state law requires that a local pilot guide the ship in and out of the harbor, the pilot's NEGLIGENCE is not imputed to the shipowner. In rem proceedings allow the ship itself to be charged with the pilot's fault and make it subject to a maritime lien enforceable in court.

In an in rem proceeding, the vessel, cargo, or freight can be arrested and kept in the custody of the court unless the owner posts a bond or some other security. Usually the owner posts security to avoid an arrest, and the property is never taken into custody. Where the owner fails to post security and the plaintiff is awarded a judgment against the vessel, the court will order that the property be sold or the freight released to satisfy the judgment.