Lochner Law Firm, P.C.

Todd D. Lochner, Esq.
Greg Singer, Esq.

Lochner Law Firm, P.C.
Donner Building
91 Main St., Suite 400
Annapolis, MD 21401

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Maritime Liens

A lien is a claim for an amount of money which is secured by a piece of personal or real property. A maritime lien entitles the lien-holder to have a vessel seized and sold to satisfy a debt. Since vessels can move, a maritime lien is enforceable by arresting the vessel and holding it in place until the debt is satisfied or secured with a bond. In the United States, this is usually done by U.S. Marshals in an action in the federal courts, although many states have state lien laws. The law in this area is greatly complicated by the fact that maritime liens can arise without the lienholder filing the lien with any central authority. Only recently has the USCG accepted most liens for filing. Enforcement of maritime liens is also complicated by the fact that it courts engage in the fiction of personifying the boat. Liens are enforceable against the boat itself, even though boats cannot themselves be negligent, boats cannot themselves breach contracts, and boats cannot themselves fail to pay wages.

In the maritime sphere, liens arise in several areas. The one that the casual boat owner knows is that of a bank or mortgagee. This type of lien, if filed appropriately, is called a preferred ship’s mortgage. This type of lien usually appears in an abstract of title available through the USCG and follows the vessel until paid off. Yet there are other, hidden liens, that can burden a vessel.

The highest priority lien is that of a seaman. This class includes virtually any person that is working on a vessel in navigation. A seaman will have a lien against the boat for his or her unpaid wages and this lien will have first rights over any other lien.

Another type of a lien is when a maritime business provides "necessaries" to a vessel. "Necessaries" are those items or services that are necessary to the operation of the boat. For marinas, necessaries include dockage, fuel, electricity, water, hauling, etc. For service companies, liens will arise through repairs to the hull, engine and the like. Other liens may arise out of services requested by the vessel itself, such as equipment ordered specifically for the vessel (e.g. radar, tackle, ropes, etc.) and even insurance premiums. The law is very generous to those who “furnish” these necessary services to the vessel. In order to qualify, the parts or service must be necessary to operation, and they must be provided to the individual vessel. Generally speaking, items sold in a retail store then taken to the vessel will not give rise to a maritime lien against the vessel. Conversely, those same items supplied on the credit of the vessel, may give rise to a lien.

Additional maritime liens can arise in the context of injuries that occur aboard the vessel or from property damage caused by the vessel. A passenger that is injured by the negligence of a crewmember has a lien against the boat. A dock owner whose property is damaged when the vessel comes into contact with it has a lien against the boat. Finally, liens from salvage and other areas can encumber the ship.

Enforcement of lien (for a marina or seaman) or defense of a lien (for the boat owner) can be complicated and costly. Suit must be filed where the boat is physically located, which can be difficult to ascertain. It may be advisable (or inadvisable) to assert a claim against the owner or operator of the vessel as well. Asserting a proper and enforceable claim to arrest a vessel requires significant expertise, and there are fees for having the marshals arrest the boat; fees for storing the boat until it can be sold; and attorneys' fees and costs associated with preparing and trying the case.

Moreover, should the vessel be sold at a judicial sale, all liens, known and unknown will be extinguished. By law, a sale by the U.S. Marshals clears all liens on the vessel. This means that if a person has a valid lien on a boat, but fails to exercise it or fails to intervene in the arrest proceedings, should that vessel be sold at a judicial sale, the lien on the vessel will be cleared. Finally, providing services to a vessel that is arrested, such as fuel or dockage, and not making a claim before the sale is ratified, such person(s) will forfeit any claim against the vessel.

If you have a lien to enforce, or your vessel is seized to satisfy one, find an admiralty attorney, preferably one in the jurisdiction in which the boat lies. Timing is of the essence. If you wait, you may lose your rights to enforce the claim, or lose your rights to contest an arrest that was done improperly.

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