Unpaid Bunker Suppliers Free To Pursue Their Maritime Lien Against Owners In The US

Oceanconnect UK Ltd & another v Angara Maritime Ltd (Fesco Angara) [2010] EWCA Civ 1050

Under English conflict of laws rules, recognition of a right to enforce a maritime lien is a matter to be determined by the lex fori (the law of the place where the action is heard). However, English law does not recognise the concept of a maritime lien for necessaries (charges for goods and services rendered to the vessel). Therefore, an unpaid bunker supplier would not enjoy a maritime lien as a matter of English law. However, under US maritime law, such a bunker supplier does have a maritime lien. In this case, US bunker suppliers sought to set aside an anti-suit injunction obtained by the vessel owners in the English court so that they could pursue a claim for unpaid bunkers by way of an in rem claim in the US.

Background facts

The original dispute between the parties in this case related to a claim by bunker suppliers, Oceanconnect, for unpaid bunkers which had been supplied to Britannia Bulkers A/S, charterers of the Fesco Angara. The charterers subsequently went into administration and the bunker suppliers sought to recover their losses from Angara Maritime, who were the owners of the vessel. The London Mercantile Court rejected Oceanconnect's claim against the owners (see report on that decision in our July 2010 e-brief). However, the matter came before the Court of Appeal on a slightly different issue.

Oceanconnect had originally arrested the vessel in Amsterdam in order to secure their claim. The parties subsequently entered into an escrow agreement whereby the vessel was released upon provision by the owners of an amount by way of security.

The escrow agreement was expressed to be "governed by and construed in accordance with English law and any dispute arising hereunder or relating thereto or arising in connection herewith shall be referred to the exclusive jurisdiction of the High Court of England and Wales" (clause 7). However, clause 3 of the escrow agreement also stated amongst other things that the amount of the claim was payable to Oceanconnect "...by virtue of a judgment (which is not or no longer subject to appeal) rendered against Angara by a competent court of law having jurisdiction ....or by virtue of a valid arbitration award which is not or no longer subject to appeal...."

Thereafter, the owners commenced proceedings in the English court for negative declaratory relief, seeking a declaration that they were not liable to...

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