CML Working Paper: Reconsidering the Law on Maritime Liens for Bunker Suppliers’ Claims by Dr Víctor Hugo Chacón

This paper discusses the legal position of bunker suppliers in the wake of the OW Bunker collapse and the Hin Leong scandal. It provides a comparative analysis of recent case law on the issue from the United Kingdom, Singapore, and the United States.
The paper argues that the reasons for the historical abolition of the maritime lien for necessaries in the United Kingdom, and its restriction in the United States, are no longer compelling in the 21st century. Current circumstances, industry practice, and recent case law suggest that maintaining the 19th-century approach to enforcement of ship suppliers’ maritime claims has become impractical. A more balanced approach is required.
The restoration of the maritime lien for necessaries is a practical solution to the current problem. Granting a maritime lien to the party which bears the highest exposure in the transaction and suffers the actual loss should promote the prompt payment of bunkers, prevent suppliers’ insolvencies, and help restore banks’ confidence in financing the shipping industry. For decades, courts have expressed ‘sympathy’ for supplier claims, but the situation is reaching a point that requires more than sympathy.

The paper is available on SSRN at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4019834

It is also available for download here

Dr Víctor Hugo Chacón was a Senior Research Fellow at the Centre for Maritime Law at NUS Faculty of Law from 4 February 2019 to 3 February 2022.   Until 2018, He was professor at the Universidad Marítima Internacional de Panamá (UMIP) and been a practising maritime lawyer for over 13 years before the Maritime Courts of the Republic of Panama, handling claims related to cargo losses and damages, personal injuries, ship suppliers and ship collisions, among others. His doctoral dissertation was published in 2017 by Springer as The Due Diligence in Maritime Transportation in the Technological Era.