Second Circuit Confirms Physical Suppliers Don't Have Maritime Liens

James H. Power is a partner and Marie Larsen is an associate in Holland & Knight's New York office

HIGHLIGHTS:

• In the legal battle of competing maritime lien claims against vessels whose charterers contracted with O.W. Bunker & Trading A/S or its affiliates in October-November 2014, an important decision was issued recently by the U.S. Court of Appeals for the Second Circuit.
• Under the Commercial Instruments and Maritime Lien Act (CIMLA), a provider of necessaries may obtain a maritime lien against the supplied vessel under certain circumstances, if such provision was made on the order of the vessel or a person authorized by the owner (i.e., a charterer).
• The Second Circuit ruled that the physical suppliers do not have liens against the vessels, but the issue of whether the security agent may assert a lien claim against any vessel remains a serious question.