Maritime Law and Admiralty Jurisdiction

Admiralty law deals with legal problems that arise at sea or in connection with ships and shipping. That includes disputes over cargo, unpaid supplies (such as fuel), damage caused by a ship, salvage, crew wages, and sometimes enforcement against a ship itself. Because ships cross borders and money is often owed to overseas companies, the law provides special tools, most importantly, a way to bring legal action against the ship (not only the person), so a claimant can secure payment.

Two practical differences matter to clients:

1. You can sue the ship (an action “in rem”), and the courts can arrest (detain) the vessel until the dispute is resolved or appropriate security is given. That provides quick, practical leverage.
2. Different rules about priority and sale proceeds, if a ship is sold by court order, the money from the sale is distributed according to special rules that often differ from ordinary creditor priority.

Those features make admiralty law quick, technical and strongly procedural, which is why expert lawyers usually handle maritime disputes.

• A supplier (for example, bunker/fuel supplier or repair yard) is unpaid and wants security for the debt.
• Cargo damage in transit, and the cargo owner seeks compensation.
• A salvager has rescued a ship and needs payment.
• Crew who haven’t been paid or need repatriation.
• Charterers and owners are arguing about unpaid hire or damaged cargo.
• A vessel has been arrested, and the owner needs it released on security.
• Financiers enforcing a ship mortgage.
• Ships will not leave the harbour despite unpaid licence fees.

If any of these happen, time is often of the essence.

The court can order the ship detained, and the local court marshal will prevent it from leaving port while the dispute is dealt with.

Practically, the ship has the notice affixed to its mast or other acceptable place.

To stop the ship from leaving, so the claimant can either

1. get payment from the ship’s owners, or
2. obtain security (for example, a bank guarantee) as a substitute for arrest.

What owners can do

Owners can apply to the court for the release of the ship by offering acceptable security (for example, a bank guarantee or cash). Whether the court accepts that security depends on the likely value of the claim and the public interest in securing payment.

Practical tip

If your ship is at risk of arrest, contact specialist maritime lawyers immediately. Early steps, such as negotiating and implementing acceptable security measures, often prevent lengthy, costly detention.

If more than one creditor claims against the same ship and the ship is sold by court order, the court supervises the distribution of the proceeds of the sale among the claimants. That can be a complex and fact-heavy process. Creditors with different kinds of claims may rank differently; for example, crew wages and salvors’ claims often receive special attention.