Shipowner’s Lien Over Yachts Carried as Cargo

We recently assisted an owner whose yacht was being transported across the Atlantic on a heavy-lift cargo carrier. The contract was made with a well-known yacht carriage company (YCC), which in turn contracted with the shipowner. Freight was paid to YCC but not paid on to the owner.

When the vessel arrived at the discharge port, it had not received freight payment, so it exercised a carrier’s lien against each of the yachts on board, thereby forcing most of the yacht owners to pay again.

Such liens are very traditional as a means of protecting the shipowner, but of course create an injustice for cargo owners, who end up paying twice and then seek to recover against a YCC that may be insolvent. Because the rules about the exercise of such liens are legally complex, the rights should be challenged and justified in each case.