The precautionary seizure of a vessel is a formidable procedure for any creditor seeking to recover a debt. It makes it possible to immobilise a valuable asset, often the debtor's main working tool. However, its implementation is fraught with pitfalls, particularly when the question of ownership of the vessel arises. Maritime law is a complex crossroads where national law and international conventions intersect, creating distinct and sometimes contradictory legal regimes. This article looks in more detail at the more technical aspects of seizability, to complement our complete guide to the seizure of ships. Navigating these murky waters without a clear legal compass can lead to costly disappointments, whether for the unwary creditor or the wrongfully seized homeowner. The assistance of a lawyer competent in ship seizure is essential to secure your rights.
Introduction to the seizability of the vessel in provisional arrest
Although classified as movable property by the Civil Code, ships have a unique legal status that makes them similar in some respects to immovable property. Its registration and the possibility of mortgaging it bear witness to this hybridity. This special nature justifies the existence of a specific seizure regime, distinct from ordinary enforcement law. The economic stakes involved in immobilising property also explain the complexity of the applicable rules, which can be found in our guide on seizable and unseizable vessels.
Particularities of the vessel and link with the claim
The possibility of seizing a vessel depends fundamentally on the applicable law, which varies according to the flag of the vessel. There are two main systems: French law and the 1952 Brussels Convention. French law, based on the general right of pledge under article 2284 of the Civil Code, allows any creditor to seize a vessel belonging to his debtor, provided that his claim appears to be well-founded in principle (article L. 5114-22 of the Transport Code). It does not matter whether the debt is maritime or land-based; the link between the claim and the vessel is irrelevant.
In contrast, the Anglo-Saxon-inspired Brussels Convention of 1952 adopts a real approach (in rem). It only authorises seizure to secure a "maritime claim", the list of which is exhaustively defined in Article 1. In this context, the claim is attached to the ship itself, and not just to the person of the debtor. This conceptual distinction has major practical consequences, particularly as regards the possibility of seizing a ship that does not directly belong to the debtor.
Liability of the seizing creditor in the event of abuse of seizure
The detention of a vessel is a particularly damaging measure. A creditor who abuses it incurs liability. Article L. 121-2 of the Code of Civil Enforcement Procedures empowers the judge to order the release of any abusive measure and to order the creditor to pay damages. In maritime law, the distrainor's liability is not automatic; it requires proof of fault. Jurisprudence holds that there has been abuse when the creditor has acted with blamable thoughtlessness, obvious bad faith or malice aforethought.
The courts may, for example, penalise a seizure that is disproportionate to the amount of the debt or a seizure initiated without basic checks on the identity of the shipowner. The damage suffered by the shipowner, including operating losses, port costs and damage to reputation, may then give rise to significant compensation. Visit claims for compensation before the enforcement judge are subject to precise formalities that require legal expertise if they are to be carried out successfully.
Seizure of a vessel not belonging to the debtor
This is one of the most complex issues in terms of protective seizure. The possibility of seizing a third party's vessel to recover another party's debt is a major departure from the fundamental principles of security law. The solutions differ radically between the international framework and French law.
International framework (1952 Brussels Convention: ship to which the claim relates vs. owner's other ship)
Article 3 of the 1952 Convention is at the heart of the system. It allows the creditor to seize "either the ship to which the claim relates or any other ship belonging to the person who, at the time when the maritime claim arose, was the owner of the ship to which the claim relates". This provision enshrines the attachment of the "sister ship": the creditor can sue not only the ship that gave rise to his claim, but also the other ships in the same owner's fleet. This approach, which focuses on the person of the owner at the time the debt is incurred, offers a broad guarantee to the creditor.
French framework (general right of lien and exceptions)
In French law, the principle is the opposite. By virtue of the creditors' general right of pledge (articles 2284 and 2285 of the Civil Code), only assets belonging to the debtor may be seized. It is therefore in principle impossible to seize a vessel that is not the property of the person or company liable for the debt. However, there are exceptions to this rule, which is based on a personal conception of the obligation. The main exception concerns claims with a maritime lien. These liens, which confer a right of resale, allow the creditor to follow the ship in whatever hands it passes and therefore to seize it even if it no longer belongs to the original debtor.
Charter vessels (bareboat, time charter, voyage charter) and charterer's debts
The situation becomes more complicated when the vessel is operated by a charterer who does not own it. Can the ship be seized for a debt owed by the charterer? The 1952 Convention provides a partial answer. Article 3(4) expressly authorises the attachment of a bareboat chartered ship for a maritime debt relating to that ship, where the charterer is solely liable for it. The same provision states that this rule "shall also apply to all cases where a person other than the owner is liable for a maritime claim", which case law has interpreted as including time and voyage charters, provided that the claim is related to the operation of the vessel. In French law, on the other hand, seizure for a charterer's debt remains impossible in principle, unless the creditor can invoke a maritime lien on the vessel or demonstrate that the apparent owner (the charterer) has created legitimate confusion leading him to believe that he was contracting with the true operator.
Importance of the owner's identity and the theory of appearance
Verifying the identity of the ship's owner is a fundamental duty of care for the creditor. Seizing a vessel with the wrong owner exposes the creditor to an action for immediate release and a conviction for wrongful seizure. The theory of appearance, which protects a person who has entered into a contract with a person whom he could legitimately believe to be the true owner, is applied with great caution by the courts. A simple consultation of the registration books is generally sufficient to identify the official owner. Appearance can only be invoked if the real owner has, by his behaviour, contributed to creating a misleading situation and has misled the creditor. In practice, this theory is rarely applied when basic checks would have removed the ambiguity.
Seizability of a vessel other than the one to which the claim relates
The ability of a creditor to seize a "sister ship", i.e. a vessel belonging to the debtor but with no direct link to the claim, is a strategic weapon. It makes it possible to circumvent the unavailability of the initial vessel (for example, if it is at sea or in an inaccessible port) by targeting another asset in the same fleet.
The principle of Article 3 of the 1952 Convention and its exceptions (ownership, mortgage)
As mentioned above, Article 3 of the 1952 Brussels Convention lays down the principle that any other vessel belonging to the owner of the vessel to which the claim relates may be attached. However, this same article provides for some important exceptions. The attachment of a sister ship is excluded for three specific types of maritime claims, listed in subparagraphs o), p) and q) of Article 1: those relating to the disputed ownership or co-ownership of a ship, and those secured by a mortgage or mortgaging. For these claims, which relate to a very specific right in rem, only the ship that is the subject of the dispute may be seized. A mortgagee, for example, has a security interest in a designated vessel and cannot extend his right of seizure to his debtor's other vessels by virtue of that same security interest, as detailed in the system of maritime mortgages.
Single ship companies" and "related ships" (confusion of assets, fictitious status)
To get around the "sister ship" rule, many shipowners resort to complex legal arrangements, in particular the creation of "single ship companies". Each ship in a fleet is owned by a separate company, theoretically preventing the seizure of one ship for the debt of the company that owns another. Faced with this practice, creditors have developed the theory of "related ships" (associated ships). French case law, which for a time accepted seizure on the basis of a simple "community of interests" or an appearance of economic unity, has become stricter. Today, in order to "pierce the corporate veil" and seize a vessel belonging to company B for the debt of company A, the creditor must prove the fictitious nature of one of the companies or a confusion of their assets and liabilities. He must establish that the legal autonomy of the companies is no more than a facade concealing a single economic and decision-making reality.
The theory of "maritime emanation" for state fleets
A similar problem arises for fleets owned by states but operated by separate private companies. The theory of "maritime emanation" makes it possible, under certain conditions, to seize the vessel of one of these companies for a debt owed by the State or another State-owned company. As with single ship companies, the French courts require rigorous proof. Mere State control over the company or the performance of a public service mission is not enough. The creditor must show that the company has no real autonomy and is merely an "emanation" of the State, with no separate assets of its own.
Application of French law (article 2284 of the Civil Code)
In French law, the situation is apparently simpler. Article 2284 of the French Civil Code states that anyone who is personally liable is obliged to fulfil his commitment on all his movable and immovable property, present and future. In application of this general right of pledge, if a debtor owns several ships, the creditor may seize any of them to secure his claim, even if the claim relates to only one of the ships. This rule applies even if the debtor is a charterer, provided that the vessel seized belongs to him.
Seizability of a vessel that has been placed in hands other than those of the debtor
One of a creditor's greatest fears is that the vessel, his pledge, will be sold or transferred before he can seize it. The question of whether seizure remains possible after this transfer has given rise to important developments in case law.
Vessels sold by debtors (droit de suite and change in case law)
For a time, the Court of Cassation accepted, on the basis of Article 3 of the 1952 Convention, that the holder of a maritime claim could seize the ship to which his claim related even if it had been sold. This solution, which established a genuine right of resale for all maritime claims, was very favourable to creditors. However, a major turnaround occurred in 2005. Relying on article 9 of the same convention, the Court of Cassation ruled that the seizure of a ship that no longer belonged to the debtor was only authorised if the creditor was relying on a claim with a lien conferring a droit de suite under the law of the forum (French law in this case). Henceforth, an unsecured creditor may no longer seize a vessel after it has been sold; only preferential creditors retain this option.
The vessel returned by the charterer to its owner (hesitations in the case law)
The situation is also uncertain where the claim arose from a charterer who returned the vessel to its owner at the end of the charter. Case law has been hesitant for a long time. Some rulings authorised attachment, considering that Article 3(4) of the 1952 Convention did not limit this possibility to the period of the charter. Other decisions have refused, taking the view that attachment for a debt owed by the charterer relates to the debtor and not to the vessel itself, and that it would be unfair to make the owner bear the consequences of a debt that is foreign to him once he has recovered his property. The current trend, in line with the 2005 reversal concerning sales, seems to be towards making it impossible to seize the vessel after it has been returned, unless the creditor can invoke a preferential claim giving him a right of resale.
The complexity of property rules in maritime law, combined with the subtleties of international conventions, makes the precautionary arrest of ships a high-risk procedure. A precise legal analysis is essential to secure a claim or to defend a vessel against a potentially abusive seizure. For an in-depth analysis of your situation and tailored advice, contact our team of lawyers specialising in ship seizures.
Sources
- Brussels Convention of 10 May 1952 for the Unification of Certain Rules Relating to the Precautionary Arrest of Seagoing Ships
- Transport Code
- Civil Code
- Code of civil enforcement procedures
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