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Unreasonable delay in exercising maritime lien can extinguish it

In the present age we don’t often see owners relying on the ‘doctrine of laches’ to defeat a maritime lien primarily because the claimants usually assert their rights swiftly by way of arresting the vessel whenever she turns up in an arrest friendly jurisdiction.

In The Varesia [2018], the claimants (Singaporean bunker suppliers in this case, claiming for unpaid bunkers) did not exercise their maritime lien for nearly four years and US Court of Appeal for 5th Cir. held that this delay was “not excusable”. Background to this case is that the charterers had contracted with World Fuel for bunker supply in 2012 and a few months later the charterers went bankrupt. In the years between invoicing (in 2012) and arrest of the vessel (in 2016), World Fuel had done little to assert their claim. They had contacted owners only twice and did not seek to arrest the vessel earlier. A case of bunker suppliers ‘slumbering on their rights’.

A reminder that – maritime lien, though a powerful and a unique security device, can easily be extinguished if there is an unreasonable delay in enforcing it. A cautionary note - operation of laches (just like other areas of maritime law) is not uniform across all jurisdictions.

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