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 News Notes No. 7
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Passive vs Aggressive approach to collecting overdue maritime debt � An analysis � Part 2 of 3

Last month we addressed the Repetitive Dunning, also knows as the �Begging Method�, of bill collecting which all of us use to some degree. When the receivable goes delinquent beyond 90 days, it becomes evident that the invoice will not be paid using the �Begging Method�. A more aggressive approach may be in order to motivate the debtor to pay the bill or come to the negotiating table. If the debtor is having financial problems or has a perceived problem with the workmanship he must be forced to the negotiating table.

If the work or supplies to the vessel are maritime in nature, a lien is created and attaches to the vessel. The contractor/supplier needs to assess the options available to determine how to proceed. The first step is to post the claim of lien in a public place for others to see and be aware. A posted lien in itself does nothing until the vessel owner needs additional work or supplies, or tries to sell or finance. The contractor/supplier always has the option of having the vessel arrested and sold to satisfy the outstanding invoice. Any savvy buyer or lender understands that the lien would come ahead of his or her interest and decline any further negotiations until the claim of lien is resolved. Likewise any downstream contractor/supplier would need to know of claims of liens on a vessel prior to contracting with it, to be sure their potential claim is not dominated by an existing claim. Buyers, lenders and downstream contractors/suppliers are all forces that will force the settlement of a claim of lien against a vessel.

It needs to be pointed out that a lien does not need to be posted with a government office or private online service such as Marineliens.com for it to be a valid lien. But if logic prevails and the contractor/supplier wants payment he/it must make it known.

The next issue will deal with the final method of settling.


Legal history of Indonesian Archipelago � Part 2

By Pandji R. Hadinoto, Attorney at Law, Jakarta, Indonesia

The term of Indonesia, historically is compounded by Indo (Latin word for India or Hindus) and Nesia (= nesos, a Greek word for island);

Before 1820, this Indonesian Archipelago was expressed as India beyond the Gangges or Ultra Gangetic India and further East India;

Archipelago (English) or Arcipelagus (Italia) is compounded by �arci� means important and �pelagus� means ocean. This term of Arcipelagus was used at the first time in the Agreement between Republic of Venezia and King Micael Palaeologus, 1268. In this agreement, Arcipelagus is �aigaius-pelagus� (Greek word, Aigaion-pelagos or Aigaia Sea). Further, Archipelago means a body of water with islands within) and now known as �islands world�;

John Crawfurd, a scientist from Edinburg, used �Indian Archipelago� to express �Dvipantara� in his book, History of the Indian Archipelago, 1820. This term was reinforced further in Notice of the Indian Archipelago and Adjacent Countries by J. H. Moore, Singapore, 1837, and in The Indian Archipelago, Its History and Present State by Horace St. John, London, 1853. A. R. Wallace preferred to use Malayan Archipelago in 1869 and DR Prichard, a French scientist, used Malaysian Archipelago in his Physical History of Mankind. The other French scientists use �Oceania et Malasia�;

George Samuel Windsor Earl, a jurist born in London, is known as the pioneer of using Indu-nesians or Malayu-nesians to express the inhabitants of the �Indian Archipelago� or �Malayan Archipelago� as written in The Journal of Indien Archipelago and Eastern Asia, 1850;

James Richardson Logan, a jurist born in Scotland, is known as the inventor of Indonesia when writing The Ethnology of the Indian Archipelago : Embracing enquiries into the Continental relations of the Indo Pacific Islanders, 1850, which expressed �The name Indian Archipelago is too long to admit of being used in an adjective or in an ethnographical form. Mr Earl suggests the ethnographical term Indu-nesians but rejects it in favour of Melayu-nesians. For reasons which will be obvious on reading a subsequent note, I prefer the purely geographical term Indonesia, which is merely a shorter synonym of Indian Islands or the Indian Archipelago. We thus get Indonesian for Indian Archipelagian or Archipelagic, and Indonesians for Indian Archipelagians or Indian Islanders,��

Multatuli used Insulinde in his book Max Havelar, 1859, compounded by �inseln� means islands and �indie� from Indus = India. There were also Malay Archipelago or Le Grand Archipel Malais or Nusantara Malayu Raya (Nusantara Raya) that extended to use;

Prof Adolf Bastian, University of Berlin, popularized the name of Indonesia through his book Indonesien oder die Inseln des Malayichen Archipels, 1884-1894;

The first political party named as Indische Partij in 1913 which then renamed as Partai Insulinde referred to Max Havelar;

University of Leiden then developed division of Indology in 1922, organized by Prof Cornelis van Vollenhoven; His valuable contribution is recoqnized todate when describing the Indonesian Customary Law into 19 subsystems of indigenous legal environmental as written in his Het Adatrecht van Nederlandsch Indie (1901-1931);

Indische Vereeniging in the Netherland then renamed as Indonesische Vereeniging or Perhimpoenan Indonesia (one of the founder was DR Moh Hatta, who later became the first vice president of Republic of Indonesia); Partai Nasional Indonesia (National Party of Indonesia) in Bandoeng, founded in 1927 by DR Ir Soekarno, who later became the first president of Republic of Indonesia;

Soempah Pemoeda (Declaration on Oath by Young Generations) confessed one father-land, one nation and one language of Indonesia (Jakarta, 1928);

Gabungan Partai Indonesia abbreviated as GAPI (Union of Indonesian Parties) was formed in 1939;

The Independence of Republic of Indonesia was proclaimed in 1945.

The perspective of nationality itself, recoqnized since the imperium state of SRIWIJAYA (7th C to 14th C), imporium state of MAJAPAHIT (14th C to 15th C), Aliance of Great Nusantara by states of SAMUDERA PASAI, DEMAK and TERNATE in 15th C prior to the state of the Republic of Indonesia today.

The Indonesian�s Sea Territory firstly governed by �Territoriale Zee En Maritime Kringen Ordonantie of year 1939� which determined 3 miles distance from the coast of each islands, and measuring a jurisdiction area of 2 millions sqkm.

The Declaration of Djuanda (former Prime Minister of the Republic of Indonesia) stated that the Indonesian Geography is an Archipelago State of united islands and seas as one jurisdiction area. This declaration then continued by a Legislative Act no. 4/Prp, 1960 concerning the Jurisdiction of Indonesian Sea, and measuring a jurisdiction area of 5 millions sqkm where occupies 60% of the total jurisdiction area of the Republic of Indonesia. Therefore, Indonesia is really a Maritime State and the only unique one in the world.

Internationally, the above national policy was discussed in the Conference of Sea Law by the United Nations in 1958, in 1960 then in 1982 where the Principle of Archipelago State is accepted as such and stating it in the UNCLOS�82 (United Nations Convention on the Law of the Sea).

The Indonesian Legislative Act no. 17, 1985 is issued to ratify that UNCLOS�82.

Further, the Indonesian People General Assembly Decree No.IV/MPR/1978 governs the National Outlook named as Wawasan Nusantara as the basic pattern and platform of the National Development, later the Decree No.II/MPR/1993 governs Wawasan Nusantara as the legal certainty of the people of Indonesia. Nusantara means also today as the Crossroad of Asia.


Maritime collections -- finding an attorney to get your money

Marine businesses, like all businesses, are faced with the fact that sometimes people don't pay. This a special problem in the marine industry, where most companies are relatively small and often family-owned. Why? First, small businesses don't have the resources of a large corporation, resources like in-house counsel or a contract with an outside law firm. Second, there are relatively few lawyers that have the expertise to collect debts or understand the claims that relate to boats. Finally, for smaller businesses, one unpaid debt can sometimes mean the difference between a profit and a loss.

If the time comes that your business needs to take legal action to collect a bill, here are the things that you should consider in hiring an attorney. First, find someone who is knowledgeable about boats and maritime law. Consider doing an initial search on quality websites like lawyers.com. Check your local phone book to see who is listed as doing maritime or admiralty law. Also ask for references from other marine professionals, they may have already done the same search, and have direct experience to relay. Lawyers that concentrate on maritime law will be better able to understand your claim, will understand the special tools that are available to collect maritime liens, and will probably be more interested in your case as well. Second, look for an attorney that has a regular practice collecting debts. Some attorneys will take relatively small collections cases that arise in consumer transactions, but many focus on the larger issues that arise in commercial shipping. Finally, choose someone that is available on the telephone when you have a question. Lawyers that are too busy to return your telephone calls are probably too busy to handle your matter with the attention that it deserves.

Once you are in contact with an attorney, you will need to come to some terms for payment of the fee. In the United States, the typical choices are to pay hourly for the attorneys' time, or to have the attorney take a percentage of whatever is recovered-- a contingent fee. If you are strapped for cash, a contingent fee arrangement may be the best alternative. In this country, the typical contingent fee is around 33 percent of whatever is recovered. Often the percentage rate is tied to how much effort is required to collect the debt -- it is not unusual for a contingent fee to be 40% of the recovery if a trial is required. You should consider paying on an hourly basis if you have the resources, the amount owed is relatively large, and the debtor has assets. For example, if you have a $50,000 recovery, a 33% contingent fee will be $16,500. If you had paid on an hourly basis, the total fee might be significantly lower. When you are discussing fees, be sure to discuss the payment of costs (such as experts' fees, filing fees, skip tracing, etc) -- in most collection cases, costs are usually paid by the client in advance, but this may be negotiable depending on the specific lawyer and the specific matter at hand.

J. Dirk Schwenk
Lochner and Schwenk, LLC
30C West Street
Annapolis, MD 21403
410 263 4464


Use several tools to find liens says lawyer

A web-based system to search for maritime liens is a good concept says admiralty attorney Thomas A. Russell of Russell & Associates in Newport Beach, CA. It is one of several tools a diligent buyer or lender should consider in investigating the possibility of maritime liens against a vessel. Maritime liens are typically secret and unrecorded. They can come ahead of the interests of boat buyers and marine lenders. Anyone buying or financing a boat should take precautions to ensure there are no liens on a vessel before making an investment. Russell, who heads the Maritime Law Association's Recreational Boating Committee, suggests three primary ways to double-check on liens:

-- The first line of defense against liens is to know the history of the boat. This is usually learned through the owners and operators of the vessel. If they are in difficult circumstances, liens may exist for unpaid goods and services supplied to the boat.
-- The second line of defense is to check public records. Maritime liens do not need to be recorded, but a notice of claim of lien may be filed with the Coast Guard for some federally documented vessels. Still, there is no governmental record a boat buyer or marine lender can rely upon to completely rule out maritime liens.
-- Insurance may be a defense. Hull and machinery insurance, and protection and indemnity coverage, may offer protection from some types of maritime liens. In addition, a few insurance companies now offer boat title insurance.

A web-based service allows maritime lien claimants to give notice of their claims on the Internet and merely indicates that someone decided at one time to state a claim publicly. Those who use such a service should bear in mind that recorded claims of maritime liens may or may not be valid, Russell points out. Knowing that, boat buyers and marine lenders should not rely solely upon any one service in exercising diligence to rule out maritime liens against a vessel. In larger transactions, the opinion of competent legal counsel should be obtained.

For more information, contact Russell at 562/495-6000; [email protected]


Onboard Basic Safety Training Program

Intended for use by commercial marine industry and seagoing recreational vessels, this training program is based on requirements set forth in Table VI of the STCW Code, as amended in 1995. Basic Fire Fighting

Provides Shipboard Training Resource

There is no more terrifying hazard that confronts commercial seamen and commercial ships than fire at sea. To prevent this catastrophic emergency, every seaman is trained in Basic Fire Fighting. Each is expected to pay constant attention to fire prevention, and to be capable of serving as an effective member of a fire response team.

These realities are reflected in the Standards of Training, Certification and Watch keeping for Seafarers (STCW) that have been adopted by the International Maritime Organization (IMO) and its member nations. Competence in Basic Fire Fighting is one of four core elements of the Basic Safety Training that all ships are now required to provide, and all seamen are obligated to achieve.

Created to assist ship owners in preparing their crewmembers to cope with the hazard represented by fire at sea, Basic Fire Fighting relies on dramatic audio-visual media depicting live fire fighting operations.

In a July, 2002 letter, the U.S. Coast Guard�s National Maritime Center stated that it "would approve the use of the tapes in any Basic Safety Training courses or program." This program is one of five modules that comprise the Onboard Basic Safety Training Program. Other modules include Onboard First Aid: Immediate Actions, Personal Survival, Personal Safety & Social Responsibility and the Interactive Training, Drilling & Assessment Compact Disk.

Using this Product

Intended for use by commercial marine industry and seagoing recreational vessels, this training program is based on requirements set forth in Table VI of the STCW Code, as amended in 1995.

Consisting of three Training cassettes, the Test cassette and the Workbook, the product offers training, testing and assessment features that facilitate compliance with the International Safety Management (ISM) and STCW codes.

Content is organized into three segments:

Part 1
How to Use This Program
Shipboard Fire Fighting Organization
Escape Routes Periodic Fire Drills
The Elements of Fire & Explosion
Fuel, Heat, Oxygen
Types & Sources of Ignition
The Three Methods of Fire Spread
Classes of Fire

Part 2
Extinguishing Agents
Discovery of Fire
Immediate Actions
Fight & Extinguish Fires
Fire Fighter's Outfit
Personal Equipment
Fire Fighting Equipment & Appliances

Part 3
Portable Fire Extinguishers
Self Contained Breathing Apparatus
Fire Fighting Methods


Crew members should be assigned to watch Basic Fire Fighting, Parts 1, 2 and 3 then view the Test cassette while recording their answers to the test questions.

Answer sheets and Certificates of Completion should be signed by each crewmember, his or her supervisor and by the captain, and maintained with crew records. Crewmembers are encouraged to keep copies of the Certificate of Completion with their personal records as well.

Photocopy master versions of the answer sheet and Certificate of Completion can be found in the back of this Workbook. Remove these pages and create as many copies as you require. You also have the option of removing the answer sheet at the back of the Workbook before it is issued to crew personnel.

The Onboard Basic Safety Training Program has been written and produced by John Sabella & Associates, Inc. of Seattle, Washington. It is distributed by Walport USA of South Toms River, N.J. For further information, contact the Basic Safety Training Joint Venture at 1-800-438-9872 or [email protected].
Contact: Bob Negron or John Saez
Phone: 732-818-9883
Fax: 732-818-9884
Email: [email protected]
World Wide Web: www.walportusa.com


Supreme Court to rule on prop guard case

The U.S. Supreme Court on Tuesday considered a product liability case that could have serious consequences for the marine industry. A decision is not expected until sometime next spring.

The case, Sprietsma vs. Mercury Marine, involves a wrongful death suit originally filed in Cook County, Ill. Rex Sprietsma of Downers Grove, Ill., filed the suit on behalf of his wife, Jeanne, who died in 1995 of prop injuries from a Mercury engine.

The circuit court, a state appellate court and the Illinois Supreme Court all have ruled for Mercury, stating that federal statutes pre-empt state law in boating safety matters. They have said that because federal boating rules don�t require prop guards, Sprietsma can�t claim that a boat without prop guards is defective and seek damages under Illinois� wrongful death laws.

Monita Fontaine, vice president of government relations for the National Marine Manufacturers Association, attended yesterday�s hearing with representatives from the National Association of Manufacturers. Both groups submitted friend of the court briefs in support of the Fond du Lac, Wis., engine maker.

As reported by Soundings Trade Only online publication


Importance of success stressed as diplomatic conference gets underway

International Conference on the revision of the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea, 1974: 21 October to 1 November 2002

IMO Secretary-General William O'Neil stressed the crucial importance of a successful outcome to the Diplomatic Conference meeting this week and next at IMO to amend the liability regime relating to damage suffered by passengers on international voyages.

In his opening remarks to the Conference, which has been convened to consider the adoption of a protocol to amend the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea, 1974, Mr O'Neil said today that the successful adoption of the protocol would ensure that all those likely to be affected by a shipping incident will receive prompt and adequate compensation based on internationally accepted criteria.

At its opening session, the Conference elected His Excellency Dr. Ra Jong-Yil, Ambassador Extraordinary and Plenipotentiary from the Republic of Korea, as its President. Dr Ra Jong-Yil told the Conference that there was an understanding in the international maritime community that this is the right time to amend the Athens Convention, and stressed that the Conference faced a heavy responsibility in ensuring that its work resulted in a positive outcome.

The Convention has been in force since 1987. At present, 28 States are party to it.


International Maritime Organization (IMO) will consider proposed amendments to expand the scope and effectiveness

of regulations concerning the prosecution and extradition of those engaged in the perpetration of unlawful acts at sea during the 85th session of the Organization's Legal Committee. The Committee will review the text of draft proposed amendments to the 1988 Convention for the Suppression of Unlawful Acts(SUA) Against the Safety of Maritime Navigation (SUA Convention) and its related Protocol for the Suppression of Unlawful Acts against the Safety of Fixed Platforms Located on the Continental Shelf, 1988.

The review of the SUA Convention and its related Protocol followed the unanimous adoption in November 2001 by the IMO Assembly of resolution A.924(22) calling for a review of measures and procedures to prevent acts of terrorism which threaten the security of passengers and crews and the safety of ships.

The main purpose of the SUA convention and its related protocol is to ensure that appropriate action is taken against persons committing unlawful acts against ships.

In the present Convention, these acts include the seizure of ships by force; acts of violence against persons on board ships; and the placing of devices on board a ship which are likely to destroy or damage it. The proposed amendments would significantly broaden the range of offences and make it more relevant to modern conditions.

The Convention obliges Contracting Governments either to extradite or prosecute alleged offenders thereby ensuring that those responsible for perpetrating acts of violence against or on board ships, will be brought to justice, wherever in the world they seek to hide. The SUA Convention has been ratified by 73 States, representing 75.4 per cent of world merchant shipping tonnage and the SUA Protocol has been ratified by 66 States, representing 75.1 per cent of world merchant shipping tonnage.

Wreck removal

The Committee is expected to consider the text of the draft wreck removal convention (WRC), with a view to making a recommendation to the IMO Assembly as to the holding of a diplomatic conference to adopt it.

The WRC is intended to provide international rules on the rights and obligations of States and ship owners in dealing with wrecks and drifting or sunken cargo which may pose a hazard to navigation and/or pose a threat to the marine environment. The draft Convention currently being considered by the Legal Committee is intended to clarify rights and obligations regarding the identification, reporting, locating and removal of hazardous wrecks, in particular those found beyond territorial waters.

The current session is expected to address some fundamental issues such as the definitions of "wreck" and "hazard", the "convention area", the "State whose interests are most directly threatened by the wreck" and issues concerning liability, compensation and financial security. The Committee will also receive an oral report of the fourth session of the Joint IMO/ILO Ad Hoc Expert Working Group on Liability and Compensation regarding Claims for Death, Personal Injury and Abandonment of Seafarers, which developed proposed questionnaires to be distributed in order to monitor implementation of previous Assembly resolutions and guidelines on these issues.


Sewage rules for ships to enter into force following breakthrough ratification

Regulations for the prevention of pollution by sewage from ships are set to enter into force in September 2003 following the ratification by Norway of Annex IV of MARPOL 73/78 Convention on marine pollution. Norway's ratification means the entry-into-force criteria for the Annex, set at 15 States whose combined merchant fleets constitute not less than 50 per cent of the world's merchant fleet by tonnage, have now been met.

Norway deposited its instrument of acceptance for MARPOL Annex IV on 26 September 2002. This brought the total number of countries that have accepted Annex IV to 88 and their tonnage accounts for 51 per cent of the world's total. In accordance with MARPOL Article 15(2), Annex IV will now enter into force on 27 September 2003.

The Annex sets out in detail how sewage should be treated or held aboard ship and the circumstances in which discharge into the sea may be allowed. It requires Parties to the Convention to provide adequate reception facilities for sewage and contains a model International Sewage Pollution Prevention Certificate to be issued by national shipping administrations to ships under their jurisdiction.

The Annex will apply to ships engaged in international voyages. On entry into force it will have immediate effect on all new ships of 400 gross tonnage and above and new ships of less than 400 gross tonnage which are certified to carry more than 15 persons. It will apply to existing ships of 400 gross tonnage and above and of less than 400 gross tonnage and above but certified to carry more than 15 persons five years after the date of entry into force.

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