Lex Maritima – principles of maritime law, globally recognised

1.1. What is Lex Maritima?

There is an understanding among lawyers specializing in the maritime law that this sphere is based on a number of general provisions – the pillars. However, until recently no attempt has been made to identify and formulate these general basic principles of the maritime law. In 2014 Professor Eric Van Hooydonk organised work on the general principles of the maritime law, giving them the name Lex Maritima. A working group was set up within the International Maritime Committee (hereinafter referred to as the CMI), comprising representatives from different jurisdictions in a personal capacity. The purpose of this group was to formulate, in simple and comprehensible language, basic principles that would serve as the key to interpreting rules and resolving mishaps in the law of the sea.

The result of the work was presented at the 125th meeting of the CMI, which took place in October 2022. The explanatory note is available on the Committee’s website.¹

1.2. Status of Lex Maritima

Principles – this is the common foundation of the maritime law, which should be adopted by the General Assembly of CMI. Their adoption is plaining in 2023.

The fourth principle is declared that Lex Maritima is not intended to derogate from the positive maritime law, but to supplement it and is capable to unify the enforcement of conventions and national legislations. Nothing in the Principles prevents a court from applying and formulating any other general principles which is not included in Lex Maritima. The Principles can serve as a model for national law and international conventions.

Thus, Lex Maritima is a so-called soft law that does not need to be adopted and ratified by national states. It is of a recommendatory nature, but as it has been developed by respected maritime law experts, their views are taken into account in both practice and teaching.

1.3. The goals of Lex Maritima

Drafters formulated three main goals of the principles:

1. Key for interpretation maritime positive law – national legislation, international conventions and even court’s decisions.

2. Step to the unification of maritime law.

3. Method of teaching maritime law.

First two goals are in the Principles 6.

1.4. Comparison of Lex Maritima with Principles of International Commercial Contracts (UNIDROIT Principles)

In the mid-twentieth century, the Institute for the Unification of Private Law worked on and in 1994 adopted the Principles of International Commercial Contracts, common fundamental rules for all jurisdictions, named the UNIDROIT Principles. These Principles never had the property of being generally binding, but the parties to a foreign trade transaction could choose the Principles as the law applicable to their contract, and a university professor was entitled to teach contract law on their basis. Gradually, the Principles have had an enormous impact on jurisprudence and new codifications, including the 1994 Russian Civil Code and the Draft Common Frame of Reference (DCFR – Model Civil Code for EU, which, however, has not been and is unlikely to be adopted). As an example, the ten-year objective limitation appeared in the 2010 version of the Principles and was subsequently included in both the Russian Civil Code and the DCFR, as well as in the codes of some EU countries.²

The UNIDROIT Principles are referred to by many lawyers as soft law, which on the one hand is not necessary, but on the other hand influences all national legislation primarily through legal education. It is no secret that many professors teach the law of contract based on the Principles.³

About 10 years ago, the maritime law professors working with the CMI decided to summarize and formulate the fundamental principles of the maritime law, those rules that are common to all jurisdictions. The Principles of International Commercial Contracts were to some extent formulated by professors, while the drafters of the Lex Maritima, by contrast, sought not to formulate anything themselves, but to include in the Principles existing rules in practice. It can be said that the UNIDROIT Principles are the dreams of professors in the field of the Law of Contract, but Lex Maritima – it is common foundation from practice, it is what is recognized and applied. It is not the professors’ ideal, but the rules recognized by all.

Lex Maritima pursues the same goals as the UNIDROIT Principles – a soft and unobtrusive unification of law, hence the projects can be compared.

The drafters of the Lex Maritima did great research to summarize the provisions of international conventions and judicial decisions from all countries in order to identify the common core of the maritime law. The Principles, called Lex Maritima, were formulated on the basis of convergent approaches to the solution. It has not been possible to formulate a general rule in all areas of the maritime law, in particular on the issue of the transfer of title to a ship and the role of transfer of possession there is no consensus amongst jurisdictions.

In his speech at the CMI conference in October 2022, Eric Van Hooydonk, the main ideologist behind the development of Lex Maritima, noted that the UNIDROIT Principles are fantasies of professors that have evolved over twenty years into a framework for contractual dispute resolution practice, while Lex Maritima are rules that already exist in the maritime law, but in Lex Maritima they have been brought together.

1.5. Structure and the main contents of Lex Maritima

Lex Maritima consists of 25 principles. The draft is divided into 7 parts.

Part 1. Objective and definitions.

Part 2. Sources of maritime law. Principles and other legal norms, including maritime custom.

Part 3. Ships (about rights to the ship; ship as a property; the law of flag and property rights to the ship).

Part 4. Freedom of navigation and the rules of the road.

Part 5. Maritime contracts (freedom of maritime contract, maritime transport contract, bareboat charter party, time charter party, voyage charter party).

Part 6. Maritime incidents (collisions, salvage, general average, wreck removal, negligence as a maritime liability principle).

Part 7. Maritime securities and time bars (ship as an asset).

To illustrate, let us consider several principles.

Principle 19 relates to liability for the collision of ships and the current wording is as follows:

1. If the collision is caused by the fault of one of the vessels, liability to make good the damages attaches to the one which has committed the fault.

2. If two or more vessels are in fault the liability of each vessel shall be in proportion to the degree of the faults respectively committed.

3. If, having regard to the circumstances, it is not possible to establish the degree of the respective faults, or if it appears that the faults are equal, the liability is apportioned equally.

4. If the collision is accidental, if it is caused by force majeure, or if the cause of the collision is left in doubt, the damages are borne by those who have suffered them.

Commentary

The principle echoes the regulation from the Convention for the Unification of Certain Rules of Law with Respect to Collisions between Vessels, adopted in Brussels on 23 September 1910.

During the discussion of Principle 19, at the CMI’s Lex Maritima International Working Group session at the October 2022 Conference in Antwerp, a question that was raised was what constituted equal liability and why not to establish solidary (joint and several) liability, which is beneficial to the creditor?

The drafters explained that universal rule in a collision is that liability depends on the degree of fault.

The phrase “liability following for the collision of ships” is taken to mean the rules of compensation for losses caused to ships involved in the collision.

Liability before third parties lies within the scope of the general regulations of obligations out of harm and has remained outside the scope of Principle 19. So, the question of solidary liability is outside the scope of this principle.

Principle 20 on salvage is formulated as follows:

1. Voluntary assistance to the ship in danger constitutes a salvage operation.

2. Salvage operations which have had a useful result give right to a salvage reward.

3. The salvage reward shall not exceed the salved value of ship.

4. No salvage reward is due if the salvage operation has had no useful result.

5. The salvage reward shall be fixed taking into account the relevant circumstances and with a view to encouraging salvage operation.

6. The positive maritime law or contractual arrangements may provide for compensation for the costs incurred by a salvor to prevent or limit damage to the environment.

Commentary

As noted during the discussion at the CMI meeting, one of the most difficult issues in salvage matters is determining the amount of the reward to the salvor. The drafters have tried to propose criteria that are not disputed in any jurisdiction. Although there may not be complete clarity on this issue because of the assessable nature of salvage operations.

Principle 21 on General Average (compensation for losses in a maritime incident) is formulated in a blanket (referential) way – the York Antwerp Rules constitute part of Lex Maritima.

Principle 23 relates to the problem of a vessel as an asset and the order of priority of the creditors awaiting satisfaction from its sale. According to the draft, the following rules are common in maritime law:

1. Specific categories of creditors of a ship are given priority over others in accordance with an order of precedence. Such preferential rights may include special legislative rights, liens, mortgages, hypothecs and similar registerable charges, and second-rank liens.

2. Claims secured by lien are ranked based on certain order between categories, taking into account, as the case may be, the order of voyages and the date when the claim came into existence.

Commentary

This principle was not the subject of discussion at the CMI’s Lex Maritima International Working Group session at the October 2022 Conference in Antwerp, but it illustrates that over-generalisation can sometimes lead to a lack of clarity.

One thing that is clear from point 1 is that some creditors may have priority and this priority may follow from the lien. However, much remains unclear and needs interpretation, although the purpose of the Principles is to clarify.

In modern civil law it is generally accepted that public encumbrances have priority over non-public encumbrances. In maritime law, in addition to a mortgage over a ship (hypothèque) a record of which is made in a public registry, where the title to the ship is registered, there are “claims secured by a maritime lien”. These are non-public claims which, by virtue of an express provision in national law (or in an international convention such as the Convention on Maritime Liens and Mortgages, 1993), have priority over the registered mortgage, although they are non-public (“hidden”) encumbrances and continue to attach the vessel even in case of sale, change of ownership, change of flag. Such claims are extinguished after one year from the date of occurrence or upon the forced sale of the vessel at public auction.

Point 2 seems to be mistier. It refers to the criteria for ranking creditors. These criteria are listed but not specified. To illustrate the problem: clause 2 states that the priority of the creditor depends on the order of the voyage. Suppose crew member Petrov was injured during voyage “A”. His claim is secured by a maritime lien over the vessel. In voyage “C” crew member Sidorenko was suffered harm and his claim is also secured by a maritime lien. Which of the creditors, whose maritime claim is secured by a maritime lien, Petrov or Sidorenko has the right to be indemnified first. On the one hand, Petrov was first to suffer harm and his lien arose earlier, so he has priority. On the other hand, if we are to consider a salvage claim, and not a personal injury claim, it is common practice in different countries to give priority to the second (last) salvage claim. Thus, what should the principle be? In any case it seems that the principles should be formulated in such a way that the questions raised could be answered.

Principle 24 deals with the immobilization of a ship and is worded as follows:

Ships may be prevented from sailing pursuant to arrest, seizure, administrative detention or to right of retention.

Arrest is the immobilization of a ship by Court order as the request of a creditor in order to secure a claim.

Seizure is the immobilization of a ship in execution or satisfaction of a judgment or other enforceable instrument with a view to a forced sale of a ship.

Administrative detention is the immobilization of a ship by a body with public law powers in order to secure a claim to or based upon suspected or proven infringements of laws or regulations.

A right of retention is the immobilization by a creditor of a ship in his possession in order to secure a claim.

Commentary

This Principle is difficult to translate into other languages from English as it is not clear how accurately the meaning of the legal institution is conveyed for each jurisdiction by the words “seizure” and “retention”.

Furthermore, the question arises as to what constitutes a sale of a ship? Namely, does the prohibition on sale mean a prohibition only on entering into a contract or does it also cover a prohibition on the performance of the contract of sale and the alteration of the ship’s ownership record on the registry? This question is of great practical importance and its clarity is important for the legal community practising maritime law.

Principle 25 is about time bars and is very succinctly worded: the positive maritime law may provide for any time bars with respect to any maritime claims.

During the 2023, the principles will be refined and finalised, with a presentation to the legal community and a vote on their adoption by the CMI Assembly scheduled for the autumn of 2023. It remains to express hope that the drafters will clarify the answers to the questions that arise during the Lex Maritima study. ■

Overview prepared by Maria Erokhova

Notes