Clifford Chance

Beware of foreign maritime liens: Australian court allows appeal in 'Sam Hawk' v Reiter Petroleum Inc

31 October 2016

On 28 September 2016, the Full Federal Court of Australia delivered its much anticipated decision in the appeal of The Ship "Sam Hawk" v Reiter Petroleum Inc [2016] FCAFC 26.

The Full Court unanimously overturned Justice McKerracher's landmark decision at first instance, which had recognised the application of US maritime lien rights in Australia. The Full Court's decision restricts circumstances in which Australian rules of private international law will recognise and enforce a foreign maritime lien. The foreign maritime lien must either correspond or be sufficiently analogous to maritime liens recognised by Australian law in order to form the basis for an arrest of a vessel in Australian waters. The effect of the Full Court's decision is to significantly undermine the ability of foreign claimants to enforce foreign maritime claims.

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