Emergency Contact Gho Sze Kee: Cargo liens for unpaid hire and freight due under a time or voyage charterparty Home Latest updates News Gho Sze Kee: Cargo liens for unpaid hire and freight due under a time or voyage charterparty 22 Jun 2016 Download Sign up for alerts During periods in which the global shipping economy is volatile, the likelihood of unpaid freight or hire occurs with higher frequency. Recently, the Club has witnessed charterers facing difficulty in meeting their obligation to pay freight due under a charterparty. In such circumstances, the shipowner may want to know if he is able to exercise a lien on the cargo until he has been paid the freight or hire due under the charterer. There must be a right of lien in the charterparty The shipowner needs to determine if the charterparty will grant him a possessory lien over the cargo for the unpaid freight and hire. The more clearly a lien clause is drafted, the easier it is for the shipowner to determine the scope of the lien clause and therefore exercise his possessory lien for the unpaid freight or hire. Examples of widely drafted lien clauses, that extend to protect the shipowners right to lien, are clause 8 of GENCON 1994 charterparty and clause 23 of NYPE 93. Only when hire or freight under a charterparty becomes ‘due’ and ‘payable’ can the shipowner secure his rights against the party in default, by exercising a lien over the carried cargo. The lien clause must be incorporated into the bill of lading The relationship between the bill of lading holder and the shipowner is created by virtue of the contract of carriage contained in, or evidenced by, the terms and conditions in the bill of lading. The more precise the reference is to the charterparty in the bill of lading, the more protected the shipowner’s right is to exercise a lien over the cargo. A typical example of an incorporation clause is found in Clause 1 of Congenbill 2007: “ All terms and conditions, liberties and exceptions of the