Recovering seafarers’ claims

At times, seafarers work without getting paid for months on end. This happens more often than one might think. Seafarers can urgently request the employer to pay their wages, but it is difficult for seafarers to undertake further action. If the crew is not being paid, this is often a sign that the shipowner is in serious financial trouble. In many jurisdictions, regulations exist to allow for easy recovery of seafarer claims. The reason for this is that seafarers, due to the international setting they work in, typically face more difficulties when it comes to getting their wages paid. The extent of the protective measures vary per jurisdiction. The Netherlands is known to be one of the most favourable jurisdictions for the recovery of seafarer claims.

Priority claim

According to Dutch law, claims arising out of a seafarer employment agreement have priority and rank higher than e.g. a mortgage claim. This means that these claims are the first claims to be paid.

Claims arising out of seafarer employment agreement may be claims related to wages and allowances or claims for wrongful dismissal or personal injury.

Be aware that a time limit applies for claims related to ‘periodic payments’ such as wages and allowances. Such claims only enjoy priority to the extent the claim has arisen in the preceding 12 months, so it is important not to wait too long before undertaking action.

Because recovery of claims can be costly, the priority also extends to the interest and the costs incurred to obtain a court order for the recovery of such claims.

Maritime lien

Dutch law stipulates that the priority of the claim comes with a so-called ‘maritime lien’. This means that the claims can be recovered from the sea-going vessel, irrespective of who the shipowner is. It does not matter whether the employer of the seafarer owns the ship or not. The seafarer still has a right of recourse against the ship for the claims arising out of the seafarer employment agreement related to that ship.

If a seafarer has worked on several ships in a fleet, the claims arising of the seafarer employment agreement concluded for working on that fleet, are recoverable upon the ships pro rata parte (in equal portions) in relation to the time served upon each ship.

Arresting the ship

In the Netherlands, vessels may be prejudicially arrested for recovery of the claim when the ship is in Dutch territorial waters. Even if the ship has no other connection with the Dutch jurisdiction. This means that foreign-flagged vessels with a foreign shipowner and employer can still be arrested in Dutch ports. The arrest is a preliminary action to safeguard the possibility of recovery of the claims upon the ship.

Arresting a ship and preventing it from continuing its voyage often provides a strong incentive to pay the crew. Unfortunately, there are also occasions where the shipowner is in such a dire financial state, possibly nearing bankruptcy, that payment is not an option. If this is the case, the seafarers must obtain a court order for payment of their claims. Such a court order must be requested within 12 months after the claims have become due. The Dutch Court may have jurisdiction to grant such a court order, solely because the ship has been arrested in the Netherlands. A court order can be obtained quickly in summary proceedings.

Judicial auction

After obtaining a court order, the ship may be auctioned before the Dutch Court to recover the claims. Many formalities and conditions apply for the auction process. But the auction process can still take place quickly. Within approximately five weeks after obtaining the court order, a foreign-flagged ship can be sold in the Netherlands. The proceeds of the ship then have to be divided amongst all claimants. Since the seafarers’ claims are priority ranked, it is generally agreed that these claims are paid out first in case there is a dispute amongst other claimants regarding the ranking of their claims.

Need help?

If you are a seafarer and you are not receiving your wages, here are some things you can do:

· Contact your union or a local lawyer for advice about your situation.
· Request a visit from welfare workers or an ITF inspector in the port.
· Check out: https://seafarersrights.org/abandonment-advice/.
· Take action as soon as possible to avoid untimely claims.

The Netherlands: a favourable place for seafarers

The Netherlands - including the Caribbean parts - is one of the most favourable jurisdictions in the world for the recovery of seafarer claims upon vessels. The whole process from arresting the ship to the final payment of the claims to seafarers can take place in approximately two to three months.

For questions regarding ships soon arriving or already located in The Kingdom of the Netherlands (the Netherlands, Aruba, Curaçao and Sint Maarten as well as Saba, Sint Eustasius and Bonaire) feel free to contact our law firm.