Like many legal principles, the short answer to our reader’s question is “maybe.”
Our reader identified a federal statute that appears to establish a statute of limitations for maritime liens. Title 46, section 31343(e) of the U.S. Code provides for the expiration of a recorded notice of lien after three years. Unfortunately, a “Notice” of a lien is not a lien.
As we have discussed many times in this column, the instrument that may be recorded with the Coast Guard is referred to as a Notice of Claim of Lien (NCL). It is, as the name implies, a notice that somebody claims to have a lien. But a NCL is not a lien and the recording of a NCL has absolutely no legal effect. A maritime lien – assuming it meets the requirements of a lien (such as providing a service to the vessel at the request of the owner) – is automatically perfected without recording anything. The recording of a NCL is entirely optional, and the Coast Guard expressly warns that their acceptance of a NCL for recording provides no evidence one way or another about the validity of the claim.
So with that description of a NCL in mind, what is the purpose of the three year expiration statute? It simply provides that the notice – not the lien – expires after 3 years. The only consequence of this expiration date is that a new person who records a new NLC against a boat would no longer be required to send notice to an old claimant upon the recording of the new NCL
Most maritime liens are not subject to any statutory time bar, but we need to qualify that statement with two exceptions.
The first exception involves claims for injury or death arising from a maritime incident. 46 U.S. Code section 31306 requires that a civil action for damages for personal injury or death arising out of a maritime tort must be brought within three years after the cause of action arose.
The second exception is more complicated, but this is where our reader may find some relief. The legal principle known as “laches” (pronounced “latches”) basically holds that if a person waits for a long period of time to exercise a right, and as a consequence of that passage of time other people are somehow harmed by the claimant’s failure to act, the claimant may lose their rights. The laches principle is not limited to maritime law. It applies to any circumstance where someone sits on their rights for a long period, but it is especially useful in the context of a maritime lien since most maritime liens are not subject to an express statutory time bar.
The laches defense is a complicated and somewhat ambiguous legal principle. It is determined on a case by case basis rather than by a strict calendar time limit, and the analysis will include the question of whether anyone was prejudiced by the claimant’s failure to enforce his or her claim. But it does provide incentive for a lien claimant to move things along, and it may be helpful for our reader to explore a laches defense when defending the claim against his boat.
David Weil is licensed to practice law in the state of California and, as such, some of the information provided in this column may not be applicable in a jurisdiction outside of California. Please note also that no two legal situations are alike, and it is impossible to provide accurate legal advice without knowing all the facts of a particular situation. Therefore, the information provided in this column should not be regarded as individual legal advice, and readers should not act upon this information without seeking the opinion of an attorney in their home state.
David Weil is the managing attorney at Weil & Associates (weilmaritime.com) in Long Beach. He is an adjunct professor of Admiralty Law at Loyola University Law School, is a member of the Maritime Law Association of the United States and is former legal counsel to the California Yacht Brokers Association. He is also one of a small group of attorneys to be certified as an Admiralty and Maritime Law Specialist by the State Bar of California. If you have a maritime law question for Weil, he can be contacted at (562) 438-8149 or at email@example.com.
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