Admiralty & Maritime Law
| Arrest of Vessels in Panama
The
following are the main questions posed by the claimant, about
the proceeding to perform the arrest of a vessel before the
Maritime Court of Panama.
1. What
are the documentary and evidential requirements for an arrest of
a vessel, cargo, freight, combustible or other goods of the
defendant?
R. The
petition for arrest must be filed with the complaint. In this
regard, complaint must briefly set the reasons of fact and the
rights on which the same is based. Circumstantial or prima facie
evidence must be included in the claim evidencing the legality
of the right claimed. The evidence herein before mentioned may
be copies.
2. Can a vessel be arrested in Panama, in
circumstances where the claim has no direct relationship with
Panama? That is to say, that the flag of the vessel involved is
not Panamanian, that the cargo was not shipped from or to Panama
and neither the parties of the controversy (dispute) are from
Panama.
R.
Correct. According to the article 164 of the Maritime Code
of the Republic of Panama, the Admiralty Court of Panama also
has jurisdiction with respect to the lawsuits derived from acts
of maritime commerce and maritime trade outside the territory of
the Republic of Panama, its territorial and navigate waters,
when the defendant is out of its jurisdiction.
3. Will
the Maritime Court of Panama, permit to submit the case to
another jurisdiction, maintaining the arrest of the vessel or
the obtaining of the guarantee to substitute the arrest of said
vessel, under the jurisdiction submitted?
R. It is
correct. According to the article 19 of the Maritime Code of the
Republic of Panama, the Maritime Court may abstain, upon a
petition filed by an interested party, from taking cognizance,
or of continuing to take cognizance, of proceedings from causes
arising outside of the territory of the Republic of Panama, in
any of the following cases:
A.
When the controversy has been
previously submitted to arbitration, or to the jurisdiction of a
court in a foreign country, and if a decision is still pending
in such action.
B. When the
parties have agreed by written contract to submit their
controversies to arbitration, or to a court in a foreign
country.
C. When
testimony of witnesses is to be taken, and the witnesses reside
abroad, and the practice of taking such proof abroad, or the
appearance of said witnesses before the court is too onerous for
each of the parties.
D. When
a judicial inspection may be deemed necessary in order to have a
better appreciation of the facts, and such acts would be carried
out abroad.
In the
above mentioned cases, the Maritime Court shall suspend the
further proceedings of the claim, until such times as the
foreign court has rendered a final judgment, and will keep the
property seized, or the guaranty substituting it, subject to the
orders of said court.
4. Will
the Maritime Court accept a P & I Club Letter of Guarantee as
good security, or will the Court accept only Bank guarantees or
cash, or can the claimant choose?
R. The
Court will accept, as good security, a P & I Club letter of
guarantee, only if the same is filed by the mutual agreement of
both parties. Whenever the Maritime Code requires that a party
give security, the guarantee shall consist of any of the
following:
A.
Cash which must be deposited by the interested party in
the National Bank of Panama.
B.
Cashier's
check drawn against banks with license to operate within the
Republic of Panama.
C.
Surety
bonds issued by companies in the Republic of Panama authorized
for such in Panama.
D.
Bonds of
the Public Debt of the Republic of Panama.
E.
Any other
guarantee agreed to by the parties.
5. Does a
claimant have to put up counter security?
R. No, the
claimant does not have to put up counter security.
6. What
are the costs involved in arresting a ship in Panama, including
Court fees, Lawyers fees and fees of the Marshal?
R. The
petition for the arrest of the vessel must be presented by the
plaintiff accompanied by security of US$1,000.00, in order to
respond for the damages, caused by such arrest, and shall
consign to the order of the Marshal of the Maritime Court, an
amount of US$2,500.00 as an advance for the expenses which may
be brought about in the conservation and custody of the vessel.
The
aforesaid guarantee of US$1,000.00 is in the event that the
arrest of the vessel is directed to seek execution of Maritime
liens against the vessel, freight and cargo as well as in the
event the arrest is utilized by the plaintiff to procure
jurisdiction. However, if the arrest of the vessel is interposed
as a purely precautionary action to keep the proceedings from
having illusory effects and keep the defendant from transposing,
dissipating, encumbering, alienating or impairing the vessel,
then the plaintiff shall have to deposit a guarantee that the
Court shall prudently indicate, and that will not be less than
20% or greater than 30% of the amount of the claim.
If the
power of the attorney is not available when the arrest of the
vessel takes place, the lawyer who is handling the case, can act
as officious intervener of the claimant, for which it will be
required to file a guarantee in the form of a bond. The maximum
bond for complaints above US$1,000.000.00 is US$4,500.00. This
bond is recoverable once the power of attorney is filed with the
court.
Lawyer's
fees are agreed by the lawyers and the client subject to the
following circumstances:
A.
The amount
of the claim.
B.
The
purpose of the claim.
C.
The
complexity of the case.
D.
In some
instances, attorneys will take a matter on an hourly basis.
7. What is
the procedure for releasing a vessel from arrest in Panama, and
how long does it usually takes to release a vessel from arrest?
R. The
vessel may be released from arrest, if the defendant or an
interested third party deposits with the Court any of the
guarantees acceptable by law and which are mentioned in
questions No. 4. It is important to take into account that the
Maritime Court of Panama is open the 24 hours of every day of
the year, including holidays.
8. Do
claim documents have to be translated into the Spanish language?
R. Yes. If
the claim documents are in a foreign language this documents
have to be translated into the Spanish language, by an Official
Public Translator from the Republic of Panama. Notwithstanding
the Court usually accept documents that are in English language
if they are filed as prima facie evidence to request the arrest
of the vessel.
9. Must
the claim documents have a notarized power of attorney from the
claimant?
R. No, as
we explained in point Nº 6, if for any reason the power of
attorney is not available when the arrest takes place, the
lawyer that is handling the case can act as officious intervener
of the claimant, for which it will be required to file a
guarantee in the form of a bond.
10. Once
documents are In the hands of a Lawyer. how long does It takes
for the Judicial process of acquiring the court's authority for
an arrest?
R. Once
the documents and funds for securities are in hands of the
lawyers, the order of arrest can be obtained in a matter of
hours.
11. Does
the Maritime Court accept documents that are sent by email / facsimile
transmissions?
R. Yes.
The Admiralty Court accept email /facsimile transmissions, but only as
prima facie evidence to arrest the vessel.
12. Is
there any additional and special documentation, required in
order to arrest a ship?
R. In
addition to the documentation mentioned in the answer of
question N° 1, no other special documentation is required in
order to request the arrest of a vessel before the Maritime
Court of Panama.
13. Is
there any special procedure or requirement for an arrest of a
ship?
R. In
addition to the requirements and procedures hereinbefore
detailed in this questionnaire, there are no other special
requirements in order to arrest a vessel in the Republic of
Panama.
