In Rem v In Personam in Maritime Law

by | May 8, 2024

Maritime law, also known as admiralty law, governs legal disputes related to navigable waters. Within this specialized field, two types of claims are predominant: “in rem” and “in personam.” These Latin terms represent different legal actions that can be taken in maritime cases, and understanding their nuances is essential for practitioners in maritime law.

“In rem”

“In rem” claims are directed against a “thing” rather than a person. In the context of maritime law, the “thing” is typically a vessel. An “in rem” action allows a maritime lienholder to enforce their lien against the vessel itself. This kind of claim asserts that the vessel was the instrument of liability and, under maritime law, is considered to possess a legal personality of its own. As such, the vessel can be arrested and sold under a court order to satisfy the lien. This type of action is often used for claims related to salvage operations, maritime liens for repairs, supplies, or crew wages, and mortgage claims.

One of the key features of an “in rem” claim is that it allows the claimant to secure their claim by arresting the vessel, regardless of the owner’s location or solvency. The practical effect of this is that a maritime lien can be enforced even if the vessel changes ownership. The maritime lien is “stuck” to the vessel until it is extinguished, and it provides security to the lienholder that an “in personam” claim might not.

“In personam”

“In personam” claims, on the other hand, are directed against a person or entity. These claims are based on personal liability and require the claimant to demonstrate that the person or entity, such as a shipowner, charterer, or operator, is responsible for the maritime obligation. An “in personam” action is typically brought for breaches of maritime contracts such as charter parties, carriage of goods by sea, and maritime personal injury claims under the Jones Act.

The distinction between the two types of claims is crucial because they determine how a case is pursued and against whom or what enforcement actions can be taken. In “in rem” actions, the vessel itself can be arrested and held by the court as security for the claim, which can be a powerful tool in ensuring payment. In contrast, “in personam” actions often involve traditional legal proceedings against a company or individual, including garnishment or attachment of assets other than the vessel.

The choice between pursuing an “in rem” or “in personam” claim depends on various factors, such as the nature of the claim, the available assets of the responsible party, and the presence of the vessel within the jurisdiction. It’s not uncommon for claimants to file both “in rem” and “in personam” actions simultaneously if the circumstances warrant it.

One of the most significant differences between the two types of claims is their impact on third parties. An “in rem” claim can affect the interests of third parties who may have an ownership stake in the vessel, as the vessel can be sold to satisfy the maritime lien. Therefore, third parties need to be vigilant about the liens that may be attached to a vessel before purchasing or financing it. In contrast, “in personam” claims typically do not impact third parties unless they are directly involved in the personal liability.

The international nature of the shipping industry also plays a role in the application of “in rem” and “in personam” claims. The ability to arrest a vessel in a foreign port can be a powerful mechanism for a claimant to secure their claim, but it also requires an understanding of the international treaties and local laws that govern such actions. Similarly, pursuing an “in personam” claim may involve navigating the complexities of international jurisdiction and the enforcement of judgments.

Both “in rem” and “in personam” claims are fundamental to maritime law and offer different methods of enforcing rights and obligations. “In rem” claims provide a unique mechanism to secure and satisfy maritime liens against a vessel itself, offering a degree of security to maritime claimants. “In personam” claims allow for traditional recourse against individuals or entities responsible for maritime obligations. Understanding the strategic use of these claims, the legal implications, and the practical enforcement challenges is essential for maritime law practitioners. As global trade continues to expand, and the shipping industry evolves, the importance of adeptly navigating “in rem” and “in personam” claims will only increase.

It is essential that you seek counsel from a qualified and experienced maritime law attorney from Sayer, Regan & Thayer. Please contact us to schedule a meeting.

Disclaimer: This blog post is for informational purposes only and should not be construed as legal advice. Please consult with a qualified business law attorney at Sayer, Regan & Thayer for specific guidance on your situation.