Enforcement of Ship Mortgage

Jaya Prakash

Ex. Sr. Partner

Messrs Khattar Wong & Partners, Advocates & Solicitors, Singapore

March 21, 2003

MORTGAGE OF SHIP OR SHARE

(1) A registered ship or a share therein may be made a security fora loan or other valuable consideration, and the instrumentcreating the security (in this Act called a mortgage) shall be inthe prescribed form or as near thereto as circumstances permit,and on the production of such instrument the registrar of theship’s port of registry shall record it in the register book.

(2)Mortgages shall be recorded by the registrar in the order intime in which they are produced to him for that purpose, andthe Registrar shall, by memorandum under his hand, notify oneach mortgage that it has been recorded by him stating the dayand hour of that record.

Section 29 of the Singapore Merchant Shipping Act

MORTGAGEE NOT DEEMED TO BE OWNERMORTGAGEE NOT DEEMED TO BE OWNER

Except as may be necessary for making a mortgaged

ship or any share therein available as a security for the

mortgage debt, the mortgagee shall not, by reason of the

mortgage, be deemed to be the owner of the ship or

share, nor shall the mortgagor be deemed to have ceased

to be the owner thereof.

Section 50 of the Indian Merchant Shipping Act

MORTGAGEE NOT DEEMED TO BE OWNER

Except insofar as may be necessary for making a mortgaged ship

or share available as a security for the mortgage debt, the

mortgagee shall not, by reason of his mortgage, be deemed to be

the owner of the ship or share, nor shall the mortgagor be deemed

to have ceased to be owner thereof.

Vangat Ramayah – Ship Finance(Singapore & Malaysia)

In other words, it must not be assumed that themortgagee has all the rights that the mortgagor has overhis ship. The mortgagee only has such rights as arenecessary to make the ship available as security. Thecorollary to this is that a mortgagee may not interferewith the rights of the owner other than for he purposesof the preservation and enforcement of the mortgagee’ssecurity interest in the ship.

• As long therefore as the dealings of the mortgagor with the shipare consistent with the sufficiency of the mortgagee’s security, solong as those dealings do not materially prejudice and detract fromor impair the sufficiency of the security comprised in themortgage, so long is there parliamentary authority given to themortgagor to act in all respects as owner of the vessel, and if hehas authority to act as owner he has of necessity authority to enterinto all those contracts touching the disposition of the ship whichmay be necessary for him to get the full value and benefit of hisproperty. [Per Lord Westbury LC in Collins v. Lamport (1864) 4De GJ & S 500]

• … the mortgagor remains the dominus of the ship with regard toeverything connected with its employment until the momentarrives when the mortgagee takes possession. [Keith v. Burrows(1878) 2 App. Cases at page 655].

• It therefore follows that unless the collateral deed gives the

mortgagee specific rights to interfere in the operation or

management of the ship, the mortgagee has no inherent right to

interfere unless his security is being impaired. Even if the

collateral deed does confer such right, and even if the security is

being impaired, a further question may arise as to whether the

mortgagee can ignore any charterparty of the ship or otherwise

interfere with the employment of the ship by the charterer (who is

a stranger to the collateral deed). [Ship Finance (Singapore &

Malaysia) by Vangat Ramayah at page 68]

Section 51 of the Indian Merchant Shipping ActRIGHTS OF MORTGAGEE

(1)Where there is only one registered mortgagee of a ship or share, he shallbe entitled to recover the amount due under the mortgage by selling themortgaged ship or share without approaching the High Court :

Provided that nothing contained in this sub-section shall prevent themortgagee from recovering the amount so due in the High Courtas provided in sub-section (2).

(2)Where there are two or more registered mortgagees of a ship or sharethey shall be entitled to recover the amount due under the mortgage inthe High Court, and when passing a decree or thereafter the High Courtmay direct that the mortgaged ship or share be sold in execution of thedecree.

(3)Every registered mortgagee of a ship or share who intends to recover theamount due under the mortgage by selling the mortgaged ship or shareunder sub-section (1) shall give an advance notice of fifteen days relatingto such sale to the registrar of the ship’s port of registry.

(4)The notice under sub-section (3) shall be accompanied with the proof ofpayment of the wages and other amounts referred to in clause (a) of sub-section (2-A) of section 42.

Section 51 of the Indian Merchant Shipping Act[prior to 1993]

Rights of Mortgagee :

(1)A registered mortgagee of a ship or share shall be entitled torecover the amount due under the mortgage in the High Court,and when passing a decree or thereafter the High Court maydirect that the mortgaged ship or share be sold in execution ofthe decree.

(2)Subject to the provisions of sub-section (1), no such mortgageeshall merely by virtue of the mortgage be entitled to sell orotherwise dispose of the mortgaged ship or share.

EVENTS OF DEFAULT

• There shall be an Event of Default:

(a)Non-payment : if the Borrower fails to pay any sum due or payableunder this Agreement, in the currency and in the manner specifiedherein on its due date; or

(b)Breach of Other Obligations : if the Borrower or the Guarantorcommits or threatens to commit a breach of any of the covenants,undertakings, stipulations, terms and conditions or provisionscontained in this Agreement and/or the Securities and on its part to becomplied with; or

(c)Breach of Warranty : if any representation or warranty made by theBorrower in this Agreement or by the Borrower and/or the Guarantorin any other documents called for by this Agreement or the Securitiesor any certificate or statement delivered or made hereunder orthereunder shall be or become incorrect or untrue in any materialrespect at the time it was made or repeated or deemed to have beenmade or repeated; or

(d)Cross Default : if any other indebtedness of the Borrower and/or ofthe Guarantor for borrowed money (to whomsoever owing) or partthereof is not paid at its stated maturity or on its due date (as may beextended by any grace period) or by reason of any default or theoccurrence of any event becomes due or is declared due prior to itsstated maturity or original due date or if the Borrower and/or theGuarantor fails to discharge any guarantee or indemnity given by itwith respect to any indebtedness; or

(e)Adverse Effect of Other Agreements : if an event has occurredwhich constitutes a default on the part of the Borrower or theGuarantor with respect to its payment obligations under or in respectof any other agreement or document to which the Borrower or theGuarantor as the case may be is a party or by which it may be boundor an event has occurred which, with the giving of notice, lapse oftime, determination of materiality or other condition might constitute adefault on the part of the Borrower or the Guarantor as the case maybe with respect to its payment obligations under or in respect of anysuch agreement or document; or

EVENTS OF DEFAULT contd...

(f) Insolvency : if the Borrower or the Guarantor becomes insolvent, isunable to pay its debts as they fall due, stops, suspends, or threatens tostop or suspend payment of all or a material part of its debts, orproposes or makes a general assignment or an arrangement orcomposition with or for the benefit of its creditors for any monieswhatsoever; or

(g) Judicial Management and Dissolution : if any competent order ismade or step or petition is taken by any person for the dissolution orwinding-up of the Borrower or of the Guarantor or for theappointment of a liquidator, receiver, administrator, trustee, judicialmanager or other similar officer of the Borrower or of the Guarantorover their respective assets and undertakings or part thereof; or

(h)Cessation of Business : if the Borrower, or the Guarantor shall ceaseor threaten to cease to carry on its business whether voluntarily orinvoluntarily; or

EVENTS OF DEFAULT contd...

(i) Enforcement Proceedings against Borrower : if a distress, anexecution or writ of seizure and sale or attachment is levied upon orissued against any of the property or assets of the Borrower or of theGuarantor;

(j) Nationalisation : if any agency of any state seizes, compulsorilyacquires, expropriates or nationalises all or a material part of theassets, properties or shares of the Borrower or of the Guarantor; or

(k)Unlawful Performance : if it is or will become unlawful for theBorrower and/or the Guarantor to perform or comply with any one ormore of its obligations under this Agreement and/or the Securities,PROVIDED THAT it shall not be an Event of Default hereunder ifthe Borrower immediately pays the Indebtedness to the Lender; or

EVENTS OF DEFAULT contd...

(l) Authorisation and Consent : if any action, condition or thing at anytime required to be taken, fulfilled or done for any of the purposes ofthis Agreement and/or the Securities is not taken, fulfilled or done orany such consent ceases to be in full force and effect withoutmodification or any condition in or relating to any such consent is notcomplied with; or

(m)Material Adverse Change : if there shall occur a material adversechange in the financial position of the Borrower or if any situationshall have arisen which in the reasonable opinion of the Lender shallmake it improbable that the Borrower or the Guarantor will be able toperform its obligations under this Agreement and/or the Securities asto case may be; or

(n)Securities : if any of the Securities is terminated or extinguished orotherwise ceases to remain in full force and effect; or

EVENTS OF DEFAULT contd...

(o)Business in Jeopardy : if in the reasonable opinion of the Lender thebusiness of the Borrower or of the Guarantor is in jeopardy and noticethereof has been given by the Lender to the Borrower; or

(p)Arrest of Vessel : if the Vessel is arrested or otherwise detained; or

(q)Breach under the Charter : if there shall be a breach of any Charterby either the Borrower or the charterer or if either party shallterminate or repudiate the Charter or declare it to be frustrated; or

(r)Breach of obligations : if in the opinion of the Lender the Borrowerand/or the Guarantor is or may be unable to perform their respectiveobligations hereunder or under any of the Securities, and noticethereof has been given to the Borrower and/or the Guarantor (as thecase may be).

EVENTS OF DEFAULT contd...

EVENTS OF DEFAULT

Upon the happening of any of the following events (herein called“Events of Default”) the Outstanding Indebtedness and allamounts secured by this security shall, immediately become dueand payable to the Lender on demand :

(a)subject as provided below, if the Company defaults or threatens todefault in the due performance and/or observance of any term orcondition hereof;

(b)if the Security Ship becomes a Total Loss : PROVIDED THAT itshall not be an Event of Default hereunder if the Security Ship hasbeen insured in accordance with the provisions of Clause 7 hereofand the proceeds of the Insurances shall have been recovered bythe Lender and applied in accordance with Clause 12 in completesatisfaction of the Outstanding Indebtedness within one hundredand twenty (120) days of the occurrence of the event giving rise tothe Total Loss;

EVENTS OF DEFAULT contd..

(c)if the Security Ship be arrested or otherwise detained for a periodexceeding thirty (30) days;

(d)if anything is done or knowingly suffered or omitted to be done bythe Company or the Master (if any) or any charterer or any sub-charterer (if any) or Manager for the time being of the Security Shipwhich in the opinion of the Lender has imperilled or is likely toimperil the security hereby created; or

(e)if an Event of Default (as defined therein) under the LoanAgreement shall occur.

Farrar v Farrar (1888) 40 ChD 395 and Kennedy v De Trafford (1896)1 Ch 762A mortgagee exercising a power of sale is not a trustee of the power. The powerarises by contract with the mortgagor, and forms part of the mortgagee’s security.He is bound to sell fairly, and to take reasonable steps to obtain a proper price; buthe may proceed to a forced sale for the purpose of paying the mortgage debt. Inmost cases (as in that before me) he is required by the terms of the power to givenotice to the mortgagor, and to allow a certain time to elapse before he can dulyproceed to a sale. In the present case a six months’ notice was required. This termof the contract gives to the mortgagor what the parties consider to be a reasonabletime to do his best to stop a sale by the mortgagee, which he may do by redeemingor by finding a transferee or a purchaser of his own. The mortgagor has no rightafter the power has arisen to insist that the mortgagee shall wait for better timesbefore selling. This observation applies in full force where the mortgaged propertyis of a speculative character, and is not producing any income. The mortgagee has aright to obtain payment of his debt through the exercise of his power when it hasarisen, without regard to the then existing condition in the market. He cannot berequired to run any risk in postponing the sale, or to speculate for the mortgagor’sbenefit.

Chitty J’s judgment was affirmed on appeal. Lindley LJ said, at page 411 :-But every mortgage confers against the mortgagee the right to realize his securityand to find a purchaser if he can, and if in exercise of his power he acts bona fideand takes reasonable precautions to obtain a proper price, the mortgagor has noredress, even although more might have been obtained for the property if the salehas been postponed : Cholmondeley v Clinton; Warner v. Jacob

Cuckmere Brick Co Ltd v Mutual Finance Ltd (1971) Ch 949 at 965It is well settled that a mortgagee is not a trustee of the power of salefor the mortgagor. Once the power has accrued, the mortgagee isentitled to exercise it for his own purposes whenever he chooses to doso. It matters not that the moment may be unpropitious and that bywaiting a higher price could be obtained. He has the right to realisehis security by turning it into money when he likes. Nor, in my view,is there anything to prevent a mortgagee from accepting the best bidhe can get from an auction, even though the auction is badly attendedand the bidding exceptionally low. Providing none of those adversefactors is due to any fault of the mortgagee, he can do as he likes.A little further on in his judgment, at pages 968 Salmon LJ said this :I accordingly conclude, both on principle and authority, that amortgagee in exercising his power of sale does owe a duty to takereasonable precautions to obtain the true market value of the mortgageto property at the date on which he decides to sell it.

per Nigel Teare QC in Den Norske Bank ASA v Acemex ManagementCompany Limited (2003) EWHC 326 (para 30)

So long as the mortgagee acts in good faith for the purpose of obtainingrepayment of the loan, he can arrest the vessel notwithstanding thatsuch action might harm the interests of mortgagor or surety

Section 190 of the Singapore Merchant Shipping Act

LIABILITY OF BENEFICIAL OWNERS

(1)Where any person has a beneficial interest in any ship or anyshare therein registered in the name of some other person asowner, the person so interested shall, as well as the registeredowner of the ship, be subject to all pecuniary penalties by this Actor any other written law on the owner of the ship or the sharestherein and proceedings may be taken for the enforcement of anysuch penalty against both or either of the aforesaid parties, withor without joining them.

(2)For the purposes of this section, a person who has an interest inany ship or any share therein by way of mortgage, charge or lien,shall not be deemed to have a beneficial interest in the ship unlesshe is in possession of the ship.

Section 71 of the Indian Merchant Shipping Act

LIABILITY OF OWNERS

Where any person is beneficially interested otherwise than by wayof mortgage in any ship or share in a ship registered in the nameof some other person as owner, the person so interested shall, aswell as the registered owner, be subject to all the pecuniarypenalties imposed by this or any other Act on the owners of shipsor shares therein, so nevertheless that proceedings for theenforcement of any such penalties may be taken against both oreither of the said parties with or without joining the other ofthem.

Fisher & Lightwood, Law of Mortgage 11th edition

MORTGAGOR RESPONSIBLE FOR LIABILITIES OF SHIP

PRIOR TO MORTGAGEE TAKING POSSESSION

Where a ship or share is subject to a registered mortgage then :

(a) except so far as may be necessary for making the ship orshare available as a security for the mortgage debt, themortgagee shall not by reason of the mortgage be treated asowner of the ship or share; and

(b)the mortgagor shall be treated as not having ceased to beowner of the ship or share. Thus although, as between theparties to the mortgage, the property in the ship has passedto the mortgagee, the mortgagor remains responsible for herliabilities and for all matters connected with her usage. Thisprovision is for the protection of the mortgagee.

Fisher & Lightwood, Law of Mortgage 11th edition

MORTGAGEE’S LIABILITIES

On taking possession, the mortgagee becomes liable for expenses

arising from the future use of the ship. He will also be liable to

perform contractual obligations incurred by the mortgagor prior

to the mortgagee, of which he had notice, if they relate to the

future, do not injure the security and are the kind of obligations

incurred by a person with apparent ownership and control of a

ship. A shipwright is entitled to enforce his possessor lien against

the mortgagee for such repairs as are made at the mortgagee’s

direction when in possession.

“The Ruta” [2000] 1 LLR 359 at 364

GENERAL PRINCIPLE ON PRIORITIES

Accurately summarized in Thomas, Maritime Liens BSL Vol

14 at paragraph 418 : The Admiralty and Appellate Courts

have adopted a broad discretionary approach with rival

claims ranked by consideration of equity public policy and

commercial expediency, with the ultimate aim of doing that

which is just in the circumstances of each case.

The Halcyon Isle [1980] 2 Lloyd’s Rep 325 at page 329

POSITION OF FOREIGN MORTGAGES

In view of the reference to be made to The Colorado it is alsorelevant to note that for the purpose of priority of ranking inter semortgages fall into two classes :

(1)British registered mortgages (which can only be upon Britishships)

(2) other mortgages, British or foreign (which can be upon eitherBritish or foreign ships)

THOMAS on MARITIME LIENS

“Foreign mortgages are governed by the lax fori for the purpose

of determining priority and probably rank to the same effect as

an unregistered English mortgage.”

Section 28 of the MSA

PRIORITY OF LEGAL MORTGAGES

If there are more mortgages than registered in respect of the same

ship or share, the mortgages shall, notwithstanding any express,

implied or constructive notice, be entitled in priority one over the

other, according to the date and time of the record of each

mortgage in the register and not according to the date of each

mortgage itself.

Section 49 of Indian Merchant Shipping Act

If there are more mortgages than one recorded in respect of the

same ship or share, the mortgagees shall, notwithstanding any

express, implied or constructive notice, have priority according to

the date on which each mortgage is recorded in the register book

and not according to the date of each mortgage itself.

Section 47(2) of the Indian Merchant Shipping Act

Mortgages shall be recorded by the Registrar in the order in time

in which they are produced to him for that purpose, and the

registrar shall, by memorandum under his hand, notify on each

mortgage that it has been recorded by him stating the day and

hour of that record

Black vs Williams (1895) 1 Ch 408 at 421

I hold therefore, that the title of the Applicants, who have got amortgage in the statutory form which has been registered, is to bepreferred to the title of the debenture-holders, who, having a priorequitable title, and being entitled to get that converted into a legal titlein the statutory form and registered, chose not to do so. There is nohardship whatever in the decision. The Act of Parliament was passedfor the benefit of commerce, and in order that English ships might beeasily dealt with by English shipowners. The Legislature hasrecognised that occasions arise when it is to the benefit of the wholecommunity that people should be able to raise money on ships by saleor mortgage, and in the interests of the general public it has thereforeprovided that registered titles in the statutory form shall have priority,thus enabling those who are disposed to purchase or lend money uponships to do so with perfect confidence that their titles will not beoverridden by priority being obtained by equitable unregistered titleswhich happen to be prior in point of time, and which, for reasons totheir own, the owners of those equitable title have not thought fit toconvert into the legal form, or to register in the way pointed out by thestatute.

Summary

ØStatutory bodies

ØSheriff’s expenses

ØArresting parties costs

ØDamage claim [all subsequent and prior damage claims are treated asranking pari passu]

– The priority of the damage lien over subsequent wages is mostcertain where the damage lienee has only the action in rem as afeasible remedy and the wages claimant is secure in an alternativeform of remedy in personam against the shipowner. Thus wheredamage and wages compete against a foreign registered shipowned by a solvent person or company, the damage lien prevailsover the wages lien. Where this precise situation does not prevail,as where … the owner is insolvent … it may be the case that thewages assume a more substantial claim and even, possibly, priorityover the earlier damage lien [Thomas 14th edition]

Summary contd...

Ø Salvage claim [competing salvage liens are ranked in accordance withthe principle in the “inverse priority rule” i.e. the last salvage lien intime prevails over earlier salvage liens]– The salvage lien is subordinate to a later wages lien, but only

where the wages lien has actually preserved the res and thereforemay be considered as a quasi-salvage lien [Thomas 14thedition]† Damage and Salvage claims are usually insurable.Many categories of claims arising consequent to a third partyliability and enforced by a statutory lien are insurable.

Ø Crew wage claim [as a general rule : individual liens of seamen rankpari passu]

Ø Statutory claims secured by the issue of a writ in rem before the dateof the mortgage [consider impact if any of “The Fierbienti” 1994 3SLR 864]

Ø Legal mortgage [registered mortgages rank inter se in the order oftheir registration and not in the order of their creation]

Summary contd...

Ø Equitable mortgageØ NecessariesØ Execution creditorsØ Possessory liens : 1.Subordinate to all maritime liens which attach

prior to assumption of possession

2.superior to all maritime liens which accrue subsequent to assumption of possession

3.superior to mortgage, even a mortgage executed before assumption of possession

4.vis-à-vis statutory liens : not clear : possibly the case that possessory lien is subordinate to a pre- existing statutory lien

GENERAL PRINCIPLE ON INTEREFERENCE : re charterparties

• per Browne-Wilkinson J in Swiss Bank Corp. v Lloyds Bank (1859)28 LJ498

• Therefore in my judgment the authorities establish the followingpropositions.

(i) The principle stated by Bruce LJ in De Mattos v Gibson is good lawand represents the counterpart in equity of the tort of knowinginterference with contractual rights.

(ii)A person proposing to deal with property in such a way as to cause abreach of a contract affecting that Property will be restrained byinjunction from so doing if when he acquired that property he hadactual knowledge of that contract.

(iii) A plaintiff is entitled to such an injunction even if he has noproprietary interest in the property : his right to have his contractperformed is a sufficient interest.

(iv)There is no case in which such an injunction has been granted againsta defendant who acquired the property with only constructive, asopposed to actual, notice of the contract. In my judgment constructivenotice is not sufficient, since knowledge of the contract is a requisiteelement in the tort.

Fisher & Lightwood, Law of Mortgage 11th editionRIGHT OF MORTGAGOR OF SHIP TO RETAIN POSSESSION

In the absence of an agreement to the contrary, the mortgagor of aship is entitled to retain possession until the debt is payable, unless theship is being dealt with in such a manner as to impair the security.While the mortgagor is allowed by the mortgagee to retain possession,he has full liberty to deal with the ship, so far as he does soconsistently with the sufficiency of the security. The mortgagor isentitled to enter into such contracts as are consistent with the fullrights and benefit of ownership and by which he can earn the meansof discharging the mortgage debt. The mortgagee can only interferewith such a contract if he can show that it will materially prejudice hissecurity. Thus, where a charter has been taken of a ship from themortgagor, and the mortgagee is not in possession, the mortgagee isnot entitled to interfere with the execution of the charterparty, unless itcan be shown to impair the security, in which case he will not bebound by it. For so long as the mortgagee does not interfere, he willbe held to have acquiesced in all proper engagements for a ship’s usewhich have been made by the mortgagor. The mortgagor may do allthat is proper to keep the ship in an effective condition, so that theship may also be a source of profit to the mortgagee himself when hetakes possession. In contracts for repair, the mortgagor in possessiondoes not have authority to pledge the mortgagee’s credit by reason ofthe relationship of mortgagor and the mortgagee.

• per Willis J in Johnson vs Royal Mail Steam Packet Company(1867) LR 3 CP 38 at page 42

• …. the case of a mortgagee and mortgagor of a ship appears to beone of quite a different complexion, because the mortgagee, so longas he does not interfere and claim the possession, may fairly betaken to have allowed the mortgagor to enter into all engagementsfor the employment of the ship of the sort usually entered into by aperson who has apparent control and ownership of a vessel.

The Fanchon [1880] 5 PD 173 at page 176

Therefore the proposition of law governing the case is that the

mortgagor has full power to deal with the ship, provided he does

not materially impair the value of the mortgagee’s security. I take

it that it lies on the mortgagee to satisfy the Court that this

charterparty would materially prejudice his security; and I am

not satisfied on reviewing the evidence that he has discharged this

burden of proof. I think that he has failed to shew that the

carrying the charterparty into effect would impair his security.

SECTION 43(2) OF THE SINGAPOREMERCHANT SHIPPING ACT

The Authority may close the register of Singapore ship (except inrelation to any unsatisfied mortgages entered therein) and cancelits certificate of registry if the Authority is satisfied that it is not inthe public interest for the ship to continue to be registered as aSingapore ship

SECTION 43(2) OF THE SINGAPOREMERCHANT SHIPPING ACT

The Authority may close the register of Singapore ship (except inrelation to any unsatisfied mortgages entered therein) and cancelits certificate of registry if the Authority is satisfied that it is not inthe public interest for the ship to continue to be registered as aSingapore ship

SECTION 46 OF THE INDIAN MERCHANTSHIPPING ACT

Where any Court, whether under section 45 or otherwise, ordersthe sale of any ship or share therein, the order of the Court shallcontain a declaration vesting in some person named by the Courtthe right to transfer that ship or share, and that person shallthereupon be entitled to transfer the ship or share in the samemanner and to the same extent as if he were the registered ownerthereof, and every registrar shall obey the requisition of theperson so named in respect of any such transfer to the sameextent as if such person were the registered owner

SECTION 39 OF THE INDIAN MERCHANTSHIPPING ACT

(1)In the event of a registered ship being either actually orconstructively lost, taken by the enemy, burnt or broken up orceasing for any reason to be an Indian ship, every owner of theship or any share in the ship immediately on obtaining knowledgeof the event, if no notice thereof has already been given to theregistrar, give notice thereof to the registrar at her port of registryand that registrar shall make an entry thereof in the register bookand its registry in that book shall be considered as closed expect sofar as relates to any unsatisfied mortgages entered therein.

(2)In any such case, except where the ship’s certificate of registry ismislaid, lost or destroyed, the master of the ship shall, immediatelyif the event occurs in any port in India, or within ten days after hisarrival in port if it occurs elsewhere, deliver the certificate to theregistrar of the port or any other officer specified in this behalf bythe Central Government if the port of arrival is in India, or if thearrival is in any port outside India to the Indian consular officerthere, and the registrar, if he is not himself the registrar of her portof registry or the officer so specified or the Indian consular officer,as the case may be, shall forthwith forward the certificate deliveredto him to the registrar of her port of registry.

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