Beware of your agent in Turkey

ONE of your vessels is transiting the Bosphorus when the traffic control centre orders it to proceed to anchorage. You know they aren’t joking because in the distance, the bow, not to mention the cannon, of a coast guard boat doing 35 knots is pointing straight at it. What is going on?

Your vessel has been arrested because there is a final court judgement for the payment of a certain sum, for bunkers or supplies or whatever. You keep a good tab of what is going on about you and your ships, but you were not even aware that there was a court proceeding against you, let alone a final judgement and an enforcement action, which cannot be appealed or stayed.

The court judgement is served on the spot and you see that the defendant is named ‘Your Company represented by Your Bosphorus Agent’. You remember that you had ditched ‘Your Bosphorus Agent’ ages ago, or - worse still – that this is the first time you have ever heard of ‘Your Bosphorus Agent’. The claim was served on the agent but the agent did not care or realise what was happening, so never passed the information onto you.

So, how do you go about releasing your ship? Unfortunately, there is only one way to do it, and that is to pay the judgment amount. It is bad enough having to pay a sizeable award at such short notice under pressure, but realising that, had you been able to defend yourself, you would not have had to pay as much is worse, and realising that you may not have had to pay at all is worse still. Maybe the debt was incurred by the previous owners but, because there was no proper defence and appeal, it was classified in the judgment, wrongly, as giving rise to a maritime lien?

The Commercial Code and well-established precedent dictate that an agent is authorised and obliged to accept service of proceedings on behalf of principals, and this authority cannot be altered contractually. The requirement is that the subject of the proceedings must be a transaction enacted or facilitated by the agent on behalf of the principal. If the judgment meets this requirement for service to the agent, your agent is liable for damages you may incur if it has not notified you of the proceedings. If the judgment does not meet this requirement, you may consider re-trial if you think proper defence would have produced a different outcome. Either way, though, you can’t stop or stay enforcement of the judgment.

So beware of your agent. If you are going to cancel an agency contract, it is a good idea to do it in writing, preferably by appointing a Turkish lawyer who can do it for about one hour’s fee through a notary public, to remove any doubt as to who said what to whom and when.