Navigating the USCG Notice of Claim of Lien Process

When a vessel is put up for sale at public auction, the United States Coast Guard will send out a document known as the USCG Notice of Claim of lien to mortgage holders, debt holders, and any other parties with a financial interest in the Vessel.

It is only possible to officially submit the Notice of Claim of Lien after the Vessel has been sold through online bidding and the Buyer has completed an LOI. This document allows the parties to comment on or contest any of the content within the notification before it is submitted on the title at the time of closure.

Additionally, it keeps the parties informed about what has been occurring to the Vessel up until that point. The following article will offer advice on how to proceed with the procedure.

Know Your Rights & Responsibilities

If you’ve ever been on a yacht, you’ve probably seen a USCG Notice of Claim of Liability. Lien notifications like these are placed on USCG-owned vessels, piers, and other properties to alert the public that the Vessel has yet to be fully paid. Although initially puzzling, they are quite straightforward (Once you know what to look for).

The Vessel’s name appears at the top of a Notice of Claim of Lien. This seems obvious, but it can get confusing if numerous vessels have the same name in your port or spot. Now read the upper left corner, where it says “Notice of Claim of Lien” or “Posting Date” in boldface.

Notices “Posting Date” are merely informative; those “Notice of Claim of Lien” are legally binding communications from the US Coast Guard. The notifications with just the publishing date are not lawfully enforceable; only those labeled as “Claims” are real claims against the property.

Understand the USCG Notice of Claim of Lien Process

The United States Coast Guard (USCG) is the government organization responsible for recovering payments due to businesses that have entered into contracts to provide products and services to the federal government.

The US Coast Guard then pays out those funds to their vendors, debtors, and other stakeholders following the legislation. When collecting from a private business rather than the government, a USCG Notice of Claim of lien can be used to put a claim on the company’s assets in exchange for payment of the services or goods provided.

A Certificate of Performance (COP) is a document submitted by a government contractor after the completion of a contract to indicate the government’s level of satisfaction with the contractor’s work. The procedure is simple but has many pitfalls if you plan carefully.

File on Time

A Notice of Claim of Lien is a document filed with the United States Coast Guard (USCG) by a third party that intends to claim ownership over an asset. If a vessel owner fails to pay a supplier, the asset owner may file a USCG Notice of Claim of lien.

This document must be filed within 90 days of the date that payment was due, and it will remain on file until either the lien is released or it is removed by judicial action. A Notice of Claim of Lien can be given to the USCG for recording, but it does not necessarily mean the Vessel will be seized.

However, if the notice is still on record and payment has yet to be received after an additional 90 days, then the USCG will seize the Vessel and put it up for sale with an auctioneer on their behalf.

Prepare For Filing

The procedure of filing a USCG Notice of Claim of lien can be intimidating and difficult to understand for many seafarers. There are many steps involved in this process, such as writing the Notice of Claim of Lien, using it, submitting it to the United States Coast Guard District Office, introducing it to the state in which you reside, following up on the claim after submitting it, and finally resolving the claim.

However, you can make this process much simpler by following a few guidelines and taking a few steps before you submit your notice of claim of attachment. Putting everything in order before you file can save time and make this process less stressful.

There’s no denying that the permitting process can be complicated. The best way to ensure you’re prepared is by contacting us at the Commercial Fishing Permits Center. We’ll happily answer any of your questions and address your concerns.