ABANDONED VESSEL LAW Preliminary Analysis

1. ABANDONED VESSEL LAW Preliminary Analysis Provided by MA Marine Trades Association Abandoned Vessel Working Group

2. PLEASE NOTE: The Abandoned Vessel Law Working Group has created apreliminary analysis for you to use as a guideline for the vessel removal process. PLEASE NOTE: This analysis cannot substitute for legal advice in individual situations. If you have outstanding concerns, be sure to consult your own counsel to discuss the specific facts of your situation.

3. Chapter 23 of the Acts and Resolves of 2008, amending primarily Chapter 255 of the Massachusetts General Laws Effective May 6, 2008 Streamlines process of removing abandoned vessels from your property by allowing the avoidance of court proceedings If needed, court proceedings remain an option under the new law (may now utilize District or Superior Court) The Abandoned Vessel Law

4. Getting Started Certified Mail Notice: Send to any owner of record, at the last known address, of the 1) amount of the lien and 2) proposed disposition or sale of the vessel. Any Owner of Record: Any and all record owners and lien holders, even if any share common names or addresses. Send separate notices to each owner of record. No Known Owner(s) of Record: May suggest theft. Contact Chief David Barber (617.626.1611) or Captain George Agganis (617.626.1663) at the Office of Marine Titling for a vessel inspection prior to disposition.

5. How Do I Go About This? Lien Holders:Contact the Massachusetts Boat Registration office and, if needed, the National Vessel Documentation Center for lien holder names and last known addresses. Lien holders are vessel “owners” requiring notice. Last Known Address: The official, of-record address with either the state or the Coast Guard, even if this address is different from the one in your own facility records. Tip: To be safe, send Certified Mail notices to all possible addresses you learn of, even if you are sending several copies to the same person.

6. State Registered/Titled Vessel vs. Documented Vessel State Registered/Titled Vessel: There is no need to contact the Coast Guard for “last known address”. Documented Vessel: If there are no known registration numbers, it is wise to contact the Coast Guard; if the vessel is indeed a Documented Vessel, it is necessary to contact the Coast Guard. Tip: Prior to sending any notice you should be aware of whether the vessel is State Registered/Titled or a Documented Vessel.

7. Notice Notice: Considered satisfied per MA Marine Titling Division once certified mail is sent, not necessarily received per relevant case law. What to Include: 1) Amount of lien and 2) proposed disposition or sale. “Disposition” can mean to the nearest landfill; “sale” can mean private sale, public auction, or intent to retain the vessel. Tip: If you are specific in the owners’ notice of exactly how, when and where you will dispose of or sell the vessel, you must stick to this detail or send another notice.

8. Federally Documented Vessels Federal Maritime Law: trumps state law, but if there are no federal issues, state law prevails (46 CFR 67.91). Abstract of Title: Determines if there is any mortgage or lien holder.  Preferred Ships Mortgage/Recent Liens: federal law applies.  No lien holders/lien holders 6+ years old: state law applies.  Tip: If the AV is documented, it’s best to secure title before disposal but if it has sat for 10 years with no signs of ownership and state law has been complied with, you probably would not face fallout from failing to take the next step. No guarantees though! It’s a business decision.

9. Insuring Proper Notice Newspaper Notice: post legal notice of the lien and proposed disposition for 3 consecutive days in a newspaper of general circulation in the city or town of any and all owners of record’s last known address. Note: No need to publish notice in every local paper in their location – just one paper of general circulation in their location will do for each owner. Statewide Papers: The Boston Globe and Boston Herald will be considered “newspapers of general circulation” for all Massachusetts cities and towns (but they charge more than local papers).

10. Insuring Proper & Moving Forward 90 Day Rule: Must be satisfied to move forward. 90 days must pass from the last posting of the legal notice AND you must not have received a reply “indicating an ability to satisfy the debt” within 90 days of the posted notice. Owner Reply: If an owner (lien holder or owner of record) does reply within 90 days asking for more time to pay, you might consider giving him a chance to meet a proposed payment schedule and documenting the promise, rather than continuing right away with the abandoned title procedure. Any potential legal objections in the future are more likely to conclude in your favor if you do have to proceed for non-payment even after a promise to pay.

11. Have You Satisfied All Three Criteria? • Certified Mail Notice: Sent to any and all owners of record, at the last known address of a) lien amount and b) proposed disposition or sale; • Newspaper Notice: Posted for 3 consecutive days in a newspaper of general circulation in the city or town of any owners of record’s last known address indicating the lien and proposed vessel disposition; and • 90 Day Rule: At least 90 days have passed from the last posting of the legal notice AND no indication has been received indicating an ability to satisfy the debt within 90 days of the posted notice.

12. After Three Criteria Satisfied Notarized Affidavit: Required to secure an Abandoned Title Document (see below). It must indicate 1) the 3 criteria above are satisfied; 2) include copies or originals of all related documents, and 3) be filed with the Marine Titling Division. Tip: Note “Attention Chief Barber” on your cover letter and keep your affidavit lean by listing the statute requirements, attesting each one is met, and attaching the required documentation. Abandoned Title Document: Secured following satisfaction of the 3 criteria and the affidavit process. Title is “presumed abandoned” and a document will be issued to you. Tip: Keep evidence that you advised any subsequent purchaser about the history of the vessel.

13. FYIs Proceeds of Sale: inexcess of any liens must be held by the MA Department of Conservation & Recreation in the name of the former owner of record for 2 years, after which time the funds are available to the agency for removing from public waterways vessels presumed abandoned.  Make check out to: Commonwealth of MA, Department of Conservation & Recreation Mark the check: Abandoned Vessel Send the check to: Stephen Scapicchio, Revenue Director Department of Conservation and Recreation 251 Causeway Street, Suit 600 Boston, MA 02114-2104      tel:  617/626-1322

14. FYIs Continued . . . Court Options: The new AV law gives the lien holder more options.  The lien holder may proceed through District Court or Superior Court if desired. Vessel Viewings: Get a signed Liability Release before anyone boards the vessel. Lien Holder Disputes: Seek counsel and avoid navigating the new AV law as your means of allowing you to dispose of or sell the vessel. Auction or As Is Sale: Include express disclaimers and disclosures.