Abstract of Title: A record kept by the Coast Guard at the National Vessel Documentation Center that summarizes the history of a vessel while documented includes all ownership, conveyances, interest, liens, and encumbrances that affect title.
Admeasurement: The manner the Coast Guard implements for calculating a vessel’s dimensions in order to determine its net weight by volume using a displacement method. It determines whether a vessel meets the five net ton requirement for documentation eligibility.
Admiralty Law: Authority granted by the Constitution to the federal court when it exercises jurisdiction over all maritime contracts, torts, injuries or offenses regulations that covers maritime activities.
Association (AVDA): A trade association compiled of professional documentation companies from across the United States.
Attorney-in-Fact: One who is designated to transact business and act as legal agent for another. The scope of authority may be broad or limited as described in the “power-of-attorney,” the instrument executed to define the agent’s right to act for the principal.
Bareboat Charter: A charter in which the vessel owner surrenders possession and control of the vessel to the charterer. Bareboat charter usage is generally considered recreational use by the Coast Guard and does not require a commercial endorsement. A bareboat charter is similar in nature to renting a car, as opposed to renting a limousine.
Bill of Sale: An instrument used to convey title to a vessel, executed by a seller to transfer ownership to a buyer. To meet Coast Guard requirements it must uniquely identify the vessel; state the consideration paid; properly identify the sellers and interest owned; name the buyers and interest transferred; and be notarized.
Broker: A party who arranges the sale between a buyer and seller of a vessel and receives a form of compensation.
Certificate: A certificate used as the initial title document and to provide build evidence. It is issued by the manufacturer or builder and references the vessel by a unique hull identification number; identifies the first owner; verifies the origin of the vessel parts; verifies the place the vessel was built; and lists the vessel specifications. To be used as build evidence by the Coast Guard it must contain these elements and be completed on the accepted form.
Certificate: A certificate issued by a manufacturer describing a vessel. The certificate lists the year, make, hull identification number (HIN) and shows the history of the vessel from the builder through at least the first transfer of ownership.
Documentation: The form issued by the Coast Guard to evidence completion of the requirements for documentation. It is an internationally accepted proof of ownership of the vessel and lists the vessel trade endorsements for commercial usages.
Ownership: The form issued the Coast Guard that verifies the current Coast Guard owner of record and any active liens against the vessel. Unlike the abstract of title, it lists only the current owner and current active liens, rather than a complete owners & lien history.
Closing Agent: A third-party that coordinates the closing of the vessel purchase. Typically, this includes researching the existing title; preparing the transfer and new ownership forms; securing lender’s interest; collecting and disbursing all funds; paying off existing recorded liens; and filing the new titling documents.
Endorsement: An authorization from the Coast Guard, notated on the Certificate of Documentation, allowing a vessel to engage in the commerce, or the transporting of goods or passengers, among different coastal ports or navigable waters of the United States.
Agreement: Arrangement between a listing broker and a selling broker to cooperate in the selling of a vessel which includes a split of the sales commission.
Fishing: Operating under a currently valid commercial or charter fishing licensing, with the appropriate Coast Guard endorsement, if required.
Vessel: A vessel that is used in a commercial manner for carrying goods and/or passengers or for commercial fishing. If the vessel is five net tons, it must qualify with the Coast Guard for this usage and the Certificate of Documentation must show the appropriate endorsement.
Dealer: A person or entity that sells vessels at wholesale or retail.
Value Form: A form used in some states when a vessel is acquired by lease, gift or brought into the state subsequent to purchase to declare the value of the vessel for the purpose of assessing state taxes.
Deed of Gift: An instrument used to transfer ownership of property from one entity to another without any consideration.
Dinghy: A secondary vessel used to carry passengers or goods from the main vessel to shore. Typically carried onboard the main vessel.
Number: A six to seven digit number given by the Coast Guard upon initial application for documentation. Remains with the vessel through subsequent owners or manner of title. Must be marked on the interior hull. Also called Official Number or Coast Guard Number.
Documentation: The description used for the issuance of a Certificate of Documentation and the maintenance of the ownership records by the U.S. Coast Guard for eligible vessels.
Company: A company that assists in obtaining Coast Guard documentation for a vessel. Typically researches the existing title to a vessel, prepares the transfer documents; prepares the Coast Guard forms and files all items required to obtain a Certificate of Documentation.
Encumbrance: A recorded or unrecorded claim or liability against a vessel.
Excise Tax: Assessment on the value of a vessel that is typically paid yearly to obtain authorization for use of the vessel on a state’s waters.
Endorsement: An authorization from the Coast Guard, notated on the Certificate of Documentation, allowing a vessel to engage in commercial fishing.
Fleet Mortgage: A preferred marine mortgage that covers more than one vessel as collateral against a security agreement. Each vessel may be discharged separately.
Foreclosure: The legal proceeding to terminate a mortgagor’s interest in a vessel which is instituted by a lender to either gain title or force a sale in order to satisfy the unpaid debt secured by the vessel.
Foreign Flag: The term used when describing a vessel that is registered with a foreign government, the equivalent to our Coast Guard Documentation.
Hailing Port: The city and state that a vessel owner declares as a vessel’s hailing port, to be marked on the vessel’s exterior hull and referenced on the Coast Guard records.
Home Port: Archaic term, often confused with a vessel’s “hailing port.” It was previously used to designate the Coast Guard port where a vessel was registered.
Number (HIN): The number, unique in nature, assigned to a vessel by the manufacturer and marked on the vessel’s hull. It typically contains the MIC (Manufacturer’s Identification Code) assigned by the Coast Guard, the length, the internal hull number, the month, year and model year.
Joint Tenants: A manner of ownership with two or more co-owners who take identical interest in the vessel simultaneously and with the same right of possession. Each tenant has a right of survivorship to the others’ share. (Some states require that this right be clearly expressed in the conveyance or title document; as in Joint Tenants with Right of Survivorship).
Legal Owner: The party recognized by law as the owner of the vessel. It may be one holding a secured interest in a vessel and referenced as either legal owner or lienholder on a vessel title. When there is no secured lien against the vessel the “registered” and “legal” owner are one and the same.
Lien: A legal right, interest or claim, either secured or unsecured, against a vessel.
Lifeboat: A craft used exclusively for lifesaving purposes.
Liability Company: A company, whose requirements and acceptability are statutory in nature, that is defined by limited liability to its owners and direct management by its members or managers appointed by its members
Listing Agreement: A contract entered into by the owner of a vessel and a vessel broker that authorizes the broker to offer the vessel for sale in either an exclusive or non-exclusive manner.
LLC: See Limited Liability Company.
Origin (MSO): A statement issued by the manufacturer of a vessel that acts as the original title document. It typically contains the vessel’s dimensions and lists the first owner of record.
Maritime Lien: A lien on a vessel granted to secure a creditor’s claim for maritime services provided to a vessel or to one who suffered an injury from the usage of the vessel. Its right, under admiralty law, to hold a claim against a vessel as a legal entity.
Markings: The Coast Guard requirements to have the vessel name, hailing port and official number “marked” on the vessel.
Bill of Sale: The bill of sale used when a vessel is foreclosed in a federal.maritime court. It is executed by a federal marshall in compliance with a federal court order to sell the vessel at auction.
Certificate: A form used previously as an original title document. It has been replaced by Builder’s Certificate, on the form required by the Coast Guard.
Amendment: A form used to change or alter the terms and/or conditions of a preferred marine mortgage.
Assignment: A form used to transfer the rights of a preferred marine mortgage to a new mortgagee upon the agreement of the mortgagor, previous and new mortgagee.
Mortgagee: The party that is granted, by a vessel owner, a secured interest and certain rights in a vessel as described in the preferred marine mortgage.
Mortgagor: The vessel owner that grants a secured interest and certain rights in a vessel as described in the preferred marine mortgage.
Center: The facility that administers vessel documentation on behalf of the U.S. Coast Guard.
Foreclosure: The process used to recover collateral by statutory authority rather than court action.
Notice of Claim
Of Lien: Typically, an unsecured claim filed with the Coast Guard against a documented vessel.
Paperless Title: Typically used when a legal owner is different from the registered owner. The legal owner is shown on the computer records only and no actual title is issued. When the lien is satisfied, the legal owner merely needs to notify the appropriate state agency to remove the lien from the records.
Perfected Interest: A loan is perfected when the security interest in the vessel is recorded with the appropriate state or federal recording agency.
Register (PPR): The register used in Canada to show a claim against personal property. Used on vessels that are not flagged under the Canadian Registry.
Tax: A tax placed on personal property by state/county/city that is typically levied annually. Rate is typically based on the value of the vessel.
(Recreational): A vessel used solely for non-commercial, pleasure endeavors.
Power of Attorney: An instrument executed to authorize an agent to act for the principal in certain named activities.
Mortgage: A written instrument executed by the owners of a documented vessel to grant a priority security interest to the mortgagee. When filed and recorded by the U.S. Coast Guard it gains “preferred” status in the hierarchal order of maritime liens.
Provincial License: The form of licensing pleasure craft in Canada when the vessel is not flagged by Canadian Registry. This is a simplified license and is not absolute proof of ownership.
Endorsement: The endorsement shown on the U.S. Coast Guard’s Certificate of Documentation showing that the vessel is eligible for recreational or pleasure use only.
Registered Owner: The party listed on a state title or registration as holding possessory ownership of a vessel. The registered and legal owner are one and the same when there is no lien against the vessel. In non-title states, the registered owner merely shows the party to whom the vessel is licensed and is not absolute proof of ownership.
Endorsement: The endorsement shown on the U.S. Coast Guard’s Certificate of Documentation that authorizes the vessel to carry goods or passengers from U.S. port to a foreign port.
Release of Interest: A form signed by an entity holding an interest in a vessel that releases that interest.
Repossession: The act of recovering collateral covered by a security interest that is in default.
Sales Tax: A tax imposed by a state on the retail sale of a vessel. The rate is usually based upon the actual sales price of the vessel.
SAMS: “Society of Accredited Marine Surveyors.” A national organization of professional marine surveyors. Most lender will require that any surveyor used to determine a vessel’s value belong to either SAMS or NAMS.
Mortgage: The form used to reflect the payoff of a lien against a vessel that was secured by a preferred mortgage.
Ships Mortgage Act: 1920 federal legislation that allows marine lenders to acquire a priority security interest in a documented vessel through a preferred marine mortgage.
Six-Pack: A term used when carrying six passengers or less for hire in a commercial vessel activity.
Skippered Charter: A term used to describe a charter arrangement in which the vessel is rented with the owner acting as skipper or captain. A coastwise endorsement is needed to provide a skipper charter.
State Registration: A form of licensing a vessel for principal use on a state’s waters that is typically issued annually upon receipt of any appropriate taxes or fees.
Number: A number given by the appropriate state agency to all vessels registered for use on the state’s waters. It is unique in nature and must be affixed to the exterior hull of the vessel, unless the vessel is documented with the U.S. Coast Guard. In that case, the number is used strictly to track ownership and payment of taxes and fees.
Survey: A marine surveyor inspection to determine the condition of a vessel and define its value.
Tax Lien: A claim against a vessel by a state agency for uncollected taxes.
Tenants by the
Entirety: A manner of ownership limited to married couples in which each partner owns an equal share of the vessel but neither may sell or give away an interest without the other’s permission. Upon the death of one spouse, their share automatically passes to the surviving spouse.
Tenants in Common: A manner of ownership for two or more persons in which, upon the death of an owner, that owner’s share passes to his heir or estate, not to the co-owners. Any transaction regarding the vessel requires all owners written permission.
Tender: A craft used exclusively to furnish transportation from a larger vessel to shore and back.
Title: A certificate issued by a state agency to evidence ownership of a vessel. Should not be issued on documented vessels, as they already hold federal documentation.
Endorsement: An authorization noted on a Certificate of Documentation that qualifies a vessel for a particular trade usage, as in coastwise and fishery.
Restriction: A limitation noted on a Certificate of Documentation preventing a documented vessel from engaging in certain commercial trade usages.
Commercial Code: The body of laws that cover the method for securing interest and providing constructive notice of a claim on non-titled and/or non-documented vessels. Typically filed and recorded on the state or county level.