Mortgage of a vessel

(1) The owner of a registered vessel in respect of which the ownership title has been registered, either preliminary or permanent, may mortgage it as security for a loan or other valuable consideration whether or not related to the vessel, or to meet any lawful obligation, present or future. (2) It shall be lawful for a mortgage to be executed and registered in favour of a security trustee appointed or acting under a trust for the benefit of persons to whom a debt or other obligation is due. Such security trustee shall, in any such case, 32 be recognized as the mortgagee of the particular mortgage and shall be entitled to exercise all the rights in relation to that mortgage as are accorded to mortgagees by this Act. (3) A registered mortgage shall attach to the vessel in respect of which it is registered until it is discharged, Provided that, (a) where a vessel has been sold pursuant to an order made by or under the supervision of a competent court within the jurisdiction in which the vessel is lying at the time of sale, the interest of the holder of a registered mortgage in the ship shall pass on to the proceeds of the sale of the vessel and the extent of the interest of the holder of the registered mortgage in such proceeds of sale as well as the ranking of its interest in order of priority with respect to such proceeds relative to that of other creditors shall be a matter for the determination of such competent court in accordance with the laws of Belize; and (b) where a vessel has been sold by a mortgagee pursuant to his rights under section 53 (2) of this Act and it is stated in the bill of sale that the ship is being sold free from such encumbrances, then the rights arising from such registered mortgage shall no longer be exercisable in relation to that vessel. (4) A mortgage registered under this Act may be drawn up to secure the payment of a principal sum and interest, an account current, as well as the performance of any other lawful obligation. 33 (5) For the purposes of this Part, the term “account current” means any indebtedness of a mortgagor in favour of a mortgagee arising and determinable in accordance with the loan agreement, guarantee, deed of covenant or other form of contract which gives rise to the relevant underlying obligations and to which reference is made in the relevant mortgage. Amendment. (6) Where a registered mortgage is amended, the Deputy Registrar at the Head Office shall, on the production of the instrument of mortgage executed in accordance with the provisions of section 40 of this Act containing the amendment, together with the written consent on the said instrument of the mortgagee whose mortgage has been amended, make a note thereof in the Register to the effect that the mortgage has been amended. Any such amendment shall, with effect from the time and date of such note, form an integral part of the registered mortgage which it amends and such mortgage, as amended, shall continue to have the same priority as it had before the amendment was noted. (7) Subject to the provisions of this section, an amendment of a mortgage may be effected for any lawful purpose, such as, but without limitation, (i) to increase the amount secured by such mortgage; and (ii) to extend such mortgage to secure any other obligation of the mortgagor, whether as principal or as surety for any other person, in favour of the (8) An amendment of a mortgage may not be effected after the obligations secured by the registered mortgage have been satisfied. (9) Where any mortgages other than the mortgage that it is intended to amend are entered in the register of the ship, an 34 amendment shall not be noted unless the consent in writing of all the other mortgagees is produced to the Registrar. (10) The consent to an amendment to a mortgage shall be signified by means of a declaration executed by the mortgagee in accordance with the provisions of section 40 of this Act.