Legal Advice

Legal Issues of Concern for Fishers

Since the cod moratorium, the fishing industry has taken on a new look in Newfoundland. There had been significant growth in the non traditional high value fisheries such as crab and shrimp. This involves a bigger investment, and has resulted in a more professional and business like fishery. This development has brought forth many new legal issues that people should be aware of.

Fishery Act Offences

With the increased emphasis on conservation, and with the development of new fisheries, there is a corresponding growth in fishery regulations and, therefore, fishery offences.

Many fishers, without intention, find they have been charged with a violation of some of the regulations. When charged, it is important to keep the following points in mind:

• You have no obligation to provide a statement but may do so if you wish, however, whatever you say, either orally or in writing may be used against you later.
  
• You should consult with a lawyer as soon as possible.
  
• Even though you may have technically breached a regulation, you may still have a valid defence such as, if you can show you made your best effort to comply with the regulation, or you were misled by officials.

Purchase & Finance of Vessels

The purchase of a fishing vessel is a big investment, usually involving financing through a chartered bank or a fish processing company. The following points should be kept in mind:

• The purchaser should always have a lawyer represent him/her to ensure the seller has clear title to the vessel, that the vessel is properly registered and there are no mortgages or liens against the vessel upon transfer, and the vessel is properly transferred to the buyer.
• Ensure the vessel is properly licensed, and all the required certificates (i.e., CSI) are available.
• If obtaining a ship's mortgage through a bank, you should have a lawyer review the documents to ensure that you are fully aware of the obligations.
• In cases where you are obtaining financing through a fish processing company or where a fish processing company is guaranteeing your loan with the bank, it is common for them to take certain security such as a catch agreement etc. It is important to have these agreements reviewed to ensure your rights are protected and built into the agreement with the fish processing company.

Other Points

Many fishers find it to their advantage to incorporate. This is beneficial to them for tax and other purposes. For example, the boat and any gear can be transferred to a company. Even though your fishing licenses are personal and cannot be held by a company, it has been suggested you can enter into an agreement with your company to hold the licenses in trust for the company. You should see a lawyer to discuss the advantages of incorporation and to make sure all appropriate documents are in place. Where there is more than one shareholder, it is important that documentation be put in place to cover the issues which may arise between shareholders.

If you form a partnership with other fishers, you should make sure you have a full and complete partnership agreement that covers all potential eventualities such as when one party wants to leave, the death of one party, or when one party gives up fishing due to disability. An agreement will provide for what happens to the assets etc.

In the event of a sale of a fishing enterprise or licenses, it is important that before you enter into any agreement to sell a portion or all of your fishing enterprises, you consult with an accountant or tax consultant to ensure you structure the sale in such a way as to minimize the tax to you. You should also consult with a lawyer before entering into such an agreement.

In the event of a marital separation, the Courts have held that a spouse, if there is a history of working together in the fishing operation, may have a claim against the fishing enterprise as a business asset. Whether or not this would apply in your situation would depend on the circumstances of each individual case. Legal advice is strongly recommended.

Being located in Clarenville, our firm is conveniently located for many fishers. We have represented many fishers from various different bays for fisheries related offences and their business dealings. One member of our firm has a Master of Laws degree in Marine Law with his thesis on the topic of ships mortgages.

The lawyers in our firm are available to meet with fishers either in our offices or at your premises, at any reasonable time, to discuss any of the above or any other legal concerns you may have regarding your personal affairs.

While care has been taken to ensure the information contained herein is accurate, the firm does not warrant that all the information relayed is correct. The information provided is based upon Newfoundland law and is supplied for general interest purposes only. It is not intended, nor should be considered to be specific legal advice or opinion.

For more assistance contact us directly!

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