Authority of charterers, sub-charterers or their agents to sign

Authority of charterers, sub-charterers or their agents to sign. The ASBATTME Time charterparty states in the “Employment clause” that the Captain

“. . . is to the bills of lading for cargo as presented in conformity with mate’s or tally clerk’s receipts. However, at Charterers’ option, the Charterers or their agents may sign bills of lading on behalf of the Captain always in conformity with mate’s or tally clerk’s receipts. All bills of lading shall be without prejudice to (the) Charter and the Charterers shall indemnify the Owners against all consequences or liabilities which may arise from any inconsistency between (the) Charter and any bills of lading or waybills signed by the Charterers or their agents or by the Captain at their request.”

When the charterers or their agents sign the B/Ls they do so as agents for the master who is the agent of the shipowner. He is considered to have delegated his authority to them. The charterers can present the B/Ls to the master for his signature on behalf of the shipowner. The B/Ls should not contain terms that are inconsistent with the charterparty. The charterers also have the option of directly signing similar B/Ls, also on behalf of the shipowner. The signature in either situation binds the shipowner. This was established in an old case, Tillmans v. SS Knutsford, 1908; which is the leading case on the signature of the owner’s being bound by signature of the bill of lading The charterers or their agents usually sign the bill of lading after the inserted words, “For and on behalf of the owners” or “For the Captain and Owners”.

Even in tanker charterparties, whether for voyage or time charters, a clause similar to that found in ASBATIME may be included. For example, in ASBA II it is stated that:

“Bills of lading shall be signed by the master as presented, the Master attending daily, if required, at the offices of the Charterer or its Agents. However, at Charterer’s option, the Charterer or its Agents may sign Bills of Lading on behalf of the Master . . .”

If the charterer sub-charters the vessel, the bill of lading may be signed by the sub-charterers and/or their agents with similar consequences for the shipowner. In The Vikfrost, 1980, the vessel was time chartered and sub-chartered. In the head charterparty and sub-charterparty, similar clauses permitted agents to sign B/Ls on the master’s behalf. In each, the employment clause stated that B/Ls may contain a “demise clause” which provided that if the vessel was not owned or demise chartered to the company or line issuing the bill of lading, the bill would take effect as a contract between the cargo interest and the shipowner. The sub-agents of the sub-charterer issued B/Ls with the demise clause on forms with the sub-charterer’s heading. It was held that the sub-charterers’ agents had authority to sign such B/Ls and there was no restrictions in the head charterparty as to what clauses could be included in B/Ls issued under the head charter or sub-charter. It was said in the English Court of Appeal:

“By necessary implication, the head charter authorised the Charterer In the case of . . . sub-letting to put the sub-Charterer in the same position as to signature of the Bills of Lading as the Charterer was under the head charter i.e. authorise the sub-charter to require the master to sign Bills of Lading or to sign them himself . . .”

Therefore the shipowner was liable under the B/Ls.
While the signature of the Charterer or agent “For the Master” is normally ‘considered to bind the shipowner (through the master) to the terms in the bill of lading, the facts of a particular case may indicate that the charterers are the actual “carriers”. In this situation, the charterers will be bound rather than the owners. This will be the result of the charterers’ (or agents) signing a bill of lading without the words “For the master . . .”.

If the Charterer or agent signs a bill of lading in a form that contains extraordinary terms, or terms which are clearly inconsistent with the terms in the charterparty, the owner cannot be bound. If the Charterer or his agent presents a bill of lading with such inconsistent terms, the master is permitted to refuse to sign…

American law seems to view the charterer’s or his agents’ signing of B/Ls in a different way to English law. If the Charterer signs and issues a bill of lading, the Charterer is bound, not the shipowner. If the Charterer signs “on behalf of the master”, the master and the owner are bound by the contract evidenced in the bill of lading only if either has expressly or impliedly authorised the charterer to do so Under ASBATIME or NYPE forms, the master is required, as seen above, to sign a bill of lading “as presented”. If the bill of lading is presented by the charterer, American law establishes that the master signs on behalf of the charterer.


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Authority of agents to sign

Authority of master to sign