Bills of Lading

The bill of lading is a record of the quantity of cargo and of its apparent order and condition at the time of shipment and, as such, is a vitally important document. Cargo damage or shortage claims can result from errors in the quantity and condition of cargo recorded on the bills of lading.

The bill of lading also represents the cargo itself and possession of the original bill indicates who is entitled to receive the cargo at the discharge port. If you have any doubt about dealing with bill of lading problems, call the local P&I correspondent immediately.

    General Procedures

    Typical discrepancies with bills of lading:

    – wrong port and date;

    – quantity of cargo incorrect;

    – description of cargo incorrect;

    – condition of cargo incorrect.

    • check the details on the bills against tally sheets, mate’s receipts, boat notes, draft surveys;

    • note on the bills any details of damaged cargo, or short-delivered cargo, or any other discrepancies. (Guidelines on how to describe pre-shipment damage to steel cargoes is contained in the Club’s Guide to P&I Cover. If in doubt call the local P&I correspondent and ask for a surveyor).

    It is not your job to decide whether the cargo is marketable, only to decide whether it is in apparent good order and condition, this is particularly relevant to steel cargoes.

    Typical Problems

    • shipper objects to the bills being claused – notify your owner or manager and P&I correspondent immediately;

    • if you suspect that the agents have signed bills on your behalf without checking the mate’s receipts or without noting on the bills any remarks which are in the mate’s receipts – inform your owner or manager immediately;

    • the bill of lading is not presented at the discharge port by the person requesting delivery of the cargo – notify your owner or manager or the P&I correspondent immediately.

Golden Rules

    • never sign wrongly dated bills;

    • never sign clean bills for damaged cargo or for cargo which is not in apparent good order and condition;

    • never sign bills for cargo which has not been loaded;

    • always call the P&I correspondent if you have any problem with the condition and quantity of cargo or with the bills of lading;

    • never deliver cargo to a third party without presentation of the original bill;

    • never discharge cargo against a letter of indemnity without your owner’s or manager’s or the Club’s agreement.

    If it is agreed to retain one original bill of lading on board against which the cargo may be delivered, the shippers’/charterers’ instructions for procedures at the discharge port must be strictly followed. In such a case, to protect the shipowner from a claim for mis-delivery of the cargo, all original bills of lading should be endorsed as follows:

    “One original bill of lading retained on board against which delivery of cargo may properly be made on instructions received from shippers/charterers.”

    • always advise your owner or manager of any deviation which involves cargo discharge.

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Written by Ship Inspection

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