Issue of bills of lading

Issue of bills of lading. Under the Hague Rules/Hague-Visby Rules, when the goods are received into the charge of the carrier, he or the master or agent of the carrier must, on demand of the shipper, issue a bill of lading properly describing the goods, that is, showing the identification marks, quantity of cargo and apparent order and condition of the goods (Art. III, r. 3).

Article 14, r. 1 of the Hamburg Rules specifies the same responsibility or duty of the carrier. The bill may not be issued if the shipperdoes not demand one.

This may cover the situation where the goods have not yet been shipped, but only received for shipment. This raises a problem because Art. I defines that – “carriage of goods” covers the period from loading on until discharge from the vessel and under Art. II the carrier has responsibilities under a contract of carriage of goods by sea. If the contract does not commence until the goods are loaded (or on the vessel’s tackle) the obligations specified in the “received for shipment bill of lading” may not be valid. The “received for shipment bill of lading”- may sometimes be referred to as a “custody bill of lading”, indicating that the goods are in the care and custody of the carrier. This form of bill of lading can be exchanged for a “shipped bill of lading”, or indorsed with the name or names of the carrying vessel or vessels, after the goods are loaded (Art. III, r. 7). Any problems are usually solved when buyers, using the documentary credits system, instruct their banks to withhold payment to shippers until documents including “shipped, on-board bills of lading” are produced to the bank.

The leading identifying marks and quantity can and usually are supplied by the shipper. The apparent order and condition are certified by the carrier or his servants or agents. The bills of lading with the marks and quantity are usually prepared by the shippers, perhaps on the carriers’ own forms although some large shippers, for example, motor vehicle manufacturers in the United States, may use their own forms indorsed by the carrier. The shipper is taken to have guaranteed this information to the carrier (Art. III, r. 5). The carrier, master or agent of the carrier is not required to agree to statements of marks and quantity if he has reasonable grounds for doubting their accuracy but he is still required to certify the apparent order and condition.

The information supplied by the shipper is prima facie evidence against him, that is, the carrier can adduce better evidence to disprove the information supplied by the shipper but no evidence to contradict the information on the bill of lading may be adduced if the bill has been transferred to a third parry. The carrier may have to satisfy the claim made by a consignee or endorsee to whom the property has passed but may seek recourse from the original shipper under the indemnity provisions in Art. III, r. S.

The description of the goads in the bill oΒ£ lading includes description of the number of packages and this would influence the package limitation of the carrier should leis liability for loss, damage or delay be established. Problems also arise if the goods do not meet the description as furnished by the shipper or as insisted upon by this person. This is especially significant in relation to a “letter of indemnity” that may be offered by the shipper in exchange for an unclaused bill of lading despite the quantity or the condition of the goods being questionable.

The bill of lading is a receipt for cargo and the Rules provide that the receipt is given for the goods as described therein when the goods are taken into the charge of the carrier. “Taking in charge” may mean that the carrier has taken the possession of the goods. The signature of the carrier or of the representative of the carrier indicates that the carrier is bound by the statements in the document. If a vessel is chartered and the charterer uses his own form, he may be bound by the statements in addition to the shipowner. He may use a “demise clause” but if he is entering into the contract of carriage with the shipper, the demise clause may be in breach of the provisions because of Art. III, r. 8 of the Hague Rules/Hague-Visby Rules. (See Demise clause.)

On demand of the shipper, the date of the shipment is put on the bill of lading under Art. III, r. ? of the Hague Rules/Hague-Visby Rules but the Hamburg Rules, Art. 15, r. 1 (f) require the date on which the goods were taken over by the carrier at the loading port to be inserted. This date can be earlier than the shipment date. If the contract of sale between the shipper and the consignee or endorsee has the date of shipment as a condition, breach of which can permit the buyer to repudiate the contract of sale and reject the goods, the date of shipment can be very crucial. “Antedating a bill of lading” or “backdating a bill of lading” is seen as fraudulent under the common law and also under the civil law practised mainly in European countries. This can cause the carier to become liable, especially if agents of the carrier carry out the fraud in a distant port. A recent example of the liability of the carrier occurred in the case of The Saudi Crown, 19$6. The vessel loaded cargo in a small port on the West

Coast of India for the U.K. The owner’s port agents signed and issued the “shipped bill of lading”. The date on the bill met the requirements of the contract of sale of the cargo but the cargo was actually shipped later. The wrongful dating of the, “shipped” bill was held to be a “fraudulent misrepresentation” and the endorsees of the bill of lading were able to claim damages from the shipowner who was the carrier Another reason for fraudulent misrepresentation may be if a shipped bill of lading is issued by or on behalf of a carrier, naming a particular vessel, but the cargo is not loaded on board that vessel. Documentary fraud can also take place if the shipper makes statements on the bill of lading that may be incorrect or attempts to prevent the issuer of the bill of lading to insert clauses describing the defective condition of the goods and/or the packaging. Therefore, the issue of bills of lading is a responsibility that can be fraught with difficulty for the carrier.

Other direct, specific responsibilities of the carrier under the Hague Rules/ Hague-Visby Rules include giving reasonable facilities to the receiver for inspecting and tallying the goods in case of any actual or expected loss or damage to the goods before or after discharge (Art. III, r. 6).

The Hamburg Rules state in Art. 10, r. 1 that the carrier remains responsible for the entire carriage of the goods from the time he takes charge of the goods until they are delivered to the consignee, his agent or port authorities and is directly responsible for the acts and omissions of his servants and agents acting within the scope of their employment. This will cover a situation where the carrier entrusts the goods to a person for transhipment or on-carriage.

On demand of the shipper, the carrier must issue a bill of lading, which must contain 15 different sets of particulars and details.

The basis of the carrier’s liability is that he is presumed to be at fault or negligent. He does not have the option of proving that he earned out his responsibilities. This presumption of liability for breach of obligation extends over the lengthy period of responsibility and if the carrier cannot show that he or his servants or agents took reasonable measures to avoid the loss, damage or delay to the goods, the carrier will be liable for direct and consequential financial loss to the holder of the bill of lading. The liability can be excluded in restricted circumstances: damage by fire where the cargo claimant must prove the carrier’s negligence; loss or damage to live animals where “inherent risk” for such cargo is acceptable; measures to save life or reasonable measures to save property; liability for dangerous goods; and where loss or damage or delay arose because of some other strong reason for the loss, damage or delay.


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