Sets of bills of lading. Bills of lading are requested by shippers in a set usually of three “originals”, although in some Countries many more “original” sets may be required for different reasons, some commercial, some regulatory.
The practice to be issued with a set of three original bills of lading is very old. For example, in a document dated 1686 it is said:
“Of the Bills of Lading there is commonly Three Bills of one tenor. One of them is enclosed in the letters written by the same Ship; another Bill is sent overland to the Factor to Party to whom the goods are consigned; the third remained with the Merchant, for his testimony against the Master, if there were any occasion of loose dealing.”
(“Tenor” can mean “intent” or “purpose”.) One danger with too many “originals” is that it increases the chance of fraud. For instance, one original from a set may be lost or stolen, the cargo may be delivered against another and then the “lost” original may turn up with the possessor claiming the cargo. Normally, bills of lading are claused stating that if one is “accomplished” the others shall be void. (See Accomplished bill of lading.)
The leading fraud case is Glyn Mills Currie v. East and West India Dock, 1882, in which three original bills of lading were issued for the same shipment. These were marked “First”, “Second” and “Third”. The consignee indorsed the “First” bill of lading to a bank for a loan. When the ship arrived at the destination, the goods were discharged to a dock company. The consignee presented the “Second” bill of lading and delivery orders and the goods were delivered by the dock company to parties named in the delivery orders. The bank brought an action against the dock company for the tort of “conversion”.
(“Conversion” is a civil wrong committed by a person who deals with goods that do not belong to him in a manner that is inconsistent with the rights of the lawful owner who is deprived of the use and possession of the goods.)
The dock company was not liable. Its duties were to deliver the goods to the first person who presented an original bill of lading. The same duty would lie on any carrier. Regarding the set of three “originals” it was picturesquely said in. the House of Lords:
“Now if there were only one part of the bill of lading the process … would be an extremely simple one. The bill of lading would be the title deed, and whoever came to the shipowner or to the master of the ship and demanded delivery of the goods, in whatever right he claimed whether as the original consignee or as a person coming by order of the consignee … all that the master of the ship (who is not a lawyer and has not, perhaps, a lawyer at his side) would have to say is, ‘Where is your title deed? Produce it’. If he had not a title deed the master would be entitled to say ‘I will not deliver these goods to you’. . .
But the confusion, the difficulty and embarrassment have arisen from there not being.., one title deed, but there being more than one, in this case, three parts of the title deed, that is to say of the bill of lading … For whose benefit is it that there are those three parts? Certainly not for the benefit of the shipowner, or for the benefit of the master. To them the presence of three parts of the bill of lading is simply an embarrassment. It is for the benefit of the shipper or of the consignee…”
In a more recent case, The Mobil Courage, 1987, there was no fraud but negligence of the master in not signing the triplicate set of originals of the bills of lading carried on board. This caused the shipowner to lose his claim for demurrage. (See Bills of lading carried on board.)