Carriage of Goods by Sea 1
Carriage of Goods by Sea 1
Carriage of Goods by Sea 1
History
• The origin of the B/L can be found with the Register
books which ship’s clerk were obliged to maintain.
• Those days owners of the goods use to sail along
with the goods on ship and therefore there was no
need of the B/L.
• When trading practises began to change and goods
owners were no longer able to travel with the goods
to their destination.
• It was then, that the use of B/L began to start.
• The earlier function of the B/L was thus, that it was used as a
receipt of the goods that was shipped.
• Subsequently, the other two functions came into picture when
there was a requirement to incorporate the terms of the contract.
• Later, with modernization and availability of the new modes of
transport, cargo owners preferred to sell their goods while in
transit which brought the third function of the B/L i.e. document
of title.
• Thus, the first case Lickbarrow V. Mason- recognized the custom of
merchants that a B/L in which goods were stated to have been
shipped enabled the holder to transfer the property in the goods
to the transferee.
• Thus it stated that B/L is capable of
transferring property.
• But the ability of to give its holder a symbolic
possession of goods was yet to be developed
which was then decided in the
“ Barber V Meryerstein”
• Thus it gave the holder of the B/L the legal
possession of the goods.
• Historically, the liability of the carrier under the
B/L contract to transport the cargo safely to its
destination was strict with only few exceptions:
• 1. act of God
• 2. public enemies
• 3. inherent vices
• Even though the carrier was covered by these
exceptions, he would otherwise be liable for his
own negligence.
• The dominating power of the carrier to excuse himself from
liability took one more step when he tried to exempt himself
from the liability even for loss resulting from their own
negligence.
• The resultant combined resistance from the shipper, bankers and
others led to the initial legislation called the Harter Act 1893 in
USA.
• This was also felt to be insufficient for which a huge demand to
form an international convention came forth.
• Therefore, for the first time the Maritime Law Committee of the
International Law Association came up with a draft called the
“Hague Rules” in Brussels on 25 August 1924.
• The declared objective of the Hague Rules was to unify certain
rules relating to B/L and to establish a minimum degree of
protection for the cargo owner but a maximum protection the
carrier could derive from the insertion of exception and limitation
clauses in the contract.
• This was given effect in the UK by the Carriage of Goods by Sea
Act, 1924.
• With further advancements in trade and transport, problems
arose in the Hague Visby rules which gave more protection to the
Carrier.
• This gave way to amendments which resulted in the formation of
the “Hague/Visby Rules” in February 1968.
Definitions
• Bills of Lading- it is a type of transport document that
may be issued in respect of the carriage of goods by sea
by or on behalf of the owners, or less commonly the
charterers of the carrying ship.
• A B/L serves as a receipt for the goods entrusted to the
carrier in respect of both the quantity and the condition
of the goods received.
• When goods are already loaded on board the ship- such
a B/L is called as a “shipped” B/L- See Diamond Alkali
Export Corporation v. Fl. Boureois (1921) 2 KB 443
Kinds of Bills of Lading
• But when goods are into the carrier’s care and
custody before loading such a B/L is called as
“Received for shipment bill”
• Such a bill is considered as a document of title
in the civil law jurisdiction but is yet unclear in
common law jurisdiction.
Bearer B/L
• A B/L made out without naming the consignee but in
favour simply of “bearer” or “holder” or is kept blank –
is known as the Bearer B/L.
• This means that delivery will be effected whomsoever
holds the bill.
• It can be negotiated by physical delivery.
• Sec. 1(2)(a), 5(2)(b) of the COGSA, 1992 recognizes the
fact that the person entitled to delivery may be
identified simply as the bearer of the bill.
• A bearer bill is a document of title.
Order B/L
• A B/L made out in favour of a named consignee “
or order” is called as an Order B/L
• Eg. “Delivery to A ltd or to order or assigns”