Types of Documents

The Order Bill of Lading (B/L)

The Order B/L has 3 important functions:
  1. it is a receipt for goods received for carriage by the carrier.
  2. it is evidence of the contract of carriage. In most cases it is also the contract.
  3. it is a transferable document of title to the goods stated on the B/L When issued "to (the) order" the goods can be sold and bought merely by passing on the Bill of Lading provided all endorsements are in order.

Because the of these functions the carrier has to be quite fuzzy when issuing a B/L. The carrier must ensure that all details on the B/L (e.g. cargo quantity and description) are fully correct. A carrier knowingly accepting incorrect information on the B/L joins the shipper as a party of fraud on the consignee. Furthermore the carrier must ensure not to release the cargo without receiving the duly endorsed B/L by the rightful holder of this document. Otherwise he can be sued by the rightful consignee for damages.

The Straight (not negotiable) Bill of Lading

This is a B/L issued straight to a named consignee without the remark "to (the) order". Such B/L still functions as receipt for goods and evidence of contract of carriage but cannot be used to sell and buy the goods by passing on the B/L. It is no transferable document of title. In most countries however, it is still considered a document of title which means that the carrier will still insist to receive the duly endorsed B/L by the named consignee before releasing the cargo. Only in the USA a Straight B/L is considered just like a Sea Waybill (see there).

The Sea Waybill

As transittimes have become much faster (very often resulting in a situation where the ship arrived earlier than the B/L) , as cargfo volumes have increased and as also for quite some goods being shipped transferable B/L's are not really required initiatives were started to produce an easier -to- handle document which is also suitable to be processed by modern electronic means.

The Sea Waybill still acts as a receipt for the goods and evidence of the contract of carriage (usually a carrier's waybill always refers to the terms /conditions of the carrier's Bill of Lading) but it is not a document of title.any longer. The advantage for the shipper/consignee is that it has not to be surrendered at the port of discharge to the carrier fo receipt of cargo. On the other side the carrier is allowed to release the cargo to the named consignee on sufficient proof of his identity. Provided the carrier has used due diligence he cannot be held responsible by the shipper/ consignee for damages resulting from wrong delivery.

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