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Documents

Introduction

The transportation of cargo by sea is a complicated matter.

Interests of all parties concerned must be matched and considered carefully.
These interests are best looked alter by a proper administration that comprises
the use of many different documents.
Explanations, descriptions and examples of the most important documents are
given below.
It is but a small part of the total bulk of documents one may come across in the
mercantile trade.
The filling out of all these documents may well be considered one of the most
important tasks on board vessels, because a careful management of both ship-
and cargo-handling will always be of great benefit for all parties concerned.
These parties are:
The shipper (or consignor) the person or company who supplies or owns the
cargo that will be transported;
The carrier - the shipowner. usually referred to as "the Owners";
The consignee - the person or company to whom the cargo will be delivered:
The charterer - the person or company who wishes to charter (hire) the
vessel;
The shipbroker, or agent - the intermediary between shipper and carrier;
The insurer - the insurance company that will insure all parties from losses due
to perils and risks.

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Charter Party

A Charter Party is a contract between a shipowner and a person or company

who wishes to charter ("hire") a vessel or part of a vessel for the carriage of
cargo from one port to another.
There are basically two types of Charter Parties: demise and non-demise.
We speak of a demise - or bareboat Charter Party when the charterer charters
the vessel without its crew. The shipowner will provide the vessel - the charterer
will provide the crew.
Consequently, the charterer will take full responsibility for the operation of the
vessel and will pay all expenses incurred.
A non-demise Charter is used when the shipowner provides both the vessel
and her crew.
A time Charter is used when the vessel is chartered for an agreed period of
time, which may extend from a few weeks to several years.
A demise Charter Party is always a time Charter.
A voyage charter is a contract in which it is agreed that the vessel will be
chartered for a particular voyage. The majority of tramp cargo-shipments are
made on a voyage-charter basis.
The most common terms that appear in Charter Parties are:
"Bareboat Charter", "Berth Charter", "Clean Charter", "Demise Charter", "Gross
Charter", 'Lump sum Charter", "Open Charter", "Time Charter", "Voyage
Charter", all the terms beginning with "Free ………. " or "Freight ………", and many
more.
All these terms are explained in the Glossary below.

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 CHARTERING AND CHARTER – PARTIES

A chartering broker may be described as an intermediary between the ship-

owner and the merchant or the cargo owner. His knowledge must be extensive in
order that he may cope with all requirements of his business; he must have a
sound knowledge of shipping law, geography, port information, charges
throughout the world, facilities at different places, distances between ports, and
countless other matters. It also stands to reason that he must be of the highest
character.

He acts between a ship-owner who has tonnage idle, and a cargo owner who has
a cargo which he wishes to be transported. He engages space for cargo and
arranges the whole of the business details between the principals, receiving for
his services the commission agreed under such an arrangement.

When he fixes a contract of this nature it is known as a charter-party, of which

there are three classes: voyage, time, and bareboat or demise. The charter party
is a contract of affreightment, and for voyage charters is an agreement for the
carriage of goods from one specific port to another, the owner of the vessel
receiving freight for the cargo carried. In the case of time and demise charters,
both of these contain a contract whereby the vessel is actually hired for a specific
period of time, during which period the charterer has the freedom, within the
stipulations of the charter-party conditions, of using the vessel for what purposes
he may wish. In a demise charter the ownership to all intents and purposes
changes hands for the period of the contract. The payment in this case is for the
hire of the vessel, and an agreed amount is paid per month or per day for the
use of the vessel.

While in the case of bill of lading shipments standard rates are charged, the rates
for chartered ships fluctuate according to the state of the market, it being the
tendency for rates to be high during busy periods, when tonnage is scarce, and
low in slack times when idle ships are plentiful.

The arrangement of a charter-party is known as “fixing” a charter and when this

is completed the vessel is termed “fixed”.

Before proceeding to describe the contents of a charter-party and the meaning of

clauses, there are several types of “days” which are mentioned in chartering, and
definitions of these are:

Laydays Days agreed for loading and discharge. They may be separated into
days for loading and days for discharge, or if agreed a total taken for the two
operations, when days are then known as reversible laydays. This is the time
allowed under the charter-party, and a note of the agreed number of days will be
shown in the charter-party.

Weather working days Days for loading and discharge when the weather
permits. Where weather working days are allowed, and work is commenced, time
ceases to count if the work is held up owing to bad weather, or if weather makes
the possibility of a start impracticable for the day. This applies only when work
would otherwise be carried on.

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Running days Consecutive days, counting all days. Saturdays, Sundays, Bank
Holidays, etc, the same.

Working days In England a day of eight hours constitutes a working day,

therefore a 24 hour day would be considered as three working days (if work is
continuous), but in foreign countries this would alter according to the number of
hours which constitute a working day in such places.

“Days” It cannot be strongly enough emphasized that many troubles arise

through careless wording of what is meant by “days” in a charter-party . It must
be specified exactly how they are to count.

Before fixing a charter-party the essential details that are required

to be known are:

- Draught of vessel.
- Size of holds (in order to be sure of the space available for cargo).
- Particulars of derricks and/or cranes on the ship. Their position and individual
lifting capacity.
- Bunker capacity.
- Fuel consumption.
- Rate of loading and discharge and approximate weight to measurement of
cargo.
- Loading and discharge ports.
- Date of readiness.

For all charter-parties the following clauses are essential:

- Title of contracting parties. Names of the charterer and owner of the ship.
- Name of the vessel and warranty of seaworthiness. The warranty of
seaworthiness may be in the form of the words “good ship” with the class of
the vessel added, e.g. good ship called the ....classed 100 A1 at Lloyd's. It is
well to remember that once a vessel has commenced loading the charterer
cannot demand cancellation for unseaworthiness. Also, that although a ship
may be 100 A1 at the start of the voyage, there is no obligation on the
owners to keep this class during the period of the charterparty.
- Description of the vessel. This is only contained in the gross and net
tonnage of the vessel.
- Loading and discharging ports. For a time charter this would not apply, as
with a vessel being hired for a stated period there is no necessity or desire for
the owner to know where the vessel is to load, and instead the time charter
contains date of delivery of ship and date of redelivery, these being the two
dates between which the charterer hires the vessel.
- Cargo to be carried. In a voyage charter this is stipulated together with the
amount of cargo to be carried. This, again, is not necessary in a time charter,
with the exception of the term “any lawful merchandise”, but the radius of
trading is inserted. Radius of trading is usually very broad, and a term similar
to “World-wide radius, ice bound ports excepted” may be the only reference
to this point.
- Position of the vessel. For voyage charters. A statement which must be
perfectly correct in detail.

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 If the owner states that the ship is “now at Antwerp” and it is proved later
that the vessel was not at Antwerp, charterers may claim cancellation of the
charter-party. In a time charter the date when the vessel will be ready and
place of delivery is given in place of the above clause.
- Remuneration. For voyage charter-parties freight is paid on the amount
carried, but for time charters the payment is by hire for the period of the
engagement.
- Laydays and how they count. This clause applies only to voyage charter-
parties, as an owner is not concerned with the time that a vessel on time
charter spends in loading and discharge.
- Days of demurrage and dispatch and the rate. The preceding explanation
also applies to this clause. Should a vessel load and/or discharge in less than
the prescribed time, owners of a ship pay dispatch money as a “reward” for
time saved. If, on the other hand, the time allowed is exceeded, then
demurrage is payable at an agreed rate to the owner as “compensation” for
lost time.
- Brokerage clause. States the rate of brokerage that shall be paid.
- Lien clause. Giving owners of the vessel a right to hold cargo against
payment of freight or hire.
- Exemptions from liability clause. This clause includes many occurrences
from which owners claim exemption. A few of these exemptions are:

a) Act of God.
b) Barratry. Any wilful wrongdoing of the master and/or the crew without the
connivance of the owners. Actions of the master or the crew without the
intention to defraud owners, or actions which cannot be described as criminal,
are not included under this heading.
c) Capture and seizure. Acts of taking the ship by an enemy or belligerent, or
the forcible taking of the ship.
d) Queen's enemies. Opposition forces of the Crown. The ship's nationality is
its flag, and this clause may be read as any enemy of the country of the ship's
nationality.
e) Restraint of princes. Every case where the voyage is interrupted by the
supreme power of the country, such as an embargo, or prohibition of cargo.
f) Perils of the sea.
- Average clause. This clause states that general average, if any, shall be
payable according to York-Antwerp Rules. As there are four sets of rules, the
1924, 1950, 1974 and 1994 the date must follow. The rules issued later did
not cancel the earlier codes, although 1974 or 1994 rules are generally
adopted.
- Arbitration clause. This sets out that any disputes shall be referred to
arbitrators, and gives the conditions under which arbitration shall be carried
out.
- Penalty for non-fulfilment clause. Gives the amount to be paid for default in
carrying out the charter-party agreement.
- Sub-letting clause. This clause gives or refuses permission for the vessel to be
sub-let, or subchartered under the charter-party.

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The time charter-party clauses usually incorporated are as follows:

- Clause as to who pays fuel and port charges. This clause stipulates that
all charges including the above are to be paid by the charterer.
- Provision that time ceases on breakdown. Commonly known as the
“breakdown clause”, it is inserted to adjust the hire when by reason of a
breakdown the vessel ceases to operate. If by breakdown of machinery the
vessel ceases to operate, the charterer is entitled to some return for lost
time. The stipulation is usual for a period in excess of twenty-four hours, after
which time ceases to count, and the charterer is credited with such time lost
by the breakdown in his settlement for hire of the vessel.
- Return of overpaid hire if vessel is lost. Essentially a time-charter clause,
stating that, should the vessel be lost, hire shall cease to be chargeable, and
any amount overpaid shall be returned.
- Charterer's obligation to provide master with full sailing directions.
The master, in order to carry out instructions, must have full directions, and
failure on the part of the charterer to supply these may entail delay and lost
time.

The third list of clauses which are clauses a voyage charter

may contain is:

- Limitation of liability clause. Known widely as the “cesser clause”, it

stipulates that “Charterers' liability shall cease on the loading of cargo, and
qualified payment of freight, dead freight and demurrage”. When the
charterer has loaded the cargo and paid the charges incurred his liability
ceases.
- Description of cargo. This is phrased as “The charterer shall load a full and
complete cargo of ....not exceeding ...... tons, not less than ...... tons”. A full
and complete cargo may be described as a quantity sufficient to sink the
vessel to her load line in excess of tackle, provisions, furniture, etc....The two
quantities are stipulations between which any amount constitutes a full and
complete cargo.
- Options of other ports and cargoes. Gives permission for the vessel to
carry other cargo than that fixed in the charter-party, usually, however, at
the same rate of freight, and also the option of calling at other ports for
loading and discharge.

The principal disputes which arise in connection with charter-party agreements

are usually with reference to the meaning of clauses, and the ambiguous way in
which they are drawn up. Protection and Indemnity clubs are always anxious that
owners shall wherever possible fix ships upon some recognized charter-party
form, in order to avoid possible extra liability. When a printed form is adopted,
however, the conditions as printed may be altered or amended to suit the
circumstances of charterer or owner, in which case alterations are made to the
existing print.
In these cases the written clauses and amendments always overrule the printed
conditions; such alterations must, however, be made with care, as the alteration
of one clause may lead to alteration through contradiction of many others.

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Several points raised in connection with charter-parties are given below:

Always afloat. Meaning that the vessel shall remain afloat during the whole of
her loading and discharge, and shall at no time rest upon the bottom of the river
or dock.
“Redelivered in like good order and condition”. Charterer must redeliver the
ship after the period of the time charter has elapsed in the same condition as
when he accepted her, with the proviso “fair wear and tear excepted”. All
damage must be repaired if it occurs whilst under charter.

Representation or misrepresentation. Occasions arise where incorrect

particulars are given in the charter-party, and any claims which may arise are
judged upon the extent of such representation and its effect on the contract.

In voyage charter-parties it is recognized that notice of readiness or advice to

the charterer that the vessel is ready to load in accordance with the terms of the
agreement shall be given.
This notice must be given before the laydays start to count, and may not be
given until the ship is actually ready in all respects. This means that the ship
must be ready to receive the cargo, and failure to have all holds ready even
though only one or two may be worked for the reception of cargo makes the
vessel unready.
In the case of grain charter-parties, shifting boards or alternatives, which are to
prevent the grain moving on voyage, must be provided and be ready for use at
the same time as the vessel, to claim perfect readiness.
The charterer must arrange to supply his cargo when the ship is ready to load,
and any delay is for his account; when his lay days are used, demurrage is
charged for any extra time incurred.
Any delay which may occur outside the charterer's control, as transport to the
ship, is no defence for the charterer. Should however, a strike or some change in
circumstances of a like nature arise which makes the carrying out of the charter-
party impossible, then the charter may be considered to be frustrated by delay.

When the charterer supplies the cargo, the master must take same on board
with all reasonable speed, expressed in the term “as fast as ship can load”. The
supplying of the cargo is generally considered to mean supplying the cargo
alongside the ship, or within reach of the ship's gear.

All terms and conditions of bills of lading issued under a charter-party are
controlled by the charterparty terms and the clauses of a charter-party overrule
the terms of a bill of lading, unless bill of lading is endorsed to third party.

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 MOST COMMONLY USED CHARTER PARTY FORMS

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 CHARTERING ABBREVIATIONS
AA: Always Afloat
AAAA: Always Afloat And Accessible
ADCOM: Address Commission
AH: Antwerp/Hamburg Range
APS: Arrival Pilot Station
AR: Antwerp/Rotterdam Range
ARA Antwerp / Rotterdam / Amsterdam
A/S: Alongside
ATDNS: Any Time Day Or Night Shine
BA: Buenos Aires
BB: Ballast Bonus
BB: Bare Boat
BB: Below Bridge
BBB: Before Breaking Bulk
BBCP: Bare Boat Charter Party
B/C: Bulk Carrier
BDI: Both Dates Included
BENDS: Both Ends
BIZ: Business
BKRS: Bunkers
B/L: Bill of Lading
BW Brackish Water
BWAD: Brackish Water Arrival Draft
BWT: Bleeding Wing Tanks
CAD: Cash Against Documents
CAN: Canadian/Canada
CANDF: Cost And Freight
CC: Cubic Capacity
CHOP: Charterers' Option.
CHOPT: Charterers' Option
CHTRS: Charterers,
CIF: Cost Insurance And Freight
CIF & E: Cost, Insurance, Freight And Exchange
C/O: Certificate of Origin
COD: Cash On Delivery
COM: Commission
CONSECS: Consecutive Voyages
C/P: Charter Party
CPDD: Charter Party Dated
CQD: Customary Quick Despatch
CT: Contract
CUFT: Cubic Feet
CU: Cubic Feet
DAP: Days All Purposes
DD: Dated
DD: Drydocking
DELY: Delivery
DES/DEM: Despatch/ Demurrage
DHDATSBE: Demurrage Half Despatch All Time Saved Both Ends
DHDWTSBE: Demurrage Half Despatch Working Time Saved Both Ends
DISCH: Discharge
DISOPS: Discharge Operations
DO: Diesel Oil

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DO: Delivery Order
DOP: Dropping Outward Pilot
DT: Deep Tank
DW: Deadweight
EIU: Even If Used
ERTL: Expected Ready To Load
ETA: Expected Time of Arrival
ETC: Expected To Complete
ETD: Expected Time of Departure
ETR: Expected To be Ready
EXCL: Excluding
EXPLIFT: Expected to Lift
EXPLOAD: Expected to Load
FAA: Free Of All Average
FAE: Free Alongside Elevator
FAS: Free Alongside Ship
FD: Free Discharge
FDD: Freight Demurrage Despatch
FH: First Half
FHEX: Fridays And Holidays Excepted
FIFO: First In, First Out
FIO: Free In And Out
FIOS: Free In And Out And Stowed
FIOT: Free In And Out And Trimmed
FLOP: Full Loading Options
FO: Fuel Oil
FOB: Free On Board
FIOST: Free In And Out, Stowed And Trimmed
FOC: Flag Of Convenience
FOG: For Our Guidance
FOLL: Following
FOQ: Free On Quay
FOW: First Opening Water
FPA: Free of Particular Average
FRT: Freight
FWAD: Fresh Water Arrival Draft
FYG: For Your Guidance
GA: General Average
GD: Geared Vessel
GRN: Grain Cubic
GRT: Gross Register Tonnage
GTEE: Guarantee
GW: Gross Weight
HDWTSBE: Half Dispatch Working Time Saved Both Ends
H/H: Holds / Hatches
HM: Hull And Machinery
HR: Hampton Roads
HRS: Hours
HSS: Heavy Sorghums And/Or Soyas
IFO: Intermediate Fuel Oil
INC: Including
INFO: Information
IWL: Institute Warranty Limits
LAYCAN: Laydays/Cancelling
LB: Pound

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LBS: Pound Sterling
LDG: Loading
LDN: London
LDYS: Laydays
LH: Last Half
LL: Lakes, St Lawrence
LOA: Length Over All
LPP: Length between Perpendiculars.
LT: Long Tons
LTSBE: Laytime Saved Both Ends
ML: More Or Less
M/M: Minimum / Maximum
MIN/Max: Minimum / Maximum
MOL: More Or Less
MOLOO: More Or Less Owners’ Option
M/R: Mate’s Receipt
M/S: Motor Ship
MT: Metric Ton
M/T: Motor Tanker.
M/V: Motor Vessel
NAABSA:Not Always Afloat But Safe Aground
NOLA: New Orleans
Galvagnon/Pearson ENMM Marseille 2002 15
NOPAC: North Pacific
NOR: Notice of Readiness
NRT: Net Register Tonnage
NWP: Next Working Period
NYPE: New York Produce Exchange
OBO: Ore Bulk Oil
OO: Ore/Oil
OO: Owners’ Option
OSO: Ore, Slurry, Oil
O/T: Overtime
PC: Per Cent
P AND C: Private And Confidential.
PD: Port Dues
POD: Paid On Delivery
PPT: Prompt
PT: Port
PUT: Port Utilization Tax
RC: Running Costs
RDAM: Rotterdam
REDELY: Redelivery
REF: Reference
REV: Reverting or Revert
RGDS: Regards
RGE: Range
RPT: Repeat
RV: Round Voyage
SATAFEX: Saturday Afternoon Excepted
SAVED BENDS: Saved Both Ends
SB: Safe Berth
SBAA: One Safe Berth Always Afloat
SHEX: Sundays And Holidays Excepted
SHINC: Sundays And Holidays Included

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S/O: Sellers' Option.
SOF: Statement Of Facts
SOL: Shipowners’ Liability
SP: Safe Port
SR & CC Strike, Riot And Civil Commotion
SS: Steam Ship
SSW: Summer Salt Water
ST: Short Ton
ST: Straight Time
ST: Self-Trimming
STEM: Subject To Enough Merchandise
SUB: Subject
Galvagnon/Pearson ENMM Marseille 2002 16
SUB: Substitute
SW: Salt Water
SWAD: Salt Water On Arrival Draft
TARV: Transatlantic Round Voyage
TBA: To Be Advised
TBC: To Be Chartered
TBN: To Be Nominated
T/C: Time Charter
TDA: To Day
TDY: To Day
TDW: Ton Deadweight
THKS: Thanks
TIP: Taking Inward Pilot
TOM: Tomorrow
TPI: Ton Per Inch
TST: Top Side Tanks
UU: Unless Used
USD: United States Dollar
VOY: Voyage
VSL: Vessel
WA: With Average
WCCON: Whether Customs Cleared Or Not
WGT: Weight
WHR: Warehouse Receipt
WIBON: Whether In Berth Or Not
WIPON: Whether In Port Or Not
WIFPON: Whether In Free Pratique Or Not
WOG: Without Guarantee
WP: Weather Permitting
WPA: With Particular Average
WPAGW: Weather Permitting All Going Well
WRO: War Risks Only
WWR: When Where Ready

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Bill of Lading (B/L)

A Bill of Lading is a receipt for cargo brought on board a vessel.

It states the condition and terms in which the cargo was delivered to and
received by the vessel.
It forms the evidence that the carrier (shipowner) has received the goods and
has promised to transport the cargo to its destination.
A Bill of Lading (B/L) is a so-called "Document of Title".
This means that he who owns the B/L is the owner of the goods it describes.
A B/L is a negotiable document, which means that it can be sold.

A Bill of lading states:

 The names of the shipper, consignee and carrying vessel, and the name
and address of the person to be notified upon arrival of the shipment;
 Description of the cargo (provided that it is not bulk cargo), including any
shipping marks, package numbers in the consignment, contents, cubic
measurement, gross weight, etc.;
 Port of loading and port of discharge;
 Full details of freight. terms of the contract of carriage and terms of
payment (" Freight Prepaid " or, "Freight Payable at Destination",
sometimes referred to as "Freight Collect ";
 The date that the cargo was received for shipment and loaded on board
the vessel;
 Number of Bills of lading signed on behalf of the master or his agent;
 Master’s signature (or his agent's) and the date.

There are many types of Bills of Lading. The most common are:
"Alongside B/L ", "B/L to bearer", "B/L to order", "Claused B/L", "Clean B/L";
"Foul B/L", "Stale B/L", "Combicon B/L", "Direct B/L", "Groupage B/L", "Straight
B/L", "Received for Shipment B/L", "Shipped BIL", "Through B/L", "Ocean B/L",
"Inland Waterway (or River-) B/L", and more.
All the se Bills of Lading are described in the Glossary below.

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 BILLS OF LADING
The document under which cargo is carried on board vessels is a bill of lading,
and may be defined as a receipt for goods, signed by the master or other duly
authorized person on behalf of the ship-owner, and constitutes a document of
title to the goods specified there in.

For over three hundred years, bills of lading have been most important
documents in a variety of international trade transactions.

Their format has varied in accordance with the particular trade and the
requirements of individual ship-owners.

Whilst it is primarily a receipt, and not strictly speaking a contract of carriage it is

nevertheless good, and sometimes the only, evidence of the terms and
conditions of carriage.

The ship-owner is at liberty to restrict his liabilities and this he seeks to do by

concluding special contracts as evidenced by the terms, conditions and
exceptions of the bills of lading.

A glance at a modern general cargo bill of lading will convince one that the ship-
owner takes every precaution to minimize his liabilities by inserting protective
clauses exempting him self from responsibility for a very exhaustive range of
losses, including those arising from the negligence of his servants, etc.

Bills of lading for goods shipped from the United Kingdom and Northern Ireland,
however, are in this respect subject to the Carriage of Goods by Sea Act 1971.

The act establishes the responsibilities, liabilities, rights and immunities attaching
to carriers under bills of lading, and in effect prescribes a standard form of bill of
lading which has the force of law.

It removes the difficulties and uncertainties which were associated with the
plethora of protective clauses which ship-owners were accustomed to insert in
bills of lading and has bestowed a considerable advantage on the mercantile
community, particularly banks and insurance companies, as, now that, they
know exactly the extent of the ship-owners' liabilities, etc, they can make
advances and adjust insurance premiums on cargo with greater facility.

It is the shipper’s duty to supply the shipping company with the bills of lading. As
soon as the shipper ascertains the number of packages he wishes to ship by the
vessel, he completes the bills of lading and lodges these with the shipping
company for their attention.

He may; however requests the carrying company to make out bills of lading for
him, in which case he supplies an invoice and instructions and the shipping
company undertakes this business.

A small charge is made for the extra work entailed.

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The bills of lading are made out in “sets”, and any number may constitute the
set according to the requirements of the particular trade.

It is essential that at least one bill of lading be supplied, together with a copy bill
of lading, known as the captain's copy, which is retained by the master for record
purposes.

While the bill of lading is the document proper, the copy is of no value and as
many copy bills of lading may be included in the set as are desired either for the
shipping company's purposes or for the shipper's own requirements.

The bills of lading, however, are of equal standing, and it is usual to find at the
foot of the bill of lading the term -“In witness whereof the master or agent hath
affirmed ...... bills of lading all of this tenor and date, the one of which being
accomplished the others stand void”.

The number of bills of lading which constitute the set are entered in the blank
space.

The shipper usually affirms to three bills of lading, one for his own records, one
for his consignee and a second copy for the consignee sent usually by the
following mail in case the first copy forwarded him is lost or delayed.

The master of the ship is instructed to deliver the goods to the person who
produces a bill of lading, and therefore it is in the interest of all shippers, where
more than one bill of lading is issued, to see that the consignee is the person
who receives it.

The master; in the absence of knowing that the holder of the bill of lading has no
right to it, or in the absence of known fraud; has authority to deliver the goods.
In the event of any goods being so delivered to another person who holds the
document of title but is not authorized, the master is free from liability for
wrongful delivery.

In describing bills of lading it must be remembered that nearly all bills of lading
were originally “received for shipment” bills of lading, which state that the
goods have been received for shipment on board the vessel.

Here, there is no actual receipt for goods which have been shipped.

The Carriage of Goods by Sea Act contains a stipulation that if a shipper so

demands, he shall have issued to him a shipped bill of lading when the cargo is
loaded. This commences “shipped on board the vessel . . .”, and states that
the goods are actually on board.

Bankers are reluctant to accept documents that do not clearly set out this
important statement, and many demand “shipped” bills of lading.

Many shipping companies now only print shipped bills of lading.

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As there is no implied or express demand for a seaworthy ship, the term
“shipped on board the good ship” is rarely seen, it being “shipped on board
the vessel....”

The next clause for consideration is that of “apparent good order and
condition”.

The full opening phrase on a bill of lading is “Shipped (or received) in

apparent good order and condition on board the vessel ....”.

This phrase means that the outward condition of the goods on being received by
the ship is in good order; the ship-owner in effect says: “I can only judge by
exterior proof as to the soundness of the goods received, and apparently
they are in good order”.

To earn his freight the carrier is only bound deliver them in the same order in
which he received them.

If they were in apparent good order, on shipment, it is his duty to deliver them in
like apparent good order and condition.

Should the goods have any defects, then the carrier will qualify the term
“apparent good order” by including in the margin of the bill such terms as “old
case”, “stained case”, “straw wrapped pieces only”, or “unprotected”.

The addition of any similar qualifying clause makes the bill “unclean” (foul), and
conversely, the expression “clean bill of lading” means any bill of lading which
has the clause “apparent good order and condition” unqualified.

Shipping Companies in their own interest insert these clauses when necessary as
a safeguard against unwarranted claims.

There is a practice of issuing letters of indemnity against clean bills of lading,

which is adopted by a number of companies.

These letters of indemnity state that in consideration of being given a clean bill of
lading the holder indemnifies the carrier against all risks and claims arising from
the defect.

This, although practiced, is legally wrong, and the holder of a letter of indemnity
in this case has no right other than that of good faith.

The master of the vessel having signed for so many cases in apparent good order
and condition, when he knows they are not so by being given a letter of
indemnity to that effect, issues a legal document in the form of the bill of lading
with a misstatement of fact upon it, which is nothing less than a common fraud,
and on these grounds numerous cases fail because the owners are unable to
seek the assistance of the letter of indemnity.

The bill of lading is made out in the name of the shipper, or, if an agent, as
“A.B. as agents”, and consigned to the consignee or receiver.

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For many reasons, such as confidentiality, some shippers are anxious that the
name of the consignee shall not become known, and in this case the bill of lading
is consigned to “order”.

When goods are consigned to a named consignee, the shipper has no need to
endorse the bill of lading before forwarding to his consignee, but when it is
consigned to “order” he must endorse the bill over to the consignee to whom he
wishes delivery made.

The bill is signed at the foot by, or for, the master. He, as agent for the
owners in the care of the vessel, and bailed for the cargo during its shipment, is
personally responsible for the goods while in his care.

If a bill of lading is signed for goods which are not actually on board, the liability
of the master is increased, for it may happen that the bill is issued, and therefore
the “prima facie” evidence is that the goods were actually shipped, and the
carrier may have great difficulty in proving that this was not so.

It is therefore the master's duty, or the duty of anyone having authority to sign
for the master, to see that the particulars in the bill of lading are accurate,
before the bill is issued.

The date which appears at the foot at the bill should of course be the actual date
of shipments or receipt of the goods. This traditional bill of lading is now known
as the “long form” bill of lading.

In the body of the bill the ports of shipment and delivery are mentioned, and the
contract is therefore to carry the goods with all reasonable speed from the one
place to the other.

“Through” bills of lading are issued when a shipper wishes the carrying company
to make arrangements for a complete journey, and these bills of lading in
addition to the agreement to carry goods from port to port include a further
journey (by sea or land) from the port of ship's destination to a distant place.

In this case the carrier incorporates in the bill of lading a clause stating that the
goods are to be “transshipped and forwarded to . . . at ship's expense but
at shipper's risk”.

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Captain's Declaration
Upon arrival in a port the captain must present a declaration to the authorities,
in which all the vessel's particulars during the past voyage are stated.
A Captain’s declaration must contain:
Vessel’s name. call sign and flag, owner and charterer, tonnages, dimensions,
times of arrival, embarkation of pilot, number of tugs used, draft on arrival,
cargo to be loaded and/or discharged, number of holds, hatches, decks, derricks
and winches, type of engine and propeller, service speed, bunkers on board, last
port of call, next port of call or destination, and other requested data.

Cargo Manifest
The Cargo Manifest is a document that contains all the important information
concerning the cargo that the vessel is carrying to the destination(s).
As a rule the Manifest is made up by the agent.
It contains the name of the vessel, port of Loading, port of destination,
BIL-number, shipper, consignee and cargo-particulars.

Notice of Readiness
ln the "Notice of readiness" (NOR) the master informs the shipper, the
consignee (receiver) and the authorities that the vessel is ready to load or
discharge the cargo.
It states the ports of loading / discharging.
The time of commencement of loading / discharging, the type of cargo and
its metric tonnage.
The "reporting day" is the day that the NOR must be handed over to the
charterer according to the Charter Party.
If the readiness of the vessel is delayed by whatever reason, laydays will be
counted from the beginning of the next day after the reporting day, unless the
Charter party states otherwise.
By "detention" is understood any delay in the loading or discharging of the
cargo.
Compensation of damages that occur due to detention is called "demurrage".

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