Bill of Lading and Mate’s Receipt
The bill of lading (B/L) is issued upon the goods being received for shipment or, traditionally, upon their shipment. It is signed by the representative of the owner of the carrier, e.g. the Master of the vessel or in practice, more often by the owner’s agent.
The functions of a B/L are as:
- A receipt for the goods which have been received for shipment or shipped.
- Evidence for the contract of carriage of goods (this contract is governed by the Hague-Visby Rules as amended).
- A document of title (the owner of the Bill of Lading is entitled to possession of the goods).
A Bill of Lading (B/L), is a receipt for goods received / shipped onboard. It is an evidence of the existence and terms of a contract between the shipper and carrier. B/L as a document of title signifies that the holder has a legal right to the possession of the goods it describes. It can be transferred to a third party so as to affect transfer of title of the goods it describes.
A Bill of Lading is governed by one of the three international conventions, i.e. the Hague Rules, the Hague-Visby Rules or the Hamburg Rules, which set out the minimum terms and conditions out of which the carrier cannot contract. View the following pdf for a comparison of the three conventions.The master of the vessel needs to treat the Bill of Lading as a very important document due to its legal implications. While signing and issuing original Bs/L, he should take care that all potential contractual pitfalls are covered. Shipped Bs/L are signed on behalf of the carrier by the Master or by the agents of the carrying ship. However, when an agent signs a B/L on behalf of the Master, it could jeopardize the owners’ interest if due care is not exercised in doing so.
The scenario below illustrates the issues related to Bills of Lading signed by the agent on behalf of the Master.
Details are entered into a B/L on the basis of a Mate’s Receipt (MR). It is a receipt issued and signed by the ship’s chief officer for goods received onboard and is used for all types of cargoes except liner trades. MR is neither a document of title to the goods shipped nor does any title pass by its endorsement or transfer. It is vital that the information contained in the MR is correct. A Mate’s Receipt should be prepared from a ship’s tally / measurement and show the actual quantity and condition of the goods as received, and it should not be copied directly from the shipping note presented by the shipper.