Key Facts
- •Unicredit Bank (Bank) financed the purchase of an oil cargo by Gulf Petrochem FZC (Gulf) from BP Oil International Ltd (BP).
- •BP voyage chartered the vessel SIENNA from Euronav N.V. (Owners).
- •Owners issued a bill of lading to BP.
- •Before carriage completion, the Bank paid BP, and the charterparty was novated to Gulf.
- •The oil was discharged in Oman on Gulf's instructions without presentation of the bill of lading.
- •BP later indorsed the bill of lading to the Bank.
- •The Bank sued Owners for breach of contract of carriage, alleging delivery without the bill.
- •Moulder J dismissed the claim, finding no contract of carriage in the bill at discharge or, alternatively, no causation.
Legal Principles
A bill of lading in the hands of a voyage charterer is usually a mere receipt, not a contract of carriage.
Rodocanachi v Milburn (1886) 18 QBD 67
Upon indorsement to a third party, a bill of lading attains contractual status, creating a new contract between the ship and consignee.
Tate & Lyle Ltd. v Hain Steamship Co. (1936) 55 Lloyd’s Rep 159
COGSA s. 2(1) retrospectively vests all rights of suit under the contract of carriage in the lawful holder of a bill of lading.
Carriage of Goods by Sea Act 1992
COGSA s. 2(2) confers rights of suit even if the bill is spent, if the holder obtained it under pre-existing contractual arrangements.
Carriage of Goods by Sea Act 1992
A waiver by a prior holder of a bill of lading does not bind a subsequent indorsee.
Tate & Lyle v Hain Steamship
Outcomes
Appeal dismissed.
The Court found that even if the bill of lading was a mere receipt in BP's hands at discharge, COGSA s. 2(1) retrospectively created a contract between the Bank and Owners upon indorsement. The Bank's loss was not caused by the Owners' breach because the Bank would have authorized the discharge without the bill anyway.