BILL OF LADING

HISTORICAL INTRODUCTION

Nobody can precisely say when the bill of lading (B/L) was used for the first time. The first entries in the ship's log book of goods shipped on seagoing vessels must be more than a thousand years old.

In the "Ordonnance Maritime de Triani" (an Italian town) of 1063, it was laid down that every master was obliged to have a clerk (in fact a writer) on board. It also made mention of a log book or register. This is the first indication that goods which were shipped were registered.

The ordinances of the Mediterranean towns and the "Consulat de la Mer", made reference of a "scribanus" or writer. The writer had to enter all the goods that were loaded on board in a log book and keep it up to date. In accordance with the "Consulat de la Mer", the master or the crew were not allowed to load or discharge the goods without the writer being informed. When goods which were entered in the logbook by the writer were lost, the master was obliged to refund them. If he could not refund them, his ship could be sold. All entries in the log book had force of law.

Entry of the goods in the log book served thus as evidence that the goods had been shipped on board. Shippers could receive an excerpt of the log book that could be presented in case the log book was lost. These excerpts can be considered as the precursors of the bill of lading.

The bill of lading, just like the insurance policy and the bill of exchange, originated in Italy. It was found for the first time in 1526, in a decree of the town of Florence under the name of "polizza di carico" i.e. "police de chargement".

In the sixteenth century, the use of the bill of lading is extended to Western Europe and the ordinances around that time, contained several provisions which were related to the bill of lading. We will limit ourselves to the "Ordonnance de Philippe II" of 1563 regarding maritime commerce, the "Ordonnance d'Anvers" of 1570, the "Ordonnance d'Amsterdam" of 1598 and the "Ordonnance des villes Hanséatiques" promulgated at Lübeck in 1591. In those days, the bill of lading was merely a receipt, deliverd by the master which was defined in the "Guidon de la Mer" as follows : "Le connoissement est la promesse particulière que fait le maistre du navire de la réception de telle et telle sorte de marchandise appartenant à tel marchand, et faut tant de connoissements comme il y a de diversité de personne à qui elles appartiennent".

Later, with the "Ordonnance de la Marine" from 1681 from Colbert, the bill of landing, amongst others, received a more definite form.

When, in the beginning of the nineteenth century, by order of Napoleon, the Civil Code, the Penal Code and the Commercial Code were drawn up, the Ordonnance de la Marine from Colbert was nearly completely taken over. However, on this Ordinance, with regards to the bill of lading, an important element was added, namely that the bill of lading could be issued to a named person, to bearer  or to order. And so, the bill of lading became a negotiable document, representing the property of the goods. As a title deed, the bill of lading was to become the basic document of every maritime trade transaction.

Initially, the bill of lading contained no exemption or exoneration clauses so that the master was fully responsible for the goods that were put in his care. The "Consulat the la Mer" held the master fully responsible for all the goods that were entered into the log book by the scribanus. The only exceptions to this rule were : Act of God, Acts of War, hidden defects of the goods, a fault of the shipper and contribution to General Average. In the eighteenth century the clause "Che dice essere" (said to be) was found, whereby the master turned dawn every responsibility with regard to the content of the parcels he carried. One of the oldest exoneration clause which was inserted in the bill of lading was: "The dangers of the sea excepted".

Due to the technical revolution of industry and shipping In the middle of the nineteenth century, the responsibility of the Owner increased continually. Vessels became larger, they carried an increasing variety of goods, which sometimes were destined for hundreds of receivers, the cargo handling was entrusted to outside enterprises on which the master had little or no control, etc. Because of his ever increasing responsibility, the carrier sought to obtain legal protection from the authorities, but in vain. Their only way out was to include a number of exoneration clauses in the bill of lading.

Due to the close competition in the maritime transport around the middle of the nineteenth century, shipping tumbled in a deep period of crisis, which made freights drop disastrously. In the second half of the nineteenth century, the freight conferences were created. When the conference was sure of its monopolization, it went further than imposing high freight rates and a great number of exoneration clauses were enforced. All these situations lead to the fact that the responsibility of the carrier became nearly inexistent. At a certain moment there were so many exoneration clauses in the bill of lading that one could rightly say that the master could carry anything, where and how he wanted it and in the state that best suited him, without any responsibility whatsoever on his behalf.

In a way, one could say that the only responsibility that the owner had was to collect his freight. In fact, the bill of lading had no practical value anymore and gave the third holder no recourse at all against the owner.

Very quickly, not only the shippers, but all who were directly or indirectly concerned with the transport of the goods such as the merchants, the producers, the consumers but mainly the bankers and the insurance companies were very hostile towards these exoneration clauses so that the need for a international legislation was more than necessary.

The United States have always been ahead regarding maritime legislation and in 1893 they introduced the "Harter Act". With this law, they aimed at putting an end to the far-reaching exoneration clauses introduced by the sea carrier by imposing a minimum of requirements regarding their liability for the cargoes that were put in their care. This legislation served as an example for many other countries.

In 1921, in the Hague (The Netherlands), the "International Law Association" drew up the Hague Rules. Their aim was to regulate the liability and the obligations of the carrier of goods by sea and to protect the third holder of the bill of lading. After some amendments they were accepted by a large number of countries and introduced at the "International Brussels Convention" of 25 August 1924 and known as the International Convention for the Unification of certain Rules regarding the bill of lading.

Thanks to the Hague Rules, the bill of lading was now more than a contract of  carriage; it was also a deed on which banks could give credits. Bankers, who were not involved in the initial contract and who consequently had no say regarding the conditions, now showed an interest in them. It was also important that there was uniformity in the different countries concerning the interpretation of the many clauses appearing in the bills of lading.

In England, the rights and obligations of the sea carriers were laid down in the Carriage of Goods by Sea Act 1924.  The Hague Rules were incorporated in this law.

In the United States of America, the U.S. Carriage of Goods by Sea Act 1936 were adopted which were based on the Hague Rules. Because of this, the "Harter Act 1893" lost considerably in value, although the 1936 law explicitly stipulated that some rules of the Harter Act remained in force.

Due to the evolution of industry and shipping (e.g. containerization, roll on/roll off, and the like) together with the currency erosion, the Hague Rules 1924 had to be adapted.

At the 1963 Conference at Stockholm, the International Maritime Comity drafted a new bill that was accepted as the "Visby Rules".

On the 23rd of February 1968, at the Diplomatic Conference of Brussels, the Protocol to amend the International Convention for the Unification of Certain Rules of Law relating to Bills of Lading; signed at Brussels on 25th August 1924 was adopted. This Protocol is known as the "Visby Amendment".

The Hague Rules plus the Visby Amendment of 1968 are referred to as the "Hague-Visby Rules" (HVR).

At the Diplomatic Conference of Brussels, held on the 21st of December 1979, the Protocol to amend the International Convention for the Unification of Certain Rules of Law relating to Bills of Lading; signed at Brussels on 25th August 1924, as amended by the Visby Amendment of the 23rd February 1968 was adopted. It is more commonly known as the "Protocol of 79".

In England, the Visby Amendment of 68 was incorporated in the "Carriage of Goods by Sea Act 1971 (COGSA 71).

On the 30th of March 1978, the United Nations Convention on the Carriage of Goods by Sea, and better known as "The Hamburg Rules, 1978" were introduced.

Useful WWW links

http://www.fordham.edu/halsall/source/1248billoflading.html

http://www.aim25.ac.uk/cgi-bin/search2?coll_id=1212&inst_id=14

http://www.jhalpin.com/nj/newbruns/billoflading1.jpg

http://www.jhalpin.com/nj/newbruns/billoflading2.jpg







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