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Bill of lading related problems - Masters responsibility

The B/L is presented to the Master by the Shipper or the Agent in the port of loading,
usually three originals and one set of copies. The weight of the cargo loaded is
determined by ship and shore figures. Usually the shore figures are used on the B/L.

The following items have to be checked carefully before the B/L is signed:

Cargo destination and weight

Bill of Lading number
Date of issue: always the final loading date
Date of charter party, as indicated in the voyage orders
Information regarding ship: name, nationality, name Master, etc.
Method of payment of freight Freight as per c/p Freight prepaid Collect freight
Other
Correct port of discharge.
Cargo commingling Clause

The three original Bs/L must be signed personally by the Master and not by a rubber
stamp. All other Bs/L prepared, apart from the agreed originals are to be stamped “Copy –
Not negotiable”.

A blank B/L must never be signed. In special circumstances – by prior agreement from the
Owners – the Ship’s Agent may be authorised to sign the completed Bill on behalf of the
Master. In this case clear instructions must be given by the Master to the Agent on the
procedure to be followed. On all occasions however the Agent before signing the B/L must
contact the Master concerned who in turn will advise if a clean B/L may signed or
endorsed with the quantity in dispute or a Letter of Protest issued in lieu of clausing the
Bill of Lading.

If the Ship’s figures differ more than 0.5% from the Bill of lading figure, and clausing of
the Bill of Lading is not acceptable to the Shipper, the Master should contact the
management office for further instructions.

As soon as agreement is reached on all points, all Bs/l are to be signed by the Master.
Usually the Master will be provided with an original B/L, sometimes only a copy. The
departure telex/e-mail to the management office should include the type of Bs/l
remaining on board.

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A Bill of Lading endorsed with “Freight Prepaid” should never be signed without prior
approval from the Owners or management office.

The original Bill of Lading (or Delivery Note) covering the cargo, duly endorsed by
Consignee or Receiver has to be presented to the Master prior commencement of
discharge. In the port of loading the Master is often given an original B/L for the receiver
of the cargo. If the Master is able to determine beyond any doubt the identity of the
Receiver in the port of discharge, he may give him the B/L in exchange for a receipt.
Otherwise, the original B/L is to be given to the Agent in the port of discharge in exchange
for a receipt in which he is obligated to give the cargo to it’s rightful Receiver.

If an original Bill of Lading cannot be presented on arrival of the vessel the management
office is to be informed immediately and the Master should act according to the
instructions given.

A solution could be the discharge of the cargo against the issue of a ‘Letter of Indemnity’
(LOI), provided the Owners have agreed to it. In such a letter the Charterer or Shipper
guarantees to hold the vessel/owners free of responsibility for the consequences for
delivering the cargo without the availability of an original B/L.
Another possibility which may be considered, after approval from Owners, is for the cargo
to be discharged into customs bonded storage, from which it will only be released to
Receivers after the original B/L is presented or LOI received.

When the Master signs the B/L, the Master does so, not on behalf of the Charterers or
Shippers, but on behalf of the Owners. The B/L is an Owner’s document, and it is the
Master’s responsibility to ensure, to the best of his ability, that it is properly prepared and
signed. This applies whether the ship is employed on a Voyage or Time Charter.

The Charterers / Shippers cannot require the ship to agree to issue of Bills of lading with a
description of the cargo which is not in accordance with the cargo actually loaded.
Furthermore, we have to point out that situations like this give rise to potential prejudice
of the Owner,s P&I Cover, because the Club rules state that a claim arising from a bill of
lading being issued, with the knowledge of the Owner or Master, with an incorrect
description of the cargo, quantity or its condition, can only be paid at the discretion of the
P&I Club Directors.

Masters are to ensure they/their officers always take steps/measures to satisfy

themselves that the condition of the cargo presented for loading accords with the
description of the cargo in the documents given to the ship - mate’s receipts / bills of
lading / cargo manifest etc.

If the B/L contains inaccurate or misleading statements about the quality or quantity of
the cargo it covers, then Owners will be liable for the consequences, at least in the first
instance. The Master’s main concern must be, to see that this cannot happen.

Therefore it is essential that the Master clauses directly on the bills the correct condition
of the quality and quantity of cargo if these two items have not be properly described in
the document presented to him for signing. If he wants assistance with the wording to be
used in the clausing, he should call the commercial office who may engage the local P & I
representative for advice. If this is not acceptable to Charterers / Shippers then they will
need to find other cargo to load which does accord with the description which they want
to appear in the Bills of lading.

Masters are also to ensure that the current charter party for the voyage is onboard and
understood by all Officers, this includes notifications to be made when a potential dispute
arises. The timing of such notifications is critical in such cases, if time constraints due to
onboard operations, a telephone call to the Commercial Operator will suffice until a formal
email with relevant backup detail can be sent.

It may not always be easy for the Master to separate the differing responsibilities with
regards to the commercial operations of the vessel. If in doubt, always refer to your
management office /commercial operator for clarification and support.

Related info:

Loading / stress computer for chemical tankers

Recommended temperature monitoring equipments onboard

 Ship inspection at foreign ports -An important guideline

Issuing notice of readiness and related guideline

Cargo claims and issuing letter of protest

Importance of Statement of Facts concerning loading / discharging

Chemical handling suitable equipments for operational personnel onboard

Safety equipments - Ventilation in cargo handling spaces

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Reference publications

Equipment Manufacturers Instruction Manuals

MARPOL – 73/78 (latest consolidated edition)
International Safety Guide for Oil Tankers and Terminals (ISGOTT)
CFR 33 parts 125 to 199
Ship to Ship Transfer Guide (Petroleum)
MSDS for particular cargo carried
Chemical Tank Cleaning Guide

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