THE NAUTICAL INSTITUTE NORTH EAST BRANCH

THE MARINER AND THE MARITIME LAW

Seminar 1. Signing Bills of Lading Speakers' Papers

SIGNING BILLS OF LADING C O N T E N T S

Page NATURE AND FUNCTION OF THE BILL OF LADING AND MATES' RECEIPTS R. Rayfield ... ... ... ... ... MEASUREMENT OF BULK CARGOES
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MASTERS' ROLE IN SIGNING BILLS OF LADING T. Llewellyn ... ......... .. BILL OF LADING DISPUTES D. Davies ... ...

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1990 The Nautical Institute 202 Lambeth Road, London SE1 7LQ. Tel: 071-928 1351.

named in the bill of lading, he is usually known as the holder or endorsee of the bill of lading. What are its functions? 6. The bill of lading performs three basic functions. Firstly, it contains or evidences the contract of carriage and it is usually the best evidence as to the terms on which the contract is to be performed. Secondly, it operates as a receipt for the goods and thirdly it constitutes a document of title - that is, it is evidence, sometimes conclusive, that the person holding the bill of lading is the owner of the goods described in the bill. Before going on to examine these three functions in more detail it might be helpful to see the bill in its commercial context. Where does it fit in? 7. The starting point is the contract by which the cargo is to be sold and bought. As with all contract for the sale of goods, it should describe the goods in sufficient detail, make provision for delivery, payment, the passing of risk, the passing of ownership and usually a whole host of other provisions to cater for things which may or may not happen such as, for example, it becoming illegal to trade with Iraq and Kuwait. 8. International sales which are the sort that we are dealing with here involve parties who are separated geographically, the buyer and seller may not know each other and undoubtedly there will be legal, cultural and even political differences which can make international trade a high risk activity. Put simply, the seller will be unwilling to part with his goods before he is paid but the opposite is also true in that the buyer does not want to part with his money until delivery of the goods to him. Now enter the letter of credit. The letter of credit serves the function of reconciling what would otherwise be the irreconcilable preferences of the seller and the buyer. The contract of sale will require the buyer to establish an irrevocable letter of credit to enable the seller to be paid in his own country. There are various types of these documentary credits but most will contain the following information :(1) (2) (3) (4) (5) the type of credit (revocable or irrevocable); the name and address of the seller (exporter); the name and address of the buyer (importer); the amount of the credit, in sterling or in a foreign currency; the name of the party on whom the bill of exchange is to be drawn and whether it requires immediate payment - i.e., 'at sight' or payment a specified time after the date of the bill (this latter would be know as a tenor bill); the terms of the contract and shipment (i.e. whether 'ex-works', 'FOB', 'GIF, etc); precise instructions as to the documents against which payment is to be made; a brief description of the goods covered by the credit; shipping details, including whether transshipments are allowed; also recorded will be the latest date for shipment and the names of the ports of shipment and discharge (sometimes flexibility is introduced hereby providing for a range of ports);
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(6) (7) (8) (9)

(10) whether the credit is available for one or several shipments; and (11) the expiry date. 10. In referring to the bill of lading a letter of credit may require a 'set' or a 'full set'. These are imprecise terms but the conventional 'set' contains three original bills of lading although I understand from P & O Containers Limited that its practice is to issue two originals (comprising the set) and three non-negotiable copies. A writer in 1686 wrote:"Of the Bills of Lading there is commonly Three Bills of one tenor. One of them is enclosed in the letters written by the same Ship: another Bill is sent overland to the Factor or Party to whom the goods are consigned; the third remaineth with the Merchant, for his testimony against the Master, if there were any occasion of loose dealing." 11. As stated above, now the practice is for the complete set to be presented to the accepting (paying) bank. The master is justified in delivering the goods to the first person who presents to him an original bill of lading in respect of the goods provided that he has no notice that the claim to possession of the goods by the holder is in some way legally improper. 12. The bill of lading is relevant to item 7 of the details listed above included in a letter of credit. The bill of lading and the information contained in it must agree with the irrevocable credit, particularly with items 7, 8 and 9. Common discrepancies which will or may lead to no payment or delayed payment include :(a) that the bill of lading is not presented in a full set as required; (b) that alterations are not authenticated by an official of the shipping company or its agent; (c) that it is not clean - i.e. it carries remarks that the condition and/or the packaging of the merchandise is defective; (d) it is not marked 'on board' when so required; (e) 'on board' notation is not signed or initialled by the carrier or its agent; (f) 'on board' notation is not dated; (g) it is not indorsed by the exporter when drawn 'to order'; (h) it is not marked 'freight paid' as stipulated in the credit in respect of C & F and GIF contracts; (i) is made out 'to order' when the credit stipulated 'direct to consignee' (importer) and vice versa; (j) it is dated later than the latest shipping date specified in the credit; (k) it is not presented within the period specified after the date of shipment or such other time as specified in the credit; (1) it includes details of merchandise other than that specified in the credit; (m) the rate at which the freight is calculated and the total amount are not shown when the credit requires these details. In addition, the following are normally only acceptable if expressly allowed in the credit;
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The Bill of Lading as a receipt 20. On the face of it the bill of lading as a receipt should be straightforward but it in fact operates as a receipt in six respects:
(a) (b) (0 (d) (e) (f)

receipt as to quantity receipt as to condition receipt as to leading marks receipt as to quality receipt as to date of shipment and receipt for the freight.

I am not going to go into detail about these different ways in which the bill operates as a receipt for fear of duplicating what Tim Llewellyn might say this afternoon. 21. Contractually the status of information contained in a bill of lading as evidence would take some time to explain under common law, the Bills of Lading Act and under the Carriage of Goods by Sea Act 1971 but the important thing from the point of view of the ship's master is that the bill of lading should tell the truth. In The NOGAR MARIN [1987] 1 Lloyd's Rep. 456, the facts were that the vessel was time chartered for a voyage from France to Florida. The charterers manufactured and supplied the cargo of steel wire rods and coils and they were loaded at Caen and carried to Tampa. After the cargo had been unloaded the receivers claimed that the wire rods were rusty, they arrested the ship and security was provided in the sum of US$500,000. Eventually the claim was settled for around US$100,000. 22. The owners of the ship then set about trying to claim from the charterers an indemnity so that they could recover the loss they had suffered at the hands of the receivers. The claim was referred to arbitration and the arbitrators found that the damage to the steel wire rods existed before shipment. In such a case, where the charterers themselves had prepared clean bills of lading for signing, the owner would normally have a good claim for an indemnity but it was also found by the arbitrators that the master had failed to record on the mate's receipts that the cargo was rusty at the time of shipment. Had the mate's receipts properly recorded the condition of the cargo the ship's agent would not have signed clean bills. Therefore, the reasoning went, the master's negligence broke the chain of causation between the charterers' fault in preparing clean bills for cargo which they must have known was rusty and the signing of those clean bills by the duly authorised ship's agent which would have been prevented but for the failure of the master to clause the mate's receipts. 23. Another example, where the bill of lading is a receipt for the freight, is the practice of P & O Containers. Their bills are produced by computeroperated printers but frequently the transaction between seller and buyer of the goods requires the bill of lading to be marked 'freight paid'. P & O stamp that on manually but before releasing it they generally require the shipper to provide a guarantee countersigned by its bankers to ensure payment of the freight if for any reason it is impractical for payment to be made prior to issue of the bill.
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24. But the master's position remains clear. In Glyn, Mills & Co -v - East and West India Dock Company (1882) 7 AC 591, the House of Lords held that all that the master and therefore the shipowner had to do was to deliver the goods to the first person to present an original bill of lading. He need not ask for the full set and provided he is not put on notice of possible fraud, for example, he is not obliged to enquire whether the person presenting the original bill of lading is in fact the proper consignee.

The Mate's receipt

25. Before moving on to other things, I should just mention the mate's receipt. I have not said much about it because there is not much to say. It is usually a handwritten document which acknowledges on behalf of the ship the receipt of the goods. It is prima facie evidence that the goods specified in it have been delivered to and received by the ship. Therefore, if the goods are lost after the mate's receipt has been given, the owner of the goods may sue the shipowner even though no bill of lading is ever signed. Qualifying words may be inserted to describe the condition of the goods at the time of shipment and it is a common requirement that bills of lading should be issued in accordance with mate's receipts - see The NOGAR MARIN, above.

Documentary fraud
26. Having looked at the bill of lading and its functions in the context of a commercial transaction I thought it might be interesting to look at one or two examples of where things have gone radically wrong. Because the underlying transaction relies on the validity of documents, it has not been difficult for unscrupulous operators to prey on the unwary who have trusted the veracity of the conventional documents. 27. As long ago as 1950 a notorious fraudster acted as broker to supply 45.0OO drums of lubricants to the Chinese government on a GIF price of US$1.23million. The shipment was allegedly made in January 1951 on a Swedish vessel. The documents showed the shippers to be based in Marseilles. Payment was made in Switzerland against bills of lading, Lloyd's survey certificate, export licence, analysis report and other documents. It later transpired that neither the vessel nor the French shipper nor the cargo actually existed and all the documents presented to the bank were entirely false. In addition, at that time export of oil to China was unlawful thus giving the Chinese little recourse because of the illegality of the transaction. 28. More recently, in 1981 an Egyptian buyer agreed to purchase a number of secondhand vehicles from a Belgian exporter he had known for some time. The Belgian exporter travelled to Cairo with a German associate. When he arrived at the offices of the Egyptian importer, he explained that he was unable to provide the secondhand vehicles himself but his colleague from Germany could supply the goods that were required. 29. A pro-forma invoice was duly produced and it was only then that the buyer knew he was dealing with a company registered in Liechtenstein. The buyer thought he was getting an extremely good bargain and agreed to proceed with the transaction. The following day he went to his bank
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and arranged for a letter of credit for DM350,000 to be opened in favour of the Liechtenstein company which had an account at a Swiss bank. Only two documents were called for under the letter of credit, a clean bill of lading and the beneficiary's invoice. 30. Once the German exporter had confirmation that the letter of credit had been opened in favour of the Liechtenstein company, he obtained a bill of lading on which a company called Red Medlines appeared as carrier. This company in fact had already gone into liquidation some nine months previously. The bill of lading was completed showing that a selection of vehicles had been shipped on a vessel called the "HELGA WEHR" at Hamburg. This was entirely false because on the date of the bill the "HELGA WEHR" was discharging a cargo in Lisbon. This was not known at the time and when the bill of lading together with an invoice were presented to the Swiss bank in Zurich, payment was made to the beneficiary. 31. The buyer in Egypt only became suspicious later when neither the ship nor his vehicles arrived. The "seller" proved untraceable and the Belgian said that he had acted only as an introducer of the business and nothing more. 32. In this particular case it appears it was not possible to bring any criminal charges. Although a criminal offence had taken place in Zurich when the bill of lading was forged in order to obtain the purchase price, the Swiss bank refused to become involved in any criminal complaint as it had suffered no loss, having been reimbursed from Cairo. Enquiries of the Liechtenstein company were fruitless. 33. The third case is really a classic of its type and it is one in which my own firm was very heavily involved. The details of it are now public knowledge and so it will not breach any confidences if I explain them to you now. The fraud was perpetrated by a Mr Costas Kamateros a person whom Barbara Conway in her book Maritime Fraud described as having brought the practice of charter-party and combined documentary fraud down to a fine art. In 1976 Kamateros contracted for the sale to Maduako, a Nigerian company, of 100,000 tons of cement, delivery at Lagos. There then followed a complicated series of transactions involving a number of different ships and numerous forged bills of lading. 34. Initially, the contract was performed to the extent of about 70.00O tons. Having thus established his credentials, Kamateros produced shipping documents for a further 25,000 tons loaded into three vessels for delivery to Lagos. All the shipping documents were fraudulent including the bills of lading which were marked freight pre-paid, and when they were presented to the paying bank in London, they realised US$1.7million. It transpired that at the time when the fraudulent bills of lading indicated that the vessels had loaded the cement, they were all in fact laid up in Greece. 35. The buyer in Nigeria became concerned about the delay in delivery of the cement. Kamateros excused the delay by saying that owing to a change in circumstances it had been necessary to load 18,000 of the 25,000
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tons on to one larger ship, the "CINDY". My firm acted for the owner of the "CINDY" and her P & I Association. 36. The buyer in Nigeria was placated for a while long enough for Kamateros to offer the same cargo for sale to another Nigerian company, Ekimpex. Another forged set of documents was produced by Kamateros showing that the "CINDY" had loaded the 18.0OO tons of cement at what was then the East German port of Rostock. Again, the buyer failed to check on the whereabouts of the ship. At the date of the bill of lading the "CINDY" was in fact at Lisbon on a voyage quite unrelated to the voyage to Nigeria. 37. Having duped Ekimpex into paying for the cargo, Kamateros purchased the required quantity of cement and chartered the "CINDY" which then loaded it and sailed for Nigeria. 38. When the ship arrived, agents for two receivers presented apparently genuine bills of lading for the purpose of taking delivery of the cargo. They were the original buyer, Maduako and also the second buyer, Ekimpex. Barbara Conway's account of the episode ends there with the comment that the two victim companies were left to sort out the mess for themselves. That was in 1977. In fact, I can tell you that the third victim was the "CINDY" and her owners. Sorting it out meant that the innocent shipowner, his solicitors and P & I Association became embroiled in a ten year struggle with the receivers. Inevitably, the ship was delayed for a long time. The Kamateros chartering company, Kos International had long since stopped paying hire, freight or anything else. The ship was arrested. The master was arrested. Interminable court actions followed in Lagos, Port Harcourt and elsewhere. The vessel's P & I Association provided security. The parties in Nigeria would not accept a club letter. A deposit was made in cash. Totally outside the control of the P & I Association, the money was not placed on deposit for the benefit of the parties. It was converted into naira. At the time, the naira was worth more than a dollar. By the end of the story, the very large amount of security which had originally been asked for was worth little. The future 39. Moving on from that somewhat depressing subject, what of the future? If we believe what we are told, the future is Electronic Data Interchange, or Edi for short, which is the interchange of trade data effected by electronic transmission. The Comite Maritime International has already prepared a set of draft rules on the electronic transfer of rights to goods in transit. The idea is not to affect property rights between buyer and seller under the contract of sale or to affect rights under the contract of carriage. Those rights will be ascertained by the terms of those contracts. Edi is concerned with the transfer of the right to possession of the goods. In other words, it is concerned with the right to delivery. 40. Conventionally, as we have seen, as between the carrier and the cargo interests the right to delivery is decided by possession of one original bill of lading in respect of that cargo and the surrender of that bill in exchange for delivery. Edi is an attempt to dispense with the need for paper. One effect, it is hoped, will be to reduce the risk of documentary fraud. To work, its operation will have to be governed by a common set of

rules and it will be a matter for agreement between parties to a transaction - seller/shipper, carrier, buyer/receiver - whether the "documentary" side of the transaction is to be operated by electronic data transfer or not. My understanding of the way it will work is this. (a) The parties to the transaction will have to give each other their electronic addresses. (b) When the goods are shipped the carrier will send a message to the shipper confirming receipt of the goods and giving details of the place of shipment, date of shipment, the quantity and nature of the goods shipped and all the other essential information which is normally contained in a paper bill of lading. In addition, the carrier is likely to make reference to the contractual terms upon which the carriage is to be performed. (c) This message is intended to be the equivalent of the shipowner Issuing and releasing to the shipper a paper bill of lading. 41. In the electronic context there has to be introduced a feature which, when the goods might have been sold on one or more times to the final receiver, will enable the carrier to be sure that the person seeking delivery by electronic means is entitled to delivery. The CMI draft rules call it the "private key" composed of a unique alpha/numeric combination which the carrier will give to the shipper for the purpose of establishing the authenticity and integrity of a transmission. The person in possession of this private key is in fact the equivalent of the holder of a paper bill of lading. He is the person who can claim delivery of the goods, nominate the consignee, transfer the right of control over the goods to another party, and instruct the carrier on any matter concerning the goods in accordance with the contract of carriage. d) When the time comes for the shipper to transfer rights to another party, the procedure is a little different from the conventional documentary one. The shipper contacts the carrier electronically and gives details of the party to whom the rights are to be transferred. Included in the message would be the private key originally agreed upon. (e) After acknowledging the message the carrier would then send an electronic message to the transferee nominated by the shipper. Provided the transferee agrees to accept the rights, the carrier will issue the transferee with a new private key and will cancel the private key given to the shipper. In a simple transaction, this transferee will, of course, be the final receiver. (f) If there are subsequent transfers, they will be effected in the same way through the carrier. (g) When the time comes for delivery, by electronic message the carrier will inform the current holder (i.e. the person in possession of the current private key) of the time and place for delivery and delivery will be undertaken in accordance with the holder's instructions in the same way as it would be in accordance with the instructions of a holder of a paper bill of lading. On delivery, the carrier will cancel the private key.

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42. Changes to the bill of lading system are likely to be slow in coming if only because of the enormous investment in computers which will be required to achieve it. The computing hardware and software will have to be compatible. I suspect it will come in initially in the more sophisticated liner trades although I can also imagine that large grain traders will also wish to adopt it and that will be an incentive for shipowners who aim to do business with first class charterers to do likewise. 43. When the changes do start to come in, there will be a number of knockon effects. The master's role in signing bills of lading will disappear for a start and so this afternoon's paper on the subject may well be redundant. But it will have to be catered for in the underlying contracts of sale, in letters of credit, in cargo insurance policies, in P & I club rules and in charter-parties. Probably legislation will be necessary to cover it in the same way as it now covers paper bills of lading in the form of the Bills of Lading Act 1855. Edi is a glimpse of the possible future but I suspect the past and present in the form of paper bills of lading will be with us for some time to come. Thank you. Newcastle upon Tyne September 1990

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MEASUREMENT OF BULK CARGOES

By Captain Keith Parker, Master Mariner. MNI Maritime Consultant, Murray Fenton & Associates Introduction 1 I am asked to talk about measurement of bulk cargoes with particular reference to signing Bills of Lading. 2 In other words, what can you do to establish or confirm the quantity of bulk cargo loaded and discharged, and what can you do in the event of a dispute to protect your Owners/Charterers interests? Let me first of all say that it is not within the scope of this paper, or my intention to try to tell you how to do your job in this respect, rather to show what the problems are and to look at what you can do to avoid problems. I have attached examples of the way we calculate and present our reports for draft surveys and oil outturn surveys. However, that is all they are, examples; if you have a tried and proven layout and method which you always use and you can properly quantify cargo on board, regardless of how the Charter Party requires it to be measured, then you are doing your Job correctly. Regrettably the age old practice of "blame the ship" if things go wrong still very much applies. However, keeping good records of facts and figures goes a very long way towards helping someone like me to come along to unravel the conflicting information and to try to establish what caused the dispute on quantity discharged as against that said to have been loaded under the Bill of Lading. As you all know measurement of bulk cargo is anything but an exact science. Sometimes, quite frankly, it is at best a guesstimate.

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Section One 1 1.1 Liquid Bulk Cargoes This section has been prepared by my colleague Roger Woodcock, who is an ex Tanker Master, Tanker Senior Marine Superintendent and is now the resident tanker expert in my company. As I mentioned in my introduction, the paper is written from the point of view of a surveyor by a man who over the last couple of years has on average done two outturn surveys per month. Accurate measurement is the primary and essential requirement for the sale, purchase and transit handling of liquid cargoes. The various procedures described in this paper refer primarily to the measurement of crude oils and clean petroleum products on board tankers but the same basic principles can be applied to liquid cargoes generally both within shore terminals and on board ship. Before any cargo measurement operations commence on board ship the surveyor should make himself known to the Master of the ship for two main reasons; the first, as a common courtesy and secondly, as the Master will normally hold the official cargo documents to which the surveyor will require access to ascertain the information required to combine with the actual measurements obtained to calculate the total cargo volume on board. At this time enquiries should be made whether any Letters of Protest were lodged at the loading port and particularly whether any reference was made to discrepancies between Bill of Lading figures and the ship's calculated figures. It is not normal to clause tanker Bills of Lading. 'Clean' Bills are required for commercial trading purposes and any discrepancies are covered in the wording of the Letter of Protest. Some Owners require the Master to specify the difference in figures while others may not, merely that there is a difference in figures. Currently some difficulties are being experienced with the accuracy of Bill of Lading figures issued by at least one oil exporting country due to the data used to calculate the quantity said to have been loaded being both inaccurate and out of line with generally agreed industry standards. Having examined documents obtained from the Master the surveyor should meet with the ship's Chief Officer, normally the ship's Cargo Officer, and any other surveyors who will be representing interested parties, eg. shippers, charterers, owners, receivers and terminal operators. Often surveyors will represent more than one party but it can be that each party appoints their own individual surveyor. At the time of boarding it is useful to make a quick visual check of the drafts forward, midships and aft. Often of course fore and aft drafts are difficult or impossible to check but the amidships draft will be visible from the jetty and provides an immediate cross reference when
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the same information is requested verbally from the Cargo Officer. Once on board tell tale signs including the way water is lying in the scuppers, or how water is running from steam leaks and even the 'feel' of the deck will give an indication of trim and list if any. 1.9 During or following the meeting with other surveyors and the Cargo Officer it will be useful to examine the relevant basic ship's plans covering tank and pipeline layout, hatch and gauging point locations, tank dimensions, calibration tables, tank reference heights and whether pipeline quantities are included in or excluded from tank calibration quantities. If fitted, automatic ullage read-outs should be noted for comparison against the manual gauging readings to be taken subsequently, and automatic draft gauge readings if available should be checked against the draft stated. The various loading port cargo documents obtained from the Master or Chief Officer should be examined to ascertain the quantity said to have been loaded and to identify the appropriate data used for calculation of the volume loaded and to be subsequently discharged. These include the Bill of Lading quantity, given in US Barrels at 60F or cubic metres at 15C, that is the volume, and weight in long tons and metric tonnes, the certificate of quality and quantity showing the same figures and in addition a figure for BSW or Bottom Sediments and Water (expressed as a percentage of the total gross volume) and the API gravity at 60F or occasionally the Relative Density (60/6OF) or (15/4C), the OBQ or On Board Quantity certificate from the loading port showing the amount of sediments, free oil and free water, if any, on board prior to loading and finally the ship's documents indicating the VEF or Vessel Experience Factor, the ratio between the sum of relevant Bill of Lading totals to the sum of the corresponding quantities independently determined from shipboard measurements. This latter information gives an indication of the accuracy of the calibration of the ship's cargo compartments. Upon completion of checking the preliminary data physical gauging of the ship's tanks can commence having ascertained whether the ship is to be gauged "open" or "closed". Older tonnage will need to have the Inert Gas System depressurised or at least reduced to a very slight positive pressure before opening ullage hatches whilst on more modern vessels all gauging and sampling is carried out via the vapour lock system which allows the inert gas pressure to be maintained well positive throughout the operation. The gauging of the tanks consists of ullaging, that is measuring the distance between the tank height reference point and the surface of the liquid to the nearest 5mm, sounding the bottom of the tank to ascertain whether water or traces of water are present and checking the temperature at three levels, upper, middle and lower, of the oil volume. The ullage and water dips (soundings) are sometimes taken with a steel tape, using water finding paste on the brass "bob" to detect water at the tank bottom or water finding paste over a greater length
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of the tape if it is known that an amount of water may be present, for example in a slop tank. 1.14 However, it is becoming increasingly common for electronic gauging tapes to be used to measure ullage, temperature and to detect water in one operation using the differences in conductivity of air, oil and water to indicate the appropriate readings on a digital read-out incorporated within the instrument itself. It is also important to check the reference height, that is the distance from the tank ullage reference point at the ullage hatch to the tank bottom to compare with the tabulated height in the tank calibration tables. All relevant data will be recorded on a tank by tank basis. At this time it is also important to check any empty cargo tanks for leakage and also that permanent or segregated ballast tanks are free of oil. Samples of cargo are drawn from each tank for laboratory analysis to provide a check that the cargo to be discharged is in fact the cargo stated on the certificate of quality. This analysis is outwith the capability of the ship but is necessary for comparison of the final ship's outturn to the quantity actually received ashore at the end of the discharge. It will be appreciated that in order to maintain consistency of readings the ship must remain as far as possible at rest during gauging operations and operations such as bunkering and shipping or transferring ballast must not be permitted during this time. For vessels discharging at sea berths or engaging in transshipment operations these conditions are impossible to meet if only due to movement in a seaway. In this situation considerable care must be exercised to get the best possible accuracy and averaging of ullage readings. Generally speaking approximately one to one and a half hours will be occupied gauging tanks on a VLCC, more or less depending upon circumstances - more in driving rain at 0300 hours on a March morning in Europoort and less on a sunny summer afternoon at Fossur-Mer! Having collected all the required data it is now necessary to calculate the total volume of cargo on board for comparison with the stated Bill of Lading and ship's loaded figures. This is carried out in conjunction with the ship's calibration tables, trim tables if necessary, average temperature, API or SG and volume correction tables - using a work sheet something along the lines of that shown in the papers. At this point it is useful to remember that having overcome, to the best of his ability the difficulty of obtaining accurate data, the surveyor calculating the quantity on board has to choose between one
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of the two systems currently in use. First the traditional method of measurement in barrels and long tons using the API gravity corrected to 60F or the perhaps more logical metric system expressing measurement in cubic metres and metric tonnes at 15C using the density of the liquid. Furthermore it is not possible to directly convert between the two systems as their respective standard temperatures do not correlate, and finally as the volume of a liquid changes with temperature and as the change is not linear, correction tables have been developed in the industry showing the correction to apply to bring the observed volume at the observed temperature to the appropriate standard temperature. 1.23 Unless the surveyor has an overriding preference for a particular system his decision is usually influenced in practice by the ship's calibration data. In the example shown barrels was the chosen volumetric measurement. A work sheet along the lines of that shown is used and the basic data of drafts, trim, ullage and temperature are entered in the appropriate columns. In this example the trim happened to be 0.5m by the head therefore unless the gauging point is at the geometric centre of the tank it is necessary to apply the appropriate trim correction, as indicated in the trim table, to the observed ullage to obtain the corrected or true ullage. The calibration tables are entered with the true ullage and the corresponding volume in barrels entered in the appropriate column. Similarly a volume corresponding to the water dip is calculated and subtracted from the tank total volume. This then provides the gross observed volume of oil in that particular tank.

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1.25 The appropriate VCF or volume correction factor is now obtained from the ASTM (American Society for Testing and Materials) Crude Oil Table, 6A in this case as API at 60F is being used in conjunction with the average tank temperature in F, and applied to the gross observed volume to obtain a GSV (Gross Standard Volume at 60F). This procedure is repeated for each tank and a total GSV for the ship calculated. The GSV in barrels is then multiplied by the factors from the appropriate ASTM Tables 4, 11 and 13 to obtain cubic metres at 15C; long tons and metric tonnes respectively. The tables most regularly used are published in handy A3 paper size by the commercial bulk liquid surveying companies. The tables are the result of co-operation between the American Petroleum Institute (API), the American Society for Testing and Materials (ASTM) and the Institute of Petroleum, London (IP) to provide uniform and authoritative publications based upon the most accurate information available. Thus the various tables provide a basis for standardisatian of calculations of the measured quantities of petroleum liquids regardless of origin, destination or units of measurement. 1.26 The figures thus obtained are then compared to a similar calculation carried out at the completion of loading and an in-transit gain or loss established. A figure within 0.3% of the loaded figure is considered to be within the limits of measurement error and acceptable in the oil transportation industry.

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1.27

Upon completion of discharge all cargo tanks are sounded and dips of sediments and oil, if any, recorded. For various reasons it may not be possible to discharge all free oil in a compartment but for accurate accounting this must be taken into consideration. It is possible to measure the depth of material in the tank bottom but, after taking into account the trim of the ship, it may not be possible to enter the calibration tables to determine the volume if the corrected dip is small or negative. The 'Wedge Formula' has been developed to enable small volumes of ROB (Remaining on Board) to be determined from dip measurements. For best accuracy the dipping point should be as close to the after end of the tank as possible. (Details of measurements required and the formula to be used are at end of this paper.) Again using the calibration tables for sediments and Wedge Formula for liquids not covered in the tables, the total ROB quantity is calculated and subtracted from the arrival total to give the ship's total cargo discharged. This quantity is compared with the shore received cargo figure and the Bill of Lading figure. Obviously, in an ideal world, all three should be approximately the same. Unfortunately this is rarely the case, certainly with crude oil. Bulk liquid cargo measurement is not an exact science although everything possible is done to identify discrepancies and ascertain their cause. If it can be shown that the ship has discharged all cargo on board on arrival then any shortage must be attributable to physical loss within the receiving terminal or alternatively a paper loss due to calculations having been based on incorrect data either accidentally or deliberately. Unfortunately time does not permit us to examine this interesting aspect of cargo measurement but I hope the foregoing has given everyone a brief insight into the basic aspects of what can become a complex subject. Roger Woodcock 3rd November 1990

1.28

18

Section Two 2 2.1 Dry Bulk Cargoes In the majority of cases the ship has no control over how the cargo is to be quantified, and if it is to be by shore measurement no way of checking how it is done or verifying the results. Mostly nowadays shore measurement is used, and the Charter Party should state how and by which method. When shore measurement is used, realistically all the ship can do is to ensure that everything loaded is discharged (in the same condition) and to check the quantity by draft survey and knowledge of own ship and/or measurement of space remaining and using the stowage factor. There are then two ways of measuring a bulk cargo:

2.2 2.3

2.4

2.4.1 Measurement of weight ashore. 2.4.2 Measurement of weight on board ship. 2.5 In the first case there are a number of methods of weight measurement used with varying degrees of declared accuracy, and always with the possibility of questionable reliability. The accuracy of a mechanical weighing machine will always depend upon its age, servicing and maintenance and the regularity of inspection by the authorities (often Customs and Excise). The methods used can be grouped into the following three types:

2.6

2.7

2.7.1 Weighbridge, 2.7.2 Conveyor-belt weighing systems, and

2.7.3 Automatic weighing through weight bins/silos. 2.8 2.8.1 Weighbridges Weighbridges can in themselves be fairly accurate to something like + or - 0.2%, but of course accuracy depends upon the correct tare weight for the lorries used, and we have all heard of the classic discharge situation when the odd lorry leaves by a different dock gate without crossing the weighbridge. Conveyor-belt weighing systems Probably the least accurate and is dependent upon flow rate on the conveyor. At best with optimum rated flow, which often either cannot be achieved or is not required by shore or ship, the accuracy is about + or - 0.5%.

2.9 2.9.1

19

2.10 Automatic weighing by bins/silos 2.10.1 This is the system most frequently used, especially in the grain trade, and the generally claimed accuracy is + or - 0.1%, although some manufacturers are more realistic and suggest that this equipment is capable of accuracy in that range but that operational accuracy is more like + or - 0.3%. 2.10.2 It can therefore be said that the best that can be expected by shore gauge/scale is an accuracy of + or - 0.2%. That is a claimed average figure and I believe somewhere between 0.3 and 0.5% to be more realistic. 2.10.3 One of the criteria in measuring weight is to compare like with like in terms of load weight and discharge weight, so that it can be seen if a different method of shore weighing is used for loading than for discharge, different percentage accuracy can apply. Even if the machines are in top class condition, one reads minus the other plus, a difference of 0.5% can easily apply which in a 50,000 ton cargo could mean a claimed shortlanding of 250 tons. 2.10.4 It may be just that I have been involved mostly with grain disputes, but it seems to me that most shortage claims are in the grain trade. Perhaps its because grain, being the least dense of normal bulk cargoes, is more difficult to weigh. I have known a case where an allowance was made against a grain shortlanding claim for 0.1% for dust which had blown away through discharging in windy conditions. 2.10.5 So what can the ship do if the cargo weight is to be quantified by shore weight? It may be said not a great deal. However, questions to the agent, the terminal operators and the shipper if he is available to demonstrate interest does have a salutary effect and could prevent a try on. You might even get to see the weight dockets or records; not that they would necessarily mean very much. 2.10.6 We are therefore left with checking the weight on board and despite the well known shortcomings of this, in my opinion it is still well worthwhile, and even if not particularly accurate can still be used as a check on shore figures and can help to support Owners in a dispute. 2.10.7 Unfortunately there are no weighbridges for ships and in any event the calculation of the ships tare weight would be somewhat difficult. We are left with either establishing weight by space measurement and stowage factor or the much maligned draft survey. 2.11 Space Measurement 2.11.1 By no stretch of the imagination can this produce anything more than a rough estimate of weight. 2.11.2 First it is extremely difficult to measure the space remaining after loading with any accuracy. The idea being to measure the space remaining and deduct it from total cubic to get space occupied by cargo and divide by the stowage factor. The declared stowage factor

20

may be given based on experience or the nature of the trade or at best by laboratory analysis, but whatever, it may not stow to that in your particular ship for many reasons which we do not need to go into. Thus an approximate stowage factor divided into an estimated space used, can only produce an approximate weight of cargo. 2.12 Draft Survey 2.12.1 I have used the expression "much maligned" draft survey. I believe it can still be a very valuable and reasonably accurate method of calculating weight of cargo, provided that it is done correctly, regularly, is always done the same way and its limitations are understood. 2.12.2 It used to be the only way of measuring the weight of bulk cargo and in some trades it still is, and is regularly used. 2.12.3 In my company we carry out regular draft surveys, on small scrap loading ships where the Bill of Lading figure is produced from our survey, and for medium size grain ships where it is used as a check on the shore gauge figures. 2.12.4 We probably carry out 5-6 scrap loading ship surveys per month and 2 grain ship surveys per month during the season. To illustrate my opinions and our methods I have attached 2 examples of our actual surveys to this paper, which I will refer to as we discuss the method in general terms. I have also attached a series of computer print-outs, again based an actual surveys we have done, to demonstrate the very significant differences which can occur if a draft survey is not done correctly. 2.12.5 To properly plan and complete your loading it is necessary to do a deadweight calculation especially if there are draft restrictions. It follows that a draft survey at the same time produces all the facts and figures to check against the Bill of Lading. 2.13 Draft or Deadweight Surveys 2.13.1 The two are often referred to as the same, which is not correct. A deadweight survey does not have the same value as a draft survey, because it relies upon a Constant which can only be an estimated figure, whereas in a draft survey the constant is a calculated figure. 2.13.2 A deadweight survey is nevertheless still a useful tool because it can be used at any time to establish the weights on board. That is providing a careful record has been kept of all previous constants and a figure can be used in which you are reasonably confident represents the unknown weights on board. 2.13.3 Simply, if you know the weights of all the measurable items on board (usually termed known weights) such as bunkers, fresh water and ballast water, added to the ships light displacement plus the constant and deduct the figure from the current displacement, the result is the weight of cargo. Thus without an accurate constant the deadweight survey produces only an estimated cargo figure.
21

2.14 Draft Survey 2.14.1 A draft survey depends upon the accuracy of the calculations, but no matter how good they are, if you haven't read the draft correctly or measured the dock water density as accurately as possible, the results may be worthless. 2.14.2 It is often referred to as a "before and after" survey, the principle being to establish the ships displacement empty and loaded or the other way round at discharge port. 2.14.3 The start point is of course reading the draft, which as I've said must be done as accurately as possible. 2.14.4 It should be easy, and I think most of us would like to think in good conditions we can read a draft to an accuracy of + or - 1cm, which on a small ship may not be significant, but on my last ship was equal to 73 tonnes. 2.14.5 If I might digress here, I was taught to read the draft on my first ship, a 10,000 ton NE Coast Tramp. The cadets had to keep their own draft book, which the Master compared regularly with the Carpenters morning and evening drafts and the 3rd Mates arrival and sailing drafts. The draft was always read and recorded twice per day as were actual soundings of all tanks; either working tanks or full or empty tanks - a full record. I have always tried to work the same way. Unfortunately often nowadays draft books are not kept. You might find arrival and departure drafts entered in the log book, and soundings are frequently limited to working tanks only and may not be recorded. 2.14.6 It is of prime importance that proper records are kept and in terms of our particular subject today, without them cargo cannot be properly measured. 2.14.7 Incidentally, my first ship in 1954 was also my first bulk cargo. We loaded 10,000 tons of grain at Port Lincoln, north of Adelaide, by bleeding the bags. I seem to remember it took about 10 days. The main thing I learnt was how to trim. I think the Mate got an envelope for providing our services and we got the promise of a half day off next voyage. I cannot remember if we ever got it. I remember we loaded L.E.F.O. (Lands End for Orders) and discharged at a continental port, after which I learned the next important job with bulk grain, how to clean the bilges. 2.14.8 My last ship was a "proper" bulker of 80,000 deadweight which I left at the end of 1980. I remember thinking when I joined her that cargo work and measurement would be easy with a loadicator and draft gauges. The draft gauges never worked correctly, the loadicator wasn't as reliable as the Ralston we had had on my first ship and when the Mate told me he measured ballast in the two ballast holds by counting the rungs on the hold ladders, I thought "so much for progress". On that last voyage we loaded about 60,000 tonnes in less

22

than 24 hours, including a long stop because we had to arrive with heavy ballast of about 30,000 tons to achieve the air draft, and at 2.000 tons per hour we could not de-ballast fast enough to keep up with the loading rate. 2.15 Draft Reading 2.15.1 To get back to reading the draft, to achieve the best results, there are a few points to consider. i) Obviously the ship should not be working cargo, or ballasting or bunkering.

ii) Have the ship upright. The stability information is calculated on this basis and any list will produce errors. iii) Read the drafts from a boat if possible. Looking down at an angle will produce errors. iv) Read all six drafts and mean them. v) It may be more accurate when reading the midships draft to measure the freeboard from waterline to the top of the deck line. (To convert freeboard to draft add deepest summer draft to summer freeboard and subtract the measured freeboard.)

2.16 Density 2.16.1 The old bucket over the side and drop in the hydrometer just isn't good enough. i) ii) Use a good quality instrument and treat it with care. Take the density at the same time or as soon as possible after reading the draft.

iii) Try to read draft and density at slack water. The drafts can be affected by squat if there is a strong tide and the density will be changing. iv) Try to obtain a composite sample of water, i.e. from three positions on the offshore side, each one from a depth equal to the draft rising to the surface. 2.17 Corrections to Draft 2.17.1 Once the 6 drafts have been accurately read it is necessary to make a series of corrections in order to produce a true mean draft and an actual displacement. i) Correction to the Perpendiculars This is necessary because the draft marks are not usually cut at the fore and aft perpendiculars and therefore have to be corrected to them. This is found by:23

Formula for Correction to Perpendiculars (shown on page 1 of our draft survey print-outs under trim correction.) Forward Correction Aft Correction FWD x Apparent Trim Distance Between Marks AFT x Apparent Trim Distance Between Marks

Where: FWD = Distance of fwd marks from fwd perpendicular (FWD = +) AFT = Distance of aft marks from aft perpendicular (AFT = -) Apparent Trim = Difference of fore and aft marks as read Distance Between Marks = LBP + FWD - AFT Note that: Apparent Trim Distance Between Marks Thus is produced :Corrected Forward Draft Corrected After Draft True Trim
ii)

True Trim L.B.P.

Correction for Hull Deformation The midships draft is only the same as the mean of the fore and aft drafts when the ship is neither hogged or sagged. This correction may be obtained for a bluff shaped ship like a bulker or tanker by taking the mean of mean drafts. Forward Draft + After Draft + (6 x Midships Draft) 8

iii) Trim Correction When the ship is trimmed the calculated mean draft is not the same as the true mean draft measured at the L.C.F., and when trimmed the L.C.F. moves from its tabulated position.
First Trim Correction (Layer Correction) is calculated by:Correction = Dist. C/F FWD of Midships x True Trim LBP This correction is in metres. In the old method it was multiplied by the T.P.C. to give the correction in tonnes. This produces draft at C.F. From it the displacement from the scale is obtained.
24

Second Trim Correction (Form Correction) is calculated by:Correction (Tonnes) = 50 x Trim x Trim x dM LBP dZ Where: Trim = True Trim dM = Difference in MCTIC between drafts 50cm dZ above and 50cm below the mean draft The correction must be added to the displacement. This produces an actual displacement. iv) Density Correction The actual displacement must be corrected for density. True displacement = Scale Displacement x Density of dock water Density used for scale
v) Heel Correction

The ship should be upright during the survey. If not, then a Heel Correction should be applied. Correction in Tonnes = 6 x (T, - T2) x (D, - D2) Where: Tj = TPC for deepest draft midships (D,) T2 = TPC for shallowest draft midships (D2) (always addition) 2.18 True (or Actual) Displacement 2.18.1 Once this figure has been calculated in the unladen condition, the known weights are deducted from it, the difference being the constant. 2.18.2 It is essential that very careful and accurate tank soundings are taken to quantify all the liquids on board. ALL tanks must be sounded. 2.19 Constant 2.19.1 This figure includes stores and equipment and other items for which individual accurate figures cannot be obtained. The ship's stability book will normally give a figure for the original constant. 2.19.2 Over the years it will increase because of added weights, such as increased stores and equipment and extra layers of paint. 2.19.3 If the constant calculated is markedly different from the norm (original + expected increase) then the calculations may be incorrect or there is some other factor which must be investigated.

25

2.19.4 One factor may be a build-up of mud in the ballast tanks if the ship has been regularly ballasted in muddy rivers. Remembering that additional weight results in loss of cargo lifting, this sort of problem has to be dealt with. 2.19.5 There are patent chemicals which are used to put mud into suspension in ballast water, so that it can be pumped out. In my experience they only have limited success. One bulk carrier where we tried this in the double bottoms had virtually no effect. On inspection I found that the mud had a crust on the top of it, produced by a mixture of the mud itself, rust scale and residues of the anodes. Only if the crust was destroyed could the chemical work. The only solution in this case was to cut holes in the bottom at drydock and shovel the stuff out. An estimated 600 tons was removed. 2.19.6 The before loading draft survey is to establish the known weights on board and the constant. Then the after loading draft survey, prepared and corrected in exactly the same manner, produces a loaded displacement. 2.19.7 By applying the amended known weights and the constant to the loaded displacement the TOTAL WEIGHT OF CARGO IS FOUND. 2.20 It will be seen from the attachments to this paper that our draft surveys are done on a computer, and although I am not computer literate I am told it is easy to do and set up, and any ships particulars can be plugged into a set programme. I believe there are pocket calculator type computers on the market for draft and deadweight calculations for own ship. The print-outs show the weight of cargo with all corrections made, and then the effects not using the proper corrections can have. In the case of the 44,000 deadweight bulker the difference can be as much as:True Figure Uncorrected Difference 98.4% 22,363.78 MT 22.719.45 MT 353.67 MT

2.21 2.22

and even on the small scrap ships :True Figure Uncorrected Difference 97% 2.23 2,084.40 MT 2.149.33 MT 64.93 MT

Clearly such large differences could lead to large and expensive claims, and no Master would be popular signing a Bill of Lading for 355.67 tonnes/64.93 tons more than was actually on board.
26

2.24

Also, such differences being greater in terms of percentage than the normally accepted allowances of 0.5% when quantifying cargo weight by shore scale it can be seen that to use a draft survey as a check if it's not done correctly would be worthless.

2.25 Bill of Lading 2.25.1 Your cargo may be quantified by draft survey or by shore gauge. Whichever is used, if you don't do your own draft survey you are signing the Bill of Lading blind. 2.25.2 A draft survey before and after loading and before and after discharge, correctly done, has got to be worthwhile and is your best protection, along with making sure everything loaded is discharged in the same condition, if a dispute occurs. 2.26 Conclusion 2.26.1 I almost signed the end of my paper "Report is without prejudice" as I would a survey report. 2.26.2 As I said at the beginning, I have not attempted to teach you anything, even if I was qualified to do so; what I have tried to do is show and remind you what seamen can do to avoid claims, or at least be well prepared to fight claims in Bill of Lading disputes, particularly on quantities. 2.26.3 For more comprehensive information on calculating draft surveys, I would recommend a paper entitled "Improving the Accuracy of Draft Surveys" by J.L. Strange, which appeared in the May 1980 edition of "Seaways". 2.26.4 Incidentally, I notice that it was followed by an article on Hydrometers by Edward Stokoe, who had a letter on a similar topic in the most recent (October) copy of "Seaways". Keith Parker 3rd November 1990

27

BUIK LIQUID CARGOES

1) 2)

Details of 'Wedge Formula' Examples of "Cargo Outturn Survey" Report Work Sheets

28

WEDGE FORMULA CALCULATION

29

M.V./S.S.: PORT: BERTH: DISCHARGING: DATE:

Survey No.

CARGO OUTTURN SURVEY

************************************* ************************************

Certificate of Total Quantity on board after Loading Certificate of Total Quantity on board prior to Discharge Statement of apparent In-transit gain/loss Tank Dry Certificate Certificate of Residues Remaining on Board Certificate of Total Quantity discharge

*****************************************************************************

For and on behalf of MURRAY FENTON & ASSOCIATES LIMITED.

DRY BULK CARGOES

Medium Size Bulkier Loading Grain Laden Cargo Weight used by Owners/Charterers as check on Shore Gauge Quantity

1) Example of Draft Survey 2) Computer Print-outs

37

Sea Conditions

At the time of our initial survey, the wind was South Westerly force 3 to 4 with a slight sea and low swell running in the dock. At the time of the final survey, the wind was North West force 5 to 6 with a rough choppy sea and low swell.
RESULTS AND CONCLUSIONS

From our measurements and observations, we consider that the total cargo loaded was 22,487.37 metric tons. This compares with the shore figure (and Bill of Lading quantity) as follows: By MFA Draft Survey: By Bill of Lading: Difference: (Percent of s/dwt): Report is without prejudice. 22,487.37 metric tons

22,500.00 metric tons 12.63 metric tons 0.052 2

For and on behalf of

MURRAY FENTON AND ASSOCIATES LTD.

1st

1990

Ends: Draft Survey calculation sheet

39

DRAFT SURVEY No SHIP: BERTH:

- SN - 90
CARGO: LBP:

NO

Barley 172.00
UNLADEN LADEN

TIME DATE WIND SEA CONDITIONS DENSITY:

1200 23/02/90
SW 3/4 SLIGHT

1630 01/03/90
NW 5/6 Moderate

1.015

1.0195
10.13 10.22 10.175
9.96 10.30 10.13

DRAFTS:
Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: Hid Starboard: Mid Mean: Aft Port: Aft Starboard: Aft Mean:
APPARENT TRIM: TRIM CORRECTION:

5.03 5.02 5.025 5.89 5.91 5.9 7.03 7.03 7.03

2.005

10.01 10.15 10.08 -.095

-6.67 7.59
.0040171 -.004571 10.17902 10.07543 -.103588 -.002777 10.12931

Dist fwd mark fm F.P. (Fwd = +! Dist aft mark fm A.P. (Fwd = +; Fwd Correction: Aft Correction:

-6.67 7.59
-.084781 .0964749 4.940219 7.126475 2.186256 .1333470 5.933337

CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM:

HULL DEFLECTION (hog = +): MEAN OF MEANS C(F+A+6M)/8]:

40

ipf
Survey No Page 2
MEAN OF MEANS [(F+A+6M)/8D:

- SN - 89

5.933337

10.12931

Dist of CF fwd of Midships: 1st Trim Corrn: Draft at CF:

MTRS

-3.1 -.039403
5.972740 TONNES MTRS

-1.08 .0006504
10.12866 TONNES 31860 32035
T-M

Draft displacement 1: Draft:Displacement 2:

5.95 6.00
MTRS

17902 18065

10.10 10.15
MTRS

T-M
320.80 332.54
TONNES

Draft:MCTlC 1: Draft:MCTlC 2:

5.50 6.50

9.80 10.30

388.21 401.35 TONNES

DISPL FOR DRAFT AT F:

2nd Trim Corrn: Density Corrn:

ACTUAL DISPLACEMENT: DEDUCTIONS:

17976.13 16.31
-175.54 17816.91

31960.29 .08
-171.49 31788.88

Lightship: Fuel OiI.Diesel Oil: Lube Oil: Freshwater: Ballast:

7755.00
673.00 44.70

7755.00
667.00 43.60

30.00 254.00 8811.30 17568.00 248.91

30.00 209.00 348.00 9052.60 248.91 22487.37

TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

41

SHIP: 44,000 dwt CARGO: CONDITION': No 1 - K&te condition with all corrections BERTH: LEF: 172.00

UNLADEN DENSITY: DRAFTS: Fwd Fort: Fwd Starboard: 4.01 3.99 1.015

LADEN 1.015

10.13 10.22

Fwd Mean: Mid Port: Mid Starboard: Mid Mean: Aft Fort: Aft Starboard: Aft Mean:
APPARENT TRIM:

4 5.83 5.90 5.89 7.99 7.99 7.9?

3,99

10.175 9.96 10.3 10.13 10.01 10.15 10.08

-.095

TRIM CORRECTION:
Dist fwd mark fm P.P. Dist aft mark fm A.P. Fwd Correction: A f t Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog => +): MEAN OF MEANS C(F+A+6M)/8:! (Fwd = +): (Fwd = +): -6.67 7.59 -.168716 .1919874 3.831284 8.181987 4.350704 .1166356 5.919159 -6.67 7.59 .0040171 -.004571 10.17902 10.07543 -.103583 -.002777 10.12931

Survey No

0 - SN - 69

Faoe 2
MEAN OF MEANS C(F+A+6M>/83: Dist of CF f w d of Midships: 1st Trim Corrn: Draft at CF: MTRS Draft displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: Draft.-MCTIC 2: 55 .0 65 .0 5.919159 -3.1 .0784138 5.997573 TONNES 17902 18065 T-11 3 0 8 2 . 0 3 2 5 3 . 4 TONNES DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: 7 5 . 0 7 5 0 75.0 750 1 0 7 0 8 5 . 9 6 . 0 4 6 -176.80 17944.89 MTRS 10.12931 -1.03 -.000650 10.12866 TONNES

10.10 31860 10.1532035.00 MTRS 93 .0 10.30 T-M 332 8.1 401.35 TONNES 3902 16.9 .03 -311.81 31648.57

Fuel Diesel Oil: Lube Oil:

Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

Oil:

673.00 44.70 30.00

254.00 8 5 . 0 9 6 0 17712.70 232.19

667.00 43.60 30.00

290 0.0 380 4.0 95.0 026 232.19 22363.73

42

bull-': ti.wj owt LHPJUU: CONDITION: No 2 - As 1 but without stem/stern corrections BERTH: LBP: 172.00

UNLADEN DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: Mid Starboard: Mid Mean: Aft Port: Aft Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd mark fa P.P. (Fwd +): Dist aft mark fia A.P. (Fwd = +): Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog = +>: MEAN OF MEANS C(F+A+6M)/8]: Survey No Page 2 MEAN OF MEANS C(F+A+6MJ/8J: Dist of CF fwd of Midships: 1st Trim Corrn: Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: Draft.-MCTIC 2: 5.50 6.50 5.91625 -3.1 .0719129 5.988163 TONNES 17902 18065 T-M 320.BO 332.54 TONNES DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT: 7755.00 630 7.0 44.70 3.0 00 254.00 85.0 960 17712.70 191.65 ' 18026.41 54.33 -176.40 17904.35 MTRS 0 - SN - 89 4.01 3.99 4 5.88 5.90 5.89 7.99 7.99 7.99 3.99 0 0 0 0 4 79 .9 3.99 .105 5.91625 1.015

LADEN 1.015 10.13 10.22 10.175 9.96 10.3 10.13 10.01 10.15 10.08 -.095 0 0 0 0 10.175 10.08 -.095 -.0025 10.12938

10.12938 -1.08 -.000597 10.12373 TONNES

10.10 31860 10.1532035.00 MTRS 9.80 10.30 T-M 383.21 401.35 TONNES 31960.72 .07 -311.81 31648.98

7755.00 670 6.0 43.60 3.0 00 209.00 348.00 9052.60 191.65 22404.74

43

SHIP: 44.0iX> dwt CttHbO: CONDITION: No 3 - As No 2 but without 2nd trim correcxtion BERTH: LBP: 172.00

UNLADEN DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Mean: Mid Fort: M i d Starboard: Mid Mean: Aft Port: Mt Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd mark -fm F.P. Dist aft mark fm A.P. Fwd Correction: AH Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS C(F+A+6M)/8]; Survey No Page 2 MEAN OF MEANS [(F+A+6M)/Bl: Dist oi CF fwd oi Midships: 1st Trim Corrn: Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: DraftiMCTIC 2: 5.50 6.50 5.91625 -3.1 .0719128 5.938163 TONNES MTRS 0 - SN - 89 (Fwd = +): (Fwd = +): 4.01 3.99 4 5.88 5.90 5.89 7.99 7.99 7.99 3.99 0 0 0 0 4 7.99 3.99 .105 5.91625 1.015

LADEN 1.015

10.13 10.22 10.175 9.96 10.3 10.13 10.01 10.15 10.08 -.095 0 0 0 0 10.175 10.08 -.095 -.0025 10.12938

10.12938 -1.08 -.000597 10.12878 TONNES

17902 10.10 31860 18065 10.15 32035.00 T-M .00 .00 TONNES MTRS 9.80 10.30 T-M .00 .00 TONNES 31960.72 .00 -311.81 31648.91

DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DEDUCTIONS: Lightship: Fuel Oil: Diesel Oil: DISPLACEMENT:

18026.41 .00 -175.87 17850.54

7755.00 673.00 44.70

7755.00 667.00 43.60

Lube Oil:
Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

30.00
254.00 8956.00 17712.70 137.84

30.00
209.00 348.00 9052.60 137.84 2245B.47

44

SHIP: 44.000 dwt CARGO: CONDITION: No 4 - As No 3 but without 1st trim correcxtion BERTH: LBP: 172.00

UNLADEN DENSITY: DRAFTS: Pud Port: Pud Starboard: Pud Mean: Mid Port: Mid Starboard: Mid Mean: 4.01 3.99 4 5.88 5.90 5.89 1.015

LADEN 1.015

10.13 10.22 10.175 9.96 10.3 10.13

Aft Port:
Aft Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd mark fm P.P. Dist aft mark fm A.P. Fwd Correction:

7.99
7.99 7.99 3.99

10.01
10.15 10.08 -.095

(Fwd = +): (Fwd = +):

0 0 0

0 0 0

Aft Correction:
CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS [(F+A+6M)/83:

0
4 7.99 3.99 .105 5.91625

0
10.175 10.08 -.095 -02 .05 10.12938

Survey No

0 - SN - 89

Page 2
MEAN OF MEANS C(F+A+6M)/83: 5.91625 10.12938

Dist of CF fwd of Midships: 1st Trim Corrn:

Draft at CF: MTRS Draft displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: Draft:MCTlC 2: 5.50 fc.50

0 0
5.91625 TONNES 17902 18065 T-M .00 .00 TONNES MTRS

0 0
10.12938 TONNES

10.10 31860 10.15 32035.00 MTRS 9.80 10.30 T-M .00 .00 TONNES 31962.81 .00 -311.83 31650.98

DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: Fuel Oil:

17791.98 .00 -173.58 17618.39

7755.00 673.00

7755.00 667.00

Diesel Oil: Lube Oil:

Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

44.70 30.00
254.00 8956.00 17712.70 -94.31

43.60 30.00
2900 0.. 348.00 9052.60 -94.31 ^22692.69

45

SHIP: 44.000 dwt CARGO: CONDITION: No 5 - fls No 4 but ignoring offshore dra-ft BERTH: LBP: 172.00 UNLADEN DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: Mid Starboard: Mid Mean: Aft Port: AH Starboard: AH Mean: APPARENT TRIM: TRIM CORRECTION: Dist -fwd mark fm F.P. (Fwd = +): Dist a4t mark fm A.P. (Fwd = +): 4.01 3.99 4 5.88 5.88 5.88 7.99 7.99 7.99 3.99 10. 13 10.22 10.175 9.96 10.3 10. 13 10.01 10.15 10.08 -.095 1.015 LADEN 1.015

0 0

0 0

Fwd Correction:
An Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS C(F+A+6M)/83:

0
0 4 7.99 3.99 .115 5.90875

0
0 10.175 10.08 -.095 -.0025 10.12938

Survey No Page 2

0 - SN - 89

MEftN OF MEANS t(F+A+6M>/83: Dist o-f CF fwd of Midships: 1st Trim Corrn: Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: Draft:MCTlC 2: 5.50 6.50

5.90875 0 0 5.90875 TONNES 17902 18065 T-M .00 .00 TONNES MTRS

10.12938 0 0 10.12938 TONNES

10.10 31860 10.1532035.00 MTRS 9.80 10.30 T-M .00 .00 TONNES 31962.81 .00 -311.83 31650.98

DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship:

17767.53 .00 -173.34 17594.18

7755.00

7755.00

Fuel Oil: Diesel Oil:

Lube Oil: Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

673.00 44.70
30.00 254.00 8956.00 17712.70 -118.52

667.00 43.60
30.00 209.00 348.00 9052.60 -118.52 22716.90

46

SHIP: 44,000 dwt CARGO: CONDITION: No 6 - as 5 but with list correction BERTH: LBP: 172.00 UNLADEN DENSITY: 1.015 Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: M i d Starboard: Mid Mean: Aft Port: Aft Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd mark fm F.P. Dist aft mark fm A.P. Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hoq = -f ): MEAN OF MEANS C(F+A+6K)/B 3: (Fwd = +): (Fwd +): 4.01 3.99 4 5.88 5.88 5.88 7.99 7.99 7.99 3.99 o 0 0 0 4 7.99 3.99 .115 5.90875 LADEN 1.015 10.13 10.22 10.175 9.96 10.3 10.13 10.01 10.15 10.08 -.095 0 0 0 0 10.175 10.08 -.095 -.0025 10.12938

DRAFTS:

Pace 2 MEAN OF MEANS [<F + A + 6M)/8J : Dist of CF fwd of Midships: 1st Trim Corrn: Draft at CF: MTRS Draft.'Displacement 1: Draft:Displacement 2: 5.95 6.00 MTRS Draft:MCTlC 1: Draft:MCTlC 2: 5.50 6.50 5.90875 0 0 5.90875 TONNES 17902 18065 T-M .00 .00 TONNES DISPL FOR DRAFT AT F: 2nd T r i m Corrn: Density Corrn: List Correction: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: Fuel O i l : Diesel Oil: Lube O i l : Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT: 7755.00 673.00 44.70 30.00 254.00 8956.00 17712.70 -118.52 7755.00 667.00 43.60 30.00 209.00 348.00 9052.60 -118.52 22719.45 17767.53 .00 -173.34 0 17594.18 MTRS 10.10 10.15 MTRS 9.80 10.30 10.12938 0 0 10.12938 TONNES 31860 32035 T-M .00 .00 TONNES 31962.81 .00 -311.83 2.55 31653.53

47

SHIP: 44.000 dwt CARGO: CONDITION: As 6 but i q n o r i n q d e n s i t y of b a l l a s t (1.0251 BERTH: LBP: 172.00

UNLADEN

LADEN

DENSITY: DRAFTS: Fwd Port: Fwi Starboard: Fwd Mean: Hid Port: M i d Starboard: M i d Mean: Aft Port: A f t Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd nark f F.P. Dist aft nark fn A.P. Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hoq = t): MEAN OF MEANS C(F*A+6M)/8J:

1.015

1.015

4.01 3.99 4 5.86 5.88 5.68 7.99 7.99 7.99 3.99

10.13 10.22 10.175 9.96 10.3 10.13 10.01 10.15 10.08 -.095

(Fwd = ): (Fwd = +):

0 0 0 0 4 7.99 3.99 .115 5.90875

0 0 0 0 10.175 10.08 -.095 -.0025 10.12938

Survey NoERROS Paqe 2

- SN - 89

MEAN OF MEANS f I F*JU6M >/8 J: D i s t of CF f w d of M i d s h i p s : 1st T r i i C o r r n : D r a f t a t CF: MTRS Draft:DispUcement Draft:Displacenent 1: 2: 5.95 6.00 MTRS D r a f t : M C T l C 1: D r a f t : M C T l C 2: 5.50 6.50

5.90875 0 0 5.90875 TONNES 17902 18065 T-M .00 .00 TONNES MTRS 10.10 10.15 MTRS 9.80 10.30

10.12958 0 0 10.12936 TONNES 31B60 32035 T-M .00 .00 TONNES 31962.81 .00 -311.83 2.55 31653.53

OISPL FOR DRAFT AT F: 2nd T r i n Corrn: Density Conn: List Correction: ACTUAL DISPLACEMENT: DEDUCTIONS: Liqhtship: Fuel O i l : Diesel O i l : Lube O i l : Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

17767.53 .00 -113.34 0 17594.18

7755.00 673.00 44.70 30.00 254.00 8737.56 17494.26 99.92

7755.00 667.00 43.60 30.00 209.00 339.51 9044.11 99.92 22509.50

48

SHIP: 44.000 dwt CARGO: CONDITION: No 8 - As 7 but without seawater density correction BERTH: LBP: 172.00

UNLADEN DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Hear.: Hid Port: Hid Starboard: Hid Hean: Aft Port: Aft Starboard: Aft Hean: 4.01 3.99 4 5.88 5.88 5.88 7.99 7.99 7.99 1.025

LADEN 1.025

10.13 10.22 10.175 9.96 10.3 10.13 10.01 10.15 10.08

APPARENT TRIM: TRIH CORRECTION:

Dist fwd ark fi F.P. (Fwd = <I: Dist aft mark f A.P. (Fwd = *): Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIH: HULL DEFLECTION I ho<J = t): HEAN OF MEANS t(F+A-t6H)/81:

3.99
0 0 o o 4 7.99 3.99 .115 5.90875

-.095
0 0 0 0 10.175 10.08 -.095 -.0025 10.12938

Pane 2 HEAN O F HEANS [ I F * A * 6 M 1 / 8 ) : D i s t of CF f w d of H f d s h i p s : 1st T r i i C o r r n : D r a f t a t CF: HTRS D r a f f . D i s p l a c e m e n t 1: D r a f t : D i s p l a c e n e n t 2: 5.95 6.00 MTRS D r a f t : H C T l C 1: D r a f t : H C T l C 2: 5.50 6.50 5.90875 0 0 5.90875 TONNES 17902 18065 T-H .00 .00 TONNES DISPL FOR DRAFT AT F: 2nd Tri Corrn: Density Corrn: List Correction: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: Fuel Oil: Diesel Oil: Lube O i l : Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT: 7755.00 673.00 44.70 30.00 254.00 8737.56 17494.26 273.26 7755.00 667.00 43.60 30.00 209.00 339.51 9044.11 273.26 22647.99 17767.53 .00 .00 0 17767.53 HTRS 10.10 10.15 Mm 9.80 10.30 10.12938 0 0 10.12938 TONNES 31860 32035 r-M .00 .00 TONNES 31962.81 .00 .00 2.55 31965.36

49

DRY BULK CARGOES

Small Ship Loading Scrap Metal Laden Cargo Weight used as Bill of Lading Figure

1) Example of Draft Survey 2) Computer Print-outs

50

survey No
M.V.

-SN-90 - Draft Survey

Page No 2

CARGO QUANTITY LOADED From our measurements and observations, we consider that the total cargo loaded was 2639.68 metric tons. The derivation of this figure is shown in the attached calculation sheet. Report is without prejudice.

For and on behalf of MURRAY FENTON AND ASSOCIATES LTD.

18th of
Encls: Draft Survey calculation sheet

1990

52

DRAFT SURVEY CALCULATION SHIP: H.V.

Survey No: Berth: UNLADEN

-SN-90

LADEN 1145 18/09/90 SW 3/4 Rippled Metres 4.44 .00 4.44 4.40 .00 4.40 4.415 4.416315 .0000488 4.416364 Tonnes 3833.36 .01 3833.37 1.021

TIME DATE WIND SEA CONDITIONS UNITS: Observed Forward Draft: Fwd Draft Correction: Corrected Fwd Draft: Observed Aft draft: Aft Draft Correction: Corrected Aft Draft: Midship Mean Draft: Mean of Means (F+6M+AJ/8: 1st Trim Correction: DRAbT AT "F": UNITS: Dipsplacement for Draft at "F": 2nd Trim Coorection: SW Displacement: Density:

2030 15/09/90 Lt Airs Rippled Metres 2.38 .00 2.38 3.23 -.01 3.22 2.74 2.754858 -.016891 2.737968 Tonnes 2296.27 1.92 2298.19 1.02

ACTUAL DISPLACEMENT:
Lightship: Fuel oil: Diesel Oil: Lube oils: Freshwater Ballast: Total Known Weights: Constant: LADEN CARGO WEIGHT:

2286.98
1089 0 59.35 5.3 11.5 1116.5 2281.65 5.33

3818.41
1089 0 58.6 5.3 9-5 ^U 1173.4 5.33 2639.68

53

SHIP: SMALL SHIP CARGO: CONDITION: No 1 - Base condition with all corrections &ERTH: LBP: S5.30

UNLADEN

LADEN

DENSITY:
DRAFTS:

1.015 Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: Mid Starboard: Mid Mean: Aft Port: Aft Starboard: Aft Mean: 1.92 1.92 1.92 2.895 3.17 3.0325 4.21 4.21 4.21
2.29

1.015 4.38 4.33 4.38 4.7 4.455 4.5775 4.9 4.9 4.9
.52

APPARENT TRIM: TRIM CORRECTION:

Disjt fud mark fin P.P. (Fwd = +>: Cist.,4ft mark fa A.P. (Fwd - -f): Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT:
TRUE TRIM:

-1 2.5 -.027995 .0699878 1.892005 4.279988

2378 .893

0 2.5 0 .0157005 4.38 4.915700

.370 5505

HULL DEFLECTION (hog - +):

MEAN OF MEANS C(F+A+6M)/83:

.0534963
3057 .484

.0703502
4.595088

========sse====tt====s=====:==K==3==== = s=====s=s====*z=====s==:======== = =

Survey No Page 2

0 - SN - 69

MEAN OF MEANS C(F+A+fcM)/83:

3057 .484

4558 .908

Dist of CF fwd of Midships: 1st Trin Corrn:

Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 3.00 3.02 MTRS Draft:MCTlC 1: 2.50

1.35 -.037793
3088 .001 TONNES 2411 2428 T-M 32.38 MTRS

-1.85 .0116184
4.606706 TONNES

4.58 3191.58 4.60 3 0 . 0 275 MTRS 4.10 T-M 41.75

Draft:MCTlC 2:

3.50

37.57
TONNES

5.10

46.60
TONNES 3212.84

DISPL FOR DRAFT AT F:

2417.87

2nd Trim Corrn:

Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS:

17.35
-23.76 2411.46

.82
-31.35 3182.30

Lightship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater: Ballast:

TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

983.00 .00 54.40 5.70 9.00 1317.00

2369.10 42.36

983.00 .00 54.10 5.70 8.00 5.00

1055.80 42.34 2084.14

54

SHIP: SMALL SHIP CfiRGO: CONDITION: No 2 - As No 1 but without stem/stern corrections BERTH: LBP: 85.3-0

UNLADEN DENSITY: DRAFTS: 1.015

LADEN 1.015

Fwd Port: Fwd Starboard: Fwd Mean: Mid Port:

Mid Starboard:

1.92 1.92 1.92 2.895

3.17

4.38 4.38 4J33 4.7

4.455

Mid Mean: Aft Port: Aft Starboard: Aft Mean:

APPARENT TRIM: TRIM CORRECTIONS

3.0325 4.21 4.21 4.21

2.2?

4.5775 4.9 4.9 4.9

.52

Dist fwd mark fra P.P. (FHd = +)i Dist aft mark fa A.P. (Fwd +): Fwd Correction: Mt Correction:
CORRECTED FWD DRAFT: CORRECTED AFT DRAFT:

0 0 0 0
1.92 4.21

0 0 0 0
4.38 4.9

TRUE TRIM:
HULL DEFLECTION (hog +): , MEAN OF MEANS C(F+A+6M)/83i

2.29
.0325 3.040625

.52
.0623 4.593125

Survey No Pace 2

0 - SN - 89

MEAN OF MEANS t(F+A+6M)/83: Dist of CF fwd of Midships:

3.040625 1.35

4.593125 -1.85

ist Trio Corrn:

Draft at CF: MTRS

-.036243
3.004382 TONNES MTRS

.0112773
4.604403 TONNES

Draft:Displacement 1: Draft:Displacement 2:

3.00 3.02
MTRS

2411 2428
T-M 32.33 37.57 TONNES

4.58 3191.53 4.60 3207.50

MTRS 4.1C 5.10 T-M 41.75 46.60 TONNES 3211.00

Draft:MCTlC 1: Draft:MCTlC 2:

2.50 3.50

DISPL FOR DRAFT AT F:

2414.72

2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater: Ballast:
TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

15.95 -23.71 2406.96

.77 -31.33 3180.44

983.00 .00 54.40 5.70 9.00 1317.00

2369.10 37.86

983.00 .00 54.10 5.70 8.00 5.00

1055.80 37.86 2086.77

55

SHIP: SMALL SHIP CARGO: CONDITION: No 3 - As No 2 but without 2nd trim correction BERTH: LBF: S5.SO

UNLADEN DENSITY: 1.015

LADEN 1.015

DRAFTS: Fwd Port: Fwd Starboard-. Fwd Mean: Mid Port: Mid Mid
Aft Port:

1.92 1.92 1.92 Starboard: Mean: 2.895 3.17 3.0325

4.21

4.38 4.33 4.38 4.7 4.455 4.5775

4.9

Aft Starboard: Aft Mean:

APPARENT TRIM:

4.21 4.21
2.29

4.9 4.9
.52

TRIM CORRECTION: Dist fwd mark fm P.P. (Fwd = +): Dist aft mark fra A.P. (Fwd = +): Fwd Correction: Aft Correction:
CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog - +): MEAN OF MEANS t(F+A+6M)783:

0 0 0 0
1.92 4.21 2.29 .35 02 3.040625

0 0 0 0
4.38 4.9 .52 .65 02 4.593125

Ka=a==a====s ====ss=======e===3=s: !========s=================s============2:^3

Survey No Page 2

0 - SN- - 89

MEAN OF MEANS C(F+A+6M)/83:

Dist of CF fwd of Midships:

3.040625
1.35

4.593125
-1.85

1st Trim Corrn:

Draft at CF: MTRS

-.036243
3048 .032 TONNES MTRS

.0112778
4.604403 TONNES

Draft.-Displacement 1:
Draft: Displacement 2:

3.00
3.02 MTRS

2411
2428 T-M .00 .0 0 TONNES

4.58 3191.53
4.60 MTRS 4.10 5.10 3207.50 T-M .00 .0 0 TONNES 3211.00 .00 -31.33 3179.68

Draft.-MCTlC 1: DraftrMCTIC 2:

2.50 3.50

DIStt. FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship:

2414.72 .00 -23.56 2391.17

983.00

930 8.0

Fuel Oil: Diesel Oil: Lube Oil: Freshwater:

Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CAfiGO WEIGHT:

.00 54.40 5.70 9.00

1317.00 2369.10 22.07

.00 54.10 5.70 8.00

5.00 1055.80 22.07 2101.81

56

SHIP: SMALL SHIP CARGO: CONDITION: No 4 - As 3 but without 1st trim correction BERTH: L6P: 6.0 53 UNLADEN DENSITY: DRAFTS: 1.015 LADEN 1.015

Fwd Port:
Fwd Starboard: Fwd Mean: Mid Port: Mid Starboard: Mid Mean: Aft Port:

1.92
1.92 1.92 2.895 3.17 3.0325 4.21

4.38
4.38 4.38 4.7 4.455 4.5775 4.9

Aft Starboard: Aft Mean:

APPARENT TRIM: TRIM CORRECTION:

4.21 4.21
2.29

4.9 4.9
.52

Dist fwd mark fa F.P. (Fwd = +): Dist aft mark fm A.P. (Fwd = +>: Fwd Correction: Aft Correction:
CORRECTED FWD DRAFT:

0 0 0 0
1.92

0 0 0 0
4.38

CORRECTED AFT DRAFT:

TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS C(F+A+6M)/83:

4.21
2.29 .0325 3.040625

4.9
.52 .0625 4.593125

Survey No

0 - SN - 89

Page 2
MEAN OF MEANS HF+A+6M)/83: 3002 .465 4.593125

Dist of CF fwd of Midships:

1st Trim Corrn: Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 3.00 3.02 MTRS Draft:MCTIC 1: Drft:MCTlC 2: 2.50 3.50

0
0 3.040625 TONNES 2411 2428 T-M .00 .00 TONNES MTRS

0
0 4.593125 TONNES

4.53 3191.58 4.60 3 0 . 0 275 MTRS 4.10 5.10 T-M .0 0 .0 0 TONNES 3202.03

DISPL FOR DRAFT AT F:

2445.53

2nd Trim Corrn:

Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS: Lightship:

.00
-23.86 2421.67

.00
-31.24 3170.79

930 8.0

983.00

Fuel Oil: Diesel Oil: Lube Oil:

Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

-00 54.40 5.70

9.00 1317.00 2369.10 52.57 '

.00 54.10 5.70

8.00 5.00 1055.80 52.57 2062.42

57

SHIP: SMALL SHIP CARGO: CONDITION: No 5 - As 4 but ignoring offshore draft BERTH: LBP: 85.30

UNLADEN DENSITY: 1.015

LADEN 1.015

DRAFTS:
Fwd Port: 1.92 4.38

Fwd Starboard: Fwd Mean: f.id Port: Mid Starboard: Mid Mean:
A-ft Port:

1.92 1.92 2.895 2.895 2.895

4.21

4.38 4.38 4.7 4.455 4.5775

4.9

Aft Starboard:
Aft Mean: APPARENT TRIM: TRIM CORRECTION:

4.21
4.21 2.29

4.9
4.9 .52

Dist fwd nark fn P.P. (Fwd = +): Dist aft mark f A.P. (Fwd = +): Fwd Correction: Aft Correction:
CORRECTED FWD DRAFT:

0 0 0 0
1.92

0 0 0 0
4.38

CORRECTED AFT DRAFT:

TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS C(F+A+6M)/83:

4.21
2.29 .17 2.9375

4.9
.52 .65 02 4.593125

===3s==ss===================:=================:=======::=========:====sis:====:

Survey No

0 - SN - 89

Page 2
MEAN OF MEANS [<F+A+6M)/B3: 297 .35 4.593125

Dist of CF fwd of Midships: 1st Trio Corrn:

Draft at CF: MTRS

0 0
2.9375 TONNES MTRS

0 0
4.593125 TONNES

Draft displacement 1:
Draft:Displacement 2:

3.00
3.02 MTRS

2411
2428 T-M .00 .0 0 TONNES

4.58
4.60 MTRS 4.10 5.10

3191.58
3207.50 T-M .00 .00 TONNES 3202.03 .00 -31.24 3170.79

Draft:MCTlC 1: Draft:MCTlC 2:

2.50 3.50

DISPL FOR DRAFT AT Fs 2nd Trim Corrn: Density Corrn: ACTUAL DISPLACEMENT: DEDUCTIONS:

2357.88 .00 -23.00 2334.87

Lightship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater:

Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

983.00 .00 54.40 5.70 9.00

1317.00 2369.10 -34.23

983.00 .00 54.10 5.70 8.00

5.00 1055.80 -34.23 2149.22

58

SHIP:

SHALL SHIP

CARGO:

CONDITION: BERTH:

No 6 - as 5 but with list correction LBP: 85.30

UNLADEN DENSITY: 1.015 Fwd Port: Fwd Starboard: Fwd Mean: Mid Port: Mid Starboard: Hid Mean: Aft Port: Aft Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd mark fm F.P. (Fwd = +): Dist aft mark fm A.P. (Fwd =- +): Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hog = +): MEAN OF MEANS C ( F +A + 6M)/83 : Survey NoERROR Page 2 MEAN OF MEANS C(F+A+6M)/83: Dist of CF fwd of Midships: 1st Tr im Corrn: Draft at CF: MTRS Draft:Displacement 1: Draft:Displacement 2: 3.00 3.02 MTRS Draft:MCTlC 1: Draft:MCTlC 2: 2.50 3.50 2.9375 0 0 2.9375 TONNES 2411 2428 T-M .00 .00 TONNES DISPL FOR DRAFT AT F: 2nd Trim Corrn: Density Corrn: List Correction: 2357.88 .00 -23.00 0 MTRS 4.58 4.60 MTRS 4.10 5.10 - SN - 89 1.92 1.92 1.92 2.895 2.895 2.895 4.21 4.21 4.21 2.29 0 0 0 0 1.92 4.21 2.29 .17 2.9375

LADEN 1.015 4.38 4.38 4.38 4.7 4.455 4.5775 4.9 4.9 4.9 .52 0 o 0 0 4.38 4.9 .52 .0625 4.593125

DRAFTS:

4.593125 0 0 4.593125 TONNES 3191.58 3207.50 T-M .00 .00 TONNES 3202.03 .00 -31.24 .11

ACTUAL DISPLACEMENT: DEDUCTIONS:

Lightship: Fuel O i l : Diesel O i l : Lube O i l : Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEH CARGO WEIGHT:

2334.87
983.00 .00 54.40 5. 70 9.00 1317.00 2369.10 -34.23

3170.90
983.00 .00 54.10 5.70 8.00 5.00 1055.80 -34.23 2149.33

59

SHIP: SHALL SHIP CAPGO: CONDITION: No 1 - As 6 but ionorina density of ballast (1.025) BERTH: LBP: 85.30

UNLADEN

LADEN

DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Mean: M i d Port: M i d Starboard: Mid Mean: Aft Port: Aft Starboard: Aft Mean: APPARENT TRIM: TRIM CORRECTION: Dist fwd nark ( F.P. I Fwd = -t): Dist aft Bark f A.P. (Fwd = *): Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hoq * 4): MEAH OF MEANS I(F+A*6M)/8):

1.015

1.015

1.92 1.92 1.92 2.895 2.895 2.895 4.21 4.21 4.21 2.29

4.38 t. 38 4.3B 4.7 4.455 4.5775 4.9 4.9 4.9 .52

0 0 0 0 1.92 4.21 2.29 .17 2.9375

0 0 0 0 ..38 4.9 .52 .0625 4.593125

Paqe 2 MEAN OF MEANS (( F + A-f 6M 1/81: Dist of CF fwd of Midships: 1st Tri Corrn: Draft at CF: MTRS Draft:Displaceent 1: Draft:Displaceent 2: 3.00 3.02 MTRS Draft:MCT!C 1: Draft:MCTlC 2: 2.50 3.50 2.9375 0 0 2.9375 TONNES 2411 24" T-M .00 .00 TONNES DISPL FOR DRAFT AT F: 2nd Tri Corrn: Density Corrn: List Correction: ACTUAL DISPLACEMENT: DEDUCTIONS: Liohtship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT: 983.00 .00 54.40 5.70 9.00 1284.88 2336.98 -2.11 983.00 .00 54.10 5.70 8.00 4.88 1055.68 -2.11 2117.33 2357.88 .00 -23.00 0 2334.87 MTRS 4.58 4.60 MTRS 4.10 5.10 4.593125 0 0 4.593125 TONNES 1191.58 3207.5 T-M .00 .00 TONNES 3202.03 .00 -31.24 .11 3170.90

60

SHIP: SHALL SHIP CARGO: CONDITION: No 8 - As 1 but without seauater density correction BERTH: LBP: 85.30

UNLADEN

LADEN

DENSITY: DRAFTS: Fwd Port: Fwd Starboard: Fwd Mean: Hid Port: Hid Starboard: Mid Mean: Aft Port: A l t Starboard: Aft Hean: APPARENT TRIH: TRIM CORRECTION: Dist fwd nark f F.P. Dist aft nark ( A.P. Fwd Correction: Aft Correction: CORRECTED FWD DRAFT: CORRECTED AFT DRAFT: TRUE TRIM: HULL DEFLECTION (hoq = t): HEAN OF HEANS ( (F-t A*6M )/8 J:

1.02S

1.025

1.92 1.92 1.92 2.895 2.895 2.895 4.21 4.21 4.21 2.29

4.38 4.38 4.38 4.1 4.455 4.5775 4.9 4.9 4.9 .52

(Fwd = t): IFwd = t):

0 0 0 0 1.92 4.21 2.29 .17 2.9375

0 0 0 0 4.38 4.9 .52 .0625 4.593125

Paae 2 MEAN OF HEANS t (F-tAt6M1/8): Dist of CF fwd of Midships: 1st Tri Corrn: Draft at CF: HTRS Draft:Displaceent 1: Draft:Displaceent 2: 3.00 3.02 HTRS 2.9375 0 0 2.9375 TONNES 2411 2428 T-H MTRS 4.593125 0 0 4.593125 TONNES

4.58 3191.58 4.60 3207.5 MTRS T-M

D r a f t : H C T l C 1: D r a f t : M C T l C 2:

2.50 3.50

.00 .00
TONNES

4.10 5.10

.00 .00
TONNES 3202.03 .00 .00 .11

DISPL FOR JRAFT AT F: 2nd Trim Corrn: Density Corrn: List Correction:

2357.88 .00 .00 0

ACTUAL DISPLACEMENT: DEDUCTIONS:

Liahtship: Fuel Oil: Diesel Oil: Lube Oil: Freshwater: Ballast: TOTAL KNOWN WEIGHTS: CONSTANT: LADEN CARGO WEIGHT:

2357.88
983.00 .00 54.40 5.70 9.00 1284.88 2336.98 20.90

3202.14
983.00 .00 54.10 5.70 8.00 4.88 1055.68 20.90 2125.56

61

THE MASTER'S ROLE IN SIGNING BILLS OP LADING

By T.J. Llewellyn LL.B; Extra Master. Solicitor Constant and Constant It has been explained by an earlier speaker today that the bill of lading performs three functions. It evidences the contract of carriage; it is a document of title; and it acts as a receipt. The significance of the master's signature is that in most circumstances it binds the shipowner who becomes a party to that bill of lading. Thus, it is the bill of lading as signed by the master which sets out the rights and duties of the shipowner and the cargo owner and under which one may sue the other. Accordingly the terms to which he signs are of great importance. Again, it is that document, signed by the master, which, when presented by the consignee, entitles him to be given the cargo. Lastly, it is the signature of the master which acknowledges receipt of the goods. It is this role of the master which is crucial in any subsequent dispute about shortage or damage to the cargo. This is the area in which the master's role is most significant, and this will be considered first.
A. THE BILL OF LADING AS A RECEIPT

1. Signing of the Bill In many circumstances a Ship's Master will be called upon to sign the Bills of Lading but as is well known the signing of these is for reasons of business efficacy often delegated to the "Agent" who may sign on behalf of the Master. In these circumstances what is the authority of the Agent and what is the Master's role, if any, in monitoring the action of the Agent? There are three common situations:(a) Vessel in Liner Trade The Agent is appointed by the Shipowner, is the Owner's servant and would usually have express authority to sign the Bills. Even if he does not have such authority the fact that he is "held out" as the Owners' Agent would be sufficient for a Shipper to rely upon the signature of the Agent as being made on behalf of the Master as this would be a normal and customary function of the Agent. If the Bills are to be endorsed "freight pre-paid" then the Agent will usually be instructed by the Owners to provide the signed Bills of Lading to the Shippers only against payment of the freight. The Master should always be aware of what the Agent is doing in his name and in particular should ensure that the Bills of Lading are signed in accordance with the Mates' receipts. Therefore close liaison with the Agent is necessary and a Master should not be put off by an Agent who appears less than willing to co-operate. (b) Vessel on Voyage Charter Most Voyage Charters provide that the Owners shall appoint the

62

Agents at the Ports of Loading and Discharge. Thus Bills of Lading signed by the Agent are usually "for and on behalf of the Master". Even if this is not so expressed, the Agents' signature will bind the Owners and so the Master has a role to play in co-ordinating matters with the Agent in order to protect the Shipowners' interests. In both the Liner Trade and where a vessel is Voyage Chartered a sensible precaution where the Agent is to sign the Bills of Lading is for the Owner or the Master to write a letter to the Agent instructing him to sign Bills of Lading in accordance with Mates' receipts and to ensure that the Bills give a proper description of the cargo loaded. (c) Vessel on Time Charter The Time Charterers will appoint the Agent and his duty will be to his principals. The Time Charter will probably contain a clause to the effect that the Master is under the orders and directions of the Charterer as regards employment and agency. This is generally enough to give the Charterer or his Agent authority to sign the Bills of Lading for the Master. This in turn will normally cause the Shipowner to be the carrier under the Bill of Lading and hence liable to the Cargo Owner for any loss and damage arising by virtue of a breach of the Bill of Lading Contract. This may not be the case if the Charterers use their own form of Bill of Lading and if this is expressed to be signed by the Agent on their behalf. However it is always safer to assume that even where a Ship is Time Chartered the Owners will probably be the carrier under the Bill of Lading. Therefore, although it is tempting to do so the Master should not leave everything regarding the loading of the cargo and signing of the Bills to the Charterers or their Agents. Thus as with the Liner Trade and Voyage Charter situations care should be taken to check cargo being loaded (or to supervise those who are engaged in this task) and to ensure that Mates' receipts are properly prepared. Also the Agent should be informed of the need for the Bills to be claused in accordance with those receipts in appropriate cases. This is particularly so bearing in mind that the Agent's primary duty will be to the Time Charterer and not to the Shipowner or Master. We shall now turn to other areas in which the Master has an important role to play in ascertaining that the description of the goods on the Bill of Lading conforms to the goods actually shipped. We shall look at the situation at Common Law and also where internationally agreed legislation and Rules apply either by incorporation of this into the Bill or because national legislation renders its application compulsory. Most Bills of Lading issued these days are subject to such Rules. 2. Quantity of Cargo (a) Common law At common law, that is in a situation where neither the Hague nor the Hague-Visby Rules apply, the rule is that the bill of lading is prima facie evidence that the quantity of goods alleged to have been shipped
63

has in fact been shipped. The figures are not absolutely conclusive and the master cannot for example bind the shipowner by signing for goods which were not in fact even placed on board. Thus in Grant - v Norway (1851) 20LJC P93 a bill of lading was signed by the master for bales of silk which had not in fact been loaded. It was held that the master had no authority to sign for goods which had not been shipped and that the holders of the bill of lading therefore had no claim against the shipowner for non-delivery. However, the effect of the presumption is that it is up to the shipowner to prove that some other quantity was loaded, and this will very rarely be possible. Thus, if the discharge figure is less than the bill of lading figure, a shipowner defending a shortage claim is faced with an uphill task. Bills of lading often contain statements to the effect "weight and quantity unknown". In such a case there is no presumption of the quantity loaded and to succeed in a shortage claim the shipper must show that goods of that quantity were in fact shipped. It does not matter that a figure is stated on the bill of lading. However, a recent case demonstrates that the master should beware of signing the bill of lading except in the usual place. In The Herroe and Askoe [1986] 2 Lloyd's Reports 281, a bill of lading stated the cargo to be a quantity of 43,430 bags of potatoes. It also included "a weight and quantity unknown" provision as part of the printed section of the bill of lading. In addition to signing in the usual place, the master signed next to the figures and placed a stamp there. In the subsequent shortage claim the judge held that the master's action meant that the "weight unknown" provision was invalid, and that there was a presumption that the quantity stated had been loaded. (b) The Hague and Hague-Visby Rules Where these rules apply, a shipper can demand that a bill of lading be issued showing "either the number of packages or pieces, or the quantity, or weight ... as furnished in writing by the shipper". This places the burden of proof on the shipowner who wishes to dispute the figures. Any provision to the effect that the weight and quantity are unknown will be ineffective. Where the Hague-Visby Rules apply, and a claim is made by an endorsee of the bill of lading, the shipowner is absolutely bound by the figures and cannot dispute them. However, it should be noted that the requirements of the rules are alternatives - either the number, or the quantity, or the weight. If a bill of lading states the number of packages and the weight, but it is endorsed "weight unknown" then it is evidence only of the number of packages. (c) The Bills of Lading Act 1855 Section 3 One point which used to be of more relevance to masters in the days when the master was also often the shipowner, is that in proceedings
64

brought by a consignee or endorsee of a bill of lading the statements in the bill of lading are conclusive evidence as against the master if he signs it or it is signed on his behalf. It should be emphasized that this does not give the holder of the bill of lading a right to sue the master. But where the holder already has such a right (for example where the master can be sued in negligence), he can rely on the bill of lading as conclusive evidence. For example in one old case Smith - v - Tregarthen (1887) 56 LJQB 437 the master of the "CARBIS BAY" signed the bill of lading but subsequently had 235 bales of cotton discharged before sailing because of insufficient space on board. The cargo discharged was loaded on the "WYLO" which arrived at the port of discharge three days after the "CARBIS BAY". Both cargoes were delivered to the holder of the bill of lading. He sued the master for non-delivery of the 235 bales. It was held that the master was bound by his signature on the bill of lading. The sum of damages awarded was the market value of the goods when they should have arrived. (The damages having been reduced to take into account the value of the 235 bales when they did arrive, the market price having dropped meantime.) 3. Condition of the Cargo (a) Common law If there are no statements as to order and condition in the bill of lading then the bill is not even prima facie evidence of the condition of the goods on shipment. However, bills usually state that the cargo was "shipped in good order and condition" or "shipped in apparent good order and condition". In such a case the shipowner cannot claim that the goods were not in apparent good order and condition as against the holder of the bill of lading. The only exception to this is where the holder clearly knew that the statement was untrue or he did not rely upon the statement. The master or the ship's officers on his behalf should carry out such inspection of the cargo as is reasonable. If a much more detailed inspection would have been necessary to discover a defect, then the shipowner is not bound by the master signing a bill of lading stating that the cargo was "shipped in good order and condition". However, when the master signs a bill of lading relating to perishable goods, the words "good order and condition" mean more than that they show a basically satisfactory external appearance. They also mean that they have an apparent ability to withstand the contemplated voyage. An example is provided by Dent - v - Glen Line Ltd (1940) 67 Lloyd's Reports 72 which concerned a cargo of bagged ground nuts. The bags appeared dry on external inspection but loose nuts scattered around in the vicinity of the bags were in a green and moist condition and the mate's receipts were claused accordingly. Pressure was put on the ship's agents by the shipper and bills of lading were issued stating

65

that the cargo was loaded in "apparent good order and condition". The subsequent holders of the bills of lading sued the shipowners. It was held that the statement on the bill of lading was false because the words "good order and condition" as applied to perishable goods must mean more than that their external appearance seemed to be satisfactory; it must also have reference to their apparent condition from the point of view of safe carriage. Since the plaintiffs had relied on this false representation to their detriment, they were entitled to recover from the shipowners. The addition of the words "condition unknown" does not nullify the effect of "in apparent good order and condition". (In this respect it differs from "weight and quantity unknown" statements.) (b) Hague and Hague-Visbv Rules Where the Hague or Hague-Visby Rules apply, the carrier is bound on demand of the shipper to issue a bill of lading showing "the apparent order and condition of the goods". Such a bill of lading is prima facie evidence of the receipt by the carrier of the goods "as therein described". Where the Hague-Visby Rules apply, once the bill has been transferred to a third party acting in good faith the statement is conclusive evidence of receipt of the goods in that condition. The shipowner cannot submit evidence to prove the contrary. This emphasises the need to clause bills in appropriate cases. 4. Quality of the Cargo Where a master signs a bill of lading indicating the quality of the cargo, that statement does not bind the shipowners if the goods are in fact of a poorer quality. This is demonstrated by an old case where a cargo of Jute was shipped with marks indicating its quality. The bill of lading stated that different marks, indicating a better quality, appeared on the jute. The holders of the bill of lading sued the shipowners for the difference between the actual value of the jute and the value of the jute with the higher quality marks. It was held that it was not the duty of the master to investigate and insert quality marks. If these were not correct, the shipowner was not prevented from proving that goods of that quality were not put on board. The situation regarding quality should not be confused with the insertion of marks which relate to description of the type of goods carried. 5. Leading Marks
(a) Common law The fact that a master signs a bill showing wrong leading marks does not bind the shipowner unless the marks are themselves material to the description of the goods. (b) Hague or Hague-Visby Rules Where the rules apply, a shipper can insist on the bill of lading showing "the leading marks necessary for the identification of the goods". However, the master has the power to refuse to show the leading marks in the bill of lading if the goods or their coverings are not clearly marked "in such a manner as should ordinarily remain
66

legible until the end of the voyage". Furthermore, he can also refuse to enter the leading marks in the bill of lading if he has reasonable grounds for suspecting that the information is inaccurate or he has had no reasonable means of checking it. If the leading marks are inserted, the bill of lading is prima facie evidence of the receipt by the shipowner of the goods as therein described. Under the Hague-Visby Rules the shipowner cannot prove the contrary once the bill of lading has been transferred to a third party acting in good faith. However, the shipowner may have recourse to the shipper if the marks and other details provided by him are inaccurate. 6. Date of bill of lading It is important that the Master checks that the correct date appears on the bill of lading; a wrong date can expose the shipowner to liability. An example is provided by The Saudi Crown [1986] 1 Lloyd's Law Reports 261. That case concerned a cargo of 4,500 tons of ricebran extractions. The contract of sale provided for the period of shipment to be "as per bills of lading dated or to be dated 20 June - 15 July 1982 without extension the bills of lading to be dated when the goods are actually on board. Date of bills of lading shall be accepted as proof of date of shipment". The cargo was loaded in July 1982. The bills of lading were all dated 15 July, that is, the last date in the prescribed loading period. In fact the loading was not completed until 26 July. The bills of lading were sent by the vendors to the purchasers who authorised payment. The purchasers later realised that the cargo would not arrive in time for them to meet their commitments and they had to purchase a substitute quantity of ricebran elsewhere. The purchasers sued the shipowners for damage suffered because of the false claim that the cargo had been loaded by 15 July. The bills of lading had been signed by the shipowners' agents on behalf of the master. Mr Justice Sheen held that the signing of the false bills of lading had been done by the agents in the course of their employment and that therefore the shipowner was liable for the losses caused because of the false dating to the holders of the bills of lading. A Master should always decline to sign a bill bearing a false date and particular care should be taken to ensure that ante-dated bills presented by the Shippers are rejected. 7. Clausing in general We have already noted the importance of clauses concerning condition or quantity in the context of claims by the eventual holder of the bill of lading in respect of damaged cargo or cargo shortages. The general rule is always that in a case of doubt the bill of lading should be claused accordingly. In many cases the clauses will affect not only the rights of the holder of the bill of lading against the shipowner but also the rights of the seller of the goods under any letter of credit. Banks will normally only make payments against clean bills of lading. However, not every clausing of a bill of lading

67

prevents it being a clean bill for letter of credit purposes. The general rule is laid down In the Uniform Customs and Practice for Documentary Credits. This states that: "A clean shipping document is one which bears no superimposed clause or notation that expressly declares a defective condition of the goods and/or the packaging. Banks will refuse shipping documents bearing such clauses or notations unless the credit expressly states clauses or notations which may be accepted." It is important to note that a clean bill of lading is "one in which there is nothing to qualify the admission that the goods were in apparent good order and condition at the time of shipment" (The Galatia [1980] 1 All ER 501 at 505). It follows that a bill which is claused in respect of damage occurring after the goods have been shipped is still a clean bill. In The Galatia a fire broke out on the vessel while a cargo of sugar was being loaded. The cargo was damaged by the fire and by water and was discharged. Two separate bills of lading were prepared, one of these being for the cargo which had been discharged. This carried on it the notation "cargo covered by this bill of lading has been discharged Kandla view damaged by fire and/or water used to extinguish fire for which general average declared". The buyers rejected this bill claiming that it was not a "clean" bill of lading. The Court of Appeal held that they were wrong to do so because the clause did not affect the correct statement that the goods were shipped in apparent good order and condition. It does not follow from this, however, that the provisions of the Hague or Hague-Visby Rules only apply in respect of liabilities incurred after loading. In the case of Pyrene - v - Scindia, [1954] 2 All ER 158 a fire tender was being lifted on board the vessel by the ship's tackle when it was dropped and damaged. The tender had not crossed the ship's rail. The judge nevertheless held that the shipowner was entitled to limit his liability in accordance with the Hague Rules. It could not be said that the contract covered by the bill of lading only became operative when the tender passed the ship's rail because the loading which was undertaken by the shipowner extended to the whole operation including that part of the operation taking place on the shore side of the ship's rail. 8. Letters of Indemnity Before passing on to other areas where the master's role in dealing with bills of lading is of importance, there is an aspect of the bill as evidence of shipment of the goods that is of some importance, This relates to the response of the master to a request from the shipper or charterer that he should sign a clean bill of lading against provision of a letter of indemnity offered by the shipper or charterer in circumstances where the master would normally wish to endorse the bill in respect of damage, shortage or other defect. Such a request arises because a clean bill is customarily required by the shipper for presentation to the buyer's bank for transfer of the purchase price of the goods. If the master permits the issue of a clean bill for goods which he knows to be defective then this amounts to a misrepresentation to any indorsee of the bill. It also opens up the risk of allegations of fraud against the owners and the master. Furthermore, it is unlikely that the letter of indemnity will be

68

worth the paper it is written on. This was the case in Brown Jenkinson - v Percy Dalton 11957] 2 QLB 621 where the court held that in English law a letter of indemnity given in such circumstances is legally unenforceable.
B. THE BILL OF LADING AS A DOCUMENT OF TITLE

As we have already noted, the bill of lading is a document of title. The consequence of this is that the cargo must be delivered up to the presenter of the bill of lading at the discharge port. If the cargo is delivered without presentation of the bill of lading, the shipowner will be liable in damages to the holder of the bill of lading if different to the person to whom the goods have been delivered. Nevertheless, the commercial reality is that in practice the cargo is often demanded without presentation of the bill of lading. This can arise for a number of reasons: the bill of lading may have been lost or delayed by reason of the number of hands it has to pass through to reach the eventual consignee. In the case of a short voyage there may simply not have been time to transfer the bill of lading. The dangers of handing over the cargo without presentation of the bill of lading are made even more acute by the fact that P&I cover will not extend to such mis-delivery. It may be that in the future electronic document exchange may deal with this problem. At present, however, the best solution, and the one usually adopted, is the taking of a letter of indemnity. The wording of such a letter of indemnity should be agreed with the owners' and their P&I Club. In particular it should be entered into not only by the charterer or consignee but also by a bank on their behalf. In these circumstances, and in contrast with the provision of a letter of indemnity in return for signing clean bills of lading on shipment, there is no fraud or misrepresentation. Such a letter of indemnity is therefore valid and enforceable. Another way in which the problem of non-production of the original Bill of Lading at the Port of Discharge can be dealt with, especially in cases where voyages are short or where it is known that it will take time for the Bill of Lading to pass through the various commercial stages before it reaches the hands of the consignee, is that of the set of three original bills one original bill is retained by the Master on board the vessel. This bill is handed to the consignee who then returns it to the Agent or Master and the cargo is delivered against that bill. The risks associated with this practice are obvious and should the Bill of Lading be handed over by the Master to the wrong person then substantial claim for mis-delivery could arise. Whilst being concerned about this procedure at least one well known P&I Club condones it as being commercially necessary but only if the Bills of Lading are claused by the Master along the following lines:"One original Bill of Lading retained on board against which bill delivery of cargo may properly be made on written instructions received from Shippers/Charterers". In the event of the cargo falling into the wrong hands it will be open to the Shipowner to sue those giving the instructions. However there is always the

69

possibility that the Shipper or the Charterer may be without reputation or assets and thus recourse to them would be futile. In circumstances where this practice is to be adopted it is suggested that this should only be where the company giving the instructions as to the delivery of the bill is one of sound reputation and is accessible as a Defendant if legal proceedings should prove necessary.
C. THE BILL OF LADING AS A CONTRACT

The bill of lading is evidence of the contract between the shipper and the shipowner. Where the vessel is chartered, the master has no authority by signing bills of lading (the terms of which differ from the charterparty terms) to vary the contract the owner has made with the charterer. (a) Bills to be signed "as presented" Time and Voyage Charterparties frequently provide that bills of lading are to be signed "as presented". This does not mean that the master should sign any bill of lading whatsoever which is presented by the charterers. The position is as follows. The master must sign bills of lading which are in an ordinary and customary form. In the 1980 case of The Anwar Al Sabar [1980] 2 Lloyd's Law Reports 261. a voyage charter included the usual provision that the master was to sign bills of lading as presented without prejudice to the charterparty. The quantity of cargo shipped was substantially less than the amount stipulated in the charterparty. Draft bills of lading stating the quantity actually shipped were presented incorporating the terms of the charterparty. The owners wanted the master to add a clause to the bill of lading stating: "Demurrage and deadfreight are claimed by carriers who may exercise their right to lien the cargo under clause 8 of the charterparty." The charterers objected that the clause would seriously affect the negotiability of the documents under the relevant letter of credit. Mr Justice Mustill held that the bill of lading conformed in every respect with the charterparty and that the incorporation clause was effective to carry the charterparty liens into the bill of lading. It was for the charterers to decide on the form of bill of lading provided that the bill of lading did not encroach on the rights conferred on the owners by the charterparty. Accordingly the master was obliged to sign the bill as presented. The Anwar Al Sabar was a voyage charter case. It is clear that time charterers have even wider powers to decide on the contents of the bills of lading. Lord Wilberforce pointed out in The Nanjh [1979] 1 Lloyd's Reports 201 that: The issue of bills of lading in a particular form may be vital for the charterers' trade".

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In that case (because the Charterers had deducted monies from an instalment of hire) the master refused to sign "freight prepaid" bills of lading when the charterers presented them. In the relevant trade, the Great Lakes grain trade, it was usual for bills to be so marked without reference to the terms of any time charter. The House of Lords held that the charterers could require the master to sign freight prepaid bills without any mention of the terms of the time charters. It is wellestablished that under a time charter the owner has an implied indemnity for liability incurred through signing the bill of lading which does not conform with the charterparty. In many cases there will also be an express indemnity. It would appear to be the case that where the vessel is subject to a voyage charter and the master signs bills of lading which are not in conformity with the charterparty then the presentation of such bills by the charterers constitutes a breach of contract. Thus in Kruger - v Moel Tryvan [1907] AC 272 the owners of the vessel entered into a voyage charterparty. It included a clause exempting them from liability for the master's negligence. The master was required "to sign clean bills of lading ... without prejudice to this charter". The bills of lading presented by the charterers did not effectively incorporate the negligence clause. The master signed the bills of lading and the vessel was subsequently lost owing to the master's negligence. The bill of lading holders successfully sued the owners and it was held by the House of Lords that the owners were entitled to recover from the charterers the damages payable to the bill of lading holders. In certain cases the master need not sign the bill of lading: (i) The master is not bound to sign "as presented" bills of lading which incorrectly state the quantity or condition of cargo. In The Boukadowa (1989 ILR 393) the bills of lading presented stated a quantity of oil which the master argued was in fact greater than the quantity shipped. (This turned out subsequently to be the case.) Accordingly, the master proposed to clause the bill, but the charterers refused to allow him to. Delay was caused while the cargo was re-measured. The judge held that the master was entitled to refuse to sign an unqualified bill. The consequences of the master signing a bill of lading in such circumstances are demonstrated by the case of The Nogar Maria [1988] 1 Lloyd's Reports 412. A cargo of iron rods in coils was loaded. Some of the coils were rusty. The master had inspected the cargo but nonetheless he negligently failed to give instructions for the mate's receipt to be claused. Accordingly, clean bills of lading were issued by the ship's agents. The owners incurred liability to the receivers of the cargo. They claimed an indemnity from the charterers but it was held that the charterers were not in breach of any implied term and in any event the master had been negligent in failing to clause the mate's receipt and to require the bills of lading to be claused.
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Similarly, the master must not sign a bill of lading which states that the cargo has been loaded underdeck in a case where it has in fact been loaded on deck. (ii) A master should not sign a bill of lading which bears the wrong date. In The Almak [1985] 1 Lloyd's Reports 557 Mr Justice Mustill stated that if a master did sign a bill of lading in such circumstances the shipowner might lose his right of indemnity against the charterers. (iii) The master should also refuse to sign a bill of lading which names a port of discharge outside the trading limits stated in the charterparty. (iv) Some charterparties contain provisions requiring that specific clauses must be included in the bills of lading. For example the NYPE charterparty sets out in clause 24 the wording of a USA Clause Paramount and a Both to Blame Collision Clause which are to be included in all bills of lading issued under the charterparty. The master can refuse to sign a bill of lading presented to him which fails to include clauses which are expressly required to be incorporated in this way. (v) Where the charterparty provides that the master shall sign bills of lading in the form set out at the end of the charterparty, the master is not bound to sign bills of lading which are not in that form. (vi) The master does not have to sign a bill of lading which is "manifestly inconsistent" with the charterparty or contains stipulations of an "extraordinary character". There is little authority on the meaning of these phrases. However, it has been held that a "demise clause" stating that the bill of lading is an owners' bill is not an extraordinary clause; it has also been held in one case that a bill is not "manifestly inconsistent" with the charterparty where the charterparty provided for disputes to be referred to arbitration in Oslo in accordance with Norwegian law and the bills of lading were subject to English law and Jurisdiction. The fact that a charterparty provides that bills of lading are to be signed as presented "without prejudice to the charterparty" does not affect the master's obligation to sign the bills as presented. It simply means that the contract between the owners and the charterers contained in the charterparty is not affected by the inclusion in the bill of lading of different terms. Time charters also usually provide that the master is to sign bills of lading as presented and that the master is to be under the orders and directions of the charterers as regards employment and agency. As previously mentioned it is implied from these terms that the charterer or his agents may sign bills of lading on behalf of the master. Such a signature usually binds the shipowner. This clearly raises the

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possibility of the charterers signing a clean bill of lading where it should have been claused. If the master is aware of this, he should, of course, immediately lodge a protest and notify the owners. SUMMARY We have considered a number of aspects of the Master's role in monitoring and signing Bills of Lading. There are many variables to be considered and a Ship's Master has to find his way carefully through the obstacles which may be placed in his way. How best can the basic principles be summarised? In general terms the Master should before signing the Bill of Lading ensure that:1. The goods are actually on board and the Bill of Lading is correctly dated. 2. The Bill of Lading is in the correct form if this is specified in the Charterparty. 3. The description of the goods complies with the Mates' receipts failing which the BUI of Lading should be claused accordingly. 4. If an Agent is signing the Bills of Lading then regardless of whether the vessel is on Charter the bills should be claused in accordance with the provisions of the Mates' receipts. Particular care should be taken in circumstances where the Agent is signing on behalf of the Master. The Master should not:1. Sign a Bill of Lading which is in any respect inaccurate on its face. 2. Be persuaded to sign clean Bills of Lading against the offer of a Letter of Indemnity. The Master may accept a Letter of Indemnity at the Discharge Port if the Owners and the Club agree and give their prior approval. Lastly Masters should not forget the advantages that can be obtained by virtue of the vessels' entry in a P&I Association. Most ports will have a correspondent appointed by the Club who can be called upon in urgent matters to give advice particularly on local customs and procedure. Consultation with the Club correspondent should always be in conjunction with communication with Owners or Managers who in turn will be able to discuss any difficulties with the P&I Club Head Office in London or elsewhere. In this way and with the advantage of modem communications most problems associated with the signing of the Bill of Lading can be resolved quickly providing the Master imposes upon the situation a degree of logic and commonsense in conjunction with an appreciation of commercial reality. September 1990

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BILL OP LADING DISPUTES

By Mr Donald Davies RD RNR Barrister, Blaster Mariner, PICS FCIA FNI Introduction

A very large number of bill of lading disputes are litigated/arbitrated every year in London, more by way of arbitration than litigation. Further, a much larger number of claims against sea carriers by cargo owners are settled between the parties in London through P & I Clubs and cargo underwriters on the basis of previous court decisions and how the parties view the likely outcome of an arbitration. London maritime arbitrators have to apply English law (as built up by way of judicial precedent over the years) to disputes which come before them although it is true to say that many cases turn on their own individual facts of which arbitrators are the final arbiters; there is a limited right of appeal to the courts on a point of law. Using my 20 years of experience as a maritime arbitrator I intend to speak about the legal principles which come up frequently in London maritime arbitration and in so doing will automatically advert to the types of dispute which do arise in practice. Before so doing I make some general points about arbitration and maritime arbitration in the City of London. 1. London is still the most prolific maritime arbitration centre in the world; it is said that it does more maritime arbitrations than the rest of the world put together (Moscow, Peking, Paris, Hamburg, New York, etc). Hundreds of arbitrations take place every year ranging from those on documents alone to those which may have oral hearings lasting many weeks. 2. Some of the advantages of arbitration over court proceedings are privacy, speed and cheapness. Some persons now question some of these so-called advantages. Arbitrations are still private and there is no doubt that a hearing can take less time before an arbitrator rather than before a judge; this is because arbitrators have the expertise which allows the arbitration to move at a faster speed than before a Judge. Regarding the arbitration being cheaper, this is still usually the position in respect of maritime matters albeit that the Judge comes free while the arbitrators do not. Since arbitrators tend to get through a case in much less time than a judge the overall cost tends to be less than if a case is fought in the courts. In London, there is a wide divergence of expertise and qualifications regarding the arbitrators that are members of the London Maritime Arbitrators Association. This gives the parties involved in arbitrations considerable scope to appoint arbitrators who have the appropriate expertise to deal with the disputes in question. 3. Many maritime arbitrations involve pure nautical elements so that arbitrators with nautical experience have much to contribute in the sifting of the evidence and the decision making. Contractual Terms Contracts for the carriage of goods by sea are governed by charterparties and/or bills of lading; in practice, there will usually be no difference between the contractual terms in respect of loss of/damage to cargo because the Hague Rules will invariably be applicable to both forms of contracts (by way of

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statute in respect of bills of lading, eg Carriage of Goods by Sea Acts 1924 and 1971 and by way of incorporation using a so-called Clause Paramount in respect of charterparties). The Hague Rules spell out the rights and responsibilities of the carrier and the shipper but this paper will be concerned mainly with the rights and responsibilities of the carrier as related to the problems which arise in practice and which give rise to claims by shippers in litigation or arbitration. The parts of the Hague Rules which are particularly relevant to the problems to be discussed are :"The carrier shall be bound, before and at the beginning of the voyage, to exercise due diligence to (a) Make the ship seaworthy (b) Properly man, equip, and supply the ship (c) Make the holds, refrigerating and cool chambers, and all other parts of the ship in which goods are carried, fit and safe for their reception carriage and preservation.

the carrier shall properly and carefully load, handle, stow, carry, keep, care for and discharge the goods carried.

After receiving the goods into his charge the carrier or the master or agent of the carrier shall, on demand of the shipper, issue to the shipper a bill of lading showing among other things -

(b) Either the number of packages or pieces, or the quantity, or weight, as the case may be, as furnished in writing by the shipper; (c) The apparent order and condition of the goods. Provided that no carrier or the master or agent of the carrier shall be bound or show in the bill of lading any marks, number, quantity, or weight which he has reasonable ground for suspecting not accurately to represent the goods actually received, or which he has had no reasonable means of checking.

Neither the carrier nor the ship shall be responsible for loss or damage arising or resulting from -

(a) Act, neglect, or default of the master, mariner, pilot, or the servants of the carrier in the navigation or in the management of the ship.
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(c) Perils, dangers and accidents of the sea or other navigable waters.

(m) Wastage in bulk or weight or any other loss or damage arising from inherent defect, quality, or vice of the goods.

(p) Latent defects not discoverable by due diligence.

Before going further the writer emphasises that the exception available to the carrier of negligence in the navigation or in the management of the ship is of huge benefit to carriers when so many cargoes are damaged/lost by negligent navigation or management: for example, the exception covers nearly all collisions/groundings on the basis of negligence by those on the vessel so that cargoes lost/damaged by these factors do not usually form the subject of a claim by cargo owners. However, sometimes the casualty is effectively caused by unseaworthiness, albeit that the most proximate cause in time is the failure of those on the vessel, in which case the carrier will be liable for the loss/damage unless he can show that he exercised due diligence to make the vessel seaworthy, eg vessel goes aground with a total loss of cargo through the negligence of those on the vessel but the effective cause of the casualty was the failure of the shipowners to properly supply the ships with charts of the area where the vessel grounded and this was causative of the grounding (a recent arbitration where the writer was sole arbitrator). Exercising due diligence to make the ship seaworthy Many cargoes are damaged by unseaworthiness, eg sea water entering the vessel's cargo spaces, unclean cargo spaces prior to the loading of cargo which contaminates cargo etc and many disputes occur in this area. It is not that difficult for cargo owners, in appropriate circumstances, to show that the vessel was unseaworthy when she sailed and that this caused the damage to the cargo; it is then open to the carrier to show that he exercised due diligence to make the vessel seaworthy and if he does so he will escape liability under the Hague Rules. There have been two House of Lords decisions of importance regarding the carrier's obligation of exercising due diligence one of which was also concerned with the exception available to the carrier of "latent defect not discoverable by due diligence". These important cases are Riverstone Meat Co v Lancashire Shipping Co (The "Muncaster Castle") [1961] AC 807, [1961] 1 Lloyd's Rep 57 and Union of India v NV Rederg Amsterdam ("The Amstelslot") [19631 2 Lloyd's Rep 223. The "Muncaster Castle" The Muncaster Castle was placed in the hands of reputable ship repairers for special survey and repairs. An experienced and competent marine superintendent attended on behalf of the shipowners and instructed the repairers to open up all storm valves for inspection; this involved opening up
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the inspection covers and after the inspection by a Lloyd's Surveyor a fitter employed by the repairers replaced and closed the covers. To do this, it was necessary for the covers to be placed over the studs in the top of the inspection chamber and for the nuts to be tightened on either side; once the nuts had been tightened no visual inspection could have detected any unevenness in the positioning of the cover or any insufficiency in tightening up. No cargo was damaged on the outward voyage to Australia and before loading in Australia the No 5 hold was inspected by the Chief Officer and no sign of any leakage of seawater was found. On arrival in the UK it was discovered that cargo in No 5 hold had been damaged by seawater. The Court found that the presence of the water found in the hold on the unloading was due to the negligence of the fitter who failed to secure the nuts sufficiently with the result that they were loosened by the working of the ship in rough weather; there was no negligence on the part of anyone but the fitter. The House of Lords, reversing decisions of the High Court and the Court of Appeal, held that the carrier had not discharged the burden of proving that he had exercised due diligence to make the ship seaworthy since a shipowner was not safeguarded by the fact that the negligence in repairing the ship was that of an independent contractor, and the obligation imposed on the shipowner in the work of repair was one of due diligence by whomsoever it might be done (underlining by the writer) even when the work delegated to the independent contractor called for technical and special knowledge or experience, and the negligence was not apparent to the shipowner. The decision by the House of Lords shocked/surprised the shipowning community but one of the points which influenced the House of Lords in reaching their decision was that on any other construction, shipowners would escape all responsibility for the seaworthiness of their ships by merely employing independent contractors of good repute. It follows from the decision that the shipowner's duty, under the Hague Rules, is a personal inescapable obligation to exercise due diligence to make the ship seaworthy. The "Amstelslot" The Amstelslot loaded a cargo of wheat in Oregon for carriage to Bombay and sustained engine failure during the voyage due to a fracture of a tyre in the reduction gearing as a result of which she was towed to Honolulu. At Honolulu it was discovered that the damage was extensive and that necessary replacements would take about 9 months; accordingly it was agreed between the interested parties that the ship should be towed to Japan and that the cargo should be on-carried to Bombay by another ship. Cargo-owners disputed liability for any general average and for expenses incurred in oncarrying the cargo; they contended that there was fault on the part of the shipowner in that he had failed to exercise due diligence to make the ship seaworthy. Evidence was called by the shipowner of the actual examination made of the gear when in Rotterdam a year before under Lloyd's Register continuous survey, by both the local Lloyd's surveyor and the shipowner's engineer superintendent. This examination consisted of a visual examination of the various helices through inspection openings in the cover of the gear drum whilst the gear drum was being slowly turned.
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It was alleged against the shipowner that a magnaflux test should have been made or at least that for the purposes of a visual inspection the cover should have been removed altogether, oil should have been wiped from the teeth of the gear wheels and one helix should have been examined at a time. It was held that the ship was unseaworthy at the time of the beginning of the voyage from Oregon and that the unseaworthiness caused the breakdown, that the cause of the fatigue crack was unknown and not detectable by a visual examination in 1956 and that when the ship was taken over by the shipowner in 1956 there was nothing in its previous history to suggest any trouble in the reduction gearing and that the examination which was carried out was a proper examination carefully carried out in accordance with the standard required by Lloyd's Register. Therefore, in all the circumstances, the shipowner had exercised due diligence, not because he had employed skilled and competent persons but because those skilled and competent persons had carried out all the necessary examinations in a careful and competent manner. Lord Devlin put his finger on the core of the matter when he said in his judgement:There is here no lack of care and no lack of skilled knowledge. The surveyors were quite familiar with the various methods of examination which it is said that they should have adopted; they could easily have followed them if they had chosen to do so. What is said against them is that by deciding in effect that these methods were not appropriate to the sort of examination they were conducting, they made an error of judgement which a competent surveyor ought not to have made. Lack of due diligence is negligence (underlining by the writer); and what is in issue in this case is whether there was an error of Judgement that amounted to professional negligence and I cannot find anything in the evidence that goes that far". The shipowners were entitled to take the benefit of the exception "latent defect not discoverable by due diligence". Muncaster Castle and Amstelslot While the Muncaster Castle makes the point that it may be very difficult on occasions for the shipowner to prove that he has exercised due diligence to make the ship seaworthy the Amstelslot illustrates that it is by no means impossible to do this and that the shipowner will not be liable for loss or damage to goods caused by unseaworthiness in cases where there has not been negligence on the part of anyone used by him in attending to his ship and that he will not be liable merely because precautions were not taken which subsequent experience showed might have detected or avoided the unseaworthiness. Of course, whether or not there has been negligence will be a question of fact to be decided by the tribunal before which a claim falls and this question has to be decided upon the circumstances which prevail at the time of the incident in question. What was not negligence in 1957 may well be negligence 30 years later because of the changes in modern technology, modes of inspections, etc. The two House of Lords decisions are the guidelines for judges and arbitrators who frequently apply them to many differing sets of facts/circumstances. Causation is a factor which is all-important since the
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owners will only be liable if they failed to exercise due diligence to make the ship seaworthy and this was causative of the casualty. Sometimes there can be competing causes for a casualty and lengthy oral hearings take place in order to establish the effective cause of the cargo loss/damage; whether, for example, it was unseaworthiness and the failure by the carrier to exercise due diligence to make the vessel seaworthy alternatively whether it was an event which was an excepted peril such as "negligence in the navigation or management of the ship", "perils of the sea". The writer was involved in a four week arbitration recently where the vessel sank with all hands and the cargo owners claimed for the loss of their cargo on the grounds that the vessel was unseaworthy when she sailed and that the shipowners had not exercised due diligence to make the vessel seaworthy in respect of the Butterworth covers (quick release plates in this case) and this was causative of the entry of seawater, during heavy weather conditions, into some of the empty forward tanks (the vessel was a tanker carrying molasses with some tanks empty) which led to the sinking of the vessel's forward part and subsequently the vessel. In response the shipowners pleaded that the cause of the casualty was the negligence of their own employees on the vessel in that they were cleaning empty tanks forward and did not properly secure them before the vessel entered the heavy weather so that they, the shipowners, could take the benefit of the Hague rules exception "negligence in the navigation/management of the ship". It was a difficult case to decide on the facts because, on the evidence, there was so little between the two competing causes: however, at the end of the day, the tribunal decided that the cause of the casualty was the negligence of those on board the vessel herself so that the shipowners took the benefit of the exception. The difficulty in deciding the case was exacerbated by the paucity of evidence which was available to the tribunal and the need to rely upon the expert witnesses of the parties, at the arbitration; expert witnesses can vary and a tribunal can only go on the evidence put before it. Seaworthiness/Perils of the Sea The writer was also involved in the arbitration cited in The Master's Role in Collecting Evidence" (pages 21/22) where the tribunal had to decide whether the ingress of sea water, in heavy weather, through the vessel's MacGregor hatches (which damaged the grain cargo) was caused by the failure of the shipowners to exercise due diligence to make the vessel seaworthy or whether the cause was "perils of the sea" (an exception available to the carrier under the Hague Rules). In the event the tribunal decided that the shipowners had exercised due diligence to make the ship seaworthy before the commencement of the voyage (she had been in drydock one month prior to the voyage and had undergone repairs including repairs to the hatch coamings all of which appeared to have been carried out competently) and that the prolonged periods of very heavy weather (which caused some damage to the vessel) allowed the sea carriers to take the benefit of the exception "perils of the sea". It is emphasised that the evidence in the arbitration was supportive of the shipowners' case in that :1. The master came over well as a witness. His evidence was realistic and not embellished.
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2. The ship's documentation (including the logbooks) were well kept and authentic. 3. The video tape, taken by the master, was helpful in illustrating the condition of the vessel at the commencement of the voyage as well as the state of the seas in heavy weather. While on the topic of perils of the sea and hatch covers some persons are under the erroneous view that ships' officers always fabricate the weather in the log books so as to make the weather worse than that actually experienced. In fact, many officers exaggerate the weather for logbook purposes when the weather is not that severe; for example, when winds are only force 5/6/7 the tendency is for ships' officers to add a force or two so as to build up the weather conditions; this is not for any nefarious purpose but simply the way that they have been brought up, under various masters, to ensure that some bad weather gets into the log book for so-called insurance purposes. At the other end of the scale ships' officers, in my opinion, underrate the weather when making log book entries; in weather conditions of wind forces 11/12 the tendency is for officers to only log forces 9/10; this has been borne out by US Navy research which shows, beyond a doubt, that ships' officers definitely underestimate the weather when making logbook entries in wind forces of an extremely high nature. Dry Bulk Cargo Disputes Apart from the type of disputes previously considered which have relevance to dry bulk cargoes it is not uncommon for there to be arbitrations concerning the carrier's obligation to properly and carefully care for the goods carried in the context of ventilation. Some crews are not very efficient regarding the ventilation or non-ventilation of bulk cargoes and sometimes the cargo is shown to have become damaged because of non-ventilation; of course, carriers may be able to plead 'perils of the sea' if heavy weather conditions have made it impossible to utilise the ventilators. Further, vessels sometimes transit so rapidly from one climate to another that, no matter how well the vessel ventilates, there is still sweat damage; in these circumstances there will be no liability on the carriers since their duty is only one of acting reasonably. Inherent vice is one of the exceptions which comes up fairly frequently in dry bulk cargo shortage arbitrations. I have been involved in a good many arbitrations where shipowners have contended that the damage to the cargo was due to the inherent inability of the cargo to withstand the incidents of the voyage. Or to put it another way, the cargo is the author of its own misfortune. Over the years, many big cases have been fought in the courts regarding inherent vice relating to bulk cargoes such as grain and cocoa; much expert evidence is led in these big cases as it is also in arbitrations. I well remember a particular arbitration, of a few years ago, where the case turned on the expert witnesses involved in the case. The arbitration concerned a claim against the shipowners for damage to maize on a voyage from the USA to China. The maize was loaded in the USA in cold temperatures. Temperatures rose during the sea transit but dropped as the vessel got closer to China. When the vessel arrived at China the top cargo, in all the holds, was wetted by sweat to a great extent, blackened, mildewed,
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and had a bad smell. The all important question for the tribunal was, "When did the top layer of cargo become wetted?" it being common ground that it was condensation, at some stage of the voyage, which activated the damage which was manifested upon the opening up of the hatches on the vessel's arrival. The receivers contended for condensation in the very early part of the voyage when according to them very warm air would be passing over the surface of bulk cargo thus leaving the condensation on the cargo itself. The shipowners argued that the large condensation occurred during the closing stages of the passage and while the vessel was at anchor; they asserted that, during this time, the vessel's structure would have cooled rapidly so as to have given rise to the condensation of warm moist air, rising from the cargo, on the vessel's deckheads, and the subsequent falling back of the condensation on the top layer of the cargo. The shipowners plumped for "ship's sweat" while the receivers contended for "cargo sweat". The shipowners also argued that the heating of the upper layer of the cargo, as a result of the normal transfer of heat, as the vessel travelled through warm air and sea, with further heating due to micro-biological activity, contributed to the sweat damage. The most crucial factor in the case was the rate of mould growth; whether this occurred between a certain period. On this aspect, the shipowners' expert witness was much more convincing than the receivers' expert witness and the tribunal went against the receivers' expert. The tribunal decided that intensive mould growth could take place in a relatively short time and also that ventilation by those on the vessel would not have had any significant effect in reducing the amount of ship's sweat in the circumstances albeit that those on the vessel had not ventilated in accordance with basic principles. The tribunal concluded that the wetting damage arose from the combination of moisture content of the maize, rising of warm moist air from the cargo surface and the cooling of the ship's structure. Therefore, since there was no failure by those on the vessel the Owners were entitled to the benefit of the exception "inherent vice"; with an average moisture content at loading of 15.3% the maize did not have the inherent ability to withstand the ordinary incidents of a voyage from the USA to China, at the time of the year in question, on the type of vessel which was utilised. There have been many arbitrations over the years relating to the moisture content of grain or grain type cargoes. It is well known that grain cargoes with a moisture content over a certain percentage can give rise to problems without any failure by those on the vessel. If the moisture content is reduced then the problem can be eliminated or greatly reduced but this can be a costly exercise for shippers. If shippers do not reduce the moisture content to ensure that the cargo has the inherent ability to withstand the normal incidents of the voyage then they usually have no recourse against carriers who can take the benefit of the exception "inherent vice". There is no customary percentage for such losses; each cargo has to be considered in its own circumstances. Some bulk cargoes contain more moisture than others so that the loss in weight, because of evaporation during a transit, can vary immensely. Sometimes expert evidence is put before arbitrators as to the allowance which should be made to the carrier; on the other hand, there is often a paucity of evidence regarding this aspect so that a carrier's best approach, in order to avoid liability for a weight shortage

is simply to show that the cargo in question is not one which lends itself to theft by stevedores or crew and to show that no cargo was left on board the vessel after the completion of discharge. So long as the difference between the bill of lading weight and that delivered is within a reasonable limit a tribunal will often conclude that the carrier discharged the cargo which was loaded and surmise that any deficiency was due to a loss in transit due to the nature of the cargo and/or the method of loading/discharging of the cargo. For example, in places such as Alexandria it has been accepted that loss occurs during the discharge of grain cargoes by way of portable vacuvators and Egyptian courts themselves have made an allowance of 1% of the weight of the cargo for this factor in addition to an allowance for up to 1% of the weight of the cargo for natural shrinkage of the grain during a sea voyage. Bagged Cargo Disputes With bagged cargoes there are many disputes regarding whether or not the bill of lading quantity of bags have been delivered by the carrier particularly in relation to large shipments of bagged rice, bagged potatoes, etc. The problems arise mainly because of discrepancies in tallying also the lateness, in some cases, of the tallying at the discharge port with the result that there are often paper shortages for which the carrier may be liable. From the carrier's point of view it is important to have tallies at both loading and discharging ports as the cargo comes in/goes out over the ship's side. If the bill of lading is prima facie evidence of the number of bags loaded then the onus of proof is on the carrier to explain away any apparent shortage at the port of discharge and an accurate discharge tally is the best way of showing that the bill of lading quantity of bags has been discharged. Liquid Bulk Cargo Disputes The majority of disputes concern oil cargo shortages where the onus of proof can be of considerable importance. As is well-known a bill of lading is usually prima facie evidence of the quantity of bulk cargo loaded into a vessel. Therefore, if the receivers show a difference between the quantity of cargo delivered and that evidenced in the bill of lading they get their case off the ground regarding a short delivery; the evidential burden then shifts to the carrier to show that there has been a proper delivery of the cargo loaded into the vessel. If the Hague-Visby Rules apply the bill of lading may be conclusive evidence of the quantity of cargo shipped if the bill has been transferred to a third party acting in good faith. From the carrier's point of view, the best practical way of proving that the vessel has discharged her obligation is to ensure that proper measurements of cargo are taken at both loading and discharging ports; if these measurements match up, after making allowances for temperature, etc, and the ship discharges all her cargo (evidenced by obtaining a dry certificate) then the carrier has gone a considerable way to avoiding a shortage claim. In practice, as we all know, things don't always work out that easily; for example, there may be differences as to the quantity loaded on the vessel between the figures produced by the vessel and those produced from the shore side and further, there can be arguments as to quantities remaining on board the vessel after discharge also as to whether or not a dry certificate was merited.

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In cargo oil shortage arbitrations shipowners have been used, for many years, to disclosing relevant documents such as log books (including pumproom), cargo transfer books, statements of facts, ullages, etc. What has been missing in the past to a large extent has been proper discovery from those claiming against the vessel but this has been much improved in recent years. While the shore has means of checking the ship (because of the documents disclosed by or on behalf of the vessel and the fact that shore representatives board the vessel at loading/discharging ports) the ship has little chance of checking the shore. There is no doubt that, on occasions, cargo pumped from a vessel appears to go missing on the shore side and the vessel is found liable for this cargo. What shipowners should do is to call for disclosure of all relevant documents appertaining to the shore side. The amount of data maintained by a refinery may be very large but, frequently, not all relevant data is produced at an arbitration. In a five week arbitration in which I was involved a few years ago my eyes were opened wide by the extent of the documentation extracted from the refinery in question. It led to the exposure of anomalies regarding the measurement of oil in shore tanks. For example, it was shown that measurements of some tanks were taken before proper settlement of the oil; the oil in a tank can, possibly, settle by up to 20 centimetres after completion of discharge from a vessel; at 64 tons a centimetre (the tanks in question in the arbitration) there was a large difference in the measured oil in the tank as between immediately after completion of discharge from the vessel and some 24 hours later. It was usual, for many years prior to the mid-seventies, to allow owners the benefit of the so-called 0.5% allowance. This allowance was to cover intransit losses as well as cargo remaining on board which was unpumpable. Under English law there is no question of the allowance being a custom or of similar effect. It seems sensible that there be no fixed allowance to owners in respect of in-transit and other losses which arise from no failure on their part. Every case must turn on its facts and it has to be borne in mind that, with modern techniques such as crude oil washing, there are a great many instances when the allowance made to owners is considerably less than the previously accepted 0.5% It may be that the allowance should only be between 0.2% or 0.4% depending upon the kind of cargo which is carried, the vessel's equipment, etc. Oil cargoes themselves vary regarding their wax content and other ingredients which result in it being impossible to pump out all the cargo. In recent arbitrations some tribunals have reduced allowances to as low as 0.1% in cases of vessels fitted with crude oil washing. While crude oil washing may, in some instances, lead to a shortage as low as 0.1%, there have been arbitrations where owners were allowed over 0.5% in circumstances where the cargoes were not straightforward and where large residues of cargo could not be removed by crude oil washing. Problems often arise in the assessment of oil cargo shortage claims because of the paucity of reliable evidence in respect of important areas such as measurement and temperature, shore pipelines, and vapour losses.

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Measurement The determination of shipped and delivered quantities is dependent upon measurements and analyses which are unfortunately often wrongly carried out. These errors are accordingly reflected in the calculations but to a much lesser degree when the calculation is on a volume basis. It is impossible to eliminate errors in measurement but, by adjusting on a volume basis, the effect can be minimised. Density measurements can be wrong bearing in mind the sample methods and kind of sampling which takes place to obtain densities. Sampling can often be erroneous because of the practice to take top, middle and bottom. In practice, there are large gaps between these particular points and, in any event, the bottom sample may not be taken right at the bottom of the tank. The position can be much improved by the use of in-line automatic samplers. Ships calibrations of tanks can be out so that the result is a greater quantity than that which is actually loaded. The over-measurement may be up to about 1% and is due mainly to the fact that the calibrations do not take proper account of the internal features of the tanks or of solid residues of earlier cargoes. Temperature merits particular mention. While error in observed gravity measurement affects the validity of the quantity loaded or discharged, by far the greater culprit is the measurement of observed temperature where errors have a far larger effect than those attributed to density errors. At least, with the latter, some form of confirmation can be obtained by testing retained samples. Temperatures can vary greatly in individual tanks. Sometimes there can be a 10 degree difference in a large 20,000 ton tank on a vessel; this can produce a mean error regarding the weight loaded of 100 tons. The crux of the problem lies in the quality of measurement from samples taken of the cargo supplied to the vessel at the loading port and from the vessel at the discharge port. Pipelines Pipelines should be full before loading and discharge operations are carried out. This is important because a pipeline can have a total capacity in the region of 6,000 tons. However, pipelines are sometimes only partly full. In fact it is possible for fraud to be perpetrated by a pipeline deliberately being kept empty and there have been actual instances of this. One should be wary of the entry, in a statement of facts, "shore lines said to be full". What is required is evidence to back up whether or not the shore lines are full. To be properly filled, the shore lines should be bled in respect of air in the upper areas of the line. Unfortunately, inspection of pipelines is not usually covered by supervision of loading and discharging. Those who carry out the supervision should, therefore, be asked to certify that pipelines are full. In a letter published in the February, 1987 edition of Seaways, Captain F.V Bridges of Southampton said that, back in the seventies, the marketing department in the company in which he was then serving became concerned at the so-called "loss of outturn" and conducted a series of experiments regarding "slack lines"; the technique consisted of pumping a measured amount of inert gas into the shore system and noting the rise in pressure; the
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results showed conclusively that not a single shore line involved was fully pressed up despite the fact that normal tests consisting of checking for a full flow at the manifold had been carried out. This evidence supports the possibility that, on a good number of occasions, shorelines will be slack but the problem is, as already mentioned, for the carrier to be able to prove this. Vapour losses There has been considerable controversy in recent times regarding the extent of vapour losses during an ocean voyage. It appears that the loss can vary from 0.1% to 0.4% and that crude oil washing can be an exacerbating factor. In a fairly recent arbitration the tribunal was asked to look at various factors relating to in-transit vapour losses including the figures produced by the refinery regarding the experience of receiving Sirri crude oil; in relying upon this evidence the Charterers' expert put the vapour losses at 0.15% for winter and 0.2% for summer regarding a route for which he, himself, had considerable experience in respect of Sirri crude oil; the expert did not make any allowance for losses during crude oil washing and the Tribunal, in fact, allowed the Owners 0.2% based upon 0.15% for the winter voyage in question plus an additional percentage for crude oil washing so as to bring up the total allowance, for vapour losses, to 0.2%. Care in signing Bills of Lading Recent cases have illustrated the duties incumbent on the master of a vessel when signing bills of lading and other documents regarding the quantity of cargo loaded and its apparent order and condition. In The "Nogar Marin" [1988] 1 Lloyd's Rep 412 the arbitrators found that rust damage to a cargo of wire rods in coils had occurred before shipment and that the master of the vessel was negligent in failing to record on the mate's receipts that the cargo was damaged before shipment to ensure that the ship's agents did not issue clean bills of lading. The owners were claiming against charterers on the basis of an implied right of indemnity against liability under the bills of lading which had been signed at the request of the Charterers. The arbitrators decided that the owners' claim failed because the intervening negligence of the master broke the chain of causation between the charterers' act of presenting inaccurate shipping documents and the subsequent claim by cargo interests. This decision was upheld in the High Court and the Court of Appeal; in the latter judgement it was held (inter alia):1. Although the master did not sign the bill it was his mistake concerning the receipt which permitted the ship's agents to sign the bills without qualification and if his act was not strictly intervening it could justly be regarded as predominant on the arbitrators' findings over whatever breach the charterers might have committed by presenting for signature bills of lading which conformed with the receipt which the master had previously signed. 2. The implication of an obligation to indemnify was not automatic; it depended on the facts of the individual case and on the terms of the underlying contractual relationship; it was well known in the shipping trade that a master need not sign a clean bill just because one was tendered; it was the master's task to verify the condition of the goods

before he signed and to then sign it with whatever appropriate qualification he thought fit. In The "Boukadoura" [19891 1 Lloyd's Rep 393 the court was concerned with the quantity of a cargo of fuel oil loaded in Saudi Arabia. When hoses were disconnected there was a dispute regarding the quantity which had been loaded, the shippers calculated 542,479 barrels and the vessel 537,401 barrels. A bill of lading recording shipment of "a cargo said to be and described as ... 542,479 barrels" was presented to the master for signature. He refused to sign it in that form but said that he would do so if he could endorse it with the ship's figures. A further survey was carried out by Caleb Brett, appointed by the owner's P & I Club. The ship's figure was recalculated as 536,825 barrels, effectively the same as before. As a result of the above events, the vessel sailed from the loading port some 24 hours later than she might have done if the master had signed the bill of lading as presented when loading was complete and the owners claimed damages for the period of delay. The decision went in favour of the owners, part of the judgement stating that the sensible course for the master to adopt in the circumstances was to clause the bill of lading either generally ("quantity and weight unknown") or by recording the ship's figure alongside the shipper's; the master acted reasonably in the circumstances. The above two cases illustrate the importance of the master in ensuring that a bill of lading represents the quantity and apparent order/condition of the goods which have been shipped so that innocent transferees of the bill of lading have proper notice of these details. Conclusions The large number of arbitrations and court cases which occur concerning bills of lading and those serving on vessels obviously makes the evidence emanating from vessels to be of considerable importance; often the evidence is crucial and decides whether or not the carrier wins the case. Therefore, it is incumbent on seagoing personnel to ensure that important documentation is kept in a proper fashion so that tribunals are put in as good a position as possible to make the right decisions; in addition the oral evidence which is given by shipboard witnesses should be credible and not moulded to that which the witness thinks it should be for the odds are that under crossexamination a fabricated story will be exposed for what it is. A good many cases have been lost because a ship's witness has not come up to proof and that witness's evidence has been crucial, as it is frequently, to the resolution of the dispute.

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