Selling Cargo

Using a sea waybill instead of a B/L is becoming more prevalent, especially in the liner trades. There is nothing new about a waybill as a document, as it has been in use for air freight almost since the beginning of carrying merchandise by air. A waybill looks very similar to a B/L and indeed has to cover two of its uses, namely a receipt for cargo and evidence of a contract. What it does not have is any negotiability; it is not a document of title. This means that the goods can only be delivered by the carrier to the named consignee. That is no disadvantage at all if the consignee has no intention of ‘selling the cargo on’ and/or if letters of credit are not involved such as trading with a branch office or with a tried and trusted trading partner who will settle the invoice for the goods at the right time. A waybill’s very lack of negotiability is one of its advantages because there can be no doubt and therefore no room for error when it comes to delivering the cargo to the consignee. Not being proof of title, it does not matter if the ship arrives before the documents. You will readily see that a waybill lends itself admirably to electronic transmission. There were some problems to be overcome before waybills could become more widespread; these were mainly due to their not being thought of when most Bill of Lading Acts were written into statute books. In the UK the Carriage of Goods by Sea Act 1992 has replaced the Bill of Lading Act 1855 and included Seaway bills in its provision. Under a voyage charter, the contract of carriage is quite clearly between the shipper and the ship owner. However under a time charter the shipper will not necessarily be aware of the relationship between the ship owner and the disponent or time charter owner. Consequently the law recognises that in certain cases the contract entered into between the shipper and the time charterer will also involve the ship owner.