Notes on Maritime Law: Debates on Delivery without Production of the Original Straight Bill of Lading

By Zhao Shuzhou and Chen Xin, Wang Jing & Co. Law Firm, Guangzhou

There is a debate in Chinese legal and academic circles on any liabilities that might be incurred following delivery of goods without production of the original straight bill of lading (B/L). According to one view, if the carrier delivers goods to the named consignee at the destination port without the consignee surrendering the original straight B/L, the carrier shall be held liable for losses arising from or relating to that delivery to the holder of the straight B/L. The grounds sustaining this argument are derived from the definition of the B/L in Article 71 of the PRC Maritime Law (the Maritime Law) of the PRC (adopted on July 1 1993). The article provides, inter alia, that: "A B/L is a document which serves as an evidence of the contract of carriage of goods by sea and the taking over or loading of the goods by the carrier, based on which the carrier undertakes to deliver the goods against surrender of the same. A provision in the document stating that the goods are to be delivered to the order of a named person, or to order, or to bearer, constitutes such an undertaking." Since it would be difficult to argue that this Article does not cover straight bills of lading, the carrier is therefore obligated to deliver against surrender of the original straight B/L.

According to this view, the requirement of delivery against surrender of the original straight B/L as deduced from Article 71 of the Maritime Law serves to safeguard the right to the goods of the holder of the straight B/L, and to secure the performance of the trade contract. Some experts even believe that the delivery of goods should be more strictly controlled for a straight B/L than for an order B/L or bearer B/L.