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Ship’s rail/ discharge exception not availing freight forwarders whose agents released cargo without presentation of bills of lading.

 The Facts

Nine shipments of spectacle frames and sunglasses were shipped from Hong Kong and Shanghai to Miami.

 Shipments 1 – 6 were delivered without bills of lading with the shippers’ consent.

 At the time of the 7th and 8th shipments, the subject of the dispute, receivers were substantially in arrears with their payments for the goods. 

 Freight forwarders issued the bills of lading in respect of the shipments; consignees were “to order”;  receivers were named as the “notify party”.  A forwarding agent in Miami was also named in the bills.  The forwarding agent was cited as the Third Party in the proceedings. 

 A chain of sub-bills of lading were issued with the last being issued by the actual blue water carrier.

 The two shipments were railed from the discharge port, Long Beach, to Miami where the containers were de-stuffed. 

 The shipments were cleared through US Customs by presentation of the intermediate bills of lading by the Miami forwarding agents acting as agent for the freight forwarders.  The Miami forwarding agents released the goods to the receivers without presentation of the original bills of lading issued by the freight forwarders. 

 Receivers failed to pay for the goods.  The 9th and last shipment was intercepted and sold to a different party.

 The relevant clause of the bill of lading issued by the freight forwarders read as follows: 


The responsibility of the carrier is limited to that part of the carriage from and during loading onto the vessel up to and during discharge from the vessel and the carrier shall not be liable for any loss or damage whatsoever in respect of the goods or for any other matter arising during any other part of the carriage… ” 

 Freight forwarders argued that the clause referred to above exempted them from liability for delivering without presentation of the original bills of lading. 


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