Shipowners held entitled to claim on back to back letters of indemnity issued by charterers and receivers to cover release of cargo in the absence of original bills of lading
The vessel was voyage chartered under an amended sugar charterparty to carry a cargo of sugar from Brazil to Yemen
Clause 42 provided as follows:
“In the event of the Original Bills of lading are not being available at discharge port on vessel’s arrival, if so required by Charterers, Owners/Master to release the cargo to Receivers on receipt of Faxed letter of Indemnity. Such letter of Indemnity to be issued on Charterers head paper, wording in accordance with the usual P&I Club wording, and signed by Charterers only always without a bank counter-signature.”
The master signed bills of lading in respect of the shipment of 14,000 metric tons of white crystal sugar in bags at Santos in Brazil for carriage to Hodeidah or Aden in Yemen. The shipper was named as Cargill Agricola SA (“Cargill”) and the goods were consigned “to order” of the shipper. The receivers were named as the notify party.
Cargill sold the sugar to the charterers which was on sold to the receivers.
The receivers opened a letter of credit with the Yemen Kuwait Bank for Trade Investment YSC (“the Yemen Bank”) as the issuing bank. There was no confirming bank. Credit Agricole Indosuez Suisse SA (“CAI”) was the advising bank.
On the issuing of back to back letters of indemnity by receivers and charterers the cargo was released without bills of lading.
The receivers’ LOI read as follows:
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