Dear Sir,

I would appreciate to have your opinion and advice on the following case:

Due to the nature of our product, the L/C that we receive for our export always calls for Charter Party Bill of Lading.
Recently, we presented our documents to a new negotiating bank, and to our surprise the bank rejected our Bill of Lading stating that it was not signed in accordance with Article 22 of UCP 600.

The L/C requirement for the B/L is:
"Full set of original and 3 non negotiable copies of clean shipped on board ocean Bill of Lading made out to the order of Issuing bank and notify Applicant, marked Freight Payable as per Charter Party".

Additional Conditions on the L/C:
Charter Party Bill of Lading is acceptable.

We presented the normal Charter Party B/L, which was signed by the Master, and indicating: Capt. XXXX (master's name), Master of MV XXXXXXX (vessel's name).

In the signatory column, in addition to the above signature, the B/L also bear an ink stamp, showing a logo and "MV XXXXXX" (vessel's name) and "XXXXXX SHIPPING ENTERPRISE CO LTD"


Considering article 20 (Bill of Lading) and article 22 (Charter Party Bill of Lading) of UCP 600:

a. Can we conclude that Charter Party Bill of Lading should not show carrier's name, including in the stamp?

b. Can we conclude that Charter Party Bill of Lading should not be issued by carrier?

c. What is the correct way to sign Charter Party Bill of Lading?


Thanking you in advance for your kind assistance.

Heri S.

The C/P B/L appears to be signed as per UCP 600 sub-article 22(a)(i).

If master’s name and “master” capacity are evidenced apart from the signatory box and the signature isn’t right below/above the wording evidencing master’s name and capacity, a debate could take place…

It would be valuable to know the exact language used by the nominated bank in stating that the document was discrepant - Signatures can be difficult without seeing an actual picture of the document.  Based on the information provided, it appears the document meets the requirements of article 22. 

“Article 22 Charter Party Bill of Lading

a. A bill of lading, however named, containing an indication that it is subject to a charter party (charter party bill of lading), must appear to:

i. be signed by:

• the master or a named agent for or on behalf of the master, or

• the owner or a named agent for or on behalf of the owner, or

• the charterer or a named agent for or on behalf of the charterer.

Any signature by the master, owner, charterer or agent must be identified as that of the master, owner, charterer or agent.

Any signature by an agent must indicate whether the agent has signed for or on behalf of the master, owner or charterer.

An agent signing for or on behalf of the owner or charterer must indicate the name of the owner or charterer. “

And as further explained in the Commentary

Regarding the exact wording on the Discrepancy Sheet, it was as follows:

quote

"B/L not signed as per UCP"

unquote

When we asked for clarification, the bank sent email reply as follows:

quote

"Please find below UCP clause and advised that the B/L is signed by Captain as master of the vessel and is also stamped by Shipping Company, hence its not clear if he is signing as master or for the shipping company"

unquote

I hope the above clarify the case because unfortunately, I can not provide the copy of the B/L.

Thank's again for your kind assistance.

Best regards,

Heri S.

[17 October 2008]

It seems to me that the real issue is not the way the Charter Party B/L was signed but the price drop of the commodity in question. See SWQ_85 for another example of payment excuse. Anyway allow me to address the matter submitted in questions (a) and (b) as to (c) it has already been answered.

When the Charter Party B/Ls made out to order of shipper need to clearly identify the carrier?

That's depends on the delivery terms and who is signing: shipowner, demise charterer, Master, their agents, or time charterer.
If the Charter Party B/L is signed on behalf of shipowner provided B/L indicates the name, address and contact details of company identified in the signature "as Owner" it is not necessary to indicate the carrier's name since it is clear that shipowner indicated in B/L is the carrier. Similarly, if the Charter Party B/L is signed on behalf of demise charterer because the demise charterer concludes the voyage charter party (i.e. the contract of carriage) as disponent owner of the vessel.
If the Charter Party B/L is signed by the Master or by a port agent on his behalf provided B/L indicates the name, address and contact details of Master's employer, which may either be the shipowner or demise charterer, it is not necessary to indicate the carrier's name because the Master signs (or authorizes the loading port agents to sign) as legal representative of shipowner or demise charterer, as the case may be.
Accordingly, if Charter Party B/L is signed by any of the following: shipowner, demise charterer, Master, their agents, the information identifying the carrier is not necessary. However, it shouldn't be regarded as something wrong.
The problem is with the Charter Party B/L signed by time charterer or their agents in case of back to back time charters and due to the practice of some charterers to agree one thing with shipowner / demise charterer in time charter party and doing something else thereafter. As a result of this practice the English Courts require that when time charterer agrees to issue Charter Party B/Ls subject to a voyage charter party to sign as carrier.
UCP 600 failed to address this issue nor made any distinction between various types of charterers. For more on this matter see my answer to SWQ_34.
There is nothing wrong in time charterers signing (or authorizing their port agents to sign) Charter Party B/Ls subject to a voyage charter party. Art. 1 (a) of Hague Visby Rules provides that both shipowner and charterer may qualify as carrier depending which one enters into the contract of carriage with the shipper. Thus, a time charterer that concludes a voyage charter party with a commodity supplier selling on CFR/ CIF terms is under art. 1 (a) of Hague Visby Rules a carrier since he made the contract of carriage with the shipper.
I will use as example the facts presented in an Australian Court litigation in 2007: Hilditch Pty Ltd v Dorval Kaiun KK[1].
There a commodity supplier voyage chartered a vessel from time charterer for carriage of a part cargo to be delivered on CFR terms. L/C issued for the payment of commodity asked for Charter Party B/Ls made out to order of shipper and endorsed in blank. Charter Party B/Ls issued by time charterer's agent identified the time charterer as carrier. Court accepted that. The cargo was contaminated during discharge and CFR buyer, as third party holder of B/L, claimed damages from the carrier, in that case time charterer.
However, it needs to be distinguished between the rights of Charter Party B/L holder under FOB contract and the rights of Charter Party B/L holder under CFR/CIF contract.
In the hands of FOB buyer, the Charter Party B/L is just a receipt evidencing that the goods to which it refers have been loaded on board. It is not an evidence of contract of carriage nor a document of title to the goods because the contract of carriage is the voyage charter party between FOB buyer and the carrier.
Things are different with Charter Party B/L issued for CFR/CIF shipments, because when the shipper, who is in the same time voyage charterer, transfers his title to the goods while they are in transit to a third party (CFR/CIF buyer) by endorsement and delivery of Charter Party B/L to that party, he transfers not only the title to the goods but also the rights and obligations under the voyage charter party that represents the contract of carriage provided the Charter Party B/L incorporates the voyage charter party by an express provision and properly identifies date and signatory parties of charter party, i.e. voyage charterer (CFR/CIF seller) and carrier (party from whom vessel was voyage chartered). In such case the Charter Party B/L performs all three functions: receipt for the goods, evidence of contract of carriage and document of title to the goods.

As most voyage charter parties made by CFR/CIF sellers are with time charterers rather than shipowners, Charter Party B/Ls issued for CFR/CIF shipments may indicate the carrier's name in a separate box than the signature box. This is the reason why whilst one of the declared purposes for the latest revisions of CONGENBILL and INTANKBILL is to comply with the provisions of UCP for acceptance of Charter Party B/Ls both forms have distinct spaces for identification of carrier if this is desired.Here is how BIMCO explains this matter on its website:

10.01.2008 Newsletter: "CONGENBILL 1994 Bill of Lading Revised"
"The purpose of the revision is to introduce a new style signature box consistent with UCP 600 requirements and a box to identify the carrier. The signature box has been amended in order to fulfill the requirements of Article 20 (sic) of the UCP 600 rules and to make it more clear who has signed the Bill of Lading and on whose behalf. A new box has been added to permit the name and principal place of business of the carrier to be clearly identified for the avoidance of doubt."

11.06.2008 Newsletter: "CONGENBILL 2007 re-issued"
" ... The objective of having a box identifying the carrier was intended to be a useful information tool in the event of a cargo claim ...
The signature box now provides for signature by the Master or named agent on behalf of the master or, alternatively, named agent on behalf of a named owner[1].
To be consistent with previous editions of CONGENBILL, space has been allocated on the face of the Bill of Lading to allow parties to add additional information if they so wish[2]. This additional information could be in the form of a company logo or information identifying the carrier. What is important to note is that the completion of the blank box on the form is entirely discretionary and it should only be filled in order to meet the requirements of the particular parties."

Another form of Charter Party B/L with a distinct space for identification of carrier is INTANKBILL Edition 2003 adopted by INTERTANKO, although one of the reasons mentioned by INTERTANKO on its website for revision of INTANKBILL was to re-design the B/L to conform with UCP 500.
Perhaps one way to avoid problems would be to include in L/C an additional clause allowing the identification of carrier in Charter Party B/Ls.
I take this opportunity to draw your attention that 2007 revision of CONGENBILL has replaced the blank signature box with a pre-printed signature box. Similar to 2003 revision of INTANKBILL. One more thing: The pre-printed signature box of CONGENBILL allows only Master, Owner or their named agents to sign the B/L. No provision for charterers!
 

I would like to post some comments to the inquiry no. SWQ_120 dd 08.10.2008 regarding signature of master and stamp XXX SHIPPING ENTERPRISE.

The document in question complies with UCP 600 as the INK stamp as described is actually the master's stamp and not the carrier's or other party's stamp. What I have seen in practice is that the vessel's or master's stamp incorporates both the name of the vessel as well as the name of the owner of the vessel. A carrier's stamp never shows the vessel.

Kind regards

Cristian Dobre