Lloyd's Maritime and Commercial Law Quarterly
BANK AS HOLDER UNDER CARRIAGE OF GOODS BY SEA ACT 1992
Paul Todd*
The Erin Schulte
One of the objectives of the Carriage of Goods by Sea Act 1992 (“COGSA 92”) was to simplify the law, by removing the hideous complexities that had bedevilled its precursor, the Bills of Lading Act 1855, s.1, of timing and cause of passing of property.1 The general scheme of the Act, at least where a negotiable bill is issued, is simply to transfer title to lawful holders, a question which, it seems, was not expected to be difficult.2 At first instance in The Erin Schulte,3 Teare J, observing that the aim of the 1992 Act was to “simplify the law as to the transfer of rights under a bill of lading”,4 applied it in a straightforward and simple way, largely rejecting complex distinctions.5 His decision has been upheld in the Court of Appeal,6 but on very different grounds. However, though lip service is no longer paid to the quest for simplicity, which it is now clear is difficult to achieve, the judgment in the Court of Appeal is, in reality, no more complex than that of Teare J.
Background
The case concerned an action by a confirming bank to sue the shipowner, for delivery without production of an original bill of lading, the issue being title to sue under the Carriage of Goods by Sea Act 1992.
Detailed facts were set out in the note on the first instance decision.7 In its essentials, Standard Chartered Bank (“SCB”) was the confirming bank under a documentary credit, the ultimate beneficiary of which was Gunvor (in whose favour the benefit of the credit had
1. See Law Commissions, Rights of Suit in Respect of Carriage of Goods by Sea (Law Com No 196; Scot Law Com No 130: 1991) (hereafter “Law Com No 196”), [2.9], citing Enichem Anic SpA v Ampelos Shipping Co Ltd (The Delfini)
[1990] 1 Lloyd’s Rep 252. This joint report of the English and Scottish Law Commissions led directly to the enactment of COGSA 92.
2. Law Com No 196, [2.22], cited in East West Corp v DKBS AF 1912 A/S [2002] EWHC 83; [2002] 2 Lloyd’s Rep 182, [22], per Thomas J; and note the observation in Standard Chartered Bank v Dorchester LNG Ltd (The Erin Schulte) [2014] EWCA Civ 1382; [2014] 1 Lloyd’s Rep Plus 100, [15].
3. Standard Chartered Bank v Dorchester LNG Ltd (The Erin Schulte) [2013] EWHC 808 (Comm); [2013] 2 Lloyd’s Rep 338 (Teare J).
4. [2013] EWHC 808 (Comm), [81].
5. Though he did distinguish between bills bearing a personal indorsement, such the one before him, and those indorsed in blank, and to this extent, the outcome depended on the form of the bill of lading.
6. [2014] EWCA Civ 1382; [2015] 1 Lloyd’s Rep 97.
7. PN Todd [2013] LMCLQ 275.
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