Lloyd's Maritime and Commercial Law Quarterly
DELIVERY AGAINST FORGED BILL OF LADING
Motis Exports v. Dampskibsselskabet AF 1912
Motis Exports Ltd. v. Dampskibsselskabet AF 1912, Aktieselskab
1 is the latest of a line of cases, extending the liability of a shipowner for delivering without production of an original bill of lading; the shipowner believed the bill of lading tendered to be an original, but it was in fact a forgery. The issue was the liability of the shipowner to the holder of an original bill.
Some background
Much of the value of a document of title to merchants and their bankers lies in its ability to transfer the right to possession of the goods while the goods are at sea; only the holder of an original document is entitled to take delivery of the goods at the port of discharge. Without this feature, much of the security given by such a document to an unpaid seller, or bank under a documentary credit, would be lost. If the bill of lading is retained, but the shipowner delivers to a buyer who has not paid for the goods, the holder will of course have an action against the buyer, but this is of no value if the buyer is insolvent; the security of the document lies in the liability of the shipowner for misdelivery in such cases. The law and practice of international trade was developed to protect the parties against the insolvency of others.
The use of a document of title can also protect the shipowner, however, since it identifies the only person to whom he is both entitled and obliged to deliver. It is therefore necessary that:2
- (a) if the shipowner delivers other than against production of an original document, he should be liable to the holder of the original document;
- (b) the shipowner should be entitled to refuse to deliver except against production of an original document;3
- (c) the shipowner should be protected if he delivers against production of an original document.
2. (a) and (b) were examined by J.F. Wilson, “The Presentation Rule revisited” [1995] LMCLQ 289. For completeness, it is also necessary for the holder of an original document to be able to require the shipowner to deliver to him; that requirement is not relevant to this note.
3. In Motis Exports, Rix, J., considered (but rejected) the argument that, though the shipowners might be entitled to refuse to deliver against a forged bill, whether or not they knew of the forgery, they might nonetheless be entitled to deliver in the absence of such knowledge. See further infra, fn. 27, and text thereto.
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