Lloyd's Maritime and Commercial Law Quarterly
OF STRAIGHT AND SWITCH BILLS OF LADING
Toh Kian Sing*
Straight and switch bills of lading, being different from conventional ocean bills, are not always amenable to application of established principles relating to carriage of goods. Certain legal ramifications arising from the use of such bills are examined here.
Despite considerable commercial usage, straight and switch bills of lading have not provoked much legal analysis. Straight bills, as opposed to order bills, are non-negotiable bills consigned to a named party, usually the buyer in an underlying sale contract, and, being incapable of further indorsements, are frequently used where no further chain sales of the goods carried under them are contemplated. They are for practical purposes regarded as indistinguishable from sea waybills. Switch bills are quite different: for various commercial reasons, ranging from a desire to conceal the name of one’s supplier to an attempt to avoid export duties, an issued set of bills of lading under which goods are carried is surrendered to the carrier or his local agents in exchange for another set of bills in which some details, such as the name and address of the shipper, the port of shipment, the date of issue of the bills etc. might be altered. The switch bills are then transferred down the chain of buyers.
A cluster of recent decisions from England and Singapore bring into focus the question as to what extent established principles relating to conventional, order bills can be safely applied to straight and switch bills.
Straight bills of lading—do they have to be presented at a delivery?
In Olivine Electronics v. Seabridge Transport,1 a straight consigned bill of lading was not produced by the consignee (without having tendered price to his seller) to the carrier against delivery of the cargo under which it was carried. In summary proceedings taken out by the unpaid shipper against the carrier for breach of the contract of carriage and conversion, Goh, J., of the Singapore High Court, granted the carrier conditional leave to defend, which suggested that the defence put forward by the carrier, that a straight consigned bill not being a document of title need not be produced at the time of delivery, was not regarded as credible.2 The requirement of presentation of a straight bill was left
* Lecturer in Law, National University of Singapore. I am grateful to Professor Francis Reynolds for his comments on the earlier drafts. Any errors and omissions are, however, mine.
1. [1995] 3 S.L.R. 143.
2. His Honour also considered that an express provision in the bill which appeared to give the carrier an option of not insisting on the presentation of the bill against delivery was balanced by another provison whcih nullifies copies of a bill after the first has been accomplished, i.e., presented to the carrier.
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