Bill of Lading
December 26, 2023

Bill of Lading clauses that could alter conditions of carriage of goods

The Bill of Lading (BL) is a crucial transport document, integral to the global trade system. Apart from being a transport document that serves as a receipt for goods, evidence of contract of carriage and document of title to the goods, it encapsulates crucial legal stipulations, governing the terms and conditions under which goods are carried across seas and oceans. 

This article delves into two of the key clauses that play a pivotal role in shaping the carriage terms, specifically “Methods and Routes of Carriage” and “Matters Affecting Carrier’s Performance”. 

Understanding these terms and conditions (it could be as many as 31) is not just a matter of legal necessity but a key aspect of strategic shipping management, affecting everyone from individual shippers to large-scale logistics operators.

Methods and routes of carriage

Under this clause, the Carrier at its own discretion exercise the option at any time (with or without notice to the client) to

1) use any means of transport or storage to get the goods to its destination
2) transfer the goods from one mode of transport to another
      a. including transhipping from one ship to another
      b. change the carrying ship from the one named on the front
      c. change the means of transport (e.g. from ship to road transport where possible) irrespective of whether such activity was contemplated or provided for or not
3) use any route (irrespective of whether it is the closest or most direct or advertised) at a chosen speed and call any port enroute or as often as required, deviate from the route even if it is in the opposite direction of the intended route and port of discharge
4) load, unload, tranship or store the goods at any place (including off-dock facilities) or port irrespective of whether such port is named on the bill of lading as Port of Loading or Port of Discharge or otherwise
5) comply with any orders, instructions, suggestions, or recommendations given by any statutory authority such as government or any person or bodies purporting to act as or on behalf of such authority or having the right to give orders or directions

 

The carrier can invoke the above liberties for any purpose whether it is connected or not to the carriage of the Goods. These purposes could include


– loading or unloading other goods,
– bunkering
– embarking or disembarking any persons,
– ship undergoing repairs and/or drydocking,
– towing or being towed, assisting other vessels,
– trial trips and calibrating instruments

Anything done or not done in accordance with the terms covered under “METHODS AND ROUTES OF CARRIAGE” and any delays arising from this action shall be deemed to be within the contractual carriage and shall not be a deviation.

Another clause that is closely associated with the above clause is the below clause

Matters affecting carrier’s performance

This clause essentially states that if at any time during the carriage, the carrier identifies any issues that is or is likely to affect the carriage due to any hindrance, risk, danger, delay, difficulty, or disadvantage of any kind and cannot be avoided, the Carrier may use its sole discretion carry out below actions with or without notice to the client.

    1. Move the goods to the contracted Port of Discharge or Place of Delivery using alternate routes,
    2. Suspend the carriage due to circumstances and store the goods either ashore or on board and endeavour to forward them when possible but without any guarantee or representations as to how long it will take,
    3. Abandon the carriage of the Goods altogether and place them at the client’s disposal at a place or port that the carrier deems safe and convenient which may be a point after which the carrier is unable to carry on the carriage.

The carrier will however charge full freight charges till the goods reach that point and the client is liable to pay this and/or any other additional costs as a result of this abandonment.

If the carrier invokes above clause, irrespective of which ever above options they use, the carrier has the right to charge additional freight and other charges deemed necessary to action above.

This above clause is currently being used by many of the leading global shipping lines to reroute goods away from the Red Sea and take the route around the Cape of Good Hope.

Empowering clients through knowledge and partnership

The exploration of these clauses within the Bill of Lading highlights the expansive rights and limitations granted to carriers, highlighting the importance of thorough understanding for anyone involved in the shipping process.

Clients, whether seasoned or new to maritime transport, must recognize the significance of these terms, as they outline scenarios that can drastically affect the carriage of goods.

As you can see, these clauses are being practically applied so this knowledge isn’t just about legal awareness but rather a tool for making informed decisions, choosing the right carriers, and preparing for the unexpected.

In instances where the complexities seem daunting, clients can leverage the expertise of seasoned and experienced freight forwarders who can provide invaluable insights and guidance.

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