The Identity of the Carrier in a Bill of Lading: Before and after The Starsin

Introduction2

Chapter 1: The charterparty and the bill of lading, the latter's function as evidence of the contract of carriage and the demise clause in detail6

Chapter 2: What are the advantages and disadvantages of the clause, and how does it appear within the context of the Hague and Hague/Visby Rules?11

Chapter 3: The history of the clause under English Law14

Chapter 4: The Starsin Decision19

The judgment in the Court of Appeal22

Chapter 5: Interpretation of the judgment and UCP 50027

Commercial honesty28

UCP 50030

Chapter 6: The aftermath of The Starsin34

Conclusion38

Bibliography39

The Identity of the Carrier in a Bill of Lading: Before and after The Starsin

Introduction

The demise clause: What is it? Why is it problematic?

For many years the issue of the demise clause, or identity of the carrier clause has proven to be a fruitful topic for discussion, and has also been the centrepiece of litigation in countries all around the world. Many argue that it is in fact an unnecessary and unwelcome clause in the context of bills of lading and one which can lead to considerable injustice and confusion. This argument is understandable when examining the context surrounding the demise clause presence in bills of lading, and the underlying demands and requirements of the respective parties to commercial transaction. In reality agreements relating to the sale and carriage of goods are speedily concluded, so it would appear obvious and rather crucial that a shipper of goods knows exactly with whom he is contracting for the transport of said goods. Bear in mind, this agreement would have been completed long before the bill of lading is issued. One of the functions of the bill would be to evidence those terms which were negotiated and concluded through a myriad of correspondence consisting of faxes, emails, telephone conversations and ultimately booking notes .

As such, a cargo interest would be forgiven, at least to any untrained eye for assuming that the contract of carriage lies with the entity whose name appears on the face of the bill, and who probably received the shipper's order. It is likely where a liner operator is employed, that the logo of the liner company which initially received the shipper's order appears at the top of the face of the bill. So, for all intents and purposes it would appear that the bill has been issued by the liner or certainly on the liner's behalf. At this stage, all evidence leads to the presumption that the entity with whom the shipper initially contracted, is the same entity responsible for the goods under the contract of carriage. It would follow that it is the very same entity which the holder of any bill of lading would look to initiate recourse action against, in the event that any loss is suffered arising out of the contract of carriage. Imagine then, the cargo interests surprise when legal advice is sought, and it comes to light that the contract of carriage and ...