Ref: LPL Projects Logistics Spain S.L. and TransGroup Worldwide Logistics v. Onego Shipping & Chartering B.V. – the “Pietro Benedetti”
Transformer shipped from Bilbao (Spain) to Houston (Texas) under non-negotiable express Bill of Lading. Applicability of The Hague-Visby Rules.
Summary of facts
On 11 March 2016 an agreement was concluded between LPL Projects Logistics Spain S.L. (“LPL”) as shipper and EuroAméricas Agencia Maritima S.L. (“EuroAméricas”) as agent to the carrier Onego Shipping & Chartering N.V. (“Onego”) for shipment of a transformer from Bilbao, Spain, to Houston, Texas. The recap sent by EuroAméricas to LPL read:
“Can fix as follows:
MV Pietro Benedetti (…)
for: – account EuroAméricas
– Owners Onego Shipping & Chartering B.V.
- Owners Conline, as attached
- Owners Bills of Lading to be used as attached
Original Ocean Bills of Lading MUST BE released to LPL (48) hours after ONEGO receives agreed payment. They will not be released to anyone other than the Charterers without the Charterers approval.”
Onego has issued a transport document titled “Onego Liner Bill of Lading” which was signed by EuroAméricas as agent to Onego in Bilbao. This document specifies “TransGroup”, a logistics provider in Houston as consignee. The document contains a printed clause:
“SHIPPED on board in apparent good order and condition (…) to be delivered (…) unto the lawful holder of the Bill of Lading (…). In accepting this Bill of Lading the Merchant* expressly accepts and agrees to all its stipulations on both Page 1 and Page 2 (…). One original Bill of Lading must be surrendered duly endorsed in exchange for the cargo or delivery order, whereupon all other Bills of Lading to be void
IN WITNESS whereof the Carrier, Master or their Agent has signed the number original Bills of Lading stated below right, all of this tenor and date.”
In the box for the description of the cargo to be shipped it is stated:
““THIS IS A NON NEGOTIABLE EXPRESS BILL OF LADING”
“REMARKS ON CARGO CONDITION:
– TRAFO STORED IN THE OPEN AIR, UNCOVERED AND WET PRIOR TO SHIPMENT.
- TRAFO SHOWING MINOR PAINT SCRATCHES AT LOCATIONS.
- TRAFO RUST STAINED AT FEW LOCATIONS AT ONE SIDE.”
In the box “Number of original Bills of Lading” it is stated: “0 – NONE”. The document is stamped “COPY NOT NEGOTIABLE”.”
The Onego Liner Terms & Conditions are applicable and according to Clause 2 (Clause Paramount and Jurisdiction) The Hague Rules (…) as enacted in the country of shipment shall apply to this Bill of Lading. In trades where The Hague-Visby Rules apply compulsorily, the provisions of the respective legislation shall apply to the Bill of Lading. Furthermore, the contract evidenced by the Bill of Lading shall be governed and construed by Dutch law, and the court in Rotterdam shall have exclusive jurisdiction over any dispute arising under the Bill of Lading. On 30 March 2016 the carriage by sea on board of the “Pietro Benedetti” started and on 21 April 2016 the transformer was discharged in Houston. During discharge or shortly thereafter damage to the transformer was noted and the plaintiffs started a recovery action in the Rotterdam court.
The Hague-Visby Rules comply compulsorily to this transport document that is neither a Bill of Lading nor a Seaway Bill, but given the circumstances of the case the document qualifies as a “similar document of title” as provided for in Article 1(b) HVR. The transport document issued is headed “Liner Bill of Lading”. The conditions of carriage indicate the document is a bill of lading and aim to apply either the Hague Rules or HVR. However, the document had not been issued in original, under the cargo particulars in the document the words “This is a non-negotiable express Bill of Lading” are inserted and the document is stamped “copy not negotiable”. Upon the carrying vessels arrival in Houston the document has not been presented in order to obtain delivery of the cargo. According to its contents, the document issued is not a negotiable instrument and is not intended to be used as such. The transport document therefore is not a “document of title” as meant in the English translation of the HVR but this does not preclude the applicability of the HVR. The authentic French text of the HVR does not support the requirement, sometimes distilled from the English translation, that the transport document should be a “document of title” in the sense that it can be used to transfer ownership of the goods carried. Article 6 HVR offers support for the assumption that no such requirement was intended. The transport document in this case cannot be considered to be a Bill of Lading in the strict sense, but should be considered as a document that was promised to be a Bill of Lading, but from which the carrier has withheld its proper functionality because of the manner in which it was completed and issued. For this reason the transport document falls within the definition of a “similar document” or in the French authentic text: “document similaire formant titre pour le transport des marchandises par mer” of article 1 under c HVR. For these reasons the HVR apply compulsorily.
The result is similar to the outcome in English case law “Rafaela S” – House of Lords 16 February 2005,  UKHL 11 and Kyokuyo/Maersk Line (High Court 29 March 2017,  EWHC 654 (Comm)).