TT Talk - When can you change the details in a bill of lading?

One of the more frequently asked questions that members put to the Club is along the lines of "I issued a bill of lading last week for some cargo. Now my client wants me to change the consignee's name or other details. Can I do it?" Our colleague, Harry Lee of TM Hong Kong has contributed the following guidance:

There are three usual situations under which changes in transport documents be requested: (a)Shippers' request to re-direct the consignment and alteration of named parties; (b) Switch bills of lading and (c) Loss of the original bill of lading before the consignment arrives. This item discusses the first of these situations: the other two will follow in later editions.

a) Shippers' request to re-direct the consignment and alteration of named parties: From time to time, the shippers may like to alter the name of the consignees at any stage after the issuance of the original transport document. The immediate question you should ask is: do the shippers have the right to re-direct the shipment?

When it comes to a negotiable bill of lading (i.e. bills issued "to order" or "to order or assign" of either the shipper or the consignee), the shipper in general retains the right to re-direct the shipment before endorsement of the bill of lading or delivery of the cargo to the lawful holders of the bill. Therefore, if you have issued a negotiable bill of lading and the shippers request you to amend the name of the consignee and/or the place of delivery, they must return all the original documents to you, free of endorsement, before you agree to make any change.

If the transport document concerned is a non-negotiable sea waybill, the shipper's right to re-direct or to name another consignee is always exercisable before delivery of the shipment to the original consignee. Apart from the unlikely case in which the shipper has irrevocably given up any right to vary the identity of the consignee during the transit (e.g. through a "No Disposal" clause), the shipper is entitled to replace any named consignee by a new one by way of proper notice to the carriers. The original waybill need not be returned to you, nor can the shipper just "endorse" the document to the alternative consignee. At the very least, the shipper must notify the carriers, and confirm the information in writing. Without such notice of change, the carrier would be entirely within his rights to deliver the cargo to the consignee named on the waybill.

Caution should be taken as between a "straight" bill of lading and a sea waybill. The former, as recently held by the English Court of Appeal (The Rafaela S [2003] EWCA Civ.556), is within the ambit of a classic bill of lading. By virtue of the decision, it is perhaps only safe to describe a sea waybill as a document of sea transport that is: not negotiable (and preferably also carries a clear statement that it is); made out to a named consignee; is not made out "to order" (or similar statement); and does not have an "attestation clause" requiring surrender of an original bill of lading before delivery. If the shipper asks you to change the consignee in a "straight" bill of lading, you must still see all the original bills (to make sure that the cargo has not been delivered) before you commit yourself.

Certainly, any re-shipment must be subject to the physical feasibility and payment of any extra handling charges/freight, in particular if the transportation has commenced. After the request for change has been accepted, you must immediately instruct your delivery agents accordingly and in writing.

Staff Author

TT Club