What Is a Holder of Record?

A bill of lading holder refers to a person who obtains and holds a bill of lading through legal means. For example, a shipper who obtains a bill of lading according to a contract of carriage, an endorser who obtains a negotiable bill of lading through endorsement transfer, a consignee recorded on the bill of lading legally obtaining a bill of lading, etc. Having control over the goods, it can claim rights from the carrier issuing the bill of lading according to law. ^[1]

Bill of lading holder

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A bill of lading holder refers to a person who obtains and holds a bill of lading through legal means. For example, a shipper who obtains a bill of lading according to a contract of carriage, an endorser who obtains a negotiable bill of lading through endorsement transfer, a consignee recorded on the bill of lading legally obtaining a bill of lading, etc. Having control over the goods, it can claim rights from the carrier issuing the bill of lading according to law. ^[1]

The national law and international conventions do not define the concept of "bill of lading holder" uniformly, especially the boundary between it and the concept of "consignee" is not clear.

The relationship with the carrier refers specifically to the rights, obligations and responsibilities of the holder of the bill of lading to the carrier.

• Rights of carrier of bill of lading to carrier

Control of the goods

While the goods are in transit, the holder of the bill of lading may request the carrier to change the port of unloading, suspend transportation, return the goods, etc. on the goods in transit. This right of the holder of the bill of lading is enjoyed when he obtains the bill of lading, and is lost when he transfers the bill of lading.

2. Carrier's right to claim without delivery of the bill of lading

Because the carrier has no bill of lading, the bill of lading holder of the other party of the contract of carriage cannot pick up the goods, and the holder of the bill of lading has the right to claim the carrier for compensation for the loss of the goods according to the bill of lading.

3. Claim for damage or loss of goods

In the case of loss of the transported goods due to the carrier's unavoidable reasons, the holder of the bill of lading, as a party to the contract of carriage, has the right to require the carrier to bear the liability for breach of contract and compensate for the loss. Because this breach of contract also caused the loss of the property of the holder of the bill of lading, the holder of the bill of lading has the right to claim the carrier's liability for infringement of its property. The holder of the bill of lading has the right to choose between the two when exercising this claim.

4. Right to take delivery

The collection of goods at the port of discharge is the right of a party to the contract of carriage. According to Article 71 of the Maritime Law: "... the clauses in the bill of lading to deliver the goods to the holder of the bill of lading constitute a guarantee for the carrier to deliver the goods ", The holder of the bill of lading, as a party to the contract of carriage, has the right to extract the goods.

• Obligations of the bill of lading holder to the carrier

Obligation to pay freight

When the bill of lading clearly stipulates that "freight on delivery", the holder of the bill of lading bears the obligation to pay the freight.

2. Obligations regarding the pickup of goods

Article 86 of the Maritime Law only stipulates the obligations of the consignee. Whether the holder of the bill of lading has the obligation to extract the goods, we believe that it depends on whether the holder of the bill of lading actually extracts the goods from the carrier. When the holder of the bill of lading requests the carrier to take delivery, he has the obligation to bear the costs and risks incurred due to the delay in taking delivery. When he fails to pick up the goods from the carrier, the carrier should contact the shipper and the shipper handles the goods, and the bill of lading holder does not have this obligation.

3. To bear the loss of freight, demurrage and loading and unloading related expenses

The holder of the bill of lading is obliged to pay the demurrage fee and unloading-related fees at the port of unloading, as well as the loss of shipping fees, demurrage fees and loading-related fees at the loading port as agreed.

• Liability of the bill of lading holder to the carrier

1. Responsibility for reimbursement of additional costs incurred by the carrier due to failure to extract the goods

This fee mainly refers to the expenses incurred by the holder of the bill of lading for the delayed pickup of the goods and the carrier unloading the goods in a warehouse or other place.

2. Liability for loss to the carrier as a result of exercising control of the goods

The loss includes additional costs, risks and losses incurred by the carrier as a result of obeying the bill of lading holder's instructions.

Strictly speaking, the right of action of the holder of the bill of lading should also include the two meanings of the right of action in the physical and procedural sense, but focus more on the former. Specifically, the bill of lading holder's right of action refers to the right of the bill of lading holder to claim damages directly against the carrier under the bill of lading. This is a right under the contract, which is different from the right of the holder of the bill of lading to make a claim for infringement.

When does the bill of lading holder obtain the right of action?

The traditional common law holds that "the ownership of the goods is transferred through the endorsement of the bill of lading, but the rights and obligations of the contract are not transferred." The contract of carriage of goods by sea is concluded between the shipper and the carrier, according to the principle of contract relativity The right to claim compensation for damages to the goods caused by the carrier's breach of the contract of carriage can only be enjoyed by the shipper. In this case, the holder of the bill of lading can only resort to the shipper's claim against the carrier under the contract of carriage. However, at this time, the shipper often received the payment, and the loss of the goods had nothing to do with it. He was not interested in bringing a lawsuit for the benefit of the bill of lading holders. Taking one step further, even if he filed a lawsuit, the court would reject the shipper's claim on the grounds that the shipper had not suffered any loss. At this time, the only option for the holder of the bill of lading is to sue the carrier on the grounds of infringement. But for the infringement to be established, the holder of the bill of lading must be able to prove that he is the owner of the goods. This undoubtedly aggravates the burden of proof of the bill of lading holders, and in fact the bill of lading holders are not necessarily the owners of the goods. And the infringement suit is also very unfavorable to the carrier. He may lose his rights of exemption under the contract of carriage. To solve this problem, Britain passed the Bill of Lading Act 1855. The main purpose of this law is to break through the "contract parties" principle. The holder of a bill of lading must obtain the following claims under the contract of carriage:

First, take ownership of the goods;

Secondly, ownership of the goods is obtained under or through such entrustment or endorsement.

This shows that the holder of the bill of lading must have acquired the ownership of the goods, and even only in the case of obtaining the ownership according to or through entrustment or endorsement, can the transfer of the right of action under the contract of carriage proved by the bill of lading. However, for holders who have not obtained ownership of the goods, or when the ownership of the goods is specified in the sales contract, these bill of lading holders cannot obtain the right of action under the contract of carriage in accordance with the Bill of Lading Law.

Due to the above-mentioned shortcomings in British law, it has become increasingly unable to meet the needs of international trade development and bill of lading transfer. As a result, the United Kingdom has carried out legislative reforms and has passed the Maritime Cargo Transport Act 1992. The most important change in this law is the removal of the requirement that the transfer of the right of action must accompany the transfer of ownership of the goods under the bill of lading. As long as the holder holds the bill of lading "legally", it should be regarded as a party to the contract of carriage of the goods, and Assign and grant all litigation rights under the contract.