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Bill of Lading

INTRODUCTION In order to fully understand and appreciate the meaning and legal implications of clean and claused bills of lading the researcher in his introduction would like to briefly explain the meaning and legal status of bills of lading. The two most important forms of international contracts are the FOB and the CIF and both these forms of contracts require a bill of lading to be tendered. These terms stand for: -

FOB FREE ON BOARD CONTRACTS


a. Free on board is normally a maritime trade term. 1) In most of the world its use remains limited to seaborne commerce. a) The Incoterms only uses it in connection with the carriage of goods by sea. b) In common law countries it is also used for inland carriage aboard any vessel, car or other vehicle. b. FOB (port of shipment) contract: requires a seller to deliver goods on board a vessel that is to be designated by the buyer in a manner customary at the particular port. 2) On board means that the goods: a) have been appropriated to the contracts. b) have crossed rail[1]. CIF COST, INSURANCE AND FREIGHT CONTRACTS a. Cost, Insurance and Freight (port of destination): requires the seller to arrange for the carriage of goods by sea to a port of destination and to turn over to the buyer the documents necessary to obtain the goods from the carrier or to assert a claim against an insurer if the goods are lost or damaged. 1) The three documents which the seller (as a minimum) has to provide are: a) the invoice. b) the insurance policy. c) the bill of lading. 2) These documents represent the three elements of the contract: cost, insurance and freight. 3) The sellers obligations are complete when the three documents are tendered to the buyer. a) At that time, the buyer is obliged to pay the agreed price[2]. THE BILL OF LADING The principle purpose of the bill of lading is to enable the owner of the goods, to which it relates, to dispose of them rapidly although the goods are not in his hands but are in the custody of the carrier. When goods are on the high seas in transit between two places say Singapore to London and the bill of lading has been airmailed two the buyer in Singapore and the buyer thus has become the owner of the goods, the bill of lading representing the goods enables the buyer to pledge the goods with his bank in Singapore and to resell them to a repurchaser in New York. The bill of lading is a creation of mercantile custom, a typical institution of international trade[3]. The bill of lading can be defined as an instrument issued by an ocean carrier and given to a shipper with whom

the carrier has entered into a contract for the carriage of goods at the time the goods are delivered to the carrier[4]. Hence the bill of lading is usually a document sighed by the ship owner, his agent or the master of the ship stating the goods have been received for shipment, i.e. a received for shipment bill or have actually been shipped aboard. The latter is called a shipped bill. Once signed it is delivered to the shipper who may be the seller of the goods or who mat be the buyer of the goods, and more probably, acting through an agent. A bill of lading has three functions, they are: 1. As good evidence of the terms of contract of affrieghtment. 2. As receipt of the goods as to 1. Quantity 2. Condition 3. As a possible document of title[5]. THE BILL OF LADING AS EVIDENCE OF THE CONTRACT The actual contract of carriage is always made before the bill of lading is issued, for example, when the customer books place on the ship. However the understanding will almost always be subject to the ship owners standard bill of lading and thus the bill of lading is very strong evidence of the terms of the contract[6]. THE BILL OF LADING AS A RECIEPT AS TO QUANTITY, QUALITY AND CONDITION The second function of the bill of lading is as receipt of the cargo as regards quantity, quality and condition. As regards quantity if for example the bill of lading states that 150 bales of rubber have been shipped then this is strong evidence that 150 bales of rubber were shipped[7]. The burden of proving that, only 125 bales of rubber were shipped would fall on the ship owner[8]. The master of the ship has no authority to bind the ship owner as to the quality of the shipped goods[9]. As he does not possess the skill to judge such matters. THE BILL OF LADING AS A DOCUMENT OF TITLE Section 1 of the Bill of Lading Act, 1856 reads as follows: Every consignee of goods named in a bill of lading and every endorsee of a bill of lading to whom the property in the goods therein mentioned shall pass, upon or by reason of such consignment or endorsement shall have transferred to and vested in him all rights of suit, and be subject to the same liabilities in respect of such goods as if the contract contained in the bill of lading had been made with himself. Thus a bill of lading may act as a document of title and like the key to a ware house gives the buyer the right to collect the goods from the ship or at the port of destination. If the bill is an order bill then, by the custom of merchants it is also transferable. Lord Halsburys has also observed that : As regards the ship owner, the bill of lading is a document of title, entitling its holder on production to delivery of the goods. Accordingly, a delivery to the holder of the bill of lading even where he is not entitled to the goods, discharges the shipowner, provided that it is made in good faith without notice of any defect in the holders title[10]. A person rightfully in possession of a bill of lading has title and is entitled to possess, use, and dispose of the goods that the bill represents[11]. MEANING OF THE TERMS CLEAN AND CLAUSED BILL OF LADING The dictionary of shipping terms defines a clean bill of lading as, bill of lading which contains no superimposed clause specifying any defect to the cargo or its packing; it indicates that the cargo has been received by the ship in apparent good order and condition. Clean bills of lading are often required by banks who use them as collateral security against money advanced for the purchase of the goods described therein[12]. The dictionary of shipping terms defines a claused bill of lading as, bill of lading containing one, or more than one, superimposed clause which may either specify a defect to the cargo or its packing, or may be

any comment of the master regarding the carriage of the goods, for example the weight or contents of the consignment are unknown to him, or the goods shipped on deck are at the shippers risk[13] The researcher in the following chapters goes on to explain in detail the meaning and the legal implications of clean and claused bills of lading. THE EVEDENTIAL HIERARCHY OF BILL OF LADING STATEMENTS A bill of lading can either be conclusive evidence, prima facie evidence, or no evidence of the truth of the statements it contains. If it is conclusive evidence, the carrier cannot dispute the truth of the statements made therein, even in fact it possesses the evidence needed to contradict them. So if goods are loaded in a damaged condition but a clean bill of lading is issued, the carrier will be unable to adduce evidence of this fact. The damage will be presumed to have occurred after loading and the carrier will be held liable for it[14]. If it is prima facie evidence then it can be contradicted by independent evidence, to the contrary adduced by the defendant. So, on the example given above, the carrier would escape liability if he could provide evidence that, contrary to what is said in the bill of lading, the goods were already damaged prior to loading. However, if it lacks such evidence, the statements in the bill of lading will be taken to be true, and the carrier will be liable for the loss[15]. If it is of no evidential value, the plaintiff must prove the necessary facts relating to the goods on loading by independent evidence. So, on the example given above, it is now the plaintiff on whom the evidential burden falls. Unless it can prove the condition of the goods on loading by evidence independent of the bill of lading, it will be unable to prove that the loss occurred during the carriers custody and the carrier will escape liability[16]. A statement in the bill of lading will fall in this third category if the bill is claused, in the sense that it qualifies a statement in the bill of lading. For example bills of lading for bulk cargoes frequently contain a printed clause stating weight unknown, particulars supplied by shipper. The effect of such a clause is that the plaintiff must prove the quantity loaded by independent means and cannot rely on the figure inserted in the bill of lading. A bill of lading is also referred to as claused when it notes defects in the condition of the goods on loading. This type of clausing has a different effect, in that it amounts to an unqualified statement as to the condition of the goods on loading, albeit in a defective rather than a sound condition[17]. THE BILL OF LADING AS CONCLUSIVE EVIDENCE THE EFFECT OF ESTOPPEL The elements of an estoppel are: a representation of existing fact by the party being sued (the carrier) or its agent, which is intended to be relied on and is in fact relied on by a third party to its detriment. The effect of estoppel is that the carrier is estopped from adducing evidence to prove that it was not in breach, because the goods were already damaged when the loading commenced. The damage will therefore be treated as having occurred during the period of the carriers responsibility for the goods under the bill of lading contract. The bill of lading holders contract for the breach of contract of carriage will therefore succeed, even if the truth is that there was never such a breach. In establishing an estoppel against the carrier, it will be critical to establish on whose behalf the person who actually signed the bill of lading was acting. The same principles would apply as govern the issue of whether a bill of lading is a ship owners or a charterers bill. The most likely person to sign the bill is the master, who is usually the ship owners agent for the purposes of signing the bills of lading: his signature will be treated as that of the ship owner, who will be treated as having made the representation necessary to establish an estoppel[18]. Even if the statement is made by a person acting on behalf of the carrier, an estoppel will not necessarily be established. To do this, the buyer must show that he relied on the accuracy of the statement to its detriment.

Then the question arises what if the terms of the buyers sale contract obliged him to accept a properly claused bill of lading, this question was addressed in the case of The Sk arp[19], in this case the ship owners were not estopped because the bill of lading holders would have been obliged to accept a clean bill of lading under their sale contract. In contrast to this decision in the case of The Dona Mari[20] it was found as a fact that, had the bills been claused, the indorsee would not have paid its seller or presented any bill of lading to it, even if by so doing the indorsee became liable to its seller under the sale contract. This was sufficient to establish the element of detrimental reliance necessary in an estoppel and hence the shipowners were held not liable. Thus the essential element to be proved by the consignee is that he acted on the representation contained in the bill of lading to his detriment. As Wright J. opined in United Baltic Corpn. Ltd. v. Dundee, Perth & London Shipping Co. Ltd.[21] that the carrier having stated in that very authoritative document that he received the goods in apparent good order and condition, he cannot now be heard to say the contrary; therefore by this fiction or convention he is liable for the difference between their sound value and the actual damaged value which they show. This liability is imposed on the carrier because un its absence there is a possibility that the carrier and the shipper can collude together to cheat the buyer of the goods. APPARENT ORDER AND CONDITION OF THE GOODS The most important statement in the bill of lading is that relating to the condition of the goods on loading. A bill of lading is clean if it states that the goods were in apparent good order and condition when loaded. It will be claused if ti makes adverse remarks about the condition of the goods on loading[22]. The dividing line between the condition of the goods i.e. the external aspect of the goods and the internal aspect of the goods i.e. their quality can be very fine. The distinction is important, as statements as to the quality of the goods loaded have only prima facie effect. Sir R Phillimore defined Apparent good order and condition in The Peter Der Gross[23] that apparent good order and condition as meaning that apparently and so far as meets the eye, and externally, they were placed in good order on board this ship. The application of this test is well illustrated in the case of Silver v. Ocean Steamship Co Ltd[24]where cans of frozen eggs were delivered on board a ship for shipment from China to London. The master signed the bill of lading stating that the cans were shipped in aparent good order and condition. The bills of lading were expressly made subject to the COGSA 1924 (i.e., the Hague Rules), art.4, r.2, of which provides that neither the carrier nor the ship shall be responsible for loss or damage due arising or resulting from (a) insufficiency in packing. On arrival in London many of the cans were found to be damaged, some being gashed or punctured and others only having pinhole perforations. On a claim by the cargo owners, endorsees of the bill of lading, for damages, the ship owners alleged that some of the cans were already damaged before delivery to the ship, and all the damage was due to insufficiency of packing in that (a) the tins were not covered, and so were difficult to handle, and gave less protection to the eggs, and (b) the tins had sharp edges and corners, and were therefore, likely to damage each other. In the judgment of Greer. L. J. the learned judge states that the bill of lading incorporated the rules of the COGSA 1924 and the ship owners relied on the exception of insufficiency of packing conditiond contained in art.4 r.2 of the said act, the first question before the court was that are the shippers estopped from alleging that the goods were in damaged condition before they left or that they were insufficiently packed, the court then looked at the decision of Compania Naviera Vasconzada v. Churchill and Sim[25] where it was held that those words in a bill of lading are not contractual but they contain representation of a fact that mat create estoppel in favor of a purchaser relying on the words in the bill of lading and acting on them to his detriment.the court then looked at the case of Brandt v. Liverpool Etc. Steam Navigation Co. Ltd[26] where the elements necessary to create estoppel were evolved, the elements are 1. There must be a statement of fact 2. Relied on by persons alleging estoppel and 3. He must have acted on the representation to his detriment.

The court then went on to state that the cargo owners took the bill of lading and it may be assumed that they relied on it to their detriment, in the absence of any evidence to the contrary, in the case of the tromp[27]it was held that where potatoes were shipped in wet bags described in the shipment as being of apparent good order and condition, the shipowners were estopped from saying that the condition of the bags were bad. The court held that even if it were to be accepted that the goods were insufficiently packaged inasmuch as they had sharp edges, this was known to the carrier who in spite of knowing this fact issued a clean bill of lading. Hence he was estopped from raising the defence of Art. IV(2). In the case of brandt v. Liverpool steam navigation[28]goods were being shipped on board a ship belonging to the defendants for carriage from Beunos Aires to Liverpool under a bill of lading given by the shipowner in which the goods were described as being received in apparent good order and condition. After the goods were put on board a portion of them were ascertained to be in defective condition, and were thereupon taken out of the ship to be reconditioned[29]. When they had been re-conditioned they were sent back to Liverpool four months after the due date, owing to this delay there was a fall in the market value of the goods. The plaintiffs who were the endorsees of the bill of lading, then claimed damages for re-conditioning and delay in delivery. yet during their shipment, on the request of the shipper, the carrier issued a clean bill of lading. The shipowners were held to have been estopped as against the plaintiffs from denying that fact and saying that the damage to the goods had been caused before they had been put on board. In the case of Brown Jenk ins and Co. v. Percy Dalton (London) Ltd[30]the plaintiffs as agents for the shipowners agreed with the defendants for the shipment of one hundred barrels of orange juice f.o.b London to hambirg, freight to be paid by the defendants. The defendants then stipulated that they should have a clean bill of lading. The barrels were in fact old and leaking, as the defendants knew and as the plaintiffs learnt when the barrels were bought to the dock. Yet at the request of the defendants the plaintiff agreed to issue a clean bill of lading stating that the goods were received in apparent good order and condition, the defendants agreed to indemnify the shipowners against all losses arising from the issue of a clean bill of lading. Owing to the condition of the barrels a considerable amount of the orange juice leaked before they got to the ultimate purchasers. The shipowners having paid the amount of the loss so arising assigned to the plaintiffs their rights under the agreement of indemnity. The country court judge gave judgment for the plaintiffs on the ground that as no special damage to anyone had been proved the tort of deceit was not complete, and therefore there was no ground for holding that the indemnity agreement was against public policy. The Court of Appeal by a majority, allowed the appeal. They did so on the ground that in the present case the plaintiffs knew when asking for the indemnity that the bill of lading would contain a misrepresentation. It was true that both parties hoped that the false statement would not give rise to any harmful results, and in fact there had been no injury to anyone as the ship owners had paid the damages to the ultimate purchasers. Morris L.J. held however that it was not necessary to prove that there had been any loss. The contract of indemnity was illegal because it involved the making of a false representation of fact with intent that it should be acted upon. Pearce L.J. held that the plaintiffs intended their misrepresentation to deceive, although they did not intend that the party deceived should ultimately go without any just compensation.[31] The court would not enforce the defendants promise to indemnify the shipowners, since the promise arose out of a transaction which contained all the elements of the tort of deceit and was thus given for an unlawful consideration, viz., the plaintiffs making at the request of the defendants a false representation, which they both knew to be false but on which they intended that others should act; and the fact that the plaintiffs did not contemplate that anyone would be defrauded did not render the agreement enforceable by them. The principle of ex turpi cause non oritur action would come into action. In the case of Craig and Rose v. Delargy[32], where a shipment of casks of oil which while loading were known to be defective and that the original shipper, the assignor of the plaintiff, knew this. The captain of the loading ship also saw that they were defective, but, instead of setting out the defect in detail, merely noted on the bill not responsible for weight, quality, leakage, or breakage. The holders of the bill sued the shipper and alleged that the

shipper in fact knew that the goods did not meet the stipulation in the bill of lading that they were in apparent good order and condition. The Scottish Court of Session held that the disclaimer clause above was effective against the original shipper who had notice of the defects and that under the Bills of Lading Act, the endorsee had not greater rights than the original shipper. the result therefore is that this bill of lading contained on its face notice to any endorsee taking it sufficient to put him on his guard. It was not a clean bill of lading. JUDICIAL DECISIONS BY INDIAN COURTS ON THE LEGAL IMPLICATIONS OF ISSUING A CLEAN BILL OF LADING S The Indian courts have also maintained that the contract of the shipowner in the bill of lading is that he will deliver the goods to their destination in the like good order and condition in which they were shipped. In the case of The Ellerman and Buck nall Steamship Co. v. Bhagajee Sonmull and Others[33] certain consignments alleged to contain polystrene powder; the goods consigned were packed in re-usable drums. The mates receipt[34] that was given on delivery of the goods, described the packages as re-used drums. It mat be noticed that the mates receipt is a mere acknowledgement of the receipt of the goods by the ship owner; the contract of carriage will be contained only in the bill of lading signed by the person who agrees to carry them; that is a document of title to the goods. The seller being evidently apprehensive of the description of the packages in the mates receipt, if entered in the bill of lading would not facilitate his obtaining monies under the letter of credit, requested the appellant, to issue a clean bill of lading by not mentioning that the consignment was shipped in re-used drums. The appellant acceded to this request, but safeguarded himself by obtaining from the shipper letters of indemnity, whereby the seller agreed to indemnify the carrier against any loss. But when the buyers opened the first drum they found that it did not contain any polystrene powder but instead contained coal dust and factory shavings and the contents of the other consignments were in no way different. The court went on to state that, a clean bill of lading is one that does not contain any reservations as to the apparent good order and condition of the goods or their packing. Therefore a defect in packing if noted in the bill of lading would render it to be a unclean bill of lading, hence on the above observation the courts noted that the deliberate deletion of the words re-used as descriptive of the drums in the description of the packing in the bill of lading made the bill of lading an unclean bill of lading and facilitated the seller to obtain monies that he otherwise would not have been able to under the Letter of Credit. Thus the fraud undertaken by the shipper would not have been facilitated if a unclean bill of lading had been issued. Also the indemnity clause provided for by the shipper as against the shipper went on to show that the carrier was aware of the fraud being played by the shipper. Hence there was a breach of duty on the part of the ship owner in not disclosing the correct facts, as a result of this the negotiability of the bill of lading was affected and hence the carrier was hence estopped and liable for the fraud. Thus the Indian courts have maintained that a clean bill of lading is one, which does not disclose any defect in the goods or their packing. It is prima facie evidence that the carrier received the goods in good order and condition. When a clean bill of lading is issued the carrier is estopped from denying that the goods were in good order and condition unless their bad condition was not discernible on a reasonable examination by a man of ordinary prudence. On the other hand an unclean bill of lading is one, which contains a clause depicting some defect in the goods or their packing. Such a bill of lading exempts the carrier from the liability in respect of the goods to the extent of the defect indicated in the clause, and further damage caused to them by virtue if the original defect despite the carriers vigilance. But if the carrier omits to insert such a clause willfully despite having knowledge of the defect, he is liable to the holder of the bill of lading who is cheated by paying consideration for the goods by reposing faith on the statements of the bill of lading[35]. A qualified bill of lading is not even prima facie evidence of the as to the receipt of goods as against the person who has signed it or against the owner of the vessel[36].

THE REQUIREMENT OF A CLEAN OR CLAUSED BILL OF LADING UNDER THE HAGUE, HAGUE VISBY RULES AND THE HAMBURG

RULES Article III (3) of The Hague and the Hague Visby rules, reads as follows: After receiving the goods into his charge, the carrier or the master or the agent of the carrier, shall on demand of the shipper, issue to the shipper a bill of lading, showing amongst other things: (a) The leading marks necessary for the identification of the goods as the same are furnished in writing by the shipper before the loading of the goods starts, provided such marks are stamped or otherwise shown clearly upon the goods if uncovered, or on the cases or coverings in which such goods are contained, in such a manner that it should ordinarily remain legible till the end of the voyage; (b) Either the number of packages or pieces, or the quantity, or weight as the case may be, as furnished in writing by the shipper; (c) The apparent order and condition of the goods The article contains the proviso: No carrier, master or agent of the carrier shall be bound to state or show in the bill of lading any marks, quantity, or weight which he has reasonable grounds for suspecting not accurately to represent the goods actually received, or which he has has\d no reasonable means of checking. Article III (4) of the Hague Rules provides that : Such a bill of lading shall be prima facie evidence of the receipt by the carrier of the goods as described in accordance with paras (a), (b) and (c)[37]. The Hamburg rules go to the extent of making the issuance of a clean or claused bill of lading so essential that in the absence of it, it shall be deemed that the shipper issued a clean bill of lading, art.15 of the rules provides that: The bill of lading must include, inter alia, the following particulars: (b) the apparent condition of the goods. The Hamburg Rules also provide in Art.16(2) that: If the carrier or other person issuing the bill of lading on his behalf fails to note on the bill of lading the apparent condition of the goods, he is deemed to have noted on the bill of lading that the goods were in apparent good condition. In the case of The Atlas[38] a bill of lading is subject to the Hague rules regarding bundles of steel billets contained a printed clause to the effect that weight , quantity, number unknown. Longmore J held that clausing deprived the statements as to the quantity and weight of any evidentiary status,and said that the provisions of art III (4) only apply if the shipper demands for a clean bill of lading as required by art III (3). In another Goa high court judgement The Shipping Corporation of India Ltd. Bombay and Another v. Union of India and Another[39], the plaintiffs shipped a certain amount of fertilizers through the Shipping Corporation of India, which was found to be short delivered by the plaintiffs. However the bill of lading provided that weight etc. not known. As per the learned single judge, the clearly meant that that the particulars contained in the document were those furnished by the shipper and that the carrier did not accept the particulars as correct. Hence since the burden of proving the weight and quantity shipped by the plaintiffs was not discharged and therefore no liability for damages for short delivery could be fastened on the defendants. Thus we see that The Hague and Hague Visby rules and their

judicial interpretation is behind time fo the Hamburg rules deems that if one is not issued the the shipper has issued a clean bill of lading. Yet all three of the rules acknowledge that the evidentiary status of the bills of lading if clean is that it is prima facie evidence, in the case of In Syndicate Bank v. Africana Co.[40] four false bills of lading were issued in favour of a false shipper as against which sums were advanced by the banks. The question arose as to what was the validity of the bills of lading that was issued by the carrier stating the words received in apparent good order and condition. The Kerala High Court opined that since under Art.3(4) of the Indian Carriage of Goods by Sea Act, 1925 a bill of lading is prima facie evidence of the carrier having received the goods mentioned therein, the carrier will have to prove not merely that good may not have been received but that they were not. Making the issuance of a bill of lading laying down the apparent order and the condition of the goods is important because in some cases the carrier can contract himself out of the liability that he should rightfully undertake, like in the case of K.Assainar v. Malabar Steamship Co.[41] the court observed that here the bill of lading is subject to the notation weight declared by the shipper but not checked it is indicative of disclaimer of responsibility and liability.It is open to the carrier to contract out of his liability. No presumption arises merely on the ground that certain quantity has been mentioned in the bill of lading when what has been noted has been qualified by the further statement that the weight was checked by the carrier. In such a case, the carrier could not be held responsible for shortage when there in no acceptable proof that the actual weight was as noted in the bill of lading at the time of shipment. THE EVEDENTIARY VALUE OF A CLAUSED BILL OF LADING Where the statement in a bill of lading is qualified, the bill of lading will amount to a claused bill of lading. Such clausing is common with regard to statements as to the quality or value, which the carriers servants have no independent means of verifying, but which will have prima facie effect if unqualified. The validity of these types of clauses has been upheld in the case of New Chinese Antimony Co Ltd v. Ocean SS and Co[42]where the bill of lading statement as to the weight of a cargo loaded in bulk was claused and said to be weight unknown, the statements as to the quality loaded ceased to have any evidentiary value at all. Hence the plaintiff was required to prove quantity loaded by independent evidence. In the case of The Sk arp[43] the timber being shipped was already damaged, but the master issued a clean bill of lading, and added a note at the rear of the bill of lading, it was observed that masters addition of a qualification in the reverse was not enough to contradict the effect of the front of the bill which was clean. In contrast to this in the case of Canadian and Dominion Sugar Co. Ltd. v. Canadian National Steamshi[44] the front of a bill of lading was clean with an adittion saying that some of the bags were torn, the shipowner was not stooped from proving pre-shipment damage. CONCLUSION The bill of lading is the result of mercantile practice that has evolved over the years, and in the present day scenario where money and goods are bought and sold so many times over a very short period of time, in the same manner the bill of lading affords the holder to dispose off his goods, without actually even seeing them. In such a case what is on the bill of lading acquires paramount importance, because when the goods are being resold then the second purchaser buys the goods solely on the information contained in the bill of lading. Then there is another scenario that arises in which the original seller colludes with the carrier, who would fraudulently give a clean bill and thus they would be able to cheat the buyer as well as the bank. Thus it has become of great importance for the carrier to state on the bill of lading as to the apparent order and condition of the goods at the time of loading, also if there is a dirty or a claused bill of lading issued then no bank will extend credit to such a seller but if the carrier issues a clean bill of lading then he is stooped from using the defence of pre loading damages. Thus it also became important that law makers evolve laws that encourage or force the shipper to demand a bill of lading stating the apparent order and condition of the goods. As a result of this need we see in The Hague and

the Hague Visby rules the carrier are bound to issue a bill of lading if the shipper demands one, now since the parties were contracting under these rules it became prudent that the shipper demand for a bill of lading and the carrier issue one in order that both could absolve their liabilities in any future dispute, for a clean bill of lading is prima facie evidence of the apparent order and condition of the goods and the carrier is estopped from pleadings the defense of pre=loading defect in the case that he has issue a bill of lading. In spite of this sometimes shippers do not demand a bill of lading stating the apparent order and condition of the goods, this puts the carrier in a very strong situation as he does not have any liability as regards the condition of the goods and if the shipper has to prove the carriers fault he ahs to do so with evidence independent of the bill of lading. Thus in order to rectify this the Hamburg rules has incorporated a provision in which the if the shipper does not issue a bill of lading in which the apparent order and condition of the goods is not given, then it is deemed that a clean bill of lading had been issued. Unfortunately in India where The Hague rules apply this provision forcing the carrier to issue a bill of lading stating the apparent order and the condition of the goods is not there. The law governing India specifically states that the shipper has to demand a bill of lading with the apparent order and condition of the goods on it ,and if he does not the carrier cannot be estopped from pleading the defense of pre-loading defect. Thus it is the researchers opinion that through judicial interpretation the issuance of the bill of l;adding staing the apparent order and condition of the goods should be made mandatory or the that specific provision of the Hamburg rules should be adopted, because in the absence of it their is a lot of scope for fraudulent practices.