Transport Documents
1. Phenomenology
Acts of transport are typically documented. This applies for contracts of carriage of goods and persons alike. The spectrum of types of transport documents is wide. It begins with rail tickets, ferry tickets and flight tickets. It continues with bills of lading in road and rail freight transport and proceeds on to sea waybills. It ends with bills of lading in the maritime transport industry, the most sophisticated of all transport documents.
2. Legal importance
a) Transport documents as a declarative documentation of the contract of carriage
Transport documents are not a condition precedent for either transport or for any contract of carriage. The contract of carriage also exists without any documentation being created as the contract of carriage is not identical with the transport documents. Transport documents, however, evidence the details of the arrangement and help demonstrate and provide proof in court. In cases where there may be doubt, what is written on the documents is paramount.
b) Transport documents as an application condition of international uniform law
The scope of application of some regimes of uniform law is related not to the contract of carriage as such, but to the transport document. This is the case first and foremost with the Hague Rules and the Visby Rules on the carriage of goods by sea. They are applicable only where a bill of lading has been issued, and they regulate the liability issues specifically related to bills of lading. Even if a sea waybill is issued, they are not applicable.
However, most of the other regimes of uniform law are applicable regardless of whether or not any transport document has been issued. This is particularly true for the Convention on the Contract for the International Carriage of Goods by Road 1956 (CMR). Article 4 CMR explicitly states that the absence, irregularity or loss of the consignment note shall not affect the existence or the validity of the contract of carriage and that the contract shall remain subject to the provisions of that Convention. Article 6 CMR on the other hand lists, in a very detailed catalogue a wealth of information to be compulsorily contained in the consignment note. The same as in Art 4 CMR applies to Art 3 Warsaw Convention and Art 3 Montreal Convention with regard to air freight receipts or flight tickets. Even in the field of carriage of goods by sea, the Hamburg Rules and the Rotterdam Rules do not relate to the bill of lading or another transport document, but to the contract of carriage itself.
c) Bills of lading and contracts of carriage
Transport documents typically do not establish an independent legal relationship in addition to the contract of carriage. At most, they give evidence of the claim for carriage arising from the contract of carriage. A very important exception is, however, the bill of lading in maritime transport. The bill of lading establishes a claim for delivery (on the holder’s or the consignee’s part) independent from the contract of carriage. The debtor is the carrier under the bill of lading (who might not be identical to the carrier under the contract of carriage). This claim for delivery encompasses secondary claims and sanctions for the breach of this primary obligation. To what extent the bill of lading relation exceptionally also contains claims against the bill of lading creditor (eg a claim for payment of remuneration, known as the freight, or demurrage) is subject to the rules of the law applicable to the bill of lading.
3. Order, bearer or straight transport documents
a) Order, bearer and straight (or ‘non‑negotiable’) bills
Bills of lading can exist in three different forms which are, in ascending sequence of rank: straight bills, bearer bills or order bills. Order bills either carry an explicit ‘order’ clause or have their nature attributed to them by the applicable law. Hybrid forms are conceivable and do exist, in particular hybrid forms merging order and bearer bills with combined clauses such as ‘to order or to bearer’. Straight bills, however, mention a first beneficiary without carrying an order clause. Typically the named person is the consignee. Hybrid forms merging straight and bearer bills are infrequent but can be created by combining the naming of a beneficiary with an additional ‘or to bearer’, whereas an order clause is missing. In the case of doubt, the bearer element should be deemed paramount in the interest of transferability.
Straight bills, on the one hand, and both bearer and order bills, on the other, follow different principles. Straight bills are generally subject to the additional clause: ‘the right to the bill follows the right from the bill’. For bearer and order papers the opposite principle holds true ‘the right from the bill follows the right to the bill’. In maritime practice straight bills of lading are far more widespread than is commonly believed.
b) Entitled person
Who is entitled under the bill depends to a certain degree on the particular arrangement. Primarily, the person initially entitled can either (in the event of a straight bill) be the named creditor or (in the event of a bearer or order bill) the first holder, the first consignee named or a named creditor. A named creditor is typically either the shipper of the maritime transport contract or the consignee. With order bills the consignee is normally referred to as the first creditor. Non-negotiable bills may be transferred by assignment of the underlying claim, bearer or order bills by endorsement, ie a written transfer traditionally made on the back of the bill of lading.
4. Title to the goods
A transport document can also represent title to the goods transported. It can evidence the ownership of the transported goods in such a way that the transfer of the document equals the transfer of the goods as such. This enables the passing of title to goods in transitu, in particular aboard a ship. Whether a transport document is a title to the goods needs to be determined pursuant to the law governing the document in question, not the law applicable to the goods themselves.
5. Uniform law
The carrier’s liability based on transport documents had already been addressed as a matter of uniform law in 1924, namely in the Hague Rules on liability under a bill of lading in maritime transport. This approach based on the bill of lading was kept in the Visby Rules (the 1968 modernization of the Hague Rules) and in the protocols to the Visby Rules. The Hamburg Rules dismissed this approach but they have not met with widespread acceptance (maritime transport (contracts of carriage of goods)).
Most uniform laws do not regulate the transport document itself but the contractual relationship between the carrier and consignor or, alternatively, between the carrier and passenger. This includes, however, the possibility of uniform law guidelines as regards the required content of the particular transport document. Many transport law conventions dictate that the particular transport document should incorporate a paramount clause which states that the respective regime is mandatorily applicable. This kind of paramount clause has its greatest significance in the carriage of goods by road pursuant to Art 6(1)(k) CMR and in air transport pursuant to Art 3(4) Montreal Convention and, previously, Art 3 para 1(c) Warsaw Convention. Every European passenger can find an example of such a paramount clause on the reverse side of a flight ticket; (earlier they were normally included with one of the various versions of the Warsaw Convention. Today, they are generally included in accord with the Montreal Convention).
6. Electronization
In the past, transport documents were traditional paper documents. Yet electronization plays a key part in the transport business today. Presently transport documents will often only exist in electronic form as data. This is a challenge in particular to the law of securities, a rather traditional, paper-oriented body of law. In uniform law the wording of the relevant provisions must be interpreted so as to determine whether the regime at stake has the necessary dynamic or flexibility to also cover electronic documents. At least for the more recent conventions, such as the Montreal Convention on international carriage by air, this is accepted as they were drafted at a time when electronic documents were already an issue of attention. In older conventions, however, namely the Hague Rules of 1924, the inclusion of electronic documents would be preferable under the auspices of commercial reality, but judicially, such a step would be very if not overly bold.
7. Transport documents and documentary letters of credit
Transport documents play a very significant role in the payment process of import and export activities. To underline this, the perfect example is the documentary letter of credit. A documentary letter of credit (L/C) is a bank’s conditional promise to pay. The bank, commissioned by the buyer and in most instances residing in the buyer’s state, promises to pay if the seller presents certain specified transport documents. Which requirements the transport documents have to fulfil in the concrete context, particularly whether it has to be a clean bill of lading without remarks by the carrier, is governed by the terms of the L/C. The terms of the L/C also determine which documents are required (eg invoice, ocean bill of lading, freight forwarder’s receipt, through bill of lading or insurance policy) and within which time limit they have to be produced. Typically the documents have to evidence that the goods have been shipped and are at least no longer directly controlled by the seller. Standardized terms can be found in the internationally used Uniform Customs and Practice for Documentary Credits (UCP). Ordinarily, the documents must have the nature of documents of title so that they transfer disposal of the goods. The issuing bank or an appointed paying agent takes up the documents if they comply with the terms agreed upon, and payment will be effected to the creditor/seller. Typically the acquirer tenders and the bank seizes the documents on the seller’s behalf.
8. Union law and European private law
Generally, Union law does not contain any specific regulation on transport documents. At the point Union law began to turn towards private law, the relevant uniform law already had an older, established existence and was distributed widely enough so that further Union regulation was not necessary. Moreover, contracts of carriage are not typical consumer transactions and thus do not fall into the area where Union law has begun to regulate private law. One may additionally note that the carriage of luggage is not the subject of a separate contract, but forms part of the carriage of persons, and that goods are only transported on behalf of consumers when individuals relocate their residence. Union law applies to transport documents insofar as the EU is a contracting state of uniform law conventions which in turn regulate transport documents. Ratification by the EU transposes such conventions into parts of the Union law system. The most important example here is the Montreal Convention.
European private law as such respects the uniformity in this field and does not aim to substantially interfere with it. The Principles of European Contract Law (PECL) as well as the Draft Common Frame of Reference (DCFR) do not specifically address transport documents as the matters are too specific. Other important factors might contribute to this as well. Firstly, the uniform law at stake is ordinarily of a mandatory nature insofar as it regulates transport documents. Secondly, the uniform law at stake governs transport far beyond the circle of EU Member States and is one of the few genuine success stories in the history of uniform law. Finally, the absence of special rules in European private law might reflect the fact that European private law so far has generally abstained from installing special rules for particular types of obligations.
Literature
Jürgen Basedow, Der Transportvertrag (1987); Peter Mankowski, Seerechtliche Vertragsverhältnisse im Internationalen Privatrecht (1995); René Rodière and Emmanuel du Pontavice, Droit maritime (12th edn, 1997); John Livermore and Krailerk Euarjai, Electronic Bills of Lading and Functional Equivalence (1998) 2 JILT <www2.warwick.ac. uk/fac/soc/law/elj/jilt/1998 _2/livermore/>; Rolf Herber, Seehandelsrecht (1999); Peter Mankowski, ‘Warenübereignung durch Dokumentenübertragung im Internationalen Privatrecht’ in Festschrift Rolf Herber (1999) 147; Carlos Moreno, Legal Nature and Functions of the Multimodal Transport Document (2002); Guenter H Treitel and Francis MB Reynolds, Carver on Bills of Lading (2nd edn, 2005; Nicholas Gaskell, Regina Asariotis and Yvonne Baatz, Bills of Lading (2nd edn, 2005); Florian Gehrke, Das elektronische Transportdokument (2005); Pierre Bonassies and Christian Scapel, Droit maritime (2006); Sergio M Carbone, Pierangelo Celle and Marco Lopez de Gonzalo, Diritto marittimo (3rd edn, 2006); Paul Todd, Bills of Lading and Bankers’ Documentary Credits (4th edn, 2007); Stewart Boyd and others, Scrutton on Charterparties and Bills of Lading (21st edn, 2008).
