Documents are lost in transit
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NataliaFedorova
- Posts: 5
- Joined: Fri Apr 05, 2019 5:18 pm
Documents are lost in transit
L/C terms provide presentation of full set (3/3) originals of Bill of Lading. Nominated Bank sent to us, as issuing Bank, set of documents by two mails. First mail contained 2 of 3 originals of Bill of Lading among other documents and the second mail-it's third original. First mail was lost in transit and we received only second mail, which contained only 1 of 3 original of Bill of Lading. As we know only full set of originals of Bill of Lading (in our case 3 of 3) enables it's holder title to the goods. So can we treat such second mail like documents presented with discrepancies with L/C terms and are we in position to send advice of refusal? Are we obliged to request nominated Bank for they apply beneficiary and then present us duplicates of lost originals of Bill of Lading?
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AbdulkaderBazara
- Posts: 256
- Joined: Fri Apr 05, 2019 5:15 pm
Documents are lost in transit
If the place of presentation of documents in the LC is the nominating bank's counters, then it is consider that the beneficiary has performed in accordance with the terms and conditions of the credit once he/she presents complying documents to said nominated bank and you would not have grounds to reject the documents. In accordance with artilcle 16 of UCP 500, applicant takes the risk of loss of documents in transit.
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larryBacon
- Posts: 689
- Joined: Fri Apr 05, 2019 5:26 pm
Documents are lost in transit
From a practical point of view, the Shipping Line & especially the agent at the port of destination should be advised immediately of the missing documents, particularly if documents are consigned "to order" or similar, to avoid possible fraudulent use of the missing original Bs/L.
Usually the Shipping Line will require a Bank Guarantee in the absence of all original Bs/L, to protect itself from litigation due to a possible conflict arising from more than one party ostensibly being entitled to the goods. If one original B/L remains with the issuing bank, the recommended course of action is to present it immediately as a claim on the goods, before any possible counter claim can be made. The first original B/L presented to the Line voids the others, unless there is simultaneous presentation of the others.
Usually the Shipping Line will require a Bank Guarantee in the absence of all original Bs/L, to protect itself from litigation due to a possible conflict arising from more than one party ostensibly being entitled to the goods. If one original B/L remains with the issuing bank, the recommended course of action is to present it immediately as a claim on the goods, before any possible counter claim can be made. The first original B/L presented to the Line voids the others, unless there is simultaneous presentation of the others.
Documents are lost in transit
RISK OF CARRIER DEMANDING THREE ORIGINALS
From our consultancy experience, the solution is not so simple. The applicant, before accepting and paying for the documents, should have realised that if the DC requires the B/L to be endorsed in blank, in case other parties also make claims to the same carrier or its agent at port of discharge, at the same time or even before the applicant, then the carrier has the right to demand production of three original Bs/L before the goods can be released. In that case, the applicant has paid fully for the goods but may not get them.
NO PERFECT SOLUTION FOR LOST OF BS/L IN DC OPERATIONS
This means additional time, efforts and expenses for the applicant to enforce his rights in a local court which the dispute has been referred to by the carrier for judicial decision.
That is the reason why we choose not to respond earlier as there is no perfect solution to such problems.
We are from http://www.tolee.com
[edited 8/1/01 8:04:50 PM]
From our consultancy experience, the solution is not so simple. The applicant, before accepting and paying for the documents, should have realised that if the DC requires the B/L to be endorsed in blank, in case other parties also make claims to the same carrier or its agent at port of discharge, at the same time or even before the applicant, then the carrier has the right to demand production of three original Bs/L before the goods can be released. In that case, the applicant has paid fully for the goods but may not get them.
NO PERFECT SOLUTION FOR LOST OF BS/L IN DC OPERATIONS
This means additional time, efforts and expenses for the applicant to enforce his rights in a local court which the dispute has been referred to by the carrier for judicial decision.
That is the reason why we choose not to respond earlier as there is no perfect solution to such problems.
We are from http://www.tolee.com
[edited 8/1/01 8:04:50 PM]
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AbdulkaderBazara
- Posts: 256
- Joined: Fri Apr 05, 2019 5:15 pm
Documents are lost in transit
I have been in a real situation similar to this. The courier company lost the documents, our account was debited and and beneficiary was paid. We were able to obtain new sets of documents later. It is difficult to get new set of bill of lading though. The shipping companies would be cautious to issue another set.
Agree with Mr. Bacon, the one original B/L to be presented as claim for the goods and then request for the rest if required.
Agree with Mr. Bacon, the one original B/L to be presented as claim for the goods and then request for the rest if required.