Article III(4) of the Hague-Visby 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). However, proof to the contrary shall not be admissible when the bill of lading has been transferred to a third party acting in good faith.40
This provision largely remedies the mischief of Grant v Norway. Statements as to quantity loaded fall within Art III(3)(b), and the carrier will no longer be entitled to admit proof to the contrary when the claimant is a third party, acting in good faith, who holds a bill of lading to which the Rules apply. The statutory estoppel also extends to leading marks ‘necessary for the identification of the goods’, which, at common law, had only prima facie effect.41 The shipper’s position is governed by the common law position that statements in the bill of lading have only prima facie effect. Furthermore, not every third-party holder of a bill of lading will be entitled to rely on Art III(4), for Art V of the Hague and Hague-Visby Rules provides that the Rules do not apply to charterparties. In addition, in the charterer’s hands, the bill of lading will not amount to a ‘contract of carriage’, as defined by Art 1(b) of the Rules, in that it will not regulate the relations between the shipowner and the charterer. Therefore, a charterer who obtains a bill of lading by indorsement, as occurred in The President of India Lines v Metcalfe Shipping Co Ltd,42 will not qualify as a ‘third party’ under this provision.
Where the Rules apply to a waybill voluntarily, neither Art III(3) or (4) will apply, as they are worded to apply solely to ‘bills of lading’. However, where the Rules apply mandatorily by virtue of s 1(6)(b) of the Carriage of Goods by Sea Act (COGSA) 1971, they will be modified as necessary, except for the second sentence of Art III(4) and for Art III(7). In both instances, an express conclusive evidence clause is therefore required if the rule in Grant v Norway is to be disapplied as regards a third party suing under the waybill.
40 The equivalent provision in the Hague Rules provided only that the statements set out in Art III(3)(a)–(c) had prima facie effect. However, this did not have the effect of excluding the common law estoppel. See Silver v Ocean SS Co [1930] 1 KB 416.
41 However, the words ‘necessary for the identification of the goods’ may indicate that Art III(3) refers only to marks that go to the commercial identity of the goods.
42 [1970] 1 QB 289.
Section 4 of the Carriage of Goods by Sea Act 1992
This provision replaces s 343 of the Bills of Lading Act 1855 and provides that:
A bill of lading which:
(a) represents goods to have been shipped on board a vessel or to have been received for shipment on board a vessel; and
(b) has been signed by the master of the vessel or by the person who was not the master but had the express, implied or apparent authority of the carrier to sign bills of lading,
shall in favour of a person who has become the lawful holder of the bill, be conclusive evidence against the carrier of the shipment of the goods, or, as the case may be, of their receipt for shipment.
This provision will prevent a shipowner who is sued for breach of a bill of lading contract that is not subject to the Hague-Visby Rules from relying on Grant v Norway so as to adduce evidence that less cargo was actually loaded than that stated on the bill of lading.44 Section 4 will also enable a claimant to obtain rights of suit under s 2(1) as a ‘lawful holder’ of a bill of lading even where no goods have been loaded and the bill is therefore a nullity. The carrier in such a situation will wish to argue that s 2(1) cannot apply to a document that is not, in fact, a bill of lading although it gives every outward appearance of being so. Section 4 will prevent the carrier from denying the fact of shipment recorded in the document and will therefore estop it from arguing that the bill is a mere nullity.45
As the words ‘representing goods to have been shipped’ are exactly the same as those to be found in s 3 of the Bills of Lading Act 1855 considered by the Court of Appeal in Parsons v New Zealand Shipping, it is probable that s 4 also applies to statements in the bill of lading relating to marks that go to the commercial identity of the cargo carried.
Although s 4 is not expressly limited to third parties, its provisions apply only in favour ‘of a person who has become the lawful holder of the bill’. Furthermore, s 5(5) of COGSA 1992 provides that its provision ‘shall have effect without prejudice to the application, in relation to any case, of the Rules [the Hague-Visby Rules] which for the time being have the force of law by virtue of s 1 of the Carriage of Goods by Sea Act 1971’. As Art III(4) of the Hague-Visby Rules does not affect the position between the carrier and the original shipper, neither will s 4. Therefore, the statements in the bill of lading as to the quantity loaded are still only of prima facie effect when the carrier is
43 This provided that: ‘Every bill of lading in the hands of a consignee or endorsee for valuable consideration representing goods to have been shipped on board a vessel shall be conclusive evidence of such shipment as against the master or other person signing the same, notwith- standing such goods or some part thereof may not have been so shipped . . .’ The section was of little use, given that the estoppel operated only as against the master or other person who had signed the bill.
44 Unlike Art III(3) of the Hague-Visby Rules, s 4 contains no reference to a bill of lading signed by the carrier itself. This is because the mischief of Grant v Norway would not apply to such a bill of lading, as no issue of agency would be involved.
45 This analysis assumes that the initial burden of proof on a claimant who wishes to rely on s 2(1) obliges the claimant to do no more than establish that it has become the lawful holder of a document that gives the outward appearance of a bill of lading issued on behalf of the carrier.
sued by the original shipper.46 The same applies to bills of lading that are indorsed or transferred to a charterer, given the exclusion of charterparties from the Rules effected by Art V.
However, Grant v Norway is still good law as regards contractual actions against carriers under documents other than bills of lading, particularly sea waybills and delivery orders.47 It is also still good law as regards claims in tort against the carrier arising out of the false statement made by its servant or agent.