loss of original bill of lading

Who should bear responsibility for loss of original bill of lading

An original bill of lading is required for release of cargo when it is issued as

  • A Negotiable (To Order…..) bill of lading
  • A Straight Bill of Lading

I have written earlier about what to do when the original bill of lading is lost, so I won’t go into that detail again.

One of the things that needs to be done when an original bill of lading is lost is for someone to issue a Bank Guarantee and/or Letter of Indemnity to facilitate the release of cargo.

Having personally never come across this specific situation, I have opted for practical logic to answer the question.

If an OBL has been lost in a plane crash or the plane simply disappeared (as the MH370 did), the logical thing to do would be:

  • First and foremost, ascertain who holds the title to the goods at the time of loss of the OBL. This can be determined based on what stage of negotiation or processing the OBL was before it was lost. The title could change depending on whether the negotiation with the bank was already done or payment processes between the seller and buyer was still to be done etc.
  • The title holder should approach the Shipping Line and explain the circumstances and provide proof of the loss such as tracking from the courier to confirm the genuineness of the loss, news items, videos, notices from airlines, police or court affidavits etc. and request the shipping line to issue a second set of bills of lading.
  • Whether the shipping line will provide a second set without any LOI would depend on the policy of the shipping lines. Considering the circumstances and based on a sworn court affidavit, I assume they would.
  • Once that title holder has secure the second set of bills, they can carry on with the negotiation process or payment process or any other process that they would need to follow.

So, to summarize, there should not be a requirement to submit an LOI or BG for issuance of second set because of above unique situation. However, this will be entirely up to the discretion of the shipping line.