Identification of shipper’s identity in the case of ＂arbitrage＂ of long-distance bill of lading

　　[Abstract]

　　In recent trial practice, there have been disputes caused by the remote bill of lading printing system used by large shipping companies. In order to attract customers with preferential freight rates, the agent company authorized by the shipping company adopts the means of "arbitrage", which leads to the inconsistency between the shipper of bill of lading and the actual owner in the shipping company system. In the event of a dispute over delivery of goods without bill of lading, the shipping company hereby defends the authenticity of the original bill of lading held by the actual owner. It is believed that if the plaintiff holds a full set of original bills of lading and the identity of the actual owner can be verified, even if the plaintiff is not recorded as the shipper in the internal system of the shipping company, he still has the right to claim rights from the shipping company as the carrier.

　　[case]

　　Plaintiff: Shuangye Company.

　　Defendant: COSCO Container Lines.

　　Defendant: Cosco Shipping Agency.

　　Third Party: Lexon Company

　　On March 10th, 2012, Shuangye Company reached a trade contract with M Company, an outsider, to sell a batch of textiles, and then entrusted Haihao Company, an outsider, to book shipping space. After haihao company accepted the entrustment, it also entrusted Leson company to book shipping space with COSCO Shipping Agency. The bill of lading information in the computer system of COSCO Container Lines shows that the shipper is Minmetals Corporation, an outsider, and the shipping power of attorney sent by Lexon Company also shows that the shipper is Minmetals Corporation. Lexon Company confirmed that the goods involved were indeed owned by the dual-industry company, but because there was a relatively favorable negotiated freight rate between Minmetals and COSCO Container Lines, it changed the shipper to Minmetals in the process of booking shipping space with COSCO Shipping Agency. The original bill of lading involved was printed by itself. After printing, the shipper Minmetals Company was changed into a dual-industry company, and then the original bill of lading was mailed to Haihao Company. Minmetals confirmed that it was unaware of the fact that it was recorded as the shipper of the goods involved and that it was not the owner of the goods involved. Haihao Company confirmed that it had received the original bill of lading and mailed it to Shuangye Company. All the information shown on the original bill of lading in triplicate held by Shuangye Company is consistent with the information recorded in the bill of lading in COSCO Container Transportation System, except that recorded by the shipper.

　　On August 2nd, employees of Lexon Company sent an e-mail to COSCO Container Lines, saying that the goods involved did not agree to be released to the consignee because the shipper had not received the payment, and the bill of lading is still in the shipper’s hand. Please inform the agent in the destination port to wait for Lexon’s notice before releasing it. On August 6th, employees of Leson Company sent an e-mail to COSCO Container Lines, requesting that the goods be delivered to the consignee legally. The two defendants confirmed that the goods were not delivered to the consignee on August 6 with the original bill of lading.

　　Shuangye Company believes that the two defendants have violated the obligation to deliver goods against documents and should bear the liability for breach of contract and compensate Shuangye Company for the loss of goods. The two defendants believed that the ocean bill of lading submitted by the dual-industry company was forged and was not issued by the two defendants. Shuangye Company is not the shipper of the goods involved, and there is no contractual relationship with the two defendants, so it has no right to appeal, so it requests to dismiss the application of Shuangye Company.

　 [referee]

　　The Shanghai Maritime Court held through trial that the main focus of the dispute in this case was whether Shuangye Company was the shipper of the goods involved. The dispute was caused by the "contract arrangement" of Leson Company when it used the remote bill of lading printing system of COSCO Container Lines. Lexon Company confirmed the fact of its "contract arrangement", and confirmed that Shuangye Company was the actual owner of the goods. Minmetals Company confirmed that it was not related to the goods involved, and it was unaware of the fact that it was recorded in the shipper of the bill of lading involved, so it can be considered that Shuangye Company was the real owner of the goods involved. At the same time, the shipper recorded in the original bill of lading held by Shuangye Company is himself, and Shuangye Company also booked the shipping space with COSCO Container Lines through Haihao Company. Therefore, it should be recognized as the contract shipper of the goods involved, and it has the right to claim compensation from COSCO Container Lines for the related losses caused by the goods being released without a bill of lading. In view of the fact that the two defendants confirmed that the goods had been delivered to the consignee, the evidence provided by them was not enough to prove that they could release the goods without the original bill of lading. Therefore, Cosco Container Lines, as the carrier of the goods involved, has defects in its delivery behavior, which constitutes a breach of contract and should be liable for compensation to the dual-industry company. Cosco Shipping Agency is not the carrier of the contractual relationship involved, and the dual-industry company requires Cosco Shipping Agency to assume the responsibility of the carrier, which lacks factual and legal basis. In the end, the court ruled that COSCO Container Lines compensated the double-industry company for the loss of payment.

　　After the verdict was pronounced in the first instance, none of the parties filed an appeal, and the case has now come into effect.

　　[Comment]

　　The biggest dispute between the parties in this case lies in whether the dual-industry company is the shipper of the goods involved and whether it has the right to appeal. The dispute originated from the remote bill of lading printing system used by the carrier, which is a new situation in recent trial practice. It can be predicted that the remote bill of lading printing system, an efficient and convenient bill of lading issuing mode, will be widely promoted and applied, and related problems may also appear more in trial practice. Combining with the introduction of this new mode of issuing bills of lading, this paper analyzes the controversial issues in this case, hoping to be beneficial to the settlement of related disputes in the future.

　　I. On the Remote Bill of Lading Printing System

　　1. The concept of "remote bill of lading printing system"

　　IRIS2 (Intergrated Regional Information System), the global agent system of COSCO Container Lines, is a global integrated information system. The earliest shipping management was purely manual, such as manual order, manual order, manual entry and manual tracking. After the global launch in 2003, IRIS-2 system has been put into use in COSCO Container Lines worldwide in recent years, realizing online cargo tracking, electronic booking, electronic bill of lading and online inquiry.

　　The remote bill of lading printing system is a part of this information system, that is, the shipping company does not issue the bill of lading in person, but authorizes its designated agent to print it in the remote bill of lading printing system of the shipping company. The shipping company will hang the electronic version of the completed bill of lading in the system in advance, and the designated agency will log in through the authorized user name and password to print the original bill of lading directly from the system.

　　2. Operation process of remote bill of lading printing system

　　Cosco Container Lines authorized relevant companies to use the remote bill of lading printing system through audit. The relevant companies shall apply to the relevant personnel of the Trade Zone of COSCO Container Lines Headquarters, the Project Bidding Department of the Ministry of Trade Security, regional companies and port companies for printing by remote bills of lading. After receiving the application, each department, regional company and port company shall fill in an application form and designate a special person to submit it to the Ministry of Commerce of the Ministry of Trade Security of COSCO Container Lines for review. The Ministry of Commerce of the Trade and Security Department of COSCO Container Lines will give a reply within two working days after receiving the application. If the company’s application is approved, the Ministry of Commerce will provide a model of the relevant agreement and sign an agreement with the company to use the remote bill of lading printing function. After the agreement is signed, the Ministry of Commerce of the Trade and Security Department of COSCO Container Lines will inform the company of the relevant user name and password for logging into the system. If the company’s application is not approved, the Ministry of Trade Protection will directly inform the applicant and explain the reasons for not passing the examination. Cosco will deposit the pre-printed paper of its company’s bill of lading with its authorized company in advance. The preprinted paper is printed with the letterhead of COSCO Container Lines on the front, the back clause of the bill of lading of COSCO Container Lines on the back, and the rest are blank. After the booking is completed, COSCON will upload the electronic version of the prepared bill of lading to the system, and relevant companies can directly print the original bill of lading from the system through the authorized user name and password. By default, the system will automatically delete a bill of lading three natural days after it is uploaded to the system.

　　Second, on the "arbitrage" related issues

　　1. The concept of "arbitrage"

　　With the increasingly fierce competition in the shipping market, in order to obtain the shipping rights of major customers, shipping companies often sign transportation agreements with these major customers and promise to give more favorable freight rates, while exporters or freight forwarders without agreed freight rates cannot obtain such preferential quotations. In practice, the "arbitrage" behavior followed, that is, the shipper in the "shipper" column was changed to a company with a special preferential freight rate agreement with the shipping company in order to enjoy the agreed freight rate between the company and the shipping company. After the bill of lading was generated, the "shipper" information was changed to the real shipper. Obviously, the practice of "arbitrage" will make the shipper of a certain transportation displayed in the shipping company system inconsistent with the shipper recorded in the original bill of lading held by the customer.

　　2. Disputes arising from "arbitrage"

　　Because the "contract arrangement" needs to ship the goods in the name of the big customer who signed the transportation agreement with the shipping company, it needs the cooperation of the shipping company in the past to be realized. However, with the application of IRIS system, it is possible to print the bill of lading remotely, which gives the shipping company and its agent convenience, but also invisibly gives the shipping company’s agent greater authority. The printing of remote bill of lading requires the shipping company to give the blank pre-printed paper of bill of lading to its authorized agent in advance, and the printing of bill of lading is also completed by the agent itself, so it is possible for it to modify the contents of bill of lading without authorization. In the past, the shipping company knew the identity of the "contractor" when it cooperated to complete the "contractor", but in the case of printing the bill of lading remotely, the shipping company did not know the identity of the "contractor". Therefore, in the case of using the remote bill of lading printing system, "arbitrage" is more likely to lead to disputes over cargo rights.

　　In this case, in order to obtain preferential freight rate, Lexon Company changed the shipper to Minmetals Company, which had a freight rate agreement with COSCO Container Lines, when booking shipping space with COSCO Container Lines, and then changed the shipper Minmetals Company on the original bill of lading to the actual dual-industry company. In this way, the shipper recorded in the shipping company system has nothing to do with the actual transportation and sales contract, and the dispute over the ownership of the goods continues to arise, which also involves the identification of the shipper.

　　Third, the identification of "shipper" in the case of "arbitrage"

　　According to Item (3) of Article 42 of People’s Republic of China (PRC) Maritime Code, "shipper" includes the person who signs a contract for the carriage of goods by sea with the carrier and the person who gives the goods to the carrier, and its core condition is: contract or delivery.

　　Combined with this case, although the two defendants argued that the shipper of the goods in their internal process was Minmetals Corporation, and there was no transportation contract relationship between them and Shuangye Company, Shuangye Company now held a full set of original bills of lading made out of COSCO Container Lines and it was unable to identify that the shipper of the bill of lading had been changed. Haihao Company confirmed that Shuangye Company entrusted it to book the shipping space for the goods involved, and after accepting the entrustment, it entrusted Letson Company. Lexon Company confirmed that it printed the original bill of lading in COSCO Container Transportation System by itself through the remote bill of lading printing system in order to "set up a contract" to obtain a cheap freight rate, and then changed the shipper, and the dual-industry company was the real owner of the goods involved. Minmetals was unaware of the fact that it was recorded as the shipper of the bill of lading involved, and confirmed that it was not the owner of the goods involved. In view of the fact that no one has claimed the right to the goods involved except the dual-industry company, it can be concluded that the dual-industry company is the shipper of the goods involved. At the same time, the shipper recorded in the original bill of lading held by Shuangye Company is himself, and Shuangye Company also booked the shipping space from COSCO Container Lines through Haihao Company. Therefore, his identity conforms to the characteristics of a contractual shipper who entrusts others to conclude a contract of carriage of goods by sea with the carrier in his own name, and he should be recognized as the contractual shipper of the goods involved, which constitutes a contractual relationship of carriage of goods by sea with COSCO Container Lines, and has the right to claim compensation from COSCO Container Lines for the related losses caused by the release of goods without a bill of lading.

　　Four, the "contract" bill of lading does not affect the carrier’s responsibility for delivery without bill of lading.

　　It is the carrier’s legal obligation to release the goods against the original bill of lading. In this case, the two defendants confirmed the fact that the goods had been delivered to the consignee without the original bill of lading. They claimed that the original bill of lading held by Leson Company was forged because the goods involved had not been transported. In the e-mail sent by Leson Company to COSCO Container Lines, they indicated that the release of the goods had to wait for the notice of Leson Company, and they would release the goods after receiving the notice from Leson Company informing them to legally deliver the goods to the consignee. Therefore, the two defendants only needed to follow the notice of Leson Company without relying on the original bill of lading. In this regard, Lexon Company believes that the original bill of lading has been issued for the transportation of the goods involved, and the meaning of legally delivering the goods to the consignee in the e-mail sent to COSCO Container Lines is to require COSCO Container Lines to release the goods with the original bill of lading. Usually, COSCO Container Lines has extremely strict requirements for accepting delivery without the original bill of lading, and the shipper and the agent need to provide corresponding letters of guarantee, so it is impossible to release the goods with the notice in the agent’s e-mail.

　　Although Leson Company did the act of "contract arrangement" and Cosco Container Lines did not know about it at that time, Cosco Container Lines authorized Leson Company to print the bill of lading from the remote bill of lading printing system. At this time, Leson Company’s act of "printing" the bill of lading should be regarded as Cosco Container Lines’ act of "issuing" the bill of lading, and Cosco Container Lines should be responsible for Leson Company’s act of "contract arrangement". From the emails provided by the two defendants, it is not clear that COSCO Container Lines can deliver the goods without the original bill of lading, but requires COSCO Container Lines to deliver the goods to the consignee legally. Therefore, the meaning of "legal delivery of goods" in this email should be delivery with the original bill of lading. Even if the bill of lading involved is indeed forged as stated by the two defendants, COSCO Container Lines should be confirmed by the shipper before releasing the goods. Therefore, Cosco Container Lines, as the carrier of the goods involved, has defects in its delivery behavior, which constitutes a breach of contract, and should bear the liability for compensation for delivery without bill of lading to the dual-industry company.

　　The situation reflected in this case reflects that in today’s society with more and more developed science and technology, with the continuous development of some new projects, problems will arise. When the authorized company uses the remote bill of lading printing system, even if the shipping company denies the authenticity of the original bill of lading held by the actual owner according to the fact that the shipper in its internal system is not the actual owner, as long as the authorized printing company confirms the identity of the actual owner and the actual owner still holds the original bill of lading in triplicate, the actual owner has the right to claim the rights from the shipping company as the carrier for delivery without bill of lading, although he is not recorded as the shipper in the internal system of the shipping company.

(Author: Yangshan Deepwater Port Court of Shanghai Maritime Court)