The Luna, The Sienna, The Nika, The STI Orchard and The Maersk Princess

The resolution of misdelivery claims has always been straightforward, as the law in this area is well settled. There are abundant authorities across the United Kingdom and Singapore to support the proposition that a carrier who delivers a cargo without being presented with the original bill of lading does so at its own risk and will be liable for the losses suffered by the holder of the bill of lading.1 Ordinarily, courts are able to dispose of misdelivery claims expeditiously if a claimant makes an application for summary judgment.2 The apparent lack of defence in misdelivery claims has resulted in protection and indemnity (“P&I”) clubs withdrawing insurance cover for carriers who deliver cargo without presentation of the original bill of lading.3 It is therefore widely accepted in the maritime industry that delivering cargo without presentation of the original bill of lading is a risky act and ought to be avoided because a carrier can be easily exposed to a huge liability without avail of its insurance cover.

That said, in recent years, there has been a slew of cases in both the United Kingdom and Singapore which suggests a departure from the above position. These cases can be grouped into two categories and they both show the courts’ inclination to determine the carrier’s liability pursuant to a factual inquiry into the commercial arrangements surrounding the bill of lading. The first category consists of The Luna.4 The factual inquiry here led to a finding that the bill of lading was neither a contract of carriage nor a document of title, thereby absolving the carrier of liability for misdelivery. The second category consists of The Sienna,5 The Nika,6 The STI Orchard 7 and The Maersk Princess.8 The factual inquiry in these cases found that the arrangements surrounding the financing of the cargo and the issuance of the bill of lading meant that the holder of the bill of lading would have accepted the risk of misdelivery, thereby relieving the carrier of liability. The cases in these two categories demonstrate that, in certain factual matrices, misdelivery claims are not straightforward for claimants and carriers are able to mount a defence when faced with