An examination of the application of the Sea Transport Documents Act 65 of 2000 to title to sue under contracts of carriage evidenced by sea waybills and straight bills of lading.

Abstract

The Sea Transport Documents Act, 65 of 2000, was a remedial statute intended to provide a solution to the problem of title to sue under the contract of carriage evidenced by sea transport documents. At common law a contract of carriage is not transferable. The contract of carriage is ordinarily concluded between the shipper and the carrier. The consignee lacks title to sue yet in terms of international sale contracts on C.I.F and F.O.B terms the consignee would be the person who stood to suffer the loss as risk in the goods passes from seller to buyer when the goods are loaded on board at the port of shipment. The Act provides a mechanism to transfer the contractual rights and liabilities with the transfer of the sea transport document. However section 2(2) restricts the application of the relevant provisions to documents that are ‘transferable or negotiable’. By custom of merchants bills of lading made out ‘to order’, and bearer bills of lading, are transferable and negotiable. However, straight bills of lading and sea waybills are made out to a named consignee only. These modern forms of sea transport document are increasingly popular and offer many advantages to traders and ocean carriers. Yet they are both regarded as non-negotiable. The dissertation examines the interpretation of the terms ‘transferable’ and ‘negotiable’ as they came to be applied to both negotiable instruments and bills of lading, and considers current academic and judicial opinion on the meaning of these terms. The provisions of the Sea Transport Documents Act are analysed, and compared to the remedies provided in the Carriage of Goods by Sea Act, 1992 (United Kingdom), similar legislation in other commonwealth countries and the law in the United States and Europe. Finally alternative means of establishing title to sue, including the stipulatio alteri, are considered.