[1938] AC 429 (PC) - Lord Wright
Summary, Facts, Held, Notes, Quotes from Lord Wright's speech
The case illustrates the importance of a document of title - here Ramjiban Serowgee had no document of title, and had no claim against the carrier when he delivered the cargo to the holder of a shipped bill of lading, bills of lading having been issued without the mate's receipts being given up.
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Serowgee were (intermediate) sellers f.a.s. to International Export Company, Ltd (Export), cash against mate's receipts. Serowgee had the mate's receipts but Export obtained bills of lading (Nippon Yusen as carrier granting bills of lading without requiring mate's receipts to be given up). Export did not pay Serowgee, but negotiated bills of lading to Japanese purchasers, to whom Nippon Yusen delivered against production of the bills.
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Property had passed to Export when the goods were delivered alongside the vessel; Ramjiban Serowgee was thereafter left only with an equitable lien, enforceable against Export. The lien was provided under the terms of sale contract, which provided for payment against mate's receipts, but retention of the lien suggested property had passed as soon as the goods had been appropriated, and that there was no reservation of right of disposal.
The mate's receipt was not a document of title, and the carrier was not put on notice not to issue bills of lading to the person (Export) who had booked the freight space with the carrier (the carrier had no notice of equitable lien prior to issuing bills). Thus the carrier had committed no wrong enforceable at the suit of Serowgee.
There was no general principle that the mate's receipt had to be given up before the bill of lading could be issued - the carrier was indeed bound to issue the bill of lading to the shipper who had contracted for the freight.
There was no conversion by the carrier since property had passed alongside ship.
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Serowgee's problem was that they had no cause of action, because they had neither property nor, in the absence of a document of title, possession. Nor were they party to a carriage contract, because Export were the shippers. Lord Wright says at p. 445 that the situation would have been very different if the sellers had delivered the goods to the ship in their own name as shippers, because then they would have been entitled to call for the bills of lading, and would have had a contractual cause of action against the shipowners.
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"A different state of things would have resulted if the sellers had delivered the goods to the ship in their own name as shippers, so that the ship would have held the goods on their behalf. But they did not. They delivered the goods as being shipped by the Export Company, and took a mate’s receipt which expressly stated the name of the Export Company as shippers."
"The mate's receipt is not a document of title to the goods shipped. Its transfer does not transfer property in the goods, nor is its possession equivalent to possession of the goods. It is not conclusive, and its statements do not bind the shipowner as do the statements in a bill of lading signed with the master's authority. It is, however, prima facie evidence of the quantity and condition of the goods received, and prima facie it is the recipient or possessor who is entitled to have the bill of lading issued to him. But if the mate's receipt acknowledges receipt from a shipper other than the person who actually receives the mate's receipt, and, in particular, if the property is in that shipper, and the shipper has contracted for the freight, the shipowner will prima facie be entitled, and indeed bound, to deliver the bill of lading to that person. ...
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This page was last updated on 05 May 97.
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