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The Uniform Bill of Lading

C. S. Duncan
1917 Journal of Political Economy  
Business blanks or forms arise to facilitate complex business activities. The more complex, the more far-reaching, and the more impersonal the business activity, the greater the need for these commercial instruments. And the greater the need for forms, the more urgent the demand that they be standardized and uniform. It is natural, therefore, that with the rapid extension of the railway business there should have been an equally rapid multiplication of forms, and then that a movement should
more » ... movement should gain headway to make the forms of standard, uniform character. Among these multifarious business forms used by the railroads is the bill of lading. This is a very important instrument now and has manifold possibilities for future development. It has been estimated that annually "there is about $25,000,000,000 worth of business handled through bills of lading,.and of that, $5,ooo,ooo,ooo is handled by the banks."' There is no wonder, then, that much concern is felt about the liabilities and conditions connected with it. What kind of an instrument this bill of lading is, what functions it performs as a commercial document, what steps have been taken to safeguard it and to make it uniform, and under what conditions and regulations it moves today will be the subjects of this discussion. I The bill of lading originated from the old ship "register," in which was entered the character and amount of goods delivered. This record served at first as written evidence of receipt of the goods, and later of the terms of a contract of shipment between the merchant and the master of the ship. "It would seem probable that oral evidence of shipment was replaced by the quasi-official ship's register, which in its turn gave way to the private contract between the individual merchant and the master."2 It is possible to conceive of the entry in the register as a rudimentary bill of I A. T. Thom, counsel of Southern Railway Co., in Senate Hearings on Bills of Lading, p. iii. All use subject to University of Chicago Press Terms and Conditions ( JOURNAL OF POLITICAL ECONOMY lading. But the need for the development of a separate and distinct document would be felt when the merchants no longer traveled with their goods.' When goods are dispatched under a shipment contract, there are three parties to this contract-the shipper, the carrier, and the consignee. Here is ample reason, in "the growing requirements of practical commerce," why the bill of lading should early have been issued in triplicate. Each party vitally concerned in this contract would desire a copy. Originally transferred, in the United States, from the steamship, canal, and pike-road bill of lading, the railway bill was also at first little more than a certificate of receipt.2 The numerous conditions which are today encumbering it were formerly printed on the tariff sheets.3 Originally, also, bills of lading were drafted by each transportation company and very naturally differed "according to local conditions and to legislative enactment in different states."4 Confusion in requirements resulted, and even the fierce competition between the railway lines that caused rate wars found expression in the stipulations on the bills of lading. Conversely, the development of through freight lines made for "homogeneity in various bills of lading." It was only with the growth of the co-operative idea among the carriers that the problem of a uniform bill came into definition. The bill of lading, however, should be sharply distinguished from other forms associated with it. The freight bill, or the shipping bill, is a receipt for the goods delivered to the carrier, and nothing more. It is a form developed to fulfil that specialized function out of which the bill of lading grew. The bill of exchange, to which the bill of lading is often attached, is an independent, though an interrelated, document. It represents the banker's function in financing the shipment. Later it will be shown how intimately these two documents are connected; here it suffices to say that the bill of exchange is a business form which facilitates the financing of freight traffic t Bennett, History of the Bill of Lading, p. 6. 2 The history of the bill of lading in the United States has not yet been written. It is the early ambition of the writer to show by a series of forms how the modern bill has been developed. A very interesting collection is being made by the Chicago Traffic Club. All use subject to University of Chicago Press Terms and Conditions ( UNIFORM BILL OF LADING 68i and, when accepted, sloughs off the bill of lading along with the certificate of insurance, the consular invoice, and other documents and stands alone, a complete instrument in itself. As a mechanism for facilitating the transportation of goods, the bill of lading has three functions to perform. One of these functions is to serve as a receipt, where it duplicates the work of the freight bill. Indeed, it is gradually transplanting that document, just as the check is displacing the formal receipt in general mercantile transactions. A second function is to serve as a written evidence of a contract of shipment between shipper and carrier. A third function is to serve as a document of title to goods. In one or another of these functions the bill of lading meets the needs of the four parties chiefly concerned with a shipment of goods, i.e., the shipper, the carrier, the banker, and the consignee. These bills of lading also fall into various groups or classes, according as they are looked at from different angles. First, as to kinds of freight, the bills fall into two groups. There are those intended to apply to general merchandise, which may be grouped in one great class. The second kind may be called commodity bills, such as those intended for the conveyance of livestock, grain, cotton, and perishable produce. Again, bills of lading may be classified, on the basis of the maker, into those issued by a firm or corporation or individual-a private bill-and those issued by the carriers themselves. In another way they may be arranged, on the basis of the factors affecting negotiability, into order bills and straight bills. The former are those which may be transferred by endorsement, the latter are those accompanying goods consigned directly to consignee and are merely consignable. And, finally, on the basis of the "conditions" of the contract of carriage, the stipulations and the limitations of liability, and the agreements with connecting lines, there are the standard (or Revised Standard Bill of the Southern Classification Territory), the uniform, the through and export, and the special bills. The last-named are distinct, as being issued under common-law liability. The groups are by no means mutually exclusive, but they will serve to identify the problem underlying the uniform bill of lading. Clearly, the first step toward uniformity would have to do with the All terms and conditions in the bill of lading shown herein in plain type not underlined are agreed upon between The National Industrial Traffic League and the carriers. All provisions underlined herein are insisted upon by the carriers but opposed by The National Industrial Traffic League. All provisions in bold faced type are insisted upon by The National Industrial Traffic League and either take the place of matter underlined and immediately preceding the insertion, or are in addition to matter agreed upon between The National Industrial Traffic League and the carriers. CONDITIONS. Sec. L The carrier or party in possession of ay of the property herein described shall be liable for 2 any loss thereof or damage thereto, except as'herelnafter provided. 3 No carrier or party in possession of any of the property herein described shall be liable for any 4 loss thereof or damage thereto or delay caused by the act of God, the public enemy, the authority of law, A or the act or default of the shipper or owner, or for differences in the weights of grain, seed, or other 6 commodities caused by natural shrinkage or discrepancies in elevator weights. For lass, damage, or 7 delay caused by fre occurring after 48 hours (exclusive of Sundays and legal holidays) after notice of 8 the errova of the aprty at aestimatson or at aort af export (iaitende for e art hasce 9 sent or given, the carrier's liabilty shall be that of warehouseman oaly. Theliability of the carrier as 10 a common tarroer sibltaimnateat stch lime aB Isprovidled or determined by law. Except in ease of 11 negligence of the carrier or party in possession, and the burden to prove freedom from such negligence 12 shall be on the carrier or party in possession, the carrier or party in possession shanl not be liable 13 for loss, damage, or delay occurringwhile the property is sopped and held in transit upon the request 14 of the shipper, owner, or party entitled to make such request, or resulting from a defect or vace in the 15 property, or froms nots or strikes, or for country damage to cotton. When in accordance with general 16 custom, o account of the nature of the property, erwhen at the request of the shiver th erty is 17 transported in open care, the earrer or party in possession (except en case of loss or da b r 18 which case the liability shall be the same as though the property had been carried in closed ears) shall 19 be liable only for negligence and the burden to prove freedom from such negligence shall be on the 20 career or party s posseesson. Property not customasrly treansported in open car, when transported in 21 pn cars at the request of the shipper, all be at owner's risk as to low or damage resulting directly 22 from the use of such open cars, provided such lss or dampe could not have been prevented by reason. 23 able care by the carrier or party in poasesalon provided, further, however, that in cas of low thereof 24 or damage thereto by firs, the liability of the carrier or party in poasseoson shll be the same a if the 25 property bad been carried in closed cars, and the burden to prove that the carrier exercised reasonable 26 are shall be upon the carrier. 27 In case of quarantine the property may be discharged at risk and expense of owners into quaran-28 tine depot or elsewhere, as required by quarantine regulations or authorities, or for the carrier's dispatch 29 at nearest available point in carrier's judgment, and in any such case carrier's responsibility shall cease 30 when property is so discharged; or property may be returned by carrier at owners expense to shipping 31 point, earning freight both ways. Quarantine expenses of whatever nature or kind upon or in respect 32 to property shall be borne by the owners of the property or be a lien thereon. The carrier shall not 33 be liable for loss or damage occasioned by fumigation or disinfection or other acts required or done by 34 quarantine regulations or authorities, nor for detention, los, or damage of any kind occasioned by 35 quarantine or the enforcement thereof No carrier shall be liable, except in case of negligence, for any 36 mistake or inaccuracy in any information furaished by the carrier, its agents, or officers, as to quaran. 37 tine laws or regulations. The shipper shall hold the carriers harmless from any expense they may incur 38 or damages they may be required to pay by reason of the introduction of the property covered by 39 this contract into any place against the quarantine laws or regulations in effect at such ploc See. 2. No carrier is bound to transport said property by any particular train or vessel, or in 2 time for any particular market or otherwise than with reasonable dispatch, unless by specific agree. 8 meot endorsed hereon. Every carrier shall have the right in case of physical necessity to forward 4 said property by any railroad or route between the point of shipment and the point of destination; but If 5 such diversion shall be from a rail to a water route, the liability of the carrier shall be the same as though 6 the entire carriage were by raiL 7 The amount of any, loss or damage for whish any, carrier is liable shall be computed on the basis 8 of the actual value of the property at the place and time of shipment under this bill of lading, include. 9 Lug the freight charges,if paid; and where the actual value of the property hos cot been required to be 10 specitical stated by the stopper in this bill of lading, such actual value shall be srraved at from the I1 bona Ode invoice price. if any, to the consignee: The amount of any loss or damage to property, or 12 or damage due to delay en delivery tW of unier this bill of lading for which the carier is liable by 13 law, shall be the full actual low, damage o injury, Including freight charges, If paid: Provided, 14 however, That if the property is hidden from view and the shipper has specifically stated in this 15 bill of lading the value of the property, no carrier shall be liable beyond the amount as specifically 16 stated, whether or not the loss or damage occurs from negligence: Provided, further, In all esw 17 not prohibited by law, that where a lower value than actual value has been represented in writing by 18 the shipper or has been agreed upon or is determined by the classification or tariffs upon which the 19 rate is based, such lower value shall be the maximum amount to govern such computation, whether or 20 not such loaa or damage occurs from negligence. 21 Except where the loss, damage, or injury complained of is due to delay or damage while being 22 loaded or unloaded, or damaged in transit by carelessness or negligence, as conditions precedent to 23 recovery, claims must be made in writing to the originating or delivering carrier within six months 24 after delivery of the property, or in case of export traffic, within nine months after delivery at port 25 of export, or in case of failure to make delivery, then within six months, or nine months in ease of 26 export traffic, after a reasonable time for delivery has elapsed; and suits for loss, damage, or delay shall 27 be instituted only within two years and one day after delivery of the property or, in case of failure to 28 make delivery, then within two years and one day after a reasonable time for delivery has elapsed. 29 Any carrier or party liable on account of lass or damage to any of said property shall have the 30 full benefit of any insurance that may have been effected upon or on account of said property, en far as 31 this shall not avoid the policies or contracts of insurance: Provief That the carrier reimburse the 32 claimant for the premium paid thereon. Sec. 3. Except where such service is required as the result of carrier's negligence, all property 2 shall be subject to necessary cooperage and baling at owner's cost Each carrier over whose route 3 cotton or cotton winters is to be transported hereunder shall have the privilege, at its own cost and 4 risk, of compressing the same for greater convenience in handling or forwarding, and shall not be held 5 responsible for deviation or unavoidable delays in procuring such compression. Grain in bulk consigned 6 to a point where there in a railroad, public or licensed elevator, may (unless otherwise expressly noted 7 herein, and then if it is not promptly unloaded) be there delivered and placed with other grain of 8 the same kind and grade without respect to ownership, and prompt notice thereof shall be given to the 9 consignor, and if so delivered shall be subject to a lien for elevator charges in addition to all other 10 charges hereunder. See. 4. Property not removed by the party entitled to receive it within 48 hours (exclusive of 2 Sundays and leal o days), after notice of its arrival has been duly sent or given, my e kept 3v d o placefeli7of the carrier or warehouse, subject to the tariff charge for 4 storage and to e arrer' responsibility as warehouseman only, or may be, st the option of the carrier aat. _-a_ _ Set. 5. No carrier will carry or be liable in any way for any documents, specie, or for any articles of 2 extraordinary value not specifically rated in the published tlassifieations or tariffs unless a special 3 agreement to do an and a stipulated value of the articles are endorsed hereon. See. 6. Every party, whether principal or agent, shipping explosives or dangerous goods, without 9 peeios fai written disclosure to the carrier of their nature, shall be liable for and indemnify the 3 carrier against all lams or damage caused by suth goods, and in such cases the goods may be warehoused I at onser's risk and expense or destroyed without compensation. Sea. 7. The owner or consignee shall pay the freight and average, if any, and all other lawful 2 charges accruing on said property, and, if required, shall pay the same before delivery. The consignor 3 shall be liable for the freight and all other lawful charges, except that if the consignor stipulates, by 4 signature, in the space provided for that purpose on the face of this bill of lading, or in s written order 5 of recaama that the carrier shall not make delivery without requiring payment of such charges 6 and the carrier, contrary to such stipulation, shall make delivery without requiring such payment, 7 the consignor shall not be liable for such charges. Nothing herein shall limit the right of the carrier to 8 require at time of shipment the prepayment or guarantee of the charges. If upon inspection it is aseer. 9 tained that the articles shipped are not those described in this bill of lading, the freight charges must 10 be paid upon the articles actually shipped. Sec. 8. If this bill of lading is issued on the order of the shipper, or his agent, in exchange or in 2 substitution for another bill of lading, the shippers signature to the prior bill of lading as to the state. 3 ment of value or otherwise, or election of common law or bill of lading liability, in or in connection 4 with such prior bill of lading, shall be considered a part of this bill of lading as fully as if the same were 5 written or made in or in connection with this bill of lading Sec. 9. E tas of diverate from rail to water route, which is provided for in section 2 2 hereof, if r any pa of said property is carried by water over any part of said route, such water 3 carriage shall be performed subject to the liabilities, limitations, and exemptions provided te 4 and to the conditions contained in this bill of lading not inconsistent with attte or s section, and 5 subject also to the conditions that no such carrier or party in possession shall be liable for any loss or 6 damage resulting from fire, from any cause whatever, or for any-loss ar e reult the 7 perils of the lakes, seas, or other waters; or from vermin, leakage, chafing, breakage, heat told, frost, 8 wet, or change in weather, or by riots, stres, stoppage of labor or threatened violence, or delay ceased 9by stress of weather, or eas the carrier's control, explosion, bursting of Hoilers, breakage of shafts or 10 any 1stent detect in hull, machinery, or ap urtenances whether existing prior to, at the te oa, r after 11 saiang; or unseaworthinebm; or from enolsion, stranding, or other accidents of navigation, or from 12 prolongation of the voyage. And any vessel carrying any or all ot the property herein described shall 13 have the liberty to Call at any port or ports, to tow and be towed, to transfer, to tranship, tolightert 14 oad and discharge goods at any time, and assist vessels in distress and to deviate for lb pupose of 15 saving life or property, or for docking and for repairs. Such water carrier shall not be responsible for 16 any loss or damage to property if it be necessary or is usual to oarry such property upon deck. 17 if the shipowner shall have complied with the provisions of section 3 of the Hasten Aet, it is hereby 18 agreed tat the owners or coasignees of the cargo ashall contribalet ~-with the ah~ipowner in general aver. 19 age, and shall pay any salvage or special charges incurred. even though the necessity for the sacrifie 20 or expenditure was brought about by fault in navigation or management of the ship. 21 -If the property is being carried under a tariff ic provides that any carrie or carriers party 22 thereto shall be liable for loss from p the sea. then as to such carrier or carriers the provisions 23 of this section shall be mod fied in accordance with the provisions of the tariff, which shall be treated 24 as incorporated into the conditions of this bill of lading. 25 -The term "water carriage" in this section shall not be construed as including lighterage across 26 rnver or in lake or other harbors when performed by or on behalf of the rail earrer. The transportation 27 of ay property under the terms ofthis ill, b liter, cir tasi or car ferry, n or cross rivers, harbors 28 or lakes, shell be deemed to be transportation by rail." Sec. 10. Any alteration, addition, or erasure in this bill of lading which shall be made without an
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