Not our bills

Ship agents based in South America found themselves being pursued by owners of a ship that they had never represented. The claim was for legal costs that those owners incurred for filing a response to legal proceedings issued by cargo insurers.

Due to a simple error in the ship agents’ office, a bill of lading was issued in the name of “Good Ship” instead of “Good Ship I”. The documentary error went unnoticed. The “Good Ship 1” arrived in Miami, USA where the cargo was found to be damaged. Legal proceedings were subsequently issued by cargo insurers against the owners of the ship named in the bill of lading.

The owners of “Good Ship” had to instruct lawyers to file a response to the demand to avoid judgment being entered against them. The defence they filed denied liability on the basis that the “Good Ship” was not the correct ship. The claimants eventually accepted that this was the case and pursued their claim against the actual carriers. Fees and legal expenses incurred by the owners of “Good Ship” were claimed from the agent. It is interesting to speculate what would have happened if the claim against the actual carriers had become time barred before the error was resolved.