Wrong holds

A ship agent issued bills of lading in respect of a cargo of different types of coal being transported to Canada. Due to human error, they confused the holds and indicated on the bills of lading that Coal Type A cargo was in holds 1, 3 and 5 and Coal Type B cargo was in holds 2 and 4. However, it was actually the other way around.

The cargoes were discharged to the wrong facilities. The receivers brought a claim against the owner which was passed to the agent.

ITIC arranged for lawyers to represent the agent. They argued that there was a discharge plan on the vessel (which was correct) and had the vessel been discharged in accordance with the discharge plan this claim would not have happened. In addition the receivers had a surveyor in attendance and his reports referred to the correct configuration of the cargo. The bills of lading were however clearly wrong and the agent ultimately contributed US$ 185,000 which was 45% of the claimed amount. ITIC reimbursed the costs of the settlement and the legal fees incurred.