Shipping Lawyer Bills of Lading and Charter Parties 1 — Questions and Answers
Question 1: Which of the following is NOT a primary function of a bill of lading?
- A warranty of cargo seaworthiness (Correct answer)
- A receipt for goods shipped
- Evidence of a contract of carriage
- A document of title
Correct answer: A warranty of cargo seaworthiness
A bill of lading serves as a receipt, contract of carriage, and document of title, but it is not a warranty of the cargo's seaworthiness — that obligation rests on the shipper for dangerous goods.
Question 2: What is a 'negotiable' or 'order' bill of lading?
- A bill that can be transferred by endorsement, with title passing to the holder (Correct answer)
- A bill that can be negotiated only between banks
- A bill issued at the carrier's discretion
- A non-transferable receipt
Correct answer: A bill that can be transferred by endorsement, with title passing to the holder
An order bill of lading is a negotiable document that transfers title to the goods when endorsed and delivered to the new holder.
Question 3: What distinguishes a 'straight' bill of lading from an 'order' bill of lading?
- A straight bill is consigned to a named party and is non-negotiable (Correct answer)
- A straight bill allows any bearer to take delivery
- A straight bill requires payment before release
- A straight bill is only used in domestic trade
Correct answer: A straight bill is consigned to a named party and is non-negotiable
A straight bill names a specific consignee and is non-negotiable — only that named party (or their agent) can take delivery.
Question 4: What is a 'charter party' in shipping law?
- A contract for the hire of a vessel or its cargo space (Correct answer)
- A government license for a shipping route
- A customs clearance document
- An insurance policy for a voyage
Correct answer: A contract for the hire of a vessel or its cargo space
A charter party is a contract between a shipowner and a charterer for the use of a vessel or cargo space, either for a specific voyage or a period of time.
Question 5: Under a bareboat (demise) charter, who is responsible for operating the vessel?
- The charterer, who takes full possession and control (Correct answer)
- The shipowner, who retains operational control
- The flag state
- The classification society
Correct answer: The charterer, who takes full possession and control
In a bareboat charter, the charterer takes full possession and control of the vessel, including hiring the crew and bearing all operating costs.
Question 6: What is 'laytime' in a voyage charter party?
- The agreed time allowed for loading and discharging cargo (Correct answer)
- The total transit time of the voyage
- The time a vessel spends in port waiting for cargo
- The time allowed for the captain's rest
Correct answer: The agreed time allowed for loading and discharging cargo
Laytime is the contractually agreed period during which the vessel is made available to the charterer for loading and discharging without extra cost.
Shipping Lawyer Bills of Lading and Charter Parties 1
Which of the following is NOT a primary function of a bill of lading?