When you send goods over any other mode of transportation, it’s important to ensure that your goods are safe, delivered on time, and liable parties are held responsible for any loss or damage. For this purpose, a bill of lading is your best document to hold on to as provided by Canada’s Bills of Lading Act.
What is a bill of lading?
Under Canadian laws on shipping and transportation, every person or entity is liable for the loss or damage of goods that are under their responsibility.
This is especially important since goods may be transferred from one entity to another during its transportation.
As such, one piece of evidence in proving the liability of a person or entity is through the execution of a bill of lading.
Bill of Lading
A bill of lading is a document that is provided by a common carrier (the person or entity transporting the goods) to the shipper (the seller or origin of the goods). It is legally binding which generally includes details such as:
- Name of the shipper and consignee
- Details of the goods being transported
- Specific destination of the goods
- Goods’ quantity and quality at the time of delivery
Filling out a Bill of Lading
Watch this video to know how to fill out a bill of lading and the necessary information needed:
Talk with a lawyer in your area to know more about the Bills of Lading Act. For shippers, carriers, or consignees in Vancouver, reach out to any of the Lexpert-ranked maritime and shipping lawyers in British Columbia.
What is the law on bills of lading in Canada?
In Canada, the Bills of Lading Act governs the rights of parties in a contract of carriage of goods.
Rights of Parties in the Contract
Under Canada’s Bills of Lading Act, the rights of every consignee (the receiver, the buyer, or its agent) or every endorsee (the person or entity to whom the goods are endorsed) are specified.
Here, all consignees or endorsees both have the right of action and are liable for the goods specified in the bill of lading.
Conclusive Evidence
This law also provides that the bill of lading is conclusive evidence of the shipment when in the hands of a consignee or endorsee.
This rule also applies even if the goods, or some parts of it, have not been shipped. The exception to this rule would be:
- when the consignee or endorsee has actual notice that the goods have not shipped, or
- when the bill of lading has a stipulation to the contrary
The person who signed on the bill of lading may also be cleared of liability for any misrepresentation, if it can be shown:
- that there was no default on its part, and
- that it was the fault of the shipper, or any other party who is not a party to the contract
Rights that are Unaffected
There are certain rights or laws that are not affected, or are not prejudiced, by the provisions of the Bills of Lading Act.
These are:
- Right of stoppage in transit: the right of the shipper or seller to stop the delivery of the goods when shown that the consignee or the buyer cannot pay the shipper or seller
- Right of an unpaid vendor under Québec’s Civil Code: such as those found in Book Five of the Civil Code pertaining to Obligations
- Right to claim freight against the original shipper or owner: whose value or amount may be agreed upon through the bill of lading or any other contract
- Liability of the consignee or endorsee: such as those by reason of their being a consignee or an endorsee, or their receipt of the goods
Purpose or objectives of a bill of lading
Bills of lading serve many purposes. It generally protects the parties to a contract of transportation or shipping, while serving as a piece of evidence of the parties’ liability.
Proof of Contract
According to Canada’s Bills of Lading Act, a bill of lading also serves as proof of the contract, or a document of title, between persons or entities involved in the transportation of the goods.
As such, it must be signed by all parties involved in the contract – from the sender, the carrier, the shipper, up to the receiver of the goods.
It must also accompany the goods that it refers to at all stages of the transaction and at all times.
Evidence of Receipt
Because the bill of lading accompanies the goods it pertains to, it is the best proof that the goods were received.
In other words, a party cannot escape liability when it receives the goods as evidenced by the bill of lading. All the more so when the bill of lading was not properly executed or was executed not according to the standards of the industry.
This is especially important when disputes arise, and the court will determine who has the responsibility for the goods at the time that they were lost or damaged. Conversely, it may clear a party of any liability, depending on what the bill of lading shows.
Represents the Terms of the Contract
Bills of lading usually contain the terms and conditions of a contract of transportation.
Depending on the appropriate forms as required by law, it may provide for any of the following:
- The extent of liability of the carrier – or carriers in case of multiple carriers (e.g., originating carrier and delivering carrier)
- The rights and remedies granted to the shipper and the consignee
- What constitutes as force majeure or fortuitous event and the extent of liability of the carrier liability (if any) in such cases
- The value of the goods that will serve as the basis for computing the damages in case of the goods’ loss or damage
- The specific law or jurisdiction that will apply in case of dispute or lawsuit
To know more about the Canadian Bills of Lading Act and other related legal concerns on bill of ladings, contact any of the Lexpert-Ranked shipping and maritime lawyers in Canada