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Dec.14, 2015

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Q&A 60 THE JOURNAL OF COMMERCE DECEMBER 14.2015 PREPARING BILLS OF LADING: ANYONE CAN DO IT Q: A FRIEND RECENTLY told me the law requires that carriers issue bills of lading. I looked it up, and he seems to be right. Is this a recent change? If so, why haven't the trade publica- tions given it more attention? It cer- tainly seems to me a pretty important development. I've worked in the transportation departments of a number of companies over the years. My current employer, like all the ones I've worked for, pre- pares bills of lading for every shipment. When I brought the matter up to my boss, he was unaware of any change in the law, and told me it's usual for shippers to prepare the B/L, just as has been my own experience. But I don't see how this reconciles with my new understanding of the law. Are my friend and I reading the law wrong? If not, isn't this a pretty big deal? And how's it supposed to work? Are motor carriers now giving their drivers blank forms that they make out when they do a pickup? Some of the drivers I see don't speak English that well, so how can they prepare the forms properly? And what about rail traffic, where you may not even see a railroad employee before the car is moved out? Law or no law, this strikes me as something that's unrealistic. It's been working just fine for shippers to pre- pare the B/Ls for many years. Because it wasn't broken, why did Congress have to "fix" it? Is this some kind of misguided attempt to prevent terrorism by controlling freight traffic? A: WHOA. YOU'RE OVERREACTING, to say the least. In the first place, no, this isn't a change in the law. The requirement that carriers issue bills of lading has been part of the law for longer than anyone reading this column has been alive. I mean, it only makes sense. One function of the B/L is, after all, to serve as the carrier's receipt for the goods tendered to it by the ship- per. Naturally, that receipt must be issued by the party receiving the goods, rather than the party tender- ing them, just as when, for example, you take in your dry cleaning, the cleaner gives you a ticket. You don't give him one. And so on. You're confusing the preparation of the bill of lading with its issu- ance. It's immaterial who prepares the document, and the law simply doesn't speak to that. So far as the law is concerned, anybody may do that job. And, in the real world, that responsibility gets spread around pretty widely. Most often, as you know from your own experience, the shipper does it, but sometimes it's a third party or the carrier itself or maybe even someone else. Whoever did the preparation, the carrier discharges its legal duty to "issue" the document by counter- signing it, and providing the shipper a copy. That's the sum total of what the law requires, and has always required. The carrier's endorsement of the document represents its accep- tance of what's described in terms of shipment content, point of origin, point of destination, etc. That's not to say that any of these things can't subsequently be corrected if they're found to be inaccurate, or changes are later made by agreement between carrier and shipper, but they consti- tute the parties' understanding at the time, and the basis for their initial contractual agreement. So you can relax in the knowl- edge that you're handling this correctly. As the shipper, your employer is in the unique position of knowing what it is you're shipping, knowledge that the carrier repre- sentative may not share except as you provide it. What can it matter whether you do so verbally and the carrier (or its representative) writes it down on the B/L form or you do it by filling out the form yourself and giving the completed form to the carrier for "issuance?" The law sensibly doesn't distinguish between these two methods. Notice that I haven't said a word about references that may appear on the completed B/L form to pric- ing, or elements that may comprise price determination. Sometimes shippers, for their own reasons and purposes, will include such details on their prepared forms. Although the bill of lading serves partially as the contract of carriage between car- rier and shipper, however, pricing set forth therein is not deemed legally binding. It's determined instead by individual rate quotations, tariffs, contracts, and so on, and by the facts of the shipment (weight, distance, etc.) without regard to what may be shown on the B/L. Does that clarify things? JOC Consultant, author and educator Colin Barrett is president of Barrett Transportation Consultants. Send your questions to him at 5201 Whippoorwill Lane, Johns Island, S.C. 29455; phone, 843-559-1277; email, Contact him to order the most recent 351-page compiled edition of past Q&A columns, published in 2010. By Colin Barrett It's immaterial who prepares the document, and the law simply doesn't speak to that.

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