Every cargo claim starts with the same question: what condition was the cargo in when the vessel received it? The Master is obliged to deliver the cargo in the same good order that he received it. This is why it is important for any defects found during loading to be noted on the Bill of Lading — otherwise the Master will be responsible for those defects, even though they were present before shipment.
The Master's obligation
The contract of carriage, backed by the Hague and Hague-Visby Rules, puts the duty of care squarely on the carrier. Cargo must be received, loaded, stowed, carried, kept and discharged with proper and careful handling, and delivered in the same apparent order and condition in which it was accepted. If clean cargo goes on board and damaged cargo comes off, the receiver will look to the ship — and the ship alone must explain the difference.
| Moment | What the Master guarantees |
|---|---|
| Cargo received at the ramp or in the hold | Apparent order and condition, recorded on the Bill of Lading |
| Cargo on passage | Proper care: ventilation, lashing, temperature, segregation |
| Cargo delivered | Same apparent order and condition, except for what was noted or excepted |
The Bill of Lading: receipt, contract, document of title
The Bill of Lading does three jobs at once:
- Receipt for the goods — it records what was shipped, in what quantity, and in what apparent condition. This is the statement that decides cargo claims.
- Evidence of the contract of carriage — the terms under which the goods are moved.
- Document of title — whoever lawfully holds an original B/L is entitled to demand delivery.
The condition statements on the B/L are prima facie evidence of the order and condition at shipment. Once the B/L is transferred to a third party acting in good faith — a bank under a letter of credit, an endorsee, the final receiver — that statement becomes conclusive evidence. At that point nobody can argue about what the ship said it received. The B/L is the ship's own signature on the cargo's condition.
Clause the Bill — or carry the risk
If a defect is visible during loading, it must be noted on the Bill of Lading. A B/L with remarks is called a claused or dirty B/L; one without remarks is a clean B/L.
The trap is well known to every P&I club: steel coils arrive at the load port already showing rust stains and dents from previous carriage, cartons of bagged cargo arrive wet, drums arrive with crushed chimes. If the Chief Officer signs clean B/Ls for that cargo, the vessel has acknowledged receiving it in apparent good order. When the receiver at the discharging port rejects rusty coils or wet cartons, the cargo claim lands on the Master — even though every experienced eye on board could see the damage existed before shipment. The clean B/L removed the only defence that mattered.
Rule of the sea: what you do not clause, you own.
| B/L condition | Evidence effect | Practical consequence |
|---|---|---|
| Clean B/L | Cargo apparently in good order at shipment | Vessel liable for pre-existing defects it failed to note |
| Claused B/L | Defects recorded at shipment | Defects are the shipper's problem, not the vessel's |
| Letter of Protest only | Not part of the B/L; weak protection | Never a substitute for clausing the B/L itself |
How to clause correctly
A good remark is specific, factual and observable. It describes what the duty officer actually saw, without speculation about cause or blame:
- Poor: "Some cargo damaged."
- Good: "Units 41–58: surface rust staining and edge dents on coils, pre-load condition, tallied at loading."
- Good: "12 cartons, top tier, wet-stained on arrival in hold No. 3; packaging deformed."
Practical points for the loading team:
- Inspect before, not after. The Chief Officer's pre-load inspection is the moment defects are caught. Once the ramp closes, the ship has accepted the cargo.
- Clause every affected B/L, not just the first. Shippers will pressure the Master to sign clean "because the letter of credit requires it". A clean B/L against known damage is a misrepresentation to the receiver — and often a fraud on the bank financing the cargo.
- Issue a Letter of Protest when the shipper refuses clausing and the Master signs under commercial protest. Keep it with the B/L file. It preserves the vessel's position but does not cure the clean B/L.
- Record the evidence: tally sheets, draft surveys, hold inspection records, dated photographs, surveyor's reports. If a claim comes, the vessel argues with documents, not memories.
- Know the cargo. Steel, paper, bagged agricultural produce and project cargo generate the classic claims precisely because pre-shipment damage is easy to miss or easy to paint as "fresh".
What the Rules still excuse
Clausing protects the vessel against defects that existed at shipment. The Hague-Visby Rules separately except the carrier from losses caused by perils of the sea, act of God, act of war, quarantine, inherent vice of the cargo, and negligent nautical acts of the Master and crew in the navigation or management of the ship. But every exception must be proven by the carrier — and none of them helps a Master who signed a clean B/L for cargo that was already damaged before the first line was let go.
The bottom line
The Bill of Lading is written at the load port, when there is still time to be honest. Ten minutes of Chief Officer's remarks at the loading berth is the cheapest insurance against a claim at the discharge berth that the vessel cannot win. The Master delivers what he received — and the B/L is the proof of what that was.