BILL OF LADING A bill of lading is a piece of paper that a transport company giv
ID: 361724 • Letter: B
Question
BILL OF LADING A bill of lading is a piece of paper that a transport company gives to someone. It shows three things: 1. A receipt for goods 2 A contract to transport the goods 3. Title to or ownership of the goods EXAMPLE OF AN INTERNATIONAL BUSINESS DEAL THE ART-AI CONTRACT First, Art and Ali entered a contract for the rugs. (Recall Art is an Atlanta buyer; Ali is an Ankara, Turkey, seller.) Second, Art arranged with his Atlanta bank to isue a letter of credit to Ali, through which Art pays Ali (see Figure 9.1).Explanation / Answer
Art will not take the case to the international court of justice on the basis of following grounds:
1. There are two different contracts, one between Art and Ali and another between the Ali and the transportation company. Problems in the delivery of goods, may be due to the negligence of transportation company and Ali cannot be held liable.
2. The bank verifies the details of the bill of lading with the details of the letter of credit. If matched, the payment can be issued to Ali. Here, the actual good is not physically verified. It is one of the limitation of the deliveries involving letter of credit and bill of lading.
3. It is the responsibility of the transportation company to make the physical verification of the goods and then enter into the agreement with Ali as a seller.
Hence, it is good for Art to identify the person or entity responsible for the negligence causing the dispute and apply for recovery of damage in the respective jurisdiction.
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