Sunday, 28 August 2011

Define a contract of affreightment and explain the documentation and execution of contract or What is bill of lading and what are its characteristics


A contract of affreightment means a contract for the carriage of goods by sea.

Definition :-
The word "Affreightment" means to hire a ship.
It is a contract between the shipper and the shipping company. In this contract shipper agrees to hire the ship at settled price. This price is called affreight.

Kinds :-
This contract has two forms :

1. Contract by Charter Party.

2. Contract by Bill of Lading.

It is a written contract by which the owner of good hires the ship or its some part to carry goods from one port to another. The documents on which the contract is made is called the charter party. It has the following kinds :

1. Voyage / Charter :-
It is called voyage charter when ship is hired for any particular voyage. In this case freight is calculated keeping in view the distance and quantity of goods.

2. Charter By Time :-
If any shipper hires the ship specified period of time is called time charter. In this case, freight is calculated keeping in view the specified time period for which the ship is hired.

3. Charter By Demise :-
A shipper hires the whole ship and possession comes to his control for a particular period. The captain and staff becomes the servant of the shipper. It is called "Charter by demise."

4. Charter Without Demise :-
In this case when a shipper hires the ship but the control and possession does not come in his hand. The captain and crew of the ship are also not his servant, it is called charter without demise.

Following are the main contents of the charter party :

1. Particulars Of The Parties :-
The shipper and the owner of the ship names. addresses and other particulars are included in the charter party.

2. Nationality And Flag :-
The flag and nationality of ship must be written in the charter party.

3. Name Of Ports :-
The name of all those ports will be written in it form where the goods will be loaded and unloaded. The voyage will be also mentioned in the charter party.

4. Date And Location :-
Charter party also contains the date of departure arrival and also the location.

5. Weight And Volume :-
The weight and volume of goods which will be carried is also mentioned in the charter party.

6. Freight :-
In the charter party the freight fixed by both the parties is also mentioned. The procedure of payment is also included in it.

7. Cancellation Of Contract :-
It is also declared in it that under which circumstances contract shall be considered cancelled. In case of breach of contract penalties and liabilities are also mentioned in it.

8. Duties Of The Captain :-
Charter party also contains the duties of the captain and master of the ship.

9. Lawful Goods :-
It is also the statement that a ship will load and unload the lawful goods on all the ports.

It is a document which is issued by the shipping company after receiving the goods for carriage. After the issuance of this bill the owner of the ship will be responsible for the safe delivery of goods to the consignee. A bill of lading is a receipt of goods shipped on board by the owner of a ship.

Following are its important kinds of bill of lading :

1. Shipped Bill :-
After loading the goods on ship bill of lading is issued. The name and shipment of goods is included in this bill.

2. Clean Bill :-
The goods received from the shipper are examined by the incharge of the ship and if he is satisfied with the packing of the goods, then he writes "goods are in good order and good condition". It is called clean bill of lading.

3. Qualified Bill :-
After the examining the goods if owner of the ship or incharge writes in the bill that goods are in " Bad condition" it is called qualified bill of lading.

4. Through Bill Of Lading :-
When the gods are loaded in two ships and freight is charged composite such bill is called as "through bill of lading". Sometimes goods are carried partly by ship and partly by land but freight is charged composite.


1. Particulars Of The Party :-
In the bill of lading the names, addresses of the parties and ship by which goods are carried are written.

2. Bill Must Be Stamped :-
It must be stamped and signed by the ship owner.

3. Lading Marks :-
For the identification of goods lading marks are necessary. these are also stamped on the packing of good. The bill of lading contains these marks.

4. Condition Of Goods :-
A bill of lading also contains the condition of goods like good or bad.

5. Weight & Quantity :-
All types of necessary information's about the quality and quantity of goods are mentioned in the bill of lading.

6. Ports Name :-
The bill of lading also contains the names of ports from where goods will be loaded, unloaded and ship will pass during its voyage.


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