Court: Guangzhou Maritime Court (2023)
Facts: A Foshan building materials company (plaintiff) exported tiles to a German company on FOB Guangzhou terms with a buyer-nominated carrier. The plaintiff took up the original B/L, but the German buyer took delivery against a bank guarantee without paying for the documents. The plaintiff sued the carrier for 1.5 million USD, arguing delivery without original B/L.
Holding:
(1) Illegality of delivery without original B/L: the B/L is a document of title; the carrier must deliver against the original B/L, and a bank guarantee cannot replace its legal effect;
(2) Scope of damages: the carrier must compensate the plaintiff for the full purchase price plus interest;
(3) Choice of law: with no choice-of-law clause, the court applied Chinese law under the most significant relationship doctrine.
Significance:
· Warns carriers to strictly observe B/L rules and guard against delivery without original B/L risks;
· Provides a direct claim path against carriers for exporters facing delivery without original B/L;
· Strengthens B/L management and encourages secure settlement methods such as L/C.