[1] The validity of a bill of lading issued without receiving or loading the cargo (negative) and whether such legal principle applies to a bill of lading issued after lawful delivery to the consignee (affirmative)

[2] The meaning of "a holder who has acquired a bill of lading in good faith" under Article 854 (2) of the Commercial Act

[3] In a case where a bill of lading is issued to a consignor in accordance with a transportation contract after a consignee requested the carrier to deliver the cargo which arrived at the destination, whether the consignor who holds the bill of lading has the right to claim delivery of the cargo newly to the carrier (negative)

[1] Articles 852, 853, and 854 of the Commercial Act / [2] Article 854 of the Commercial Act / [3] Articles 139, 140(2), 815, 852, 853, and 854 of the Commercial Act

[1] Supreme Court Decision 2003Da5535 Decided March 24, 2005 (Gong2005Sang, 633), Supreme Court Decision 2006Da47585 Decided February 14, 2008 (Gong2008Sang, 567) / [3] Supreme Court Decision 2001Da7296 Decided October 24, 2003 (Gong2003Ha, 2239)

Korea Lod Co., Ltd. (Attorney Yang Sung-won et al., Counsel for the plaintiff-appellant)

A.P.D. Macker Macker A/S (Law Firm Sejong, Attorneys Kim Chang-joon et al., Counsel for the plaintiff-appellant)

Seoul Central District Court Decision 2012Na32729 Decided November 30, 2012

The appeal is dismissed. The costs of appeal are assessed against the plaintiff.

The grounds of appeal are examined.

1. As to the grounds of appeal Nos. 1 and 2

A. (1) The bill of lading represents the right to claim the delivery of the cargo, which is an inducement document prepared according to the contract of carriage, and the Commercial Act provides the premise that the carrier actually receives or loads the cargo from the consignor as a valid condition for the establishment of the bill of lading. Thus, the bill of lading issued without the receipt or shipment of the cargo is null and void as it does not meet the cause and requirements (see, e.g., Supreme Court Decisions 2003Da5535, Mar. 24, 2005; 2006Da47585, Feb. 14, 2008; 2006Da47585, etc.). This legal doctrine applies to a bill of lading issued after the lawful delivery of the cargo to the consignee.

In addition, Article 854(1) of the Commercial Act provides, “If a bill of lading has been issued, a transport contract of a general bill of lading shall be concluded between a carrier and a consignor and shall be presumed to have been received or loaded as stated in the bill of lading.” Meanwhile, Article 854(2) of the Commercial Act provides, “A carrier shall be deemed to have received or loaded the cargo as stated in the bill of lading to a holder who has acquired the bill of lading referred to in paragraph (1) in good faith and shall be liable as a carrier as stated in the bill of lading.” Unlike legal relations between a carrier and a consignor as stipulated in paragraph (1) of this Article, Article 854(2) of the Commercial Act aims to protect a third party who has acquired the bill of lading in good faith, thereby promoting the protection of the distribution of the bill of lading and the safety of transaction. Thus, it is reasonable to deem “holder who has acquired the bill of lading in good faith” as stated in this context refers

On the other hand, in maritime carriage where a bill of lading has not been issued, the consignee’s right is given priority to the consignor before the cargo arrives at the destination, and there is no right to the cargo (Articles 815 and 139 of the Commercial Act). If the consignee requests delivery after the cargo arrives at the destination, the consignee’s right shall prevail over the consignor (Articles 815 and 140(2) of the Commercial Act).

In full view of the above legal principles, after claiming the carrier for delivery of the cargo which the consignee arrived at the destination, the consignor who holds the bill of lading cannot be deemed to have the right to claim delivery of the cargo to the carrier even if the bill of lading was issued to the consignor under the contract of carriage thereafter (see Supreme Court Decision 2001Da7296 delivered on October 24, 2003).

(2) The court shall decide whether a factual assertion is true in accordance with logical and empirical rules, based on the ideology of social justice and equity, by taking into account the purport of the entire pleadings and the results of the examination of evidence (Article 202 of the Civil Procedure Act). The facts duly confirmed by the court of final appeal that the court below did not go beyond the bounds of the principle of free evaluation of evidence (Article 432 of the same Act).

B. On the grounds indicated in its reasoning, the lower court acknowledged the following facts.

(1) The Republic of Korea’s “SKY TDRING” requested the Plaintiff to transport three containers in which the exported cargo was loaded (hereinafter “instant cargo”) in order to export the vehicle parts to the “non-party” group.

(2) On February 16, 2010 and June 11, 2010, the Plaintiff entered into a contract to entrust the carriage of the instant cargo to the Defendant from the Busan Port of the Republic of Korea (hereinafter “instant contract”).

(3) On February 22, 2010, March 12, 2012, and June 12, 2010, the Defendant issued, at the Plaintiff’s request, a sea waybill concerning the instant cargo (hereinafter “instant sea waybill”), and transported the instant cargo to Akbaba according to the instant transport contract.

(4) On April 5, 2010, April 19, and July 20, 2010, the instant cargo arrived at Akba, the destination of which was the Akba, and around July 20, the instant sea waybill, and the Plaintiff’s local agent, “AL-SARAS SHIPPING CO.” and “BLUE WHE HHPPPPPERCO.” (hereinafter collectively referred to as “the instant consignees”), as the consignees listed in the instant sea waybill, requested the Defendant, the carrier, to deliver the instant cargo.

(5) Accordingly, the Defendant issued a delivery order to the consignee of this case, and the consignee of this case was delivered the freight of this case according to the delivery order around April 7, 2010, and April 23 and July 25, 201.

(6) Thereafter, the Defendant issued a bill of lading concerning the instant cargo (hereinafter “instant bill of lading”) to the Plaintiff on April 1, 201, despite the fact that the instant cargo had been delivered to the consignee as above, on April 1, 2011.

C. First, the ground of appeal disputing the lower court’s fact-finding that the instant cargo was already delivered to the consignee at the time of issuance of the instant bill of lading is merely an error in the selection of evidence and determination of the value of evidence belonging to the free trial by the fact-finding court.

In addition, even if examining the reasoning of the lower judgment in light of the aforementioned legal doctrine and the evidence duly admitted, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence in violation of logical and empirical rules, or by failing to exhaust all necessary deliberations

D. In addition, examining the above facts in light of the legal principles as seen earlier, the bill of lading of this case was issued only after the freight of this case arrives at the destination and is delivered to the legitimate consignee under the contract of carriage. Thus, the Plaintiff, a party to the contract of this case, does not constitute “holder of a bill of lading in good faith” under Article 854(2) of the Commercial Act. Thus, even if the Plaintiff possessed the bill of this case, the Defendant is not obliged to deliver the freight of this case in accordance with the bill of this case that is null

The court below held that since the bill of lading of this case is null and void, the defendant's failure to deliver the freight cannot be deemed unlawful, or even if it was issued the bill of this case, it is difficult to conclude a separate agreement to deliver the freight of this case in exchange for the bill of this case. It seems to be based on the legal principles as seen earlier.

Therefore, contrary to what is alleged in the grounds of appeal, the lower court did not err in its judgment by misapprehending the legal doctrine on “holder who has acquired a bill of lading in good faith” under Article 854(2) of the Commercial Act or by misapprehending the legal doctrine on the duty as a carrier

2. As to the third ground for appeal

For the reasons indicated in its holding, the lower court rejected the Plaintiff’s assertion that the Defendant violated this practice or implied agreement on the premise that the practice or implied agreement that the Defendant would not deliver the goods to the consignee could not be deemed to exist between the Plaintiff and the Defendant before the Plaintiff pays the cost of the shipment.

The argument to the effect that the court below's decision is not erroneous in the selection of evidence and the determination of value of evidence belonging to the free evaluation of the court of fact-finding, and the fact-finding based thereon. The reasoning of the judgment below is not erroneous in the misapprehension of the principle of free evaluation of evidence, even if examining the reasoning of the judgment below in light

In addition, so long as such an agreement or practice cannot be deemed to exist between the Plaintiff and the Defendant, the mere fact that the Defendant issued the instant bill of lading cannot be deemed to have granted the Plaintiff the trust not to deliver the cargo to the consignee before receiving the cost of the shipment, and the delivery of the instant cargo without the Defendant’s payment of the cost of the shipment cannot be deemed to go against the doctrine of the speech. Therefore, even if the lower court did not directly determine the Plaintiff’s assertion, it cannot be said that there was an error of omission of

3. As to the fourth ground for appeal

(1) As to the instant cargo, there was no error in the lower court’s determination that there was no practice or implied agreement between the Plaintiff and the Defendant that the Defendant would not deliver the cargo to the consignee before receiving the cost of the shipment. Therefore, the part of the allegation in the grounds of appeal premised on the premise that the Defendant, upon the Plaintiff’s request, was unaware of the delivery of the cargo to the consignee before receiving the cost of the shipment, cannot be accepted.

(2) On the grounds indicated in its reasoning, the lower court rejected the Plaintiff’s assertion that, even if the Defendant issued the instant bill of lading to the Plaintiff, it is difficult to deem that the damage caused to the Plaintiff due to the occurrence of proximate causal relation, and that all of the instant cargo was delivered to the legitimate consignee at the time of its issuance, and thus, it cannot be deemed that there was any change in the Plaintiff’s financial status thereafter.

Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine and the evidence duly admitted, the lower court did not err in its judgment by misapprehending the legal doctrine regarding proximate causal relation with the damage caused by the issuance of invalid bills of lading, or by exceeding the bounds of the principle of free evaluation of evidence.

4. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Shin (Presiding Justice)