Fashionably mis-released

At a discharge port in Europe, members acted as agents for a carrier carrying a container of branded clothing shipped from Asia. Half of the cargo was to be released against original bills of lading, while the remaining half had been authorised for telex release.

The agent mistakenly released the entire container against telex release, failing to notice that originals were required for part of the shipment.

In the interim, the clothing brand that had ordered the goods entered bankruptcy.

The shipper subsequently threatened proceedings against both the agent and the carrier, arguing that they had not been paid for the portion of the goods intended for release against the original bills, which they continued to hold.

ITIC fully defended the claim on the basis that the shipper had suffered no recoverable loss: the consignee was bankrupt and would not have paid for the goods in any event, and the branded clothing had no resale or salvage value given that it was customised for the insolvent buyer.

This case demonstrates clearly that while an operational error occurred, it was not causative of any actual loss. This is often the case with claims that are reported to ITIC. It is worth remembering that even though an error occurs it does not necessarily mean that it causes any loss to any party.