Transfer Of Contractual Right of Suit Evidenced in Carriage Contract Under Bill of Lading In Nigeria

Abstract

Prior to bill of lading (BOL), merchants travelled along with their goods; then recorded the goods in the ship’s mates’s register; and finally started selling the goods while in transit by way of BOL, indicative that BOL is negotiable. Common law doctrine of privity of contract did not allow the transfer of right to sue to a non-party to the contract. This created hardship to cargo owners which made many jurisdictions to enact laws in this regard. Bill of Lading Act 1855 (BLA) was enacted in United Kingdom which applied as Statute of general application under section 375 Merchant Shipping Act 1990 (MSA) in Nigeria; and conferred contractual rights of suit on consignees and endorsees, but on the passing of ownership upon or by reason of such consignment or indorsement on the shipment of the goods simultaneously. The repeal of section 375 MSA by section 439 MSA 2007, created a lacuna and doctrine of privity of contract is the extant law in Nigeria. The aim of this study is to evaluate laws governing the transfer of contractual right of suit to third party under bill of lading in Nigeria. The specific objectives of this study are to: (i) ascertain the extent to which the extant law of common law doctrine of privity of contract covers the transfer of right of suit to third party under bill of lading in Nigeria; (ii) determine the impediment(s) of the common law to transfer right to sue in the absence of any legislation; (iii) determine the applicability of doctrine of privity of contract as it relates to transfer of contractual right of suit to third party under bill of lading; and (iv) proffer possible suggestions on how to fill the lacuna created by the repeal of Merchant Shipping Act 1990 Laws of Federation of Nigeria 2004. This work adopted doctrinal approach with reliance on primary and secondary source materials. It finds that the common law doctrine of privity of contract in Nigeria is retrogressive. This work recommends for the amendment of the relevant statute to cure this defect/lacuna just like other commonwealth nations for best international practices.