Rival Cargo Claims and the Carrier’s Dilemma: Who Gets the Goods?

Introduction

Carriers can often find themselves facing misdelivery claims when there are two or more parties asserting that they are entitled to cargo under a bill of lading. For the first time, in Kama Metal v Maersk¹, a shipowner has used the English Civil Procedure Rules (“CPR”) to apply to the court for directions as to which party cargo should be delivered to where there are competing claims. The Court directed that the goods should be delivered to the consignee as the holder of the Bills of Lading.

Facts

• Cargo was shipped on board a Maersk vessel on 29 September 2025 at Mombasa, Kenya for discharge at Penang, Malaysia.
• On 1 November 2025, Maersk issued a Bill of Lading for three containers. The Bill of Lading named Kama Metal Trading LLC (“Kama” / “the Claimant”) as the consignee.
• Discharge took place on the same day as the bills were issued, 1 November 2025. However, delivery of the cargo to the Claimant did not take place because the named shipper claimed it retained an interest in the cargo.
• On 3 December 2025, Maersk received a letter of demand from Kama’s solicitors saying that the Claimant was the consignee, the lawful holder of the Bill of Lading, in possession of all three copies of the relevant Bill of Lading and demanding delivery in accordance with the usual principles.
• On 19 December 2025, the shipper commenced proceedings against the Kenyan subsidiary of the first defendant, Maersk A/S, in Kenya and against the Claimant (despite the English law and High Court jurisdiction clause incorporated into the Bill of Lading).
• The shipper sought an injunction restraining the release and delivery of the relevant cargo on the basis that the shipper was either the unpaid seller of the cargo or, in the alternative, a partially unpaid seller.
• The Claimant alleged that while the amount paid was different from the amount originally agreed, this was due to quality / purity issues with the cargo and it was maintained by the Claimant that it had paid what was due.

CPR Part 86 Stakeholder Application

CPR Part 86 allows a neutral party facing competing claims over money, goods or chattels to apply to the court for directions on how to deal with the disputed property, provided they claim no personal interest in it. 

In this case, Maersk applied to the Commercial Court in England for directions under this provision and an order that it be permitted to release the cargo to the holders of the Bill of Lading, Kama, despite the competing claim from the shipper.

In order to make an application under this rule, a party must be a “stakeholder”. CPR rule 86.1 states:

86.1 
(1) This Part contains rules which apply where—

(a) a person is under a liability in respect of a debt or in respect of any money, goods or chattels; and

(b) competing claims are made or expected to be made against that person in respect of that debt or money or for those goods or chattels by two or more persons.

(2) In this Part—

(a) ‘stakeholder’ means any person to whom paragraph (1) applies;

(b) ‘stakeholder application’ means an application made under rule 86.2(1).

The Judge applied the principles from the decision in SKAT v Shah² to determine whether Maersk qualified as a stakeholder within the meaning of CPR rule 86.1.

In SKAT v Shah, it was established that a stakeholder is one facing competing and inconsistent claims arising from a dispute between rival claimants, rather than one facing inconsistent legal liabilities arising from its own actions.

Applying these principles, it was determined that Maersk A/S (the applicant and first defendant to the shipper’s claim) was a stakeholder and that the court therefore had the jurisdiction to make the order sought.

The shipper was served with the Part 86 stakeholder application, yet it did not appear for the proceedings and nor was it represented.

The Judgment 

The Judge was satisfied that the correspondence received from the shipper was capable of constituting a competing claim - although there was ultimately no evidence to support the shipper’s claim - and the Claimant was able to produce the original Bills of Lading and make a strong argument for its position that it was entitled to delivery. 

The order was made for Maersk to deliver the cargo to the Claimant. The decision ultimately upheld the general and long-standing English law principle – that a shipowner is both entitled and bound to deliver goods against the production of an original bill of lading. 

Club Comment

This is a welcome decision for carriers faced with competing and inconsistent claims as it provides them with a clear method by which, assuming it has jurisdiction, an order from an English Court can be obtained.

This is important in light of the risk to a carrier of delivering to the wrong party and frees the carrier from having to make a commercial judgment at their own risk as to whom to deliver when facing competing claims.

However, the risk of misdelivery is ever present and can arise in circumstances where, for example:  

(i) the carrier is unaware of the risk. In Motis Exports³, the Court was asked to decide which party would bear the loss where an owner had unknowingly delivered cargo pursuant to presentation of a fraudulent bill of lading. The Court held that the loss would fall on the owner, even where the bill of lading was not known by the owner to be fraudulent and the owner was not on notice; a link to the Club’s article on this decision is here: Delivery of Cargo against Fraudulent Bills of Lading. 

(ii) the carrier is aware of the risk but agrees to deliver the cargo without presentation of the bill of lading against the protection afforded by a Letter of Indemnity (“LOI”).  

Club Cover in the Event of Delivery of Cargo without Bills of Lading

The risk of liabilities arising from misdelivery of the cargo is a common concern of owners and an issue on which the Club frequently assists its Members. Club cover is discretionary in the case of liabilities arising from delivery of cargo without production of the original bills of lading. 

The reason being that under English law, in the event of misdelivery, an owner is liable in conversion to the holder of the bill of lading, a claim to which there is usually no defence (as highlighted in Motis Exports).

However, due to short sea voyages and/or multiple sales and sub-sales, often the original bills of lading are unlikely to be available on the vessel’s arrival due to delays in the banking chain.

As a result, commercial practice has evolved where in consideration of an owner agreeing to deliver cargo without the production of the original Bills of Lading, the charterer/receiver agrees to provide an LOI indemnifying the owner against the consequences of such delivery. The LOI is intended to provide contractual recourse against the indemnifying party in respect of any resulting misdelivery claim.

It is important to note that the existence of an LOI does not reinstate or preserve Club cover (other than pursuant to the exercise of discretion under the Club’s Rules). Some of the issues associated with LOIs are highlighted in: Delivery of cargo without production of Bills of Lading: a recap. LOIs need to be carefully drafted and are only as good as the party giving the LOI. A recent decision in the English High Court on this topic was discussed in an earlier article: Steamship Mutual - In Pursuit of Undisclosed Principals – LOIs.

Members are always encouraged to discuss with their usual P&I contact any concerns as to bills of lading and delivery of cargo. 

¹ Kama Metal v Maersk [2026] EWHC 940 (Comm) (“Kama Metal v Maersk”)
² Skatteforvaltningen v Sanjay Shah [2020] EWHC 1658 (Comm) (“SKAT v Shah”).
³ Motis Exports Ltd. v Dampskibsselskabet AF 1912 Aktieselskab and Aktieselskabet Dampskipsselskabet Svendborg [1999] 1 Lloyd's Rep 837 (“Motis Exports”).