International Trade Law: Southampton Solent University Report

This report delves into the intricacies of international trade law, examining the roles of law in global business, particularly focusing on the Hague-Visby Rules and the bill of lading. It explores the importance of international contracts, the system of documentary credit, and how the contract for the carriage of goods by sea is applied. The report analyzes the case of Owners of the cargo lately laden on board the ship "David Agmashenebeli" v Owners of the Ship "David Agmashenebeli", synthesizing information to demonstrate problems encountered in the case, particularly concerning the roles and responsibilities of the master, the significance of the bill of lading, and the gaps within international contract law. The analysis emphasizes the need for fairness, trust, and the establishment of globally recognized systems within international trade to promote a stable business environment.

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INTRODUCTION
In the business world, the need for law is essential, and this is because the law plays a
paramount role in bringing harmony and guiding the traders. The law states the obligations of the
parties involved with the aim of making sure that each party is aware of their responsibilities.
The Hague-Visby rules came to dictate what should happen between the shippers and the traders.
The bill of lading is also featured by the Hague-Visby Rules, and it is a document that gives the
third party the rights and obligations on a contract basis. The third party, in this case, is the
career, and he or she acknowledges that he or she has acquired the specific goods thus assuming
the responsibility to make sure that they reach the intended destination safely. The two most
essential parties in the bill of lading are the buyer and the carrier. The shipper acknowledges that
the goods that the buyer states to have bought have been placed on his or her ship and from then,
he or she assumes the full responsibility of the products. However, the buyer must provide the
document to the carrier. The bill of lading serves three essential roles. The first role is as a
receipt to the goods that have been shipped. The second role is as a document that shows the
agreement between the carrier and the owner of the cargo and the third is as a title of the goods
that are being shipped. The focus on the case of Owners of the cargo lately laden on board the
ship "David Agmashenebeli" v Owners of the Ship "David Agmashenebeli" [2002] All ER (D)
535 (May) will foster the understanding of the international trade law and its essence in the field
of business.
THE LAW OF INTERNATIONAL CONTRACTS
The world has grown into a global village, and that has brought many nations together in
terms of trade. As a result, the need to have a law in place that governs the activities that take

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place in the international business platforms has been seen to be significant (Mansfield and
Reinhardt, 2015). The Hague-Visby Rules come in place to make sure that the business
environment is suitable for people who are interested in investing in the global markets. It is
imperative to note that when business activities take place between different nations, using the
law of one of the countries might be unfair to the other party (Pagnattaro and Park, 2015). The
reason behind it is because different nations have proved to have different laws. Therefore, it
becomes vital to have a law that generally looks into all parties (Fooks and Gilmore, 2014).
Various characteristics of the law of international contracts have made the law one of the best in
the global business platform.
One of the significant characteristics in the Hague-Visby Rules is the nature of its
diversity. For example, when a trader comes from Asia and uses the vessel that comes from
Europe and uses the same vessel to transport goods that should be taken from America to Africa,
it is evident that there is the involvement of four regions (Andrews, 2016). Different regions
have their different laws that govern the operations that take place within their boundaries, in this
respect, it becomes evident that having a law that takes care of the issue at hand is rare (Hung,
2015). The Hague-Visby Rules come in place to make sure that despite the complexity of the
matter and the diversity of the parties that are involved, fairness, law, and order are promoted.
Hague-Visby Rules comfortably fit in the laws of international contracts because of their
jurisdiction as well as the matters that they deal with (Fooks and Gilmore, 2014). It is paramount
to note that these are rules that have respect for the national laws but when it comes to an
international issue, they take center stage thus replacing the national laws.
In Hague-Visby Rules, there is the aspect of no choice. In this specific case, the parties
that are involved might not have an agreement on the exact law that is supposed to be used. The

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reason behind it might be because none of the laws in their respective nations meet their needs
(Red fern, 2015). When the case reaches to this point, the parties are given no other choice but to
use Hague-Visby Rules. The reason for doing so is because of the complexity of the Rules as
well as their effectiveness in fostering fairness and justice. There is a dire need to understand that
the reason why the Hague-Visby Rules were constituted was to make sure that when there lacks
law that can guide two or more partners who come from different nations, it becomes paramount
for there to be a universal law (Katsivela, 2017). Hague-Visby is not based on any nation, and it,
therefore, does not favor the law of a specific nation. In this respect, it is evident that the parties
that might be involved in any conflict are likely to trust the law more than they would have
trusted a law of either of their host nations. Therefore, despite the parties being denied a choice
to use either of the national laws, they are exposed to Rules that look more into the interests of
both of them than the interests of one of the parties.
It is with no doubt that the Hague-Visby Rules come in place to establish a system that is
globally recognized and appreciated. The global business platform has been expanding over the
years, and that means that many people from different parts of the world come together for the
sake of doing business together (Pauwelyn, 2016). Law and order are essential in any given
environment. However, when there is the international contract law, contracts that bind the
international business persons are established thus creating an environment that is suitable for all
international investors.
THE SYSTEM OF DOCUMENTARY CREDIT WHICH COMBINE TO REGULATE
THE RELATIONSHIP BETWEEN THE PARTIES BUYING AND SELLING THE
GOODS

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The system documentary credit is one of the systems that promote a good business
environment in international trades (Fooks and Gilmore, 2014). It is essential to note and
understand the major similarity that is between the letter of credit and the system documentary
credit. The two documents come in place to serve as payment methods to the sellers courtesy of
the buyer but through the bank. The system involves three different parties. The buyer of the
goods that are being shipped works with the bank to make sure that the products are paid for.
The buyer applies for credit but not for the amount to be channeled to his or her account but to be
given to the seller once the seller proves to meet all the agreed specifications. There is an
essential aspect in the system of the documentary credit, and this is associated with the details of
the contracts and the timeframes (Trachtman, 2018). The buyer approaches the bank with all
details about the cargo. After doing so, the bank is left in charge of monitoring and inspecting the
cargo. When the seller succeeds in delivering the cargo, all he or she has to do is present the
documents to the bank, and if the documents match with the documents that were earlier
provided by the buyer to the bank, the payments are made to the seller (Fooks and Gilmore,
2014). However, the seller must also avail the products in the stipulated time. Only the buyer has
the power to make the changes with the bank in the case of any conflict.
The system of documentary credit comes in place to regulate the relationship between the
selling and buying parties. In business, good or bad relationships can be established between the
parties that are involved (Carr and Sundaram, 2016). Some of the factors that influence these
relationships are trust and commitment to the agreements that the two parties make.
Inconveniences might be present in the process of shipping products. It is at this point that the
significance of the involvement of the bank comes in place (John et al. 2018). The bank makes
sure that when the seller arrives with his or her cargo, his or her money will be paid whether the

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buyer will be present or not (Fooks and Gilmore, 2014). Therefore, trust between or among the
trading parties is promoted. When there is trust among the trading parties, it is no doubt that the
relationships of the parties are affected positively.
HOW THE CONTRACT FOR THE CARRIAGE OF GOODS BY SEA WILL BE
APPLIED
The bill of lading is the document that shows the agreement between the party that is
transporting the goods and the owner. In the documentary credit, there are different documents
that must be present for the agreement to be signed. The documents are an insurance policy, bill
of lading, commercial invoice, and several others (Chieng, Hooi, Chew, Hock, and Law, 2017).
The bill of lading has proved to be among the documents that should be present in the
documentary credit. In this respect, it is evident that the contract of the carriage will be applied
and when the other party is receiving payments, the person in charge of carriage will also be
getting his or her fair share of payments.
SYNTHESISE AND ANALYSE INFORMATION WHICH YOU HAVE DISCOVERED
IN GROUPS AND INDIVIDUALLY IN ORDER TO DEMONSTRATE THE PROBLEMS
ENCOUNTERED IN THE CASE
The engagement of the group activities came with its fair share of benefits (Fooks and
Gilmore, 2014). A wide range of information was discovered in the groups, and the information
was associated with the international laws that come to govern the business world. The first piece
of information is associated with the essentiality of the bill of lading (Fooks and Gilmore, 2014).
The case has focused more on the bill of lading and the effects that come if the master does not

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sign the bill of lading. In this respect, it is evident that the bill of lading acts as an essential
document that is of benefit to the buyer.
In some cases and the case at hand acts as one of the cases, the sellers are determined to
sell their products without the consideration of the buyer (Fooks and Gilmore, 2014). Without
control and without proper monitoring of the quality of the products that have been shipped, it
becomes a challenge for the buyer to be protected (Chaney, 2018). However, the bill of lading
comes in place to emphasize the need to make sure that the cargo is in its best shape. Therefore,
the monitoring of the cargo must take place, and this means that the buyer is protected from any
seller who might be planning to take advantage of the possible absence of the buyer.
Another piece of information that has been discovered is associated with the jurisdiction
and powers of the master (Carpenter, Jansen, and Pauwelyn, 2017). The case presents an
interesting issue where the seller tries to argue that the master did not have an obligation to add
the clauses that talked about the bad quality of the products in question. In this case, it is
apparent that the international contract law has gaps that need to be addressed (Garcia, Ciko,
Gaurav, and Hough, 2015). The master is obligated to provide a clean bill of health after
ascertaining that the products have met a clean bill of health. At the same time, the master is
obligated to sign the bill of lading. When the master is placed in a situation where he must sign
the document which is essential and restricted to add any information in the case of any issue,
there is a considerable gap that ought to be closed (Correa and Yusuf, 2016). The buyer argued
that the master did not have an obligation to add any clause to the agreement and at the same
time, the master had to sign the clean bill. This means that at some point, the law is confusing
and it might put the master in a challenging position (Fooks and Gilmore, 2014). The reason

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behind it is because the master cannot sign off goods that are below standards since his sign
should help to know if the products meet the requirements stated or not.
The other information that is essential is about the documentary credit. The bank of the
buyer refused to pay the seller, and this is because the products were not in the standard that was
agreed upon (Gil-Pareja, Llorca-Vivero, and Paniagua, 2018). When the bill of lading reached
the bank, the clause that was added by the master indicating that the product was not meeting a
clean bill of health, the bank refused to pay. In this respect, it is evident that the bill of lading is
an essential document that comes in place to make sure that there is honesty in the dealings
among the parties included (Fooks and Gilmore, 2014). The significance of the document is seen
when it blocks the payment of a cargo that does not meet the expectations of the buyer.
OPTIONS TO RESOLVE THE PROBLEM IN FUTURE
There should be clear guidelines on the jurisdiction of the master. It is confusing to try
and enforce the law that makes sure that the master signs the bill of lading despite the
questionable quality of the products (Fooks and Gilmore, 2014). The reason behind it is because
the master is supposed to sign if only the cargo fits the standards that have been agreed on. The
best way to resolve this problem in future is by the master taking a strong position not to sign the
bill of lading if it will not have met the standards that have been put in place (Fooks and
Gilmore, 2014). The Hague-Visby Rules make sure that the interest of the parties involved is
factored in. It is for this reason that they should come in place to help in such a case if it happens
in the future. To avoid the conflict, it would be essential for the master to avoid adding a clause
and this is because of the effects that came with doing so the previous time (Lang, 2016). The
reason why the signature of the master should be on the document is to prove that the cargo

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meets a clean bill of health and therefore failing to sign because the cargo failed to meet the
standard is within the obligation and jurisdiction of the master.
CONCLUSION
International trade laws are essential in the business world. The reason behind it is
because sometimes there might be biases in following the trade laws of a specific nation.
Therefore, when two or more international trade partners come together, they are supposed to be
governed. The international contract law guides the business partners on the best practices to
observe. In this respect, it is no doubt that law and order are maintained in the international
business world. "David Agmashenebeli" v Owners of the Ship "David Agmashenebeli" case has
helped to understand the bill of lading and some of the essential components of the bill. The
limitations and the parties involved have also been outlined in a way that is informative and
educative. The diversity of the laws in the world puts the international partners in a tricky
position when they are trading. The reason behind it is because it becomes a challenge for the
partners to follow the rules or rather the law of a specific nation. It is at this point that the Hague-
Visby Rules come in place to dictate the responsibility of every partner who is involved. At the
same time, the rules have helped to understand the responsibilities of all stakeholders who are
involved in the business process.

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