The parties requested an interlocutory hearing regarding the release of a cargo of wind turbine generating equipment formerly held by Beluga Shipping GmbH Co (Beluga Shipping). At the time of these proceedings this equipment was in the custody of the Sheriff as the Court's officer. The notice of motion was filed by several companies within the Suzlon company group.

Suzlon Energy Ltd, a company within that group, manufactured or was involved in manufacturing wind turbine generating equipment; it shipped a cargo of this equipment to its Australian associated company, Suzlon Energy Australia Pty Ltd, on the MV Beluga Fantastic. These proceedings arose from Beluga Shipping's efforts to interplead in the Federal Court by discharging the cargo and having the Court hold it, pending settlement of a dispute between the time charterer, Headway Shipping Ltd (Headway), Suzlon Energy Ltd, and Suzlon Energy Australia Pty Ltd.

Held: The straight bills of lading were legitimate documents of title under the Amended Hague-Visby Rules (Schedule 1A to the Carriage of Goods by Sea Act 1991 (Cth)), and thus it was necessary to produce an original bill of lading before the Sheriff could release the cargo. The requested variation to the previous day's orders was denied.

This dispute revolved around non-payment for freight, both for this voyage and for previous voyages. One of the disputed contracts of affreightment was between Headway and Suzlon Energy Ltd, while another was between Suzlon Energy Ltd and Headway Chartering (Canada) Ltd (Headway Chartering).

Crucial to this case was that the agreement between Suzlon Energy Ltd and Headway for the wind turbine equipment shipment involved the issue of non-negotiable freight prepaid bills of lading, also called straight bills of lading. These named Suzlon Energy Australia Pty Ltd as the consignee. It appeared from the evidence that the master of the MV Beluga Fantastic or his agent had issued bills of lading for the cargo that shipped to Port Kembla (in NSW), but that these same bills were not released to Suzlon Energy Ltd, the shipper, as Headway argued that it had not yet been paid.

Partway through the interlocutory hearing, the parties came to an agreement about the release of the cargo, and the Court made orders and received undertakings to this end. Once payment was confirmed from the Suzlon companies, it was decided, the original bills of lading for the wind turbine equipment would be released or delivered or caused to be delivered to these companies by the Headway companies, as well as the bills of lading for other cargo withheld from the Suzlon companies in the USA, and finally, bills of lading for cargo on board the MV Beluga Revolution.

On the day that this case was decided, however, the parties sought to vary the previous orders to have the Sheriff deliver the MV Beluga Fantastic cargo without first presenting the original bills of lading for that cargo, which were said to be unavailable. All parties agreed to this except for Beluga Shipping. The Suzlon and Headway companies then asked to give undertakings to Beluga Shipping and the Court to indemnify Beluga Shipping and its servants and agents, in regard to any losses that might be sustained through delivering the cargo without first seeing the original bills of lading. Subject to this indemnity, they desired to have the cargo released.

Rares J denied the variation to the previous day's orders because there was no undertaking given to the Sheriff, and because the bills of lading included a clause stating that once any of the signed bills of lading was accomplished, the others would become void. It was inappropriate to require the Sheriff to act in a manner that went against what was specified in the bills of lading for that cargo. The production of the original bills was required here, and if the Sheriff did as the Headway and Suzlon companies were suggesting, he might later become liable to a person who produced the original bill and demanded delivery.

The practice of offering protection to carriers that deliver cargo on production of the original bill of lading was well-established. Particularly relevant was the above-mentioned clause from the original bill of lading, stating that the presentation of one original bill by a consignee would void all the others and complete the contract. The stipulation that the original bill be produced also works to ensure consignees or buyers do not receive their cargo until they have fully paid, as the shipper of the goods is unlikely to pass on the original bill of lading before payment is complete.

Rares J agreed with the House of Lords' finding in The Rafaela S [2005] 2 AC 423 (JI MacWilliam Co Inc v Mediterranean Shipping Co SA (CMI632)) that a straight bill of lading fell within the definition of 'a bill of lading or any similar document of title' in art 1.b of the Hague-Visby Rules. The House of Lords followed decisions, that straight bills of lading were documents of title, given earlier by the Court of Appeal of Singapore in APL Co Pte Ltd v Voss Peer [2002] 4 SLR 481 at [55], [2002] SGCA 41; reported sub nom Voss v APL Co Pte Ltd [2002] 2 Lloyd’s Rep 707, the Court of Appeal of Rennes, France, in The MSC Magallanes (2002) 631 DMF 952 and a Dutch Court in an unreported 1997 decision The Duke of Yare (unreported) 10 April 1997, ARR-RechtB Rotterdam.

This meant that the cargo could not be released by the Sheriff until the original bill was available, which it was not. Moreover, through the operation of arts 10.2 and 10.3 of the Amended Hague-Visby Rules in Sch 1A of the Carriage of Goods by Sea Act 1991 (Cth) applied, unless the original Hague Rules, Hague-Visby Rules, SDR Protocol, or Hamburg Rules applied instead due to agreement or law. There was no evidence of this; thus the Amended Hague-Visby Rules were the relevant standard. Rares J held that the bills of lading in this case also fell within the definition of 'sea carriage document' from the Amended Hague-Visby Rules, which encompasses both non-negotiable bills of lading (art 1.1.g.iii) and non-negotiable documents (art 1.1.g.iv), including consignment notes, sea waybills and ship's delivery orders.

There was no possibility or suggestion that Beluga Shipping could release the cargo in this case without an original bill of lading being produced. Nor was there any convincing reason (including the consent of the Headway and Suzlon companies) not to adhere to this requirement.