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negotiated, gave value therefor in good faith, without notice of the breach of duty, or fraud, accident, mistake, duress, loss, theft or conver sion.

SEC. 38. That where a person, having sold, mortgaged, or pledged goods which are in a carrier's possession and for which an order bill has been issued, or having sold, mortgaged, or pledged the order bill representing such goods, continues in possession of the order bill, the subsequent negotiation thereof by that person under any sale, pledge, or other disposition thereof to any person receiving the same in good faith, for value and without notice of the previous sale, shall have the same effect as if the first purchaser of the goods or bill had expressly authorized the subsequent negotiation.

SEC. 39. That where an order bill has been issued for goods no seller's lien or right of stoppage in transitu shall defeat the rights of any purchaser for value in good faith to whom such bill has been negotiated, whether such negotiation be prior or subsequent to the notification to the carrier who issued such bill of the seller's claim to a lien or right of stoppage in transitu. Nor shall the carrier be obliged to deliver or justified in delivering the goods to an unpaid seller unless such bill is first surrendered for cancellation.

SEC. 40. That, except as provided in section thirty-nine, nothing in this act shall limit the rights and remedies of a mortgagee or lien holder whose mortgage or lien on goods would be valid, apart from this act, as against one who for value and in good faith purchased from the owner, immediately prior to the time of their delivery to the carrier, the goods which are subject to the mortgage or lien and obtained possession of them.

SEC. 41. That any person who, knowingly or with intent to defraud, falsely makes, alters, forges, counterfeits, prints or photographs any bill of lading purporting to represent goods received for shipment among the several States or with foreign nations, or with like intent utters or publishes as true and genuine any such falsely altered, forged, counterfeited, falsely printed or photographed bill of lading, knowing it to be falsely altered, forged, counterfeited, false printed or photographed, or aids in making, altering, forging, counterfeiting, printing or photographing, or uttering or publishing the same, or issues or aids in issuing or procuring the issue of, or negotiates or transfers for value a bill which contains a false statement as to the receipt of the goods, or as to any other matter, or who, with intent to defraud, violates, or fails to comply with, or aids in any violation of, or failure to comply with any provision of this act, shall be guilty of a misdemeanor, and, upon conviction, shall be punished for each offense by imprisonment not exceeding five years, or by a fine not exceeding $5,000, or both.

SEC. 42. First. That in this act, unless the context of subject matter otherwise requires

"Action" includes counterclaim, set-off and suit in equity.

"Bill" means bill of lading governed by this act.

"Consignee" means the person named in the bill as the person to whom delivery of the goods is to be made.

"Consignor" means the person named in the bill as the person from whom the goods have been received for shipment.

"Goods" means merchandise or chattels in course of transportation or which have been or are about to be transported.

"Holder" of a bill means a person who has both actual possession of such bill and a right of property therein.

"Order" means an order by indorsement on the bill.

"Person" includes a corporation or partnership, or two or more persons having a joint or common interest.

To "purchase" includes to take as mortgagee and to take as pledgee. "State" includes any Territory, District, insular possession, or isthmian possession.

SEC. 43. That the provisions of this Act do not apply to bills made and delivered prior to the taking effect thereof.

SEC. 44. That the provisions and each part thereof and the sections and each part thereof of this Act are independent and severable, and the declaring of any provision or part thereof, or provisions or part thereof, or section or part thereof, or sections or part thereof, unconstitutional shall not impair or render unconstitutional any other provision or part thereof or section or part thereof.

SEC. 45. That this Act shall take effect and be in force on and after the first day of January next after its passage.


An analysis of the foregoing Federal Bill of Lading statute follows:

The first section indicates the legal authority exercised over bills of lading and is separated into four divisions.

(a) Transportation within the United States or District of Columbia.

(b) Transportation from a place in a State to a place in a foreign country.

(c) Transportation from a place in one State to a place in another State.

(d) Transportation in one State to a place in the same State, passing through another State or through a foreign country.

Sections 2 and 3 indicate the two sorts of bills employed, viz., straight and order bills.

A straight bill is one so termed when consigned to a specified person. (Consult section 6.)

An order bill is one so termed when goods are consigned to the order of any person named in the bill. Such bills are always negotiable, unless made non-negotiable by a statement in writing agreed to by the shipper.

Section 4 provides that order bills shall not be issued in parts or sets

shipments are to Alaska and

(a) Except when shipments are


(b) If issued in parts or sets, carrier will be held liable to anyone who purchases a part for value in good faith, even though such purchase is made after delivery of the goods.

(c) This section, however, does not forbid issuing of order bills in parts or sets on goods to Alaska, Panama, Porto Rico, the Philippines, Hawaii, or foreign countries, or impose liabilities for so doing.

Section 5 provides that order bills issued on goods shipped to places other than those excepted shall be marked "duplicate.' (Consult section 15.)

Section 6 provides that a straight bill shall state on its face "non-negotiable" or "not negotiable." (Consult sections 2 and 3.)

Section 7 provides that insertion of name of person in an order bill to be notified of arrival'of goods does not limit negotiability of the same or constitute notice to purchaser of equities of such person in the goods.

Section 8 provides that refusal or failure to deliver goods makes burden of proof upon carrier to establish lawful excuse for refusal or failure; also that carriers are compelled to make delivery, in absence of lawful excuse to the consignee named in a straight bill or to the holder of an order bill, if the demand is accompanied by

(a) An offer to satisfy carrier's lawful lien upon goods. (b) Offer to surrender bill properly indorsed.

(c) Readiness to sign receipt for delivery of goods if required.

Section 9 provides that carrier is justified, subject to provisions in sections 10, 11 and 12, in making delivery under following conditions:

(a) To a person lawfully entitled to possession of goods.

(b) To consignee named in a straight bill.

(c) To person possessing an order bill which states goods are to be delivered to his order or which has been indorsed to him, or in blank, by consignee or indorsee of consignee.

Section 10 provides that carrier is liable when delivery is made to person not entitled to goods, and also when the carrier is

(a) Requested not to deliver by person having right of property, or

(b) Informed at time of delivery that person was not entitled to possession of goods, but such information to be effective must be given to proper agent of carrier and must be given in time to stop delivery of goods.

Section 11 provides that, except as stated in section 26 and also except when compelled by legal process, a carrier may be liable for failure to deliver goods to anyone who for value and in good faith has purchased the bill, whether purchaser acquired title to the bill before or after the delivery of the goods and notwithstanding the fact that the delivery was made to person entitled to same.

Section 12 provides that, except as stated in section 26 and except when compelled by legal process, at the time a carrier makes partial delivery, he is liable for failure to deliver all the goods specified in the bill to anyone who for value and in good faith buys the same, provided he does


(a) Take up and cancel the bill, or

(b) Mark the bill with a description of the partial delivery.

Section 13 provides that any change in the bill shall be void, provided that the changes are made without authority from the carrier issuing the same and the bill shall be enforceable according to the manner in which it was originally drawn.

Section 14 provides that legal action may be taken when a bill is lost, stolen or destroyed, but it is especially provided that liability is not avoided in case such order bill has been negotiated for value without notice of delivery.

Section 15 provides that a bill marked "duplicate" makes the carrier liable only to the extent of declaring that it is an accurate copy of the original bill properly issued. (Consult section 5.)

Section 16 provides that the carrier is liable for nondelivery of goods

(a) When the title has not been transferred by the consignor or consignee to the carrier, or

(b) When the carrier has no lien on the goods.

Section 17 provides that when more than one person claims possession to goods, the carrier may require all the known claimants to interplead either as a defense to the action for non-delivery of goods, or as in an original suit, whichever is appropriate.

Section 18 provides that the carrier is not liable for nondelivery of goods-

(a) Provided the carrier has knowledge of some person other than the consignee or the holder who has an adverse claim.

(b) This limitation, however, continues only until the validity of such claim is determined.

Section 19 enacts that the carrier cannot be held liable for non-delivery except as provided in sections 9, 17 and 18 of this act.

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