In a liability conscious world indemnities inevitably proliferate and are frequently regarded (often incorrectly) as the answer to every problem.
Before offering an indemnity as a solution to a problem an indemnifyor should consider carefully the wording of the indemnity and the exposure to liability that this precipitates.
Equally the indemnified should bear in mind that an indemnity is only as good as the person giving it and consider the difficulties that he is likely to have enforcing it if need arises.
Overall consideration needs to be given to how the law looks at such matters, particularly regarding enforcement. It has been explained that will only enforce indemnities in the absence of negligence, unless the indemnity makes it quite clear that it is to operate even in the event of negligence.
It also needs to be borne in mind that the law regards indemnities for the issue of clean bills of lading for discrepant goods as being equivalent to conspiracy between the carrier and the shipper to defraud a consignee who is entitled to rely upon the description of the goods shown on the bill of lading as being accurate at the time of the commencement of carriage.
Accordingly the law would not enforce such indemnities as being illegal contracts and, if the shipper chose not to honor this indemnity, there would be nothing that the carrier could do about it.
Nevertheless indemnities of various types are frequently encountered in shipping and the combined transport industry.
However, the most frequently encountered indemnity is that for delivery of goods without production of bill of lading if the goods arrive ahead of the documents or the documents become lost.
Takis Kalogerakos
Marine Underwriter
