In the chain of carriage, which statement is correct about Master B/L and House B/L and how they allocate liability?

• A. Master B/L is issued by the shipper to the consignee
• B. Master B/L is issued by the carrier to the forwarder; House B/L is issued by the forwarder to the shipper; liability flows along the contract of carriage
• C. They are the same document
• D. They have no liability implications

Answer: (B)

In a chain of carriage there are two separate contracts of carriage that govern liability. The Master B/L is the contract between the carrier and the party that hires the carriage (usually the freight forwarder), covering the movement on the vessel and the carrier’s liability for that leg. The House B/L is the contract between the freight forwarder and the shipper (or consignee) for the goods under the forwarder’s arrangement, outlining the forwarder’s obligations to the shipper. Because they are separate agreements, liability is allocated along each contract: the shipper’s claim arises under the House B/L against the forwarder, and the forwarder can seek indemnity or recourse from the carrier under the Master B/L for the portion of carriage handled by the carrier. This is why the description that the Master B/L is issued by the carrier to the forwarder and the House B/L is issued by the forwarder to the shipper, with liability flowing along the contract of carriage, is correct.