$2/lb Liability

MikeJr

Moderator
Staff member
#1
Hey guys,

I've had a carrier recently advise me that for a shipment picking up in the USA destined for Canada, on a BOL produced by the shipper with no declared value on it, that they are liable for $2/lb CAD (meaning they want to be liable for $1.56 USD). How do I pitch this to a US client who expects the carrier to be liable for $2/lb USD? We have no claim history with this carrier that i know of (over the 15 years that we have tracked claims) so I'm confused as to why this would come up now.

Does anyone have any thoughts on this please?

Keep well,
Mike
 

MikeJr

Moderator
Staff member
#3
You mean the Carmack Ammendment, yes. I read quite a bit about that, I've asked the carrier to speak to their legal team (they are sizeable and I believe they have an actual legal team) and then get back to me to continue the conversation.
The particular carrier is difficult to work with even for simple shipments, so best to just not work with them until they research this topic some and come to the table with a level head.

Thanks all for your posts and the PM's for people that didn't want to post semi-private info.

Keep well,
Mike
 

PackRat

Site Supporter
#4
Hi MikeJr,

I believe the reading is $2/lb country of origin specific. So if it originates in Canada...it's 2 bucks cdn...if it originates in the US its 2 bucks USD...HOWEVER, there have been some precedents already where the claiming party used the customs docs to prove value that superseded the BOL/non disclosed value. Also,
I believe in the US that a customer can declare a value of up to $25/lbs with no added Excess Value charge assessed. But this info might be a bit old now and could have changed/been amended since then.
 

MikeJr

Moderator
Staff member
#5
PackRat,

Thank you for the input, I was under similar impression. I just can't work with a carrier that is trying to tell me that valuation will be $1.56 USD for shipments picking up in the USA when the shipper, consignee and their insurance companies would all expect a higher liability to be placed on the carrier in the event of a large/total loss. I certainly don't have the authority to bind my customer to these terms nor would I do so as it's not in their best interest. It's ok, I really disliked working with that particular carrier anyway, we never felt like they cared about us or our customers business anyway. No loss.

Thanks again,
Mike
 
#6
You mean the Carmack Ammendment, yes. I read quite a bit about that, I've asked the carrier to speak to their legal team (they are sizeable and I believe they have an actual legal team) and then get back to me to continue the conversation.
The particular carrier is difficult to work with even for simple shipments, so best to just not work with them until they research this topic some and come to the table with a level head.

Thanks all for your posts and the PM's for people that didn't want to post semi-private info.

Keep well,
Mike
You’re correct in your statement Mike. If you need further assurances on this, I can put you in touch with a top cargo claims adjuster with 30+ years experience in this field or a highly recognized transportation lawyer.
 

Michael Ludwig

Well-Known Member
#7
No Declared Value, Coles Notes Version:
In Canada, the carrier is liable for $4.50/kg, or the manufactured cost of the goods, whichever is lesser.
In the U.S. the carrier is liable for, as per Carmack, $2.00 per pound, or the sale price of the goods, whichever is lesser.
What determines the applicable rule is the embarkation point and/or the termination point. If the goods are originating in, or terminating in the U.S., regardless of where the loss takes place, Carmack applies. If the goods are strictly within Canada, then the Canadian rule applies.

Declared Value, Coles Notes Version:
You pay what's written on the bill of lading.

To be quite frank, there are a myriad of technicalities that will mitigate the carrier's exposure to loss in these situations. Literally volumes can, and have, been written about them. Far, far too many to even scratch the surface here.

The best advice you can get will come from a top cargo claims adjuster. Those are the people that highly recognized transportation lawyers talk to :) .
 

MikeJr

Moderator
Staff member
#8
Michael,
You have a way of presenting information in a concise yet detailed way.

Can't thank you enough for this and a few hundred other posts you've had over the years!

Keep well,
Mike
 

Michael Ludwig

Well-Known Member
#9
Oh, and by the way, the carrier is fishing. They're just trying to see what they can get away with.

Several, some might even say many, years ago there was a large Ontario based carrier (still in business today) that, because insurance was ridiculously expensive "allowed" their customers/shippers to opt out of cargo insurance with the promise of lower transportation rates. Truth is they pushed the customer base pretty hard to sign the cargo insurance waivers. In fairness, they did honour the lower transportation rates, but only for a short period of time because other cost factors started to increase. Overall there were no transportation cost savings. However, in the meantime they had all these blanket cargo insurance waivers on file. As far as I know those waivers are still in force.
The moral of the story: this carrier went fishing too, lucked out, and came home with a whopper ... LOL
 

MikeJr

Moderator
Staff member
#14
Nice read, thanks SC!

Secretly I was hoping someone would ask me who this carrier was who advised me for shipments originating from the US, they would only be liable for $2/lb CAD, but sadly no one has asked. I think I should volunteer the information regardless:

Transport Bourassa - over the past year or so, they have become increasingly unrealistic, borderline insane when it comes to accessorial charges, a pickup when we feel like it and deliver it when it's convenient kind of attitude. After the valuation discussion we've placed them on hold and have since rekindled some great connections with other carriers on the lanes Bourassa used to service for us. Maybe it was their way of telling me they didn't want my business? Hard to believe when the bulk of what we gave them was inbound LTL from areas that other carriers are quite happy to hear from us and jump at the loads. Anyway, moving on.

Happy Friday,
Mike
 
#15
Couldn't agree more with your take on Bourassa.

They used to be a "go to" for New England to Montreal area. Since about the time E Logs came in to play... We've also noticed that they are becoming increasingly more difficult to deal with. Accessorializing the crap out of orders. Don't get me wrong... We pay wait time (if it's realistic), Missed picks, etc., etc.

They obviously have more freight than they can handle... Usually that dictates this type of attitude. Oh and there's the "Sorry, we ran out of room" Email at 4:00 PM so that you can't re-cover.

We've been using other carriers... Bringing freight through Toronto and transferring to an ON - QC carrier.

Bourassa is no longer our "go to". Now they're our "back up".
 

lowmiler88

Site Supporter
#16
I've noticed a lot of issues with LTL carriers in Canada, they seem to have taken the US approach of "if it's late not our problem" and "if you don't like it too bad". We had one that the customer mandated double their rates, too many closings of companies and consolidation in the LTL industry.
 

Rob

Site Supporter
#17
I've noticed a lot of issues with LTL carriers in Canada, they seem to have taken the US approach of "if it's late not our problem" and "if you don't like it too bad". We had one that the customer mandated double their rates, too many closings of companies and consolidation in the LTL industry.

My understanding is the ltl guys are heaving a heck of a time finding drivers. I know we all are but I have heard they are really having an issue.
 

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