Claim -

T

thefriendlybroker

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Aug 13, 2008
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Any advice would be greatly appreciated as I am not sure this is the correct forum to post.

I recently did work with a carrier ( flatbed ) work where the carrier was advised only to chain the load. He proceeded afterwards to strap the load down and in doing so, damaged several pieces.

Upon contacting the carrier, I was informed the driver was contracted and it would have to go through his insurance and they were not responsible.

With this in mind, is this carrier responsible still as it was booked with them and no notification or insurance was provided on this driver.
 
That's a new one!

Wow, that's a new one.

I guess I have a couple of questions...

1) Who's the carrier on the BOL?
2)Was it "interlined" or "brokered" to the 2nd carrier?
3) Who's authorities and license did the load travel under?


Generally, it this would be considered an "interlined" move, the first carrier is generally held liable in my understanding.

If the load was in fact, brokered out, then guess what, you have to go to the actual carrier. However, it's pretty bad that the carrier you booked it with is washing his hands of it. You should really share the name of the carrier. This is really poor business practise.
 
Did they provide any proof of insurance to you? I would start there and verify their story. It seems like such an easy out....
I also interline flatbed freight - a good practice is to list the equipment required - (ie straps not chains)

I agree that you should share the carriers name - I would love to add them to my DNU
 
Claim

thefriendlybroker - Regardless of what the carrier tell you about having to claim on the o/o's insurance policy, they are responsible. This falls under the well established case law of "vicarious liability".

A correct statement of the applicable law may be found in Professor Fridman’s The Law of Torts in Canada, vol. 2 (Toronto: Carswell, 1990) at pp. 340-41:

The fundamental idea which justifies vicarious liability for the negligence of an independent contractor is that the negligence in question is not merely casual or collateral, but entails a breach of duty that was conclusively imposed on the employer of the contractor. The contractor’s negligence, in effect, amounts to a failure of the employer to fulfill his statutory or common law obligation as well as a failure of the contractor to fulfill the obligation that was on him by virtue of his contract with the employer. In such situations, qui facit per alium facit per se. By employing a contractor who has not satisfied the obligation in question, the employer has himself failed to satisfy it. Therefore, he is personally liable.

The duty in question may even arise under a contract. If its performance is entrusted to an independent contractor, whose negligence in doing the very act which his employer had undertaken to perform by the terms of the contract resulted in the damage, the employer of such contractor will be liable.
In other words, the contracting party cannot discharge his contractual obligation by delegation to a subcontractor although, of course, he may have a claim over for indemnification.

Here is a link to where this citation originated and also tells of the effect of holding shipments for ransom - a very interesting read if I do say so.

http://www.canlii.org/en/on/onsc/doc/1999/1999canlii14947/1999canlii14947.html

I hope this helps - Howard
 
Thanks Activet for the read (I think), I have one question as a carrier do we need to deliver on our own Pro Bill or is the Customers Bill of Lading sufficient?
 
Bill of Lading

If your the carrier, just make sure that your noted as same in the space provided on the bill of lading. Some brokers will issue their own bills of lading showing themselves as the carrier, or their customer/shipper may fill in the broker as the carrier, seemingly as a courtesy. Most of those that do this, don't fully realize the potential legal consequences of doing so, and a carrier who accepts a bill of lading showing someone other than themselves as the carrier, doesn't know how to preserve their rights at law. Also, it's very important to know if it's marked as prepaid or collect.

There is so much information available about bills of lading that most find it a daunting task to develop the knowledge and understanding that this industry requires if your practicing your due diligence. Consult a legal professional to review your contracts, terms and conditions and business practises. It's worth the money to be able to sleep at night without doubts about preserving your rights, and capital.
 
Claim

An interesting read. Thanks for the info.

We have several carriers that use owner operators with their own seperate insurance and authorities. We have only found this out by asking for PARS on shipments. You would be surprised how many carriers are doing this !!

No claim yet (Knock on wood) but we asked a lawyer just last week to look into this for us. If there is anything different that the lawyer says, I will share with everyone.
 
We have seen a number of these and it's suprising how many 'are' double brokering. If you call the carrier that moved the freight often you find they do not move exclusive for them, they run their own company and when they do not have freight they work for them and often for others. They claim to be sister companies or related, it's amazing how people try to justify double brokering.
 
Claim

You are 100% accurate on that. The list of carrier's doing this that we have compiled is so long it would scare you!! Don't believe me? Start asking for PARS on your shipments. It will open your eyes.

This is a real problem right now.

We get the excuse "we are part owners or this is my sister company, we dispatch for them but we have with seperate insurance and authorities, we do this for insurance reasons."

Can anyone enlighten me to why they claim this? Is there a legit reason why a company would do this? A cost savings of some kind?

I think it is BS.
 
A further problem is that most carriers only carry primary cargo insurance. If a claim surfaces, their insurance company will decline liability, stating that only the "actual" carrier's cargo insurance can respond.

I had a case a couple of years ago where the "carrier" refused to identify who he rebrokered the freight to, and his insurance company would not entertain the claim as it did not fall under primary cargo coverage.
 
Thanks for the great info.... i actually have come to a resolution with the carrier where they are taking responsibility now to this and are paying the damages through future loads. Seems like the best way to sort these things out sometimes...

While we are on the subject... I have another question.

I have a carrier which delivered 100 cases short of what he took. He says that he didn't touch the freight and its not his fault and will not take responsibiliity. The b.o.l shows the counts of what was on the truck and then when delivered there is a stamp stating the case count which was received. ( now 100 cases less than what he picked up according to paperwork )

It looks like I will have to go to court with this and I am looking for someone in the Guelph area which will do this on the basis of them only collecting if they win. Does anyone know someone in that area which could assist mein the legal process. The missing product is worth a few thousand and I've already paid the carrier, so I am out of pocket on this.
 
Need more info

On your second question regarding the 100 boxes short, I have some more questions.... while the fact that the BOL says the count is 100 short is good evididence, it's not a slam dunk that carrier is liable for 100 boxes.

1. was this full load or LTL?
2. was there any evidence of tampering? ie. cut stretch wrap?
3. was the load sealed in transit (if it was full)?
4. was it REASONABLE for the driver to have counted every case to verify the count on pick up?

The carrier ..I guess... is asserting that there was a mis-count on behalf of the shipper. They can definately call into question the BOL, but not just by saying "we didn't touch it". There has to be evidence to corroborate this.
 
I would say if the driver signed only his name on the B/L then he (the company) is responsible for all the cases unless the load was sealed by the shipper. Most companies are fairly sticky as to how B/L's are signed as in not allowing SLC (shipper load and count) or only signing for number of skids as it offers them no protection. Call the companies inusrance agent and file a claim that is what they are there for.
 
it was a partial load and the carrier took it back to their dock and reloaded onto a long haul trailer. The load was never sealed.

My concern was that the driver did not even notice the count was different as it was brought to our attention when our client was short paid for the product. If we had of known at the time of delivery, we could have had them re-count as the product may have been there, but not counted properly.

If I call their insurance company, will they not deny the claim as the carrier will say they didnt touch it.
 
thefriendlybroker said:
it was a partial load and the carrier took it back to their dock and reloaded onto a long haul trailer. The load was never sealed.

My concern was that the driver did not even notice the count was different as it was brought to our attention when our client was short paid for the product. If we had of known at the time of delivery, we could have had them re-count as the product may have been there, but not counted properly.

If I call their insurance company, will they not deny the claim as the carrier will say they didnt touch it.
Click to expand...


That leads me to a few more questions. How didn't you know there was a shortage? When you get a copy of the POD do you not check for shortage and damage notatations? If you do, was the shortage noted on the BOL? If not, you're going to have a pretty hard time proving your claim against the carrier.

What does 100 cases look like? Is it a full skid missing? is it a partial skid? If it's a full skid missing you're going to have a harder time countering the argument that it was a simple miscount on behalf of the shipper. However, if 100 cases is a partial skid quantity and a skid is visibly opened, you can demonstrate evidence of tampering and thus theft/loss.

If 100 cases is a partial pallet with no evidence of tampering, then you should really take the carrier's side and inform your customer that it is unlikely goods went missing in transit and it is an error on behalf of the shipper.

It is a common misconception that "just because" the driver signed for it he agreed to the count. There are numerous other factors that come into play and the count is based on a number of factors of evidence presented. The driver's count is strong evidence, but not the only, or overriding evidence.

As far as insurance goes. They're even worse to deal with than the carriers. They absolutely don't want to pay if they don't have to... and they are not worried about losing you as a customer! You will have to prove beyond a reasonable doubt with the insurance company that the good actually did go missing in transport. You wil not only have to show that the count upon shipment was correct, but that the loss occured during transit. That is to say you will have to have good evidence of the count on receipt.

In this economy all the carriers are fighting tooth and nail not to pay claims. You may just want to ask yourself how much your customer is worth to you and does it justify covering the claim and then trying to pursue the carrier yourself.
 
The bill of lading had a stamp with the cases received and this worked out to almost two full pallettes. Because we were in the process of moving our offices, I didn't notice this. I was only informed at the time when my client was short paid. Granted, it was not marked as short shipped. There were 4 products and all had check marks beside them except the product which was short.

Because everything happened after the fact in terms of being notified of a shortage ( it went to sobey's ), there was no way of knowing if there was visible signs of product tampering. ( this was food product )

Is this something I should entertain the idea of bringing to court. Someone has to be responsible for this and I can't see how the carrier is not since he was the one moving it from one truck to another to get delivered. Is he not responisble when such a large quantity is involved.

I have had other instances where I have backed up the carrier and explained to my client that it could not be the fault of the transport company, but in this case, the carrier out and out refused to discuss anything and just said it was stupid and wasn't his drivers fault.

Does anyone know a collection or lawyer in the Guelph area by chance. The person I use does not have jurisdiction in this area and only works the toronto area.
 
Take'em to small claims court!

It doesn't sound like the carrier is very organized or cooperative.

Take'em to small claims court. It doesn't cost much and you don't need a lawyer. All you need is:

1. BOL
2. POD (showing shortage)
3. Copy of the PAID freight bill
4. Statement of claim.
5. Proof of cost/value.

It's not a slam dunk, but it doesn't sound like the carrier is all that intelligent. If you have the above 5 things, then the onus is on the carrier to show that product didn't go missing during transit.

For legal advice, you can private message SCAMCHASER on this site. He's a paralegal and you can contract with him if you wish.

P.S. - Funny enough, I just had 3 claims today where the carriers response was "I didn't touch it so I'm not liable!"
 
Friendly-Broker,

I have run into this problem before on two specific occasions and I was able to get a positive result using the same technique in both cases.

Contact the insurance company for the carrier you brokered the load to. Send a formal written letter by fax or courier to the claims department of the carrier's insurance company. Explain the exact details of the situation and show them how the liability ends with them, after all they are the insurance company, and they insure the cargo. In the letter, you must state that you "are writing this letter in order to initiate the claims process for this matter, as the carrier has refused to initiate the claim on their own". A claims adjuster will most likely contact you and state that they are not liable and tell you to piss off. You are then to work your way up the chain of command to reach the claims manager or claims director. You inform them in writing that you have tried to resolve this matter through the normal claims process but were refused by the claims department and as a result you will be initiating a law suit against them.

This was the way both of the issues I had unfolded. After I threatened to sue I was told in both cases that the insurance company was not admitting liability but would not be prepared to be exposed to legal action. They will then pay the claim.

You probably will not have to sue unless you are talking about major amounts of money. The threat will be enough, but it has to be a formal threat in writing. Do everything in writing. This process will take upto a couple months.

Good Luck.
 
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