Ethical Question

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box broker

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Apr 12, 2012
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Fredericton, New Brunswick
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I paid a carrier a premium to move a 1/4 TL of freight as a FTL distance 2545 miles

"Exclusive use" was written all over the load confirmation.

After loading my 1/4 TL The carrier broke the seal on the trailer and added skids of fertilizer to the trailer which by the way contained my food grade product that HAD TO GO thru FDA.

When they delivered my FDA freight they still had the fertilizer on the trailer.

Consignee signed the POD with this stated on it and also took pictures of the fertilizer.

When I asked owner about this he admitted that he did do it and said stop complaining and just pay the bill as he delivered the freight.

My question is this .... what would you do?
 
So you paid the carrier a FTL rate.The shipper sealed the trailer and the carrier had the nerve to cut the seal and add freight. Pay the carrier a 6 skid rate based on the calculations of the full load rate you paid him. He is lucky to get anything in my opinion.
 
I would pay LTL and that's it!!


Who's the carrier so I will make sure to not use him?
 
step 1 - start by sending a claim notice to your carrier, even if you got everything delivered they might still want to claim it since "Consignee signed the POD with this stated on it and also took pictures of the fertilizer."
 
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Pay for 6 Skids.

Charge your customer exactly what you're paying the carrier (this now becomes about retaining a customer and not a profit situation).

Have your customer claim for the contaminated product. They should add transportation costs to the claim.

You'll need to pay the carrier (as I believe it's unlawful to with hold transportation costs even in their is a pending claim).

Noting the carriers attitude so far... you may want to contact his insurance company directly.

Good luck... this is where you need to work for your customer and earn your stripes as a broker.
 
Do NOT have your client submit a claim as this is just involving your client in some bad politics. Rather you submit the claim for the goods now, and file with small claims court for the breech of contract, before there is any opportunity for the claim to be reviewed. It sounds like you have sufficient documentation to make it fly. If nothing else the carrier will be more likely to cancel any invoice that may be pending, and you can throw your customer a freebie. Best of all this could be resolved by noon today, AND your customer would not need to be involved in any of this. Who was this?
 
I agree. Leave your client out of it.

On this one, I'd suggest to hold back payment until it's verified that the customer is OK, paying their bill etc. If it's food grade and there is fertilizer on the truck, it could be a big problem.

Hopefully you won't lose your customer over it.
 
Your client paid a premium to get it moved and will likely want a discount. Before paying the carrier, I'd be sure what kind of rate you and the client will settle on. It's clear the carrier got greedy and got caught. Breaking a seal is just stupid and some carriers think they can give any excuse. The fact is, if a new seal is on the trailer and it doesn't match the original seal number, the end user isn't obligated to receive it and especially if it's C-TPAT or food products (evidence of tampering or lack of load security.) They may not file a claim.
 
Ethical

Thank you to all for your replies and input.

First off I have not billed my customer and have no intention of paying the invoice.

I have exchanged emails with the carrier once.
They have politely requested payment.
I have replied with an in depth explanation of the circumstances and a very definite I will not be paying your invoice.

They admit that my allegations are true but state that is no reason not to pay their bill in full.

If they can insist on full payment I can insist on no payment.
 
You sent that truck to the west coast according to the miles you provided. Refusing to pay now makes you the villain in this scenario. By all accounts the carrier picked up and delivered on time with no damage or shortages. He got caught trying to make a profit at your customer's expense and everyone agrees your customer deserves a discount but to hold all payment to the only party that had any expense in this move is shameful and perhaps criminal.

Stiff them completely and you'll be lucky if all they do is take you to court. The consignee kept the product so they don't seem too concerned. Everyone would like to know who the carrier is and I'm curious as to what the FDA product was? I'm thinking more along the lines of canned product vs fresh chicken.
 
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As a carrier, you have the obligation to either do the "exclusive" as agreed, even if its one box, or clear with the customer that you can LTL (there have been several cases where I have topped up, but only after getting approval from the exclusive).

I'm not a broker, but I believe what you pay the carrier should be directly correlated to the damage caused to the end customer. Did they accept the freight and the rate? Are they asking for a discount? Did they refuse the product?
Have you lost the customer?
If you or your customer suffered a loss, then the carrier should absorb it, as they were dishonest (and / or greedy and less than smart too) and caused it. If the customer is relatively satisfied and pays the bill as advertised, the carrier should get the full pop, and earn a big fat spot on your DNU list.

Punishment for punishment's sake is crap. Let the carrier know that you will wait till you and your customer have resolved any issues (and you've found out what you are getting paid and if you kept the customer), then pay the carrier accordingly. In my opinion thats fair, honest, and upfront. Two wrongs don't make a right. He broke the agreement, but still delivered the freight. If the customer is reasonable, I think you need to be too.
 
The carrier delivered the freight in a timely manner, that has not been disputed. The rate provided was negotiated based on TL. As your initial question was one of ethics I would suggest the following; provide a registered letter to the carrier stating that the terms of cartage had not been fulfilled as per you agreement, and that no payment would be forthcoming due to the breach. Provide a registered letter to your customer to the same effect that you would not be billing them. Advise the carrier that you are doing this. POLITELY express that you are both losing due to their actions, not just him.

If the carrier is reasonable that will be the end of it.

Should the carrier threaten to file a claim with Small Claims, preemptively file your own claim for the loss (of profit) you sustained, and file the claim immediately.

j
 
Listen, I know that if we ship a load that is exclusive use that if the shipper doesn't put a seal on it then I hear nothing, I see nothing, I do nothing.

But there are a few things in play here:

a) Food grade mixed with fertilizer -- not too freaking smart -- and it doesn't matter if it's canned or whatever, if there is any smell lingering, it's screwed

b) If the seal is broken other than by customs, one can only assume there has been tampering. If the carrier is CSA and/or the shipper is CSA, that is a serious violation.

c) The customer may not have decided what they're going to do yet. They actually have the right to wait, especially if there is a contractual relationship between broker and customer.

A carrier that will be that careless with the freight is not someone you can count on for a later contra. The payment has to be held back until any liability has been cleared.
 
Keep in mind here that the damage to the broker will most probably be indirect. The shipper may very well decide to pay the full amount AND to never use the broker again. Then what? The carrier should be paid in full even though they lost the account for the broker? I don't think so. Although there may have been no damage to the product on this one, the damage may be to the broker's reputation with that shipper. Therefore, that has to be taken into account when deciding on what, if anything, to pay the carrier.

Personally, I would pay the carrier in full. In the event of a claim at some point down the road that can be pursued independently. If the carrier's dishonest actions result in loss of the account then that too I would follow-up with legal action. If you can show that you lost an account that has yielded X dollars in revenue directly as a result of this carrier's dishonest behavior then legal recourse is probably your best option. Even withholding all payment for this one load would then not be sufficiently compensatory in my opinion. If you lose business on account of someone else's dishonest actions, then you've got a clear shot at redress through legal means.
 
Freight broker, I am in full agreement that the damage could very well be indirect. It really depends who the shipper is and how far up the chain this goes.
 
To FreightBroker:

I take issue to your comment about pursuing legal action if you lose an account. So now carriers are exposed to this liability now as well in your opinion if they take freight through a 3rd party? I understand the context of this situation warrants a review which has sparked this discussion, but really, I think your comment to attempt at legal action for "losing an account" is a bit crazy. If that was the case we would all be busy in court, not moving freight, the way some customers jump around these days to different service providers. If you lose an account over 1 issue like this then your sales hat isn't on tight enough or you have had issues like this in the past, and maybe you need to look at your carrier selection for specific moves like this one for your customer? Just my 2 cents
 
legal action is a bit harsh, probably wouldn't hold up either way.

but I agree it would be a DNU carrier from then on.
 
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