Here's a conundrum...

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mtltrans

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Jun 21, 2017
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Got a question.
So we have a client that shipped 11 skids of food in December in Ontario. Freight was picked up in Toronto.
Suddenly, the carrier (a large common carrier owned by Transforce) managed to lose track the skids going to 3 different locations.
Their explanation each day? Their dock was overflowing with freight from BC (from the floods) and they can't do a dock check, yada yada yada.
Weeks go by. Still no freight. Nope, can't find it. Don't know, sorry.
We send a claim earlier this month.
Oh, they found the freight still at the dock in Concord but we're declining the claim because they claim there were no labels on it.
Client says to dispose of the food as the contract is over and the goods are now out of date.
The question: can the carrier decline a claim like this when they clearly were not able to manage their own freight flow or control their dock checks? And how did they find them without a bar code pro sticker?
Your input is appreciated.
Thanks!
 
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mtltrans said:
Got a question.
So we have a client that shipped 11 skids of food in December in Ontario. Freight was picked up in Toronto.
Suddenly, the carrier (a large common carrier owned by Transforce) managed to lose track the skids going to 3 different locations.
Their explanation each day? Their dock was overflowing with freight from BC (from the floods) and they can't do a dock check, yada yada yada.
Weeks go by. Still no freight. Nope, can't find it. Don't know, sorry.
We send a claim earlier this month.
Oh, they found the freight still at the dock in Concord but we're declining the claim because they claim there were no labels on it.
Client says to dispose of the food as the contract is over and the goods are now out of date.
The question: can the carrier decline a claim like this when they clearly were not able to manage their own freight flow or control their dock checks? And how did they find them without a bar code pro sticker?
Your input is appreciated.
Thanks!
Click to expand...
So... They held on to it for several weeks and then wanted to deliver?

That's some service!

Sorry, I don't have any advice on this one...

I am however, very interested to hear how this turns out...

Care to name and shame?

Good luck sir!
 
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Very clearly it was in the control of the carrier. They took the freight off at their facility and had no process to identify the freight properly - the fact that there was no stickers is no excuse. If you can prove that you followed up with them, that their response was similar to what you wrote above and the product is spoiled due to being past the actual due date then the insurance company will have to respond. Unfortunately in cases like this client does not have a say in the process. Either it is spoiled due to undue delay and there is a valid claim or it is not spoiled and they need to deliver or return the product for its potential value. The cost of delivering/returning the product will form part of the claim. They can't claim that the contract has ended and they want their money from the insurance company.

Now, if the freight was destined for BC during the floods, the insurance company may claim 'force majeure' and deny the claim. If that happens the lawyers will have to identify if there was still opportunity to get this to the consignee in due time to avoid spoilage after roads were opened.

In the end it will probably be down to what is the value of the goods. If it's Canada and the goods are listed at $2.00/lb there may not be enough value to fight over it and your client should seriously consider weather to drop it. I would recommend that your client contact their insurance provider for advice on how to proceed.
 
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shayne said:
gross negligence on part of carrier
go after them with everything youve got
Click to expand...
"gross negligence"? - seriously - filing a claim asserting gross negligence would be the best possible outcome for the carrier in question. Common law precedent would laugh that assertation right out of court- it would never pass the indifference to risk requirement to qualify.
While I don't condone that level of service, comments like this one express everything that is dysfunctional about the approach of a load broker to relationships with carriers.
 
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Jim L said:
Very clearly it was in the control of the carrier. They took the freight off at their facility and had no process to identify the freight properly - the fact that there was no stickers is no excuse. If you can prove that you followed up with them, that was their response was similar to what you wrote above and the product is spoiled due to being past the actual due date then the insurance company will have to respond. Unfortunately in cases like this client does not have a say in the process. Either it is spoiled due to undue delay and there is a valid claim or it is not spoiled and they need to deliver or return the product for its potential value. The cost of delivering/returning the product will form part of the claim. They can't claim that the contract has ended and they want their money from the insurance company.

Now, if the freight was destined for BC during the floods, the insurance company may claim 'force majeure' and deny the claim. If that happens the lawyers will have to identify if there was still opportunity to get this to the consignee in due time to avoid spoilage after roads were opened.

In the end it will probably be down to what is the value of the goods. If it's Canada and the goods are listed at $2.00/lb there may not be enough value to fight over it and your client should seriously consider weather to drop it. I would recommend that your client contact their insurance provider for advice on how to proceed.
Click to expand...
Thanks Jim, you make some excellent points. One of the 3 destinations was Calgary so this would probably not qualify as force majeure, although the carrier was clearly playing this card for movements generally to/from BC and parts of Alberta. The client will definitely need to help here.
 
thebluffs1 said:
"gross negligence"? - seriously - filing a claim asserting gross negligence would be the best possible outcome for the carrier in question. Common law precedent would laugh that assertation right out of court- it would never pass the indifference to risk requirement to qualify.
While I don't condone that level of service, comments like this one express everything that is dysfunctional about the approach of a load broker to relationships with carriers.
Click to expand...
Wrong, a tfi company is big enough to know better , but big enough not to care.

I've never had mini max lose something.. or a straight truck guy lose something....
 
mtltrans said:
Thanks Jim, you make some excellent points. One of the 3 destinations was Calgary so this would probably not qualify as force majeure, although the carrier was clearly playing this card for movements generally to/from BC and parts of Alberta. The client will definitely need to help here.
Click to expand...
Just as an aside, the carrier cannot just deny the claim carte blanche. The claim must be made, presented and submitted with a complete detailed claim cost to the carrier and their insurance company. A written response must be given and insurance companies are usually very quick to apply a claim number and a nice letter saying that they are investigating. After their investigation the information provided on the response is the basis for what the lawyers are going to start negotiating with. If I received a response that said that the claim was denied because it had no stickers on it then I would reply with 'Oh really? Does your insurance company agree with your findings because I don't think the insurance company's lawyer would like this response'. I'm sure in this case the insurance company would recommend to the carrier to settle it somehow.

Usually if you go through the right process you will find that the insurance company is very quick to get it resolved- especially if the freight is still sitting on the carriers dock.
 
Here's an update for those that may be following this. The skids were basically buried on Vitran's dock and forgotten since November (the BOL's weren't even entered until March into their system) during the big deluge from BC. They "found" the skids recently after we pressed the claim.

The claims manager at Vitran wants to decline the claim because they say the skids have no labels but meanwhile, Vitran sent a general email that says the following (have a look at the sentence about skids not being lost lol). Despite this, Vitran came back and said they will settle for the salvage value but must sell the goods. This still doesn't seem right. Our defence was that claims law relies on the BOL, which they had and neglected to use, and their employees say they put pro stickers on freight (Vitran says they didn't have those on the skids, however). Our claim is that they didn't deliver the skids through fault of their own dock checks and handling.

This should be interesting.

Here's the email:


Subject: Current situation in Toronto





Dear Valued Customer,



VITRAN , like many companies, is facing the challenge of a massive labour shortage that affects the entire world right now. This is due to lack of available workers, along with the added challenge presented by COVID.



In addition to a lack of labour, we have experienced a much higher than expected amount of volume in the past month.



This has created a significant backlog that mainly affects our Toronto terminal.



As a customer, you will experience the following issues until our operation has cleared this backlog:



  • Transit times for freight shipped out of and into Toronto will be delayed
    • Less labour means it is taking us longer to prepare departures and deliveries from Toronto


  • Shipments status may be difficult to confirm, as backlogged freight is being stored in our facility
    • Rest assured, freight is not lost and is simply being stored safely in our facility
    • We are working through the freight from the oldest to newest shipments


  • Appointment deliveries for freight delivering out of our Toronto terminal will be challenged
    • Given the high volumes and lack of available labour, we are booking delivery appointments however often the freight will not be processed on the day of delivery


We are taking significant measures to ensure we solve the labour issue as quickly as possible. We expect to see gradual improvement in all aspects of our Toronto operation throughout January, and expect to be back to normal service levels come February.



We will continue to keep our customers posted of any updates via regular bulletins that are distributed via automated email, sales reps, and customer service.










Thank you for your understanding
 
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mtltrans said:
Here's an update for those that may be following this. The skids were basically buried on Vitran's dock and forgotten since November (the BOL's weren't even entered until March into their system) during the big deluge from BC. They "found" the skids recently after we pressed the claim.

The claims manager at Vitran wants to decline the claim because they say the skids have no labels but meanwhile, Vitran sent a general email that says the following (have a look at the sentence about skids not being lost lol). Despite this, Vitran came back and said they will settle for the salvage value but must sell the goods. This still doesn't seem right. Our defence was that claims law relies on the BOL, which they had and neglected to use, and their employees say they put pro stickers on freight (Vitran says they didn't have those on the skids, however). Our claim is that they didn't deliver the skids through fault of their own dock checks and handling.

This should be interesting.
Click to expand...
All parties have an obligation to minimize the claim. Salvage value is part of minimizing the claim. What is important is the declared value and what is considered salvage; that is a discussion that lawyers generally love to stretch out and continue to get billable hours. You should recommend to your client to come up with some agreed amount and working with Vitran to get a salvage amount. If your client does not engage their claims department Vitran may choose to dispose of the freight by selling it which may do harm to your client. If your client can re-sell the freight then Vitran should be paid to deliver the freight back to the shipper and document what the freight was salvaged at. You definitely want your client involved in those discussions and if there is no agreement the client should have correspondence about what they expect and the potential ramifications should Vitran choose to go a different route. That will help solidify the argument should lawyers get involved.
 
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Jim L said:
All parties have an obligation to minimize the claim. Salvage value is part of minimizing the claim. What is important is the declared value and what is considered salvage; that is a discussion that lawyers generally love to stretch out and continue to get billable hours. You should recommend to your client to come up with some agreed amount and working with Vitran to get a salvage amount. If your client does not engage their claims department Vitran may choose to dispose of the freight by selling it which may do harm to your client. If your client can re-sell the freight then Vitran should be paid to deliver the freight back to the shipper and document what the freight was salvaged at. You definitely want your client involved in those discussions and if there is no agreement the client should have correspondence about what they expect and the potential ramifications should Vitran choose to go a different route. That will help solidify the argument should lawyers get involved.
Click to expand...
Solid insight. Thanks Jim!
 
@mtltrans

Let's start with this:

1) Assuming there was 3 BOL's, was there any declared value on it? is so how much?
2) what was the total of weight of per B/L?
3) What was commodity was listed on the BOL?
4) Did the BOL indicated those items could loose value after a specific date?
5) Are these items salvageable? is there anyway to have some material value for it? or is it a total loss..
6) Did you submit your claim as lost? damaged? both?
7) Did you paid the freight charges? (i know it wasn't delivered yet, still asking).
8) As it stands right now, does the carrier want to deliver it to the receiver or to the shipper? (Either way, they could levy storage charges and factor it into the final settlement if this is being dragged on).

From my experience, Common Carriers are quite firm refusing claims for what's called "Consequential Damages", meaning they didn't actually damaged the goods, rather it got damaged as consequence of late delivery. They are usually not liable for it unless it was pointed out on the B/L or at lease on the Load Sheet (Rate Confirmations, Booking etc.). In our case, they waived the freight charges since it was delivered outside the "reasonable" time frame.

Having said that, it would be premature to say anything without first getting answers to my 8 questions.
 
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