Stolen Load Recovered - Proceedure

T

Truck Finder

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Jul 23, 2008
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:confused:We had a load that we brokered to a carrier stolen Jan 19th. We were advised to get our customer to replace the shipment as they needed the goods for production.

A replacement load was delivered 2 weeks later. The stolen load was recovered a week after that. The product is something that is not a stock item. The carrier said the insurance claim was closed as the trailer and goods were found and in good condition.

The customer does not need the goods and wants payment for goods. I worked out a deal that the customer is working on selling goods for a 10% discounted price. The carrier or insurance won't come to the party!! They want payment in full for the original shipment and it's my problem with the customer and the discount on goods ($5000 bill).

Is this right? Any suggestions?
 
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Insurance

If I were you , I would communicate with my 3pl insurer and ask them what to do in this instance. Will your insurance cover the discrepancy.

What is the deductible on your policy, hopefully only $2500.00.

In this instance, this may be the same case as a carrier , you may have to absorb the deductible.
 
So this is my responsibility now as the carrier has been told goods have to have been missing for 30 days for any insurance company to cover the cost's?
 
I had a similar shipmnet (you can read all about it in the Kingston section).

Carrier insurance (both for GHK and Kingston) as well as our in house coverages all basically had the same answer:

"...not covered for delay of delivery..."

I would have been happy if the cost was only $5k... In the end we took a look at the big picture and cut a large cheque to the customer.

Keep well,

Mike
 
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Truck finder, you're in a tough spot no doubt. The carriers insurer should have authorised the manufacture of the replacement load prior to getting it shipped out. Obviously your customer couldn't wait and had to satisfy a "particular market". This is where, as Mike Jr just said, insurance companies will deny liability. Most, if not all Bills of Lading, have a denial of liability for delay in delivery. The best example of this that I have heard is: a load of watermelons scheduled for delivery on Monday morning is delayed because of mechanical breakdown and delivers to Loblaws on Wednesday. Loblaws put out a flyer advertising these melons at a special price starting Monday. With no melons to sell can Loblaws claim their lost sales against the truck? No, the truck is not liable for losses due to failure to deliver for a "particular market". Had the load never been recovered, well that's an entirely different story. Best advice, work closely with your customer to mitigate both your losses.
 
loaders said:
Truck finder, you're in a tough spot no doubt. The carriers insurer should have authorised the manufacture of the replacement load prior to getting it shipped out. Obviously your customer couldn't wait and had to satisfy a "particular market". This is where, as Mike Jr just said, insurance companies will deny liability. Most, if not all Bills of Lading, have a denial of liability for delay in delivery. The best example of this that I have heard is: a load of watermelons scheduled for delivery on Monday morning is delayed because of mechanical breakdown and delivers to Loblaws on Wednesday. Loblaws put out a flyer advertising these melons at a special price starting Monday. With no melons to sell can Loblaws claim their lost sales against the truck? No, the truck is not liable for losses due to failure to deliver for a "particular market". Had the load never been recovered, well that's an entirely different story. Best advice, work closely with your customer to mitigate both your losses.
Click to expand...

This being said about the Melons, does that mean a broker who deducts you for delivering late due to production loss, is not allowed to legally do so?
 
Gdunks

Certainly,

The liability goes up the chain of command. Lots of decisions are made prior to the driver picking up or delivering the freight.

Once there is a problem it always becomes the carriers fault.

Very few people DARE to put the blame where it belongs : on the supply chain managers, their mistake is what made the freight HOT in the 1st place.

There are certainly many variables that can delay a delivery and some are considered force majeure. The carrier can not always be held responsible.
On the other side of the coin, one cannot negociate themsleves out of liability.
 
If, as a carrier, you agree to deliver at a specific time to say, meet the unloading crew, and that agreement is evidenced on the Bill of Lading, then if you fail to make that delivery, you have breached your contract. I agree, it can get "sticky" and complicated. What if the unloading crew was made up of nuclear scientists at $500.00 per hour each? I guess it boils down to...don't make promises you can't keep. Having said that, I have and I will continue to reduce a carriers invoice for legitimate costs incurred for what is essentially, a breach of contract when they fail to deliver as promised. Of course, if the carrier is a good communicator and lets everyone know if and when he is going to be late, then any costs can be eliminated, or at least reduced.
 
2 of the most important words in Transportation Law are "due course". Meaning that as long as the carrier has not done anything to purposely delay the shipment such as just letting it sit they are not liable. Weather, breakdowns, thefts, road closures can all delay the shipment at no fault of the carrier. Having said that, if the carrier signs a contract (bill of lading) agreeing to deliver at a certain time and does not, they should only be liable for the freight charges to and nothing more unless it was spelled out and agreed to by both parties.
Who in there right mind is going to sign a contract that says if everything goes right, you pay me $1000.00 for the load. If something goes bad I pay you hundreds of thousands in lost production etc. C'mon.
 
I think we can close the cover on this one. Carrier is delivering load this morning. The customer negotiated a 10% discount on the goods to their customer for accepting the over stock load. The total cost was $3771.00 US. The carrier and I were on the hook for this as insurance said it was recovered in a reasonable amount of time and it is not their problem.I figured the carrier would split it with me as you figure all this was their doing. I agreed to pay the $3771 us direct to my customer and the carrier demanded $1500 cnd for hauling the load. Were our $2271 but I figure it is cheaper than getting a lawyer involved and we satisfied a good customer.
Do you think the carrier has been fair with me? Im not sure yet.
Regards
 
I attended a very good seminar yesterday focusing on Understanding Limits of Liability. It was very imformative especially for a 3PL company. The speaker was a very reputable transportation lawyer who deals in only these types of issues. It's simple really at the end of the day...cross all your "T" ' s. In this case the carrier from the information I received yesterday is this: the carrier was the "principle" holder - as it was in their custody and control. The 3PL (Truck Finder) made arrangements as an "agent" to the "shipper", therefore, the "carrier" is ultimately responsible to cover all costs whether the load was recovered or not.
 
That's the way I understand it. We as a broker never took control of the goods and entered only into an arrangement with a carrier to p/u the goods and deliver them under their insurance and authorities. Having said this, our only recource is legal action and the amount owing would not be worth it. I will have to move a few loads to make the loss up. We have been in the broker business for 18 years now and our motto is: Treat the carriers fair first, customers second, and make a dollar in between and it all works out!!

Has been working for us. I feel we have been more than fair to the carrier here, the customer is happy and I will keep moving their freight to make that dollar!
 
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I would like to pipe in and offer an alternative point of view. I might be way off here, but I'm sure you people will let me know if I am! The carrier, unless grossly negligent, could not have prevented the stealing of the goods. The customer ultimately accepted both loads although insisting they could not use the additional cargo? The shipper negotiated a great deal at 10% off the cost? So the shipper ultimately made an extra sale, because I am assuming that their mark up would be more than 10% on the cost of the product and labour. The receiver in the end got 2 loads for the price of 1 because now they are demanding someone else pay for the freight that went missing for 2-3 weeks. But why would they accept it if they were never going to use it? It seeems like at some point they think they will use it down the road and just got themselves a great deal by having someone else pay for the material. If they could not have used that second load, whoever ended up paying for it should in right, own that load and be able to sell the product/ scrap it to mitigate their losses. Please, go easy on me people for throwing this out there.... :)
 
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