Jul 7, 2017

Freight claims, whether they are due to damage, theft or any other incident, are an issue that all shippers have to confront. While cargo loss or damage eventually happens, that doesn’t mean shippers have to absorb the full cost of the incident. If the damage or loss happens while cargo is in transit with a carrier, there are costs that can be recuperated, depending on your insurance and terms under which the shipment was moved.

Are carriers actually liable for freight damages?
The answer to this question is rarely a simple “yes” or “no.”* In short, carriers are liable for your freight to a certain extent. This liability is governed via 49 U.S. Code § 14706, also known as the Carmack Amendment of 1935. This federal law applies to carriers who are hauling interstate commodities shipments within the U.S. the carrier is liable for the damage or loss (unless the carrier can prove they were not at fault for the situation.).

In order for shippers to win a claim based on the Carmack Amendment, they must:

  • Prove that their goods were in good condition when they were turned over to the carrier (make sure that this is documented before the shipment goes out).
  • Prove that the goods were damaged when they reached their destination (again, documentation of damages on the Proof of Delivery, upon delivery is essential).
  • Provide a copy of the original invoice in support of the claimed costs of the products that were damaged or lost.
  • Submit the claim within 9 months of the incident (Note: the quicker a claim is submitted to the carrier the better the chances are of retrieving claimed monies).

Exceptions to the Carmack Amendment
The Carmack Amendment actually has a few protections for carriers, as well. Negligence must be proved in order for them to be liable for the costs of damages, generally there are five exceptions that exempt a carrier from any liability. These include damages due to:

  • Acts of God: severe weather (e.g. tornadoes, flooding, etc.) and natural causes of driver impairment (e.g. a sudden heart attack causing the driver to crash).
  • Acts of the public enemy (defined as foreign military force): enemies of the U.S. government attacking shipments (naturally, this is extraordinarily rare in the U.S.).
  • Acts of default by the shipper: improper loading, packaging, etc.
  • Inherent Vice: Carrier is not responsible for damages caused by “natural laws”.  Most commonly used for perishable items such as foodstuffs (This can only be invoked by the carrier when it can be proved the shipper was the sole cause of the damage).
  • Authority of Law (Rarely used): Impoundment or seizure of freight by public authority.  Examples include confiscation of food and medications during a natural disaster, seizure of stolen or contaminated freight and road closure or embargo on trade.

Reduce your costs with smart shipping practices
While it’s impossible for shippers to avoid freight claims, shippers can reduce the chances of incurring heavy losses by working with reliable carriers. At King Solutions, we have a network of the most trusted carriers in the industry. Our clients have low freight claims because we always ensure that their freight is well taken care of. To ensure that your freight is well looked after, contact King Solutions today.

*This is general information and is not intended to be legal advice. If you are looking to settle a legal claim with a carrier you should contact a lawyer.