Freight Claims Handbook Ebook PDF

A B O UT T HE A UT H O R
John L. Price, author of the Freight Claims Handbook, has over tw enty five years of experience in the field of
transportation. Serving both the rail and trucking industry in rates, commodity classification, regulation pack aging,
packaging engineering, general traffic and claims management. Out of all the seminars he has held or attended over
the past several decad es, the subject of greatest interest to his listeners has been that of freight loss and damage claims.
Based upon the needs and concerns expressed within this fo rum , John developed the Freight C laims Handb ook. This
handy reference tool hopes to answer the questions most commonly asked by the carrier, traffic management and
shipping and receiving personn el, acting as a practical guide into the laws, rules, regulations and procedu res inv olved in
the filing and handling of freight loss and dam age claims. It also includes an illustrated damage detection guide to assist
shipp ers, receivers and com mo n m otor carriers in reducing th eir exposure to risk and liability.
NOTICE
C ONT ACT IN G TH E A UT HO R: If you have a claims problem, the solution to which extends beyond the scope of
this Handbook, there are a number of resources available (see the bibliography at the end of this book) For an
alternate source o f inform ation regarding freight loss and dam age law and ex pert claim s assistance, refer to page 5 of
this H andbook regarding the Transportation Consum er Protection Council, Inc.
USE OF THIS HANDBOOK: Every reasonable attempt has been made to ensure the accuracy of the facts and
information contained herein. However, because of the complexity and differing views even within the judiciary
pertaining to various aspects of freight loss and damage law, the Freight Claims Handbo ok is intended as a general
guide only. Its contents must not be used to interpret, supersede nor take precedent over common law, nor any federal
laws, rules or regulations published in Title 49 C .F.R., or th e U.S.C.. Neither shall they be used to negate or m odify
any adm inistrative ruling or opinion having application hereto. Furthermore, this bo oklet can not be used as a
substitute for any carrier tariff on file with the proper Federal and State regulatory agencies. In addition, th e author will
not be responsible for w hat m ay be con strued as o missions or inaccuracies, nor will he accept liability for the direct,
indirect, special, incidental, or consequential dam ages resulting from the use or misu se of th e information contained in
this booklet. When in doubt, always consult carrier tariff(s), obtain assistance through local, state, or federal regulatory
agencies, or seek legal counsel.
The FREIGHT CLAIMS INSPECTION BUR EAU , operating in the state of Nevada, is not affiliated with any other
entity bea ring an identical or sim ilar nam e located elsewhere in the U nited States.
Copyright 1991, Revised (1998) by John L. Price. All rights reserved. No part of this publication may be reproduced,
stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, or
otherwise, without the prior w ritten permission of the Freight Claims Inspection Bureau, P.O. Box 62, Verdi, NV
89439
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QUICK CHECK LIST
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RECEIVING PR OCED URES (See p.97 for a complete detailed explanation)
Only trained perso nnel sho uld receive the freight.
Alw ays co mp are documents before signin g the freight bill.
Be sure the freight bill is Signed and Dated by driver.

Sign for goods in the location where physically delivered.
Ma ke sure every package show s "your com pany name" as the consignee.
Verify the piece count:

Sign only for Units as shown on the bill and received as such.
Sign only for Pieces as shown on the bill and received as such.
Alw ays sign for freight exactly as received (assum e nothing).
Verify the method of tender, how goods were billed/shipped against the
man ner of receipt (how the go ods were actually received) - note on the
freight bill any variation in the packaging or count. (See p.14,15)
Directional M arkings: No te on the freight bill the im prop er position of

any pack age. Take ph otos if possible.
Note Tiltwatch or Shockwatch devices when "RED." (See p.100)
Method used to seal containers: Are they all identical?

Are some banded and others taped?
Differen t kinds o f tape - asso rted colors?
Box es all taped b ut staple holes are present?
Con tainers: A re they sh ipper originals?

Pallets: Are they unusual - not the type ordinarily received.
Are some shrinkwrapped and others banded?
Inspect th e freight:
Check for o pen boxes.
Damaged containers (punctured, torn, buckled , crushed).
Rup tured tape (edges of box).
Open and Inspect any package showing probability of dam age.
Record any Packaging/C ontainer dam age on the freight bill.
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Record any M issing/Altered packaging m aterials (tape, banding etc.).
Av oid vague or general statements. Example: "1 B ox short" (incorrect).

Always identify the products short or da maged , if possible.
Indicate the quantity and type of merchandise damaged.
Show model and serial number, or similar product identification.
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QUICK CHECK LIST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii
G EN E RA L IN F OR M AT IO N RE GA R DIN G LO S S A N D DA M A GE CL AIM S . . . . . . . . . . . . . . . . . . . . . 1
PART I ................................................................................... 1
THE FORMER I.C.C. RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Counting the freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Checkin g all labels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Inspecting the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Refused freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Mitigate (lessen) the loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Damaged goods awaiting carrier inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Concealed damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Concealed damage claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Handling after delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Carrier investigation and Claim's processing ......................................... 3
I.C.C. Administrative Ruling 120 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Unlawful reduction of carrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
ELKIN 'S A CT : (49 U.S .C.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Claim ant's right to reject com prom ise settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
I.C.C. Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Commencement of a suit (See Arbitration ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Attorney 's fees are not recoverable! . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Arb itration (Carrier and Claim ant) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Transportation Arbitration Board (TAB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Arb itration procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
F IL IN G O F C LA IM S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Claims for dam age ................................................................... 8
Claim s for loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Who may file a claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
W ho m ay recover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Law suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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Concealed dam age: 1 5 day ru le . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

15 Day Rule claims declinations ......................................................... 9
Visible D amage (D efinition of) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Concealed Damage (Definition of) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

A q uestion of Concealed v. Visib le . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
W hat a signed clear delivery receipt implies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Related liability issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Shipper load (SLC ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Carrier pick up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Consignee reports damage after delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Dam age to shipping containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
W ho is liable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
If the carrier is at fault . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Reusable containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Single use containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Used shipping containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Shipper - Carrier precautions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

New or Used containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Retail / Shipping containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
DO CU ME NT AT ION IN S UP PO RT OF A C LA IM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Claim statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
W hat is n ot a claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Original delivery receipt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Taking exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Package identification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Piece count . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Description o f merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
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Erroneo us advice: (Visible Dam age 10 D ay Rule) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Driver precautions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Loss of original freight bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Liability of the undersigned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Annotated delivery receipt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

As "prim a facie" evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Presumes ca rrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Carrier burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Claimant's burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
"prima facie" - Not conclusive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
THE INSPECTION REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Inspection waived . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Consignee inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Joint inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Consignee responsibility - Prior to inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Salvage and Carriers failure to inspect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
RECEIPT(S) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
BILL OF LA D IN G . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
INVOICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Profit: Can b e claimed (See M easure o f Damages) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
W here to m ail the C laim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Exp editing the claims process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Suggested claims procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
MEASURE O F DAM AGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Breach of con tract (Bill of Lading) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ACTUA L LOSS (Defined) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Carrier liable for "A ctual Lo ss" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
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M A R KE T V A L UE A T D E ST IN A T IO N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Delayed shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Loss or D amage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Profit, Earned (Ex amp le) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Manufacturers profit v. Fu ll actual loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Freight charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SPECIAL v. GENERAL DA MAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Special dam ages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
General damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
General v. Special damages: A djudicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SPECULATIVE DAM AGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
PR OV ING YO UR CLA IM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Burden of proof: D efined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Plaintiff v. Private carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Establishing a prim a facie case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Plaintiff v. Comm on carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Com mon carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
First burden . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Second burden . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Carmack amendment 49 U.S.C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Basic rules of liability established . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Burden of proof (Sh ipper - Carrier - Co nsignee) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
CLAIM PROCESSING BY THE CARRIER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Carrier's legal obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Salvage rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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Salvage pick up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Title 49 C.F.R.,370.11 (form erly 10 05.6 Ex Parte 263) . . . . . . . . . . . . . . . . . . . . . . 31
Salvage: Released V alue Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Refused freight salvaged by carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Dam aged freight salvaged by consignee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Discount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Rep air . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Parts use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Salvage and carrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
TWO O R MORE CARRIERS (Interline shipmen ts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Claiman t carrier: Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Liability of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
All carriers exclusively liable on through bills of lading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Claimant carrier is liable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Redress in the court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
INSURANCE REQUIREMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Loss, Damage or Delay: A B reach of Co ntract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Shippers subject to carrier tariff(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
National Motor Freight Classification 100 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SHIPPER'S RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Proper packaging of the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Critical to your claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
General packaging requirements (Rule 680) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Damage Claims: Packaging v. Handling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Impro per Pack aging: Act or D efault of Shipper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Rule 680: Packaging - General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Nu mb ered P ackages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Box Certification: Always "Rectangular" in shape . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
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RU LE 6 80 Interior P ackaging / Packing D evices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

RUL E 680 Improperly filled containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
RU LE 680 Carrier's option to accept or refuse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Carrier acceptan ce v. Shipper liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
RU LE 360, Sec. 2(c), of the N MFC 100 (Bill of lading) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Classification of freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Rule 36 0, Sec. 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Commodity description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Claim s declination - Balance dues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Packaging p enalty may be assessed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SHIPPER/CARRIER RELATED ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Last clear chance (Rule of Law) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Carrier liability upon accepting freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Shippers and Con cealed damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Free On Board (FOB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Limitations on carrier liability (Warehouseman) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
FO B Shipm ents: D eterm ining ownership o f goods in transit . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
BILL OF LA D IN G E X CE P TI O N S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Shippers' Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Pallets Said To Contain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

Carrier Load . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Shipper Load . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
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SHIPPER LOAD AND CO UNT (SLC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Carrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
General: An "SLC " exception may not hold up in court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Improper "SLC" notation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Carrier liability relieved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
W hen shipper loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Carrier precaution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
CARRIER'S BASIC RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Transportation, legal definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
W hen transportation is completed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
When delivery is completed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Undeliverable freight (Refused) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Loading and unloading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Standard freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
General liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SLC Loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Heavy/Bulky freight (liability): (Rule 568, NMFC 100) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Shipper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Precautions: Carrier - Shipper - Co nsignee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
BILL OF LA D IN G . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Shipper may issue its own bill of lading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Bill of Lad ing: A binding, legal contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
CARRIER'S LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
W hen liability "Begins and En ds" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Carrier as bailee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Proper or Lawful delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Released Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Carriers do no t "declare value" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
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CARRIER EXEMPT FROM LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

FIVE EXCEPTED CAUSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Acts of God . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
The Public Enemy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
The Au thority of Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
The A ct or Default of Sh ipper or O wner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Inherent V ice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
D A M A G E D ETE CTIO N P A CKA GIN G GU IDE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Pallets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Pallet gapping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Irregular load bearing surfaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Dunnage device (protection) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Pallet loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Pallet overhang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Irregular stacking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Pyramiding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Stacking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Pallet base . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Pallet bases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
W ooden crates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Banding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Sealing, pilferage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Tape ap plication, tampering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Trap ezoid creasing (Sh eet M etal Pro ducts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Corrugated Stress Pattern, friction burn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Directional or Precautionary m arkings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Suspension packaging systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Quasi-periodic vibration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
Glass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Steel drums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
RECEIVING PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Tilt and Sho ck detecting devices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
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Inspect packages indicating the probability of damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Duty to inspect the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Consignee m ust accept partially damaged shipmen ts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Consignee prohibited from inspecting the goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Diversionary damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Loading/Unloading precaution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105

Dam age salvaged by carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
Liability, Released Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
L IS T O F AB BR EV IA T IO N S A N D TE RM S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
GENERAL INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
bB IBLIOGRAPHY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
xii
GENERAL INFORMATION REGARDING LOSS AND DAMAGE CLAIMS
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PA RT I
ICC R EC OMM E N D A TIO N S
The form er Interstate Com merce C ommission prov ided general information regarding loss and dam age claims which
was issued in the form of Administrative Ruling 120 and Appendix, and is still applicable today. Select excerpts from
this document are cited below fo r your ready reference, and are discussed m ore fully throughout the rem ainder of this
handbook. (See p.103)
Counting the freight
Check for shortages as goods are being unloaded. Co unt the cartons, containers, or items and, if possible,
mak e a written tally record when ever a large num ber of items are being received or the shipment is com posed
of a numb er of different items (See p.1 5,45 ).
If there is a discrepancy, make a full notation on the freight bill before signing
for the go ods, bo th on the carrier's co py an d yo urs.
Ch eckin g all lab els
Check the labels on all cartons or containers to be certain they are consigned to you, as misdeliveries can
occur.
Inspecting the goods
Carefully check for any visible signs of damage to the cartons, containers or items, and include any unusual
"rattle s." If evidence of damage exists, the package should be opened immediately and a joint inventory and
exam ination o f conten ts should be m ade by the carrier and yourself. A full, detailed description o f the results
of such examination should be endorsed on both the carrier's delivery receipt and your copy. Generally, the
carrier's driver w ill sign the exception o n yo ur copy o f the d ocument.
Courts have generally ruled that a consignee may not open the containers and
examine the merchandise before giving a receipt to the carrier, UNLESS THE
CO NTA IN ER S IN DICA TE TH E P RO BA BIL ITY O F D AM AG E.
(See Appendix A, pp.106-108; "Shipping/Receiving Procedures,"p.97)
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Refused freight
The law on the subject of accep ting dam aged merchandise is quite clear. The fact that good s are dama ged
during transportation d oes not of itself justify a refusal to accept them. When, howev er, the damage is such
that the entire value of the goods is destroyed, you may *refuse to accept them, and hold the carrier
responsible for their value.
M itigate (lessen) the loss:
W henever possible the freigh t should be accepted, and all necessary steps taken to min imize the full
actual loss before filing a claim w ith the carrier.
Damaged goods awaiting carrier inspection
It is suggested that while awaiting the carrier's inspection you only move the goods if absolutely necessary and
that you leave them in the original container. This facilitates and improves the inspection procedure, and
lessens you r burd en of proof that you could n ot hav e dam aged or caused further injury to the good s due to
improper handling. Especially where concealed damages are involved.
Con cealed dam age
Where there is no visible evidence of loss or damage, the freight bill is signed without exceptions, indicative
that lading was "received in appa rent good order." W here loss or dama ge is later found to exist, a claim would
be one of "concealed damage." In these instances, the carrier, when it received the load, signed the bill of
lading as receiving the shipment in "apparent good order, (contents and condition unknown)" without
physically opening the container and insp ecting the co ntents. U pon delivery, the consignee similarly accepts
the shipment in "apparent good order" and makes no no tations to the contrary on the bill of lading or delivery
receip t (See pp.9 ,10).
Co nc ea le d d am a ge cla im s
Concealed damage claims present different and often complex problems. The consignee has given a
receipt to the carrier at time of delivery indicating the goods were received in app arent good o rder. It
is possible that the contents of a package may be damaged prior to carrier receipt, and without there
being any visible evidence of such dam age.
* Refer to A ppendix A, pp.10 6-10 8 (obligation to accept): "Partially Dam aged Loa ds."
2
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Burden of proof
In a concealed damage claim the burden of proof generally rests with the claimant who must prove that the
damage was caused by the carrier. Stated differently, the claimant must show that the goods could not have
been d amaged w hile in his possession subsequent to delivery . (See p.17: Claiman t's burden of proof)
Handling after delivery
Seldom is there enough "free time" made available upon delivery to examine the contents of all containers
received in apparent good order, i.e., showing no visible signs of damage. It is suggested, therefore, that you
keep any subsequent movement of the freight to a minimum, and make a thorough examination of the
contents as soon as po ssible. If any dam age is discovered, leave the damaged item(s) in the shipping container
with all interior packaging and immediately report the damage to the carrier. It is acceptable to request an
inspection by phon e in the interest of time, but it is best to follow up su ch requests in w riting (S ee p.1 8).
Carrier investigation and C laim's processing
The carrier is required to make a thorough investigation. It is also required to pay the claim in full, decline it, or make
an offer of compromise settlement. Carriers will consider many factors during the course of their investigations of
concealed dam age claims - factors such as, but not limited to, the nature of the good s, adequacy of packaging,
movem ent before pick up or subsequent to delivery, when the damage was reported, retention and condition of original
carto ns etc.
You need not accept a declination of your claim based solely upon your not having made a notation on the
deliv ery r eceipt at tim e of d elivery.
You should be allowed to present evidence to indicate the actual condition of the goods and to support your position
that the damage was caused by the carrier.
I.C.C. Administrative Ruling 120
Though its Bureau of Operations, the former Interstate Commerce Commission issued Administrative Ruling No. 120
which affirms the right of carriers to ex tend co mp rom ise offers of settlem ents. It is difficult, and often impossible, to
determ ine definitely w hen, w here an d how concealed loss or damage occurs, and w ho is actually responsible for it.
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The refore w hen a n investiga tion fails to clearly e stablish the p arty at fau lt, there is no p rohib ition again st a
com pro mise offe r of se ttlem ent.
The carrier's right to m ake such com promise settlem ents is sp ecifically recognized in 4 9 C .F.R ., 370.9 (form erly
10 05 .5), D isposition of Claims.
Un lawfu l reduction of carrier liab ility
W here carrier liability has been established, it is unlawful for it to use form ulas or percentage rules that serve to reduce
its liability to less th an th e "full actual loss." (340 I.C.C ., 515, 536 ).
ELKIN'S ACT: (49 U.S .C.) 119 02 , 1190 3, 119 15, 1191 6 (rev).
A carrier is prohibited from . . .
"offering, granting, giving, soliciting, accepting, or receiving by any means transportation or service provided for
property by a com mo n carrier subject to the (fo rmer) jurisdiction of the I.C .C. un der chap ter 105 of this title
(1) at less than the rate in effect under chapter 107 of this title, including any kind of rebate or offset of the
rate, or (2) by discrim ination. . ." Subject to fine, imprisonmen t, or both . (49 U .S.C., Section 11904).
This law would be invoked where a carrier is suspected of granting rebates to claimants through unlawful
claim payments. The pretense by which the freigh t charge to favo red clients is surreptitiously reduced .
Claim ant's right to reject com prom ise settlemen ts
Of course, claimants may accept or reject any such offer. In cases where no interline transportation is involved, the
carrier may agree to assume 1/3 of the claimed amount, as liability could rest with any one of three parties viz., the
shipper, carrier or consignee. Wh ere one or m ore interline carriers are involved, the percen tage may b e divided
proportionate to mileage and o ther factors.
If settlemen t accepted
If a comp rom ise settlem ent offered by th e claim ant carrier is accepted, the shipper and interline carrier(s), if any, shou ld
not be overlooked as an additional source of recovery. However, be advised that such parties are not bound by any
agreement entered into between you and the claimant carrier!
4
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ICC ASSISTANCE
The Interstate C om merce Comm ission was abolished as of Janu ary 1, 199 6. In an effort to downsize the go vernm ent,
diminish regulation, and permit a fair and more open market, the Commission was abolished, virtually ending the
governments regulation of the trucking industry.
It is now more important than ever that shippers and consumers alike educate themselves in the area of freight loss and
damage law, rules and regulations AND STA Y INFORM ED! Our office can provide assistance in the processing and
handling of freight claims at reasonable cost. Visit our website at www .freightclaim.com or e-m ail us at
fcib@intercomm.com. For an alternate source of information and claims assistance, consider membership with the
Transpo rtation Consumer P revention Council, Inc., 120 M ain Street, Huntington, NY 1 174 3 (516-54 9-89 88; see
their website at www.transportlaw.com. For claims information beyond the scope of the Freight Claims Handbook, you
should consider purchasing "Freight Claims in Plain English," (3rd Ed. 1995) written by William J. Augello, Esq. and
George Carl Pezold, published by the TCPC.
CO MM EN CEM EN T O F A SUIT (See p.6: Arbitration)
Per Section 1 470 6 of U .S.C. Title 49, Liability of carriers under receipts and bill of lading...In general - A
carrier m ay no t provide by rule, contract, or otherwise, a period of less than 9 mo nths for filing a claim against
it und er this section and a period of less th an 2 years for b ringing a civil action against it under this
section.....The period for bringing a civil action is computed from the date the carrier gives a person written
notice that the carrier has disallowed any part of the claim specified in the notice.
(D) C ivil Action : (1) Against delivering carrier - A civil action under this section may be brough t against a
delivering carrier in a district court in the United States or in a State Court. Trial, if the action is brought in a
district court of the United States is in a judicial district, and if in a State court, is in a State through which the
defendant carrier operates. (2) Against carrier responsible for loss - A civil action under this section may be
brought against the carrier alleged to ha ve caused the loss or dam age, in the judicial district in which such loss
or damage is alleged to have occurred (3) Jurisdiction of courts - A civil action under this section may be
brought in a United States district court or in a State court (4) Judicial district defined - In this section, "judicial
district" means (A) in the case of a United States district court, a judicial district in the United States, and (B)
in the case of a State court, the applicable geographic area over which such court exercises jurisdiction.
Claiman t/Plaintiff: Attorney 's fees are not recoverable!
As a general rule, federal law prohibits the recovery of attorney's fees in court actions for loss or damage on
interstate shipm ents. U nder the provision s of Section 20(11 ) 11 70 7, a carrier's liability is limited to the "full
actual loss or injury to pro perty ." But the Federal courts have equitable power to award attorneys' fees where
appropriate in the interest of
5
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justice, as where the losing party has acted in bad faith, wanton ly, or for oppressive reasons. Attorn ey's fees are awarded
by the court in some states, but only in actions that concern intrastate shipments (i.e., where the transportation of goods
originate and end in the same state). While undoubtedly there have been legal exceptions to this rule, it is advisable to
discuss the matter with counsel prior to engaging his or her services. (See Arbitration, this section)
AR BIT RA TIO N (C arrier an d Claim ant)
Claim disputes need not be settled in the courts, the expense of which can often equal or exceed the
compensation being sought by such action. The cost of attorney's fees alone discourage or prevent access to the
judicial system by any except the largest corporations, and usually where the amount of the action is substantial
in term s of actual dam age.
Transportation Arbitration Board (TAB)
TAB offers an alternative to legal remedies, and affords both carrier and claimant an equal advantage. The
Board is made up of business professionals selected from corpo rations, tho se in transp ortation as well as tho se
in unrelated fields of endeavor. The Board is sponsored by a wide variety of organizations throughout the
Un ited S tates. Where a significant monetary loss has been realized, and especially where such losses may be
cumulative because of recurring damage, the cost to benefit ratio would favor the injured party, whether it be
the carrier or claim ant!
Arbitration pro cedures
Claimant and carrier must execute the legally binding TAB Arbitration Agreement. This agreement along
with the *fee from each of the parties is then mailed to the TAB Administrator who will acknowledge receipt
of the agreement and fees, and announce the TAB case num ber.
The claim ant th en puts together the claim file, includ ing all of the evidence upon which the claim sh all rely. A
written brief or argument is to be included, setting forth th e reasons wh y the claim should be paid. This
document and claim file must then be mailed to the carrier.
The carrier exam ines the file, attaching whatever ev idence or docum ents that tends to prove its case, and writes
a reply b rief or argu men t. It then returns the en tire file, comprised of the original briefs and tw o copies of its
brief or argum ent, to the claimant.
6
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At this point the claimant has a final opportunity, if desired, to subm it a rebuttal b rief allowing a copy to the carrier.
No additional evidence or documents may then be added to the files after the original assembly by the claimant and
carrier. The rebuttal brief may only contain a reply to the issues raised by the carrier.
The claimant now mails the completed case file to the TAB Adm inistrator. The completed file will consist of
(1) the original claim file; (2) the claim ant's o riginal brief; (3 ) the carrier's evidence (if any); (4 ) the carrier's
reply brief; (5) the claimant's rebuttal brief; and two complete photo-copies of each brief. Carrier and claimant
provides the 2 copies of th eir briefs and evidence.
Upo n receipt of the file, the Administrator exam ines the file to verify comp liance with TA B's procedures, then
selects a team of arbitrators to consider the case. One carrier and one shipper arbitrator are selected. The
pho to-copies of th e files are mailed to the arbitrators wh ile the o riginal file is retain ed by the Ad min istrator.
The two arbitrators examine the file and then confer with one another to determine and agree upon a
unanim ous decision. The decision is written by one o f them and the work ing files and decision are then
returned to the Administrator. The Administrator retains the working file copies and a copy of the decision,
and returns the original file to the claimant, and sends a co py of the decision to each party. C om pliance w ith
the decision within 60 days is required.
The decision will have the same force as a court decision!
For the precise language of the T AB Arb itration P rocedures and the A rbitration Agreement each party m ust
execute, those interested are encouraged to request a copy of these documents from:
Tra nsporta tion Ar bitra tion Bo ard, Inc.,

15 35 Delbro ok Drive,
Richmond, IN 47374
*As of this writing the arbitration fee, that is reviewed annually, was not fixed. Contact TAB for current pricing
information .
7
FILING OF CLAIMS
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As required in the bill of lading contract, claims made against the common carrier for alleged loss or damage must be
filed in writing. Within its prov isions are tw o critical time lim itations that are app licable to the filing of all cargo loss
and dam age claims. Do make note of them .
Claims for dam age
Must be filed in writing within nine (9) months of delivery.
Claim s for loss
Must be filed in writing within nine months after a reasonable time for delivery has elapsed (i.e., for
the carrier to make up the shortage).
W ho m ay file a claim (See p.4 4: F O B v. O wn ership o f the goo ds)
The consignee, shipper or lawful owner of the goods may file a claim. However, recovery from the
carrier is a different matter.
W ho may recover (Section 20(11, P art I, I.C.A .)
"... any delivering carrier is liable to the lawful own er of the receipt or b ill of lading or to any party
entitled to recovery thereon, whether such receipt or bill of lading has been issued or not" (49 U.S .C.,
Carm ack A men dm ent 11 707(a)).
a. Person or persons suffering the loss, or legal assignee, their title to or possession of
the goods no twithstanding.
b. The owner of the goods, even if his name does not appear on the bill of lading and
neither h olding nor in receipt thereo f.
See (Loss of Original Freight Bill: Bond of Indemnity)
Law suits
If litigation is contemplated, the court suit must be instituted within two years from the d ay when
notice in writing is given by the carrier th at it has den ied you r claim either in full or in part.
8
FILING OF CLAIMS
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CONCEALED DAMAG E: 15 DAY RULE (Item 300135 of NMFC)
This rule applies only to the notification of the carrier pertaining to the discovery of concealed d amages
subsequent to delivery, freight signed for as having been "received in ap parent good order."
Failure to contact the carrier within 15 days of delivery on co ncealed dam ages
does no t preclude the con signee 's right to file a c laim und er T itle 49 , C.F .R.;
I.C.C., Ex Parte 263.
The form er I.C.C. held that a carrier cannot institute a time limit wherein it must be notified so as to establish
its liability. In any event, the claimant's burden of proof increases proportionately to its delay in reporting any
loss or dama ge beyon d the accepted 15 day perio d.
Tariff R egulation s specify (Item 300135, 300140 of NMFC 100)
". . . if more than fifteen days pass between date of delivery of shipment by carrier
and date of report of loss or d am age, and request for inspection . . . it is
incumb ent upon the con signee to offer reasonable evidence to the carrier's
representative when inspection is made that loss or damage was not incurred by the
consignee after d elivery of shipm ent by carrier."
15 Da y Ru le claims de clinations
A claim cannot be declined by the carrier on grounds that a "concealed damage claim" was not filed within the
fifteen day period. A proper claims declination is one where the claimant fails to pro vide sufficient evidence to
prove that the damage o ccurred wh ile in the possession of the carrier. This is the claimants only "legal burden
of pro of!"
VIS IBL E D AM AG E (D efinition of)
The degree of external injury that, by ordinary inspection and observation, in the exercise of
reasonable care, is determinable at time of delivery.
CO NC EA LE D D AM AG E (D efinition of)
An y typ e of dam age th at, by ordinary insp ection and observation, in the exercise of reaso nab le care, is
undeterminable at time of delivery.
9
FILING OF CLAIMS
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Un disco vere d da ma ge: A question of C onc ealed v. V isible
Concealed damage is not "undiscovered loss or dam age" that existed at time of delivery or receipt, but was no t observed
by ordinary inspection due to the negligence of th e consignee!
EXAMPLE: Two individual boxes are delivered on a clear receipt, an obvious injury went undiscovered
because the boxes w ere "sandw iched" together and the dam age turned tow ard the inside. An (unbiased)
inspe ction mu st desc ribe th e injur y as "v isible dam age."
A claimant's b urden of proof is comp licated by th e assertion imp lied w ithin th e con text of a "clear d elivery receipt" . . .
W hat a (signed) clear delivery receipt imp lies:
As an employee of the consignee, duly qualified and assigned the task of unloading and examining
goods received on its dock, I hereby ack now ledge and affirm in the exercise of my reasonable
obligation, that after ordinary inspection and careful observation of all external (visible) packages, the
shipm ent received w as fou nd to be in "ap parent good order and cond ition."
RELATED LIABILITY ISSUES
Carrier pick up
When freight is received in apparent good order and condition and delivered in bad order or condition, the
burden of proof shifts to the carrier. (The consignee has established its "prima facie" case).
Shipper load (SLC) v. Visible damage upon delivery
If the driver was present at the time of loading, a case for carrier liability may be established. That the loss or
dam age was apparent, or could h ave been discovered by ordinary observ ation, is evidenced by the co nsignee's
ordinary inspection and notation of loss or damage at time of receipt (General court ruling: See p.45:
Imp ortant Exception).
If the driver was absent, although given an opportunity to inspect the goo ds as they were being loaded, courts
have held that carrier liability cann ot be relieved solely on the basis of an S LC exception.
10
FILING OF CLAIMS
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Consignee reports damage after delivery
If dam age is reported by the consignee after d elivery, and where the carrier ho lds a "clear receipt," that is,
without excep tions: Visible or Concealed damage shall be determined by an on site inspection, conducted
jointly by carrier and consignee, and either condition being established and confirmed by "ordinary inspection or
observation ."
Dam age to Retail Sales/Shipping containers (Contents intact)
Often a manufacturer, shipper or distributor will tender goods to the carrier in cartons that also serve as the
(outer) shipping co ntainer. D uring the course of routine transp ortation these packages m ay sustain scuffs,
scrapes, nick s, gouges or other types of superficial surface abrasion. W hen there is no damage to the conten ts,
and in the absence o f carrier negligence, the carrier may be h eld liable for the cost of new containers, or losses
incurred in reco upin g or repackaging.
W ho is lia ble
Only w hen a carrier know ingly accepts freigh t imp roperly loaded or pack aged does he w aive his
defense under the bill of lading contra ct. The k ey word h ere is "kno wingly." Shipp ers are required to
package and tender freight in such manner as would enable it to withstand the normal hazards of
transportation (Rule 680, Sec. [1] and [2] of N MF C 10 0, pp.36 -38). In such instances the shipper
may be called upon to prove that the carrier knew or should hav e know n that the shipping container
would be used by the consignee as a "retail sales carton," and to what degree, if any, normal scuffing
or chafing would lessen the value of its contents. Failure could result in a claim's declination on
grou nds of the "A ct or D efault of Shipp er." (See A ct or D efault of Shipp er, p.5 6 [4 ]).
IF THE CARRIER IS AT FAULT
Reusable containers (Exh ibition crates, skid box es, drum s, etc.)
Carrier would be liable for repair expenses or the depreciated value of the reusable containers at the
time of loss or d am age.
Single u se conta iners (Conventional packaging)
If claimant intended to reship the goo ds in the same con tainer and the value of con tents is reduced
without repackaging, the carrier would be liable for the "full actual loss," including the cost of
recouping.
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FILING OF CLAIMS
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Used shipping containers
Unless otherwise provided in individual tariffs, there are no laws or rules regulating the use of
secondhand (used) shipping containers. However, they must meet the minimum tariff requirements of
Rule 680 as published in the National Motor Freight Classification 100.
SHIPPER - CARRIER PRECAUTIONS:
New or Used containers
Were the containers properly loaded, blocked and braced?
By ordinary inspection (external observation ), did the pa ckaging appear adequate at time o f shipm ent?
W as the damage due to "inheren t vice," which occurred in transit?
Were old marks and labels removed?
The precautionary or directional markings, if any, (especially on used boxes) do they reflect the . . .
(a) fragile nature of con tents?
(b) proper loading position of the shipping container relative to its contents, and
its susceptibility to damage in a given m ode?
(c) could not be known by ordinary observation?
Retail / Shipping containers
W as it made kno wn that . . .
The boxes were not ordinary shipping containers?
The containers were going to be reused?
The good s were to be reshipped in th e same containers?
The value of the pro perty is reduced in d amaged co ntainers?
12
DOCUMENTATION IN SUPPORT OF A CLAIM
1. Formal demand for payment issued to the claimant carrier in writing

2. Pr oof, as req uired, tha t the claim ant is entitled to paym ent
3. Original delivery receipt
4. Original inspection report (as warranted)
5. Bill of Lading or other con tract of carriage
6. Pho tostatic copy of the original invoice
7. Receipts for repair, parts and labor, restoration etc.
Paperwork! Paperwo rk! Paperw ork! A side from the loss or d amage itself, this rema ins one o f the prim ary comp laints
of industry. Claims documentation is not entirely w ithin th e control of the carrier. The filing of freight claim s is
governed by federal laws and regu lations published in the Un ited Sta tes Code and Title 49 of the Code of Federal
Regulations. Since a claim for loss, dam age or d elay invo lves a "breach of co ntract," it constitutes a violation of the law.
Therefore, a plaintiff m ust be able to establish a prima facie case of negligence against the defendant, and to do so the
claimant must rely upon proper, accurate and detailed documentation. E vidence, th at sho uld it becom e necessary, will
stand up in a court of law. This involves a minimal amount of paperwork. Excessive paperwork is generated because of
improp er or incom plete d ocumentation, poor com mu nication o r belabored n egotiations etc. The problem will never be
eliminated, but can be m inimized through a better understanding o f the laws that govern the p roper filing and processing
of claims.
DUTY OF TH E CONSIGNEE TO M ITIGATE LOSS
Fill out the claim form completely, as too much information is far better than too little. Sometimes it may be
necessary to provide a cover letter explaining how the amount being claimed was actually determined.
Remem ber, it is recognized in com mo n law that it is the duty of the consignee to accept injured goods that
are n ot "co mp letely w orth less." Every reason able effort must be m ade to m itigate the loss as much as possible.
(Refer to Item 3001 50 of the NMFC 100, entitled "S alvage Retention").
C LAIM S T ATE M E N T (See also "Filling out the claim form" end of section)
W hat cons titutes a claim
A dem and fo r pa ym ent submitted to the carrier for a specified or determinable amount of money, asserting
liability for alleged loss, damage, injury or delay, and containing facts sufficient to identify the shipm ent(s)
involved will constitute a claim, regardless of form." (I.C.C., Ex Parte 263; 49 C.F.R. 370.3(form erly 10 05.2);
Item 300110, of NMFC 100). A claim m ay be subm itted using the standa rd claim form, however, it is
preferable to have the claimant carrier furnish you with their own form.
13
W hat is n ot a claim
.. The mere no tation of loss or dam age on the freigh t bill at time of delivery does not constitute the
filing of a claim!
.. A subsequ ent inspection and w ritten report provided b y a carrier employee o r agent thereof does
not establish your claim!
.. Verbal notification, whether given to the driver at time of delivery or communicated by phone, or by
any o ther m eans of conveyance contra ry to F ederal an d State laws.
A C L A IM M A Y N OT BE EST AB LIS HE D IF . . . (a) Written docu mentation does not assert carrier
liability for loss, damage or delay, (b) it does no t represen t a form al dem and fo r paym ent, (c) it does no t identify
the shipm ent, quantity or k ind of go ods lost or dam aged, or (d) the nature and am ount of the loss is unclear.
Basically, the lack of essential facts preventing the carrier from making a complete investigation.
ORIGINAL DELIVERY RECEIPT
.. The carrier req uires the "original" signed delivery receipt to protect itself against a fraudulent claim, thus
preventing a duplicate paym ent for loss or dam age on claims filed by ano ther party (i.e., one who is not legally
entitled to receive such remuneration).
.. The freight bill or delivery receipt, a hand tag or bill of lading all serve as "prima facie" evidence with regard to
any loss or damage that existed at time of actual delivery when so annotated. Most claims are either paid or
declined solely on the basis of this evidence! (See "Prima Facie - Not Conclusive," end of this section).
Taking exceptions Be specific! Describe the pack age, whether it is a crate, box or bund le; the number
of pieces damaged or short; identify with mo del and serial number, or stock, catalog
or part num ber(s) etc.
INTER-LINE / DELIVERING CARRIER / CONSIGNEE:
Package or packaging identification
Bill m ay call for one box yet you receive freight in a bundle, indicative that the goods m ay have been
recouped. If concealed damage is later discovered, ruling out typographical error, it suggests that the
loss or damage took place prior to your receipt.
14
Piece co unt
Make sure you show the precise number of articles lost or damaged, distinguishing between "m aster
shipping containers" (packages) undelivered and "retail sales cartons," those packaged products within
the sh ippin g con tainer that are m issing due to "shrin kage" or com mo n theft.
De scription o f mer chan dise
(a) Positively identify each dam aged article b y m odel num ber, a nd serial number as applicable.
Many prod ucts are assigned lot or stock numbers or other type of commodity code. Take
the few extra second s to be specific! Never permit a vague exception, e.g., "1 carton
dam aged." This is in the best interest of both carrier and consignee. Which product
sustained injury? How can the carrier know that he is not paying $2 95.00 for dam age to a
$29.95 item?
(b) Describe any damage to the shipping containers that exists at time of receipt. A
conscientious driver m ay often assist interline carrier dock personnel or consignee assistant
in inspecting the goods on delivery. H owev er, the contents of a box is seldom remov ed
from the shipp ing container. It is com mo n to open the box flaps and inspect the corners, or
widen a puncture or tear to perm it partial viewing within this limited area. While such
procedures are effective in detecting visible (related) damage, they are not conclusive by any
mea ns!
If un able to describ e what is lo st or d am aged . . .
W hen a large numb er of boxes are received, or a situation is such that neither the driver or
consignee is able to open a container and inspect its contents, at least indicate the number of
shipping containers that are structurally dama ged. Later if obscure dam age is discovered, e.g.,
frame askew, internal components cracked or detached, there is a record as to the condition
of the box at time of receipt.
Do no t accep t erro neo us ad vice o n the 10 day rule
W hile you m ight hear that you hav e 10 days to notify the carrier of visible damage, this has
nothing to do with your obligation to take exceptions on the freight bill as to the actual
condition of the packaging at time of receipt.
15
Driver precautions
To prevent unfair risk to the carrier and still protect the interest of a valued customer, a
freight bill exception in this situation could read: "2 Boxes punctured, 1 Box crushed on
corn er - dam age to contents, if any, was not observed or can not be co nfirm ed at this tim e."
Lo ss of o rigina l freigh t bill (Bond of Indemnity)
W here the o riginal freight bill or bill of lading cannot be produced, whether lost or destroyed, the
com mo n carrier m ay request that the claimant sign a "b ond of ind emnity" form .
Protection for the carrier
W hen completed and signed, congruent with the terms and con ditions of this document, the claimant
hereby agrees "to hold the carrier ha rmless and ind emn ified against law ful claim s arising out of the
same shipm ent without surrend er of the original paid freight bill or bill of lading."
IND EM NIT Y: L iability of the undersigned
"W hereas, the undersigned can not supp ly to th e (claiman t carrier) or its connectio ns the O riginal Paid
Freight Bill or O riginal Bill of Lading covering the shipment hereinafter described, the undersigned
agrees to hold the said carrier and any other participating carrier harmless and indemnified against any
all lawful claim s wh ich m ay be made against it or them arising out the sam e shipm ent, and will pay to
the said carrier o r any participating carrier all losses, damages, costs counsel fees or any other expenses
which they or any o f them may suffer or pay by reason of payment of our aforementioned claim
with out surrender of th e O riginal Paid Freight bill or O riginal Bill Lading."
If another party can prove that it was entitled to receive payment as evidenced by their ability to
produce the missing Original P aid Freight Bill or Bill of Lading, the undersigned becomes liable for
all losses incurred by the carrier(s).
Annotated delivery receipt
As "prim a facie" evidence
The delivery receipt serves as "prima facie" evidence as to the condition of lading at the time of
delivery. W here goods are received by the consignee in bad order, and loss or damage determined by
joint inspection at tim e of delivery, excep tions to that effect m ust be noted o n the delivery receipt.
(See "prima facie" - Not Co nclusive at end of this section).
16
Presu mes ca rrier liability
W here goods are received by the carrier "in apparent good order" and delivered in a damaged
condition , as annotated on the delivery receipt, it establishes a prima facie case fo r carrier liability.
Carrier burden of proof
To be relieved of this obligation, the carrier m ust show where the sole or pro ximate cause o f any loss,
dam age or delay w as due to one of the fiv e exceptions. A com mon carrier has the additional burden
of pro ving that it was no t negligent in its handling of the shipm ent.
Claimant's burden of proof
If the consignee fails to annotate the delivery receipt w ith respect to loss or dam age, that which could
have been determined by ordinary inspection or ob servation, it retains the burden of proof! In order
to esta blish carrier liability the co nsignee or claim ant m ust prove, not merely allege, th at. . .
1. The goods were all accounted for, properly packaged and undamaged w hen re ceived b y the
carrier.
2. The goo ds w ere short or dama ged w hen delivered to the con signee.
3. That neither the con signee or the shipper could hav e been responsible for the loss or damage.
"prima facie" - Not conclusive
"The freight bill is only ` p rim a facie' eviden ce that the sh ippin g conta iner or its co ntents,
respective ly, was in "a ppa rent goo d or der."
It must be established by evidence to the contrary that the freight bill did not truly reflect actual
conditions at time of delivery. W here there are no ex ceptions on the freight bill to indicate loss or
dam age at time of delivery, the burden o f providing such "clear and convincing evidence" rests w ith
the claimant. Often such evidence is determined following a detailed inspection, usually performed by
an outside agency at the request of the carrier or another interested party.
17
THE INSPECTION REPORT
The consignee is obligated to request an inspection by the carrier wh ere loss or d amage was not determined at
time of delivery according to the provisions of Rule 30 013 5 and 3 001 40, respectively. Where visible damage
is the case, and annotated on the delivery receipt, either the consignee or carrier may initiate the inspection
process. However, the carrier is not compelled by statute or regulation to inspect damaged goods as part of their
investigation. This is because the am oun t of the claim in m any situatio ns or in a particular set of
circum stances m ay not w arrant the cost of an inspection.
Inspection waived
Should the ca rrier elect to waive his right to an inspection, or request that you complete an inspection form, do
not hesitate to do so. Bu t it is highly recom men ded that you o btain th e name and position of the
representative mak ing such a request, and if at all possible, for your pro tection, solicit confirmation in writing.
Consignee inspection
Regulations stipulate that when an inspection is to be conducted it must be made within five (5) normal
working days, excluding Saturd ays, Sunday s and holidays. After such time the consignee may conduct its own
inspection to the best of his ability. Under these con ditions:
The consignee inspection, in such cases, will serve as carrier's inspection and w ill not undu ly
hinder the pay men t of his claim based upon the facts contained therein. (Refer to Item
300145 of N MFC 100).
Joint inspection
W hen an inspection is m ade, rem emb er that it is a "jo int" inspection by you and the carrier's representative.
You both sign the report, thus read it thoroughly to insure its accuracy and com pleteness. Beyond the correct
rendering of the facts, make sure that the inspector does not express opinions that would relieve the carrier or
shipper of liability . Exam ples: "fo rk lift dam age," a prejudicial judgment without first hand knowledge; or
"inadeq uate packaging," a biased and argum entative o pinion expressed w ithout a p roper kno wledge of tariff
packaging requirements.
REMEMBER: The com pletion of an inspection report is not in comp liance with nor does it constitute the
filing of a claim in writing.
18
Consignee responsibility - Prior to inspection
[1] a. Up on r equesting an inspection by the carrier for visible or concealed damage, it is imperative that
the freight remain on the site, and where practical, at the ex act location where it was actually delivered.
b. Subsequent movement may result in further damage to the goods that was not obvious at time of
delivery (concealed ), or effect addition al (visible) injury, and thereby increase the loss. Contributory
negligence of this kind w ould greatly add to the claimants burden of proof an d provide a v alid basis
for ca rrier d eclination.
[2] All shipp ing contain ers, interior packaging or dunnage must be retained and left, as nearly as possible,
in the sam e form and cond ition they were in at time delivery.
[3] On ce the inspe ction ha s been completed, disposal of the packaging should be authorized by the
claimant carrier. To discard the packaging prematurely could result in a claim declination in the
absence o f conclusive evid ence to ind icate carrier liability.
Salvage and Carriers failure to inspect
W here a carrier has been notified that the dam aged good s are to be destroyed (e.g., contaminated
medical supplies etc.), and fails to inspect them within a reasonable period of time, or at a time
mu tually agreed to by ca rrier and consignee, do n ot necessarily accept a declination solely on the
grounds that the carrier was denied access to the m erchand ise. Th e claim ant's b urden of proof should
not increase under these circum stances, ho wever, it is wise to seek legal counsel prior to the disposal of
any salvaged good s.
RE CE IPT (S)
The consignee should furnish a w ritten receipt (preferably preprinted) indicating the name of the company or
individual performing the actual labor, or providing parts for the repair or restoration of the damaged goods. If
in house labor, worker(s) should punch a special time card or maintain a log documenting the manpow er, actual
time and co sts incurred in repair, rep ackaging, recouping, sorting, salvaging, an d all other efforts undertaken by
the consignee in fulfilling its lawful obligation to mitigate the loss. As for the initial cost of th e merchandise
that is lost or damaged, in the event that the goods cannot be salvaged, an invoice must be included with your
claim to substantiate the actual loss. (See Inv oice further in this section).
19
BILL OF LA D IN G
The bill of lading generally does not travel with the freight. Instead, carrier's cut a freight bill containing
information that is identical w ith that fou nd on the bill of lading o r contra ct of carriage. The original contract
is usually retained by the shipp er. A pro sticker is assigned to the bill of lading, designa ting the freigh t bill
num ber a particular shipment is scheduled to move on. In the event of a claim, both the bill of lading and
freight bill should be provided. Th ese two docu ments bear identical facts relative to the P ro (freight b ill)
number, consignee or ow ner of the good s, destination, piece count, com modity description, and all other
inform ation of propriety to identify the shipment. Moreover, they serve to establish the common carrier(s) who
participated in the handling and transpo rtation of said property. A copy of the bill of lading can be obtained
from the shipper.
Shipper retain s origin al: As a comm on practice the shipper will not surrender the original bill of lading. In
any case, m ost carriers w ill accept a photo copy of this document as it can be compared against the copy
retain ed in their files at the origin term inal.
INVOICE
A ph oto copy o f the invoice is acceptable, but it must be certified by the claimant to be "a true and correct copy
of the origina l," reflecting all discounts, allowan ces or cost reductions of any kind or nature. Such certification
can be typed, stamped or w ritten across the face of this documen t.
Claiming the pro per rates or charges
A busin ess usually assigns a set charge or hourly rate for w ork they perform "in ho use," i.e., on their prem ises,
as distinct from that charged for w ork conducted outside their facility. Also, there is often a significant
difference in the price of parts provided by the shipper for in hou se repair and the retail cost of the same parts
purch ased by the consum er. Be sure when you file your claim to indicate the appro priate debit(s), as the law
prohibits a defend ant or claiman t from making a p rofit at the carrier's expense. A carrier is only liable for the
"full actual loss."
Profit: Can be claimed (See p.26)
If goods are purchased from the shipper with the profit already com puted in the invoice price, it
qualifies as "earned profit," and is recoverable if properly reflected in the documentation.
20
FILLING OUT TH CLAIM FORM
__________________________________________________________________________________
Presently there is no regulation claim form, the style and format of which has been universally adopted by the
transportation industry. Most claim fo rms are designed and printed exclusively for the proprietary use of a particular
carrier. Although the wording and location may differ, the facts solicited in all of these form s are similar to those
exhibited in the "Standard Form F or Presentation of Loss and Dam age Claim." This form is printed by the Am erican
Trucking Association, 1616 P St., N.W., Washington, D.C., 20036. Using this format, the following serves as a guide
to assist the p repa rer in filling ou t this standa rd claim fo rm.
PART I
TO: _____________________________ _____________________________
NAME OF CARRIER CLAIM DATE
_____________________________ _____________________________
STREET ADDRESS CLAIMANT'S NUMBER
_____________________________ _____________________________
CITY, STATE, ZIP CODE CARRIER'S NUMBER
Nam e and add ress of the Date the claim is filed

carrier to w hom the claim You r claim number (if any).
is being submitted. Carrier's number, (if provided)
______________________________________________________________________________
1. This claim for $ is made against the above named carrier for L oss Dam age
in connection w ith the follow ing described shipm ent:
2. Show full amount being claimed, and whether a "Loss," "Damage," or both.
b. _____________________________ g. _____________________________
NAME O F SHIPPER NAME OF CO NSIGNEE
c. _____________________________ h. _____________________________
POINT SHIPPED FROM FINAL DESTINATION
d. _____________________________ i. ______________________________
NAME O F CARRIER ISSUING B/L NAME OF D ELIVERING CARRIER
e. _____________________________ j. ______________________________
DATE OF BILL OF LADING DATE OF DELIVERY
f. _____________________________ k. ______________________________
ROUTING OF SHIPMENT DELIVERING CARRIER F/B NO.
b. Name of the shipper (Manufacturer) g. Company receiving the goods

c. Point of origin h. and their Location
d-e. Origin carrier e. B/L Date i-j. Carrier name / Date of Delivery
f. Routing (if known) k. and the Freight Bill Num ber
21
FILLING OUT THE CLAIM FORM
____________________________________________________________________________________
PART II
If shipment reconsigned enroute (consignee/destination changed ), state particulars: (Fill in as applicable)
DETAILED STATEMEN T SHOW ING HOW AMO UNT CLAIMED IS DETERMINED

Number and description of articles, nature and extent of Loss or Da mage, invoice price of articles, amount of claim etc.
A LL DIS CO UN TS and A LL OW A NC ES MU ST BE SH OW N
______________________________________________________________________________
List items lost or damaged in the spaces provided Show Cost per Item
______________________________________________________________________________
______________________________________________________________________________
* Th e carr ier will p rov ide N M FC com m odity item num bers u pon requ est.
Indicate th e n um ber of each individual article being claimed as "lost" or "damaged," complete with model and serial
number. Sho w the invoice price of each item in the far righ t hand colum n. A b rief description as to the nature and
extent of the loss or dama ge is all that is required. Example: (5) Glass lamps shattered; (2) Shades crushed; (5) Globes
missing
If there are a large number of items being claimed they may not all fit within the limited space allocated on the claim
form. In such cases it will become n ecessary to show only the quantity of merchandise and general description of the
items lost or damaged on the actual claim form. A secondary statement, however, should be provided show ing a
com plete detailed description of all the pro ducts being claim ed and the nature of th e dama ge. Total up the amount, to
include labor, earned profit, freight and other expenses itemized within the claim statement, and place this figure in the
approp riate space.
PART III
The follow ing docum ents are subm itted in supp ort of th is claim (abb r.):
__ Original Paid Freight bill

__ Original Bill of Lading
__ Original Invoice or Certified Copy
__ Copy o f Freight B ill
__ Copy of Bill of Lading
__ Carrier's inspection Report Form
__ O ther particulars obtainable in proof of loss or dam age claimed
INDEMNITY AG RE EM EN T: This is to ind emnify claimant carrier and connections again st loss that might arise
from paymen t of this claim w hich is filed without the Original Paid F reight Bill or Original Bill of Lading. (See
IND EM NIT Y, p.16).
22
____________________________________________________________________________________
REMARKS:____________________________________________________________________________
__________________________________________________________________________________
NAME OF CLAIMANT
STREET ADDRESS
CITY, STATE, ZIP CODE
The foregoing statement of facts is _____________________________

hereb y certified to b e correct. SIGN THE CLAIM FORM
BASIC INSTRUCTIONS:
1. Fill in as much detail as possible.
2. Place a check m ark in the appro priate box(es) or spaces in the "Supp orting
Documents," and "Indemnity Agreement," sections, if needed.
3. Send original claim form with the supporting documents to the carrier.
4. Retain a dup licate of all docum ents that are part of the claim file.
FINAL COMM ENTS:
S o me claim forms do not provide space for remarks. Consequently, if you wish to comm ent on certain aspects of your
claim , it is best to furnish the carrier with such info rmation on a separate statem ent.
A check mark by a particular document advises the claims examiner, and serves as a reminder to the claimant, as to the
documentation that was forwarded to the carrier. If you check off a record that was not received, the exam iner is alerted
to this fact an d should then request the docum ent im mediately.
Although the freight may have been inspected by the carrier, photos should be taken by your staff prior to any further
handling. Retain these pictures with your claim file(s) for ready reference. Do not rely on your mem ory alone!
W here to m ail the C laim
Ordinarily the claim file is forwarded to the claimant carrier's corporate office, the mailing address of which is often
preprinted on the claim form. However, it is best to obtain this information directly from the local terminal (claimant
carrier) represen tative when requesting their claim form. If you are unclear as to any supplementary information that
should be included in your claims file, contact the carrier for assistance prior to completing or m ailing your paperwork.
An O S&D clerk, the terminal manager or salesman should be able to assist you.
23
____________________________________________________________________________________
EXPEDITING THE CLAIMS PROCESS
S PEED IN G U P TH E P AYM E N T
A carrier is required by law to settle claims within 120 days of receipt, but the actual time of resolve varies
according to the facts and circum stances un ique to each claim situ ation . Unusual time delays in the handling
of claims often stems from a lack of communication between carrier and claimant. Seldom will the original
c la im s documen tation an swer all the question s an examiner m ight raise about the actual loss or the extent of
carrier liability. Additional facts or clarification is frequently needed. Delay in the response time as well as
ma il handling schedules can easily add weeks, even months to the claims process. An agent may close out
many claims within sixty days while others may be delayed up to or well beyond the 120 day period.
C la im ants often file their claim promptly, but then fail to actively pursue payment until deferment reaches this
critical point.
SUGGESTED CLAIMS PRO CEDURES (Ensuring timely paymen t of you r claims)
1. Set up your claim using a (dummy) purchase order and enter it in your accounts receivable. Every thirty days
it will emerge as "outstanding" until the claim is eventually paid. Another simple method is to mark your
appointment calendar thirty days ahead or beyond the day your claim was actually filed. On that day your
annotation will alert you to pull the file and examine it for payment or expected correspondence. Print on the
inside jacket: Claim acknowledgement received: Yes / No. If "NO" contact (write in your name or the company
official hand ling the claim ).
2. Thirty days a fter filing your claim the carrier should acknowledge it in writing and provide an assigned claim
num ber for your referen ce. If this notification is not in the file, you need to call the local carrier agent and
have them check on the status, or perhaps resubmit the claim.
3. Sixty days after filing your claim , if still unpaid, you sh ould follow up either b y ph one or in writing. A post
card or form letter should be prepared in advance for this purpo se: (Example)
"Please refer to your claim number [# 00] and our reference num ber [# 00 ]. We feel
sufficient time has elapsed for th e pro per in vestigation and handling of this matter. W e
wo uld appreciate prompt payment of our claim filed for [$0.00] or a written explanation as
to the cause of delay."
24
MEASURE OF DAMAGES
BRE AC H O F CO NT RA CT (Bill of Lading)
The carrier bears the fundamental responsibility of delivering goods in the same condition it was received. Moreover, he
is obligated by law to execute "reasonable dispatch" in the transportation of lading, and to handle freight in a safe and
prudent manner. Any loss, damage or injury to the pro perty w hile in the po ssession of the carrier, and caused by its
negligence, is considered a "b reach of the B ill of lading contract." (See also page 35)
ACTUA L LOSS (Defined)
The owner of the property is entitled to recover full compensation for any loss, damage or injury, to the extent
that it restores him to the position he wo uld have occup ied had there been no breach o f contract less
deductions (e.g., unearned profit, co mm issions etc.). The carrier should not be held liable for more than
indemnity!
Carr ier liable for "A ctual Lo ss" (49 U .S.C. 2 0(11 ) Revised : 11 70 7)
A com mo n carrier . . . shall issue a receipt or bill of lading for property it receives for transportation . . . and
shall be liable for the actual loss or injury to property caused by (1) the receiving carrier, (2) the delivering
carrier or, (3) another carrier over whose line or route the property is transported . . . a comm on carrier may
not limit or be exem pt fro m liability im posed under subsection (a) of this section . . .
M A R K ET VA L UE A T D ES TIN A TIO N (Equivalent to "full actual loss")
Carrier's should exercise caution w hen accepting "U SED G OODS ." Obsolete equipment m ay be so ld at a
mo dest price, but if destroyed in transit the "replacement value" at the wholesale destination market price may
reflect the claimant's "full actual loss." On articles of exceptional high value, e.g., electronic or specialized
scientific equipment, the loss can be substantial. It is imperative, therefore, "released value" rates for such
comm odities notwithstanding, that a driver make accurate, detailed exceptions as to the condition of lading at
time of receipt.
De layed sh ipm ents
Generally applicab le to delayed shipm ents, or the carrier's failure to deliver with reasonable dispatch. Th e loss
is the difference between the fair market value of the property at the time and p lace when delivery w as actually
mad e, and the fair market value of the freight had it been delivered tim ely an d in good condition. How ever,
where other approaches provide a m ore p recise m easure of determining the actual loss, such will be used in
lieu of this rule. Where products have no m arket v alue at destination, the court will consider other remedies
that aptly assess th e true measure of dam ages.
25
MEASURE OF DAMAGES
Loss or D amage
Co ncer ning recovery involving loss or damage, the courts have held that the basic principle underlying
comm on-law remedies is that they "shall afford only com pensation for the injury suffered." In other w ords, the
"actual loss." Claim ants are entitled to the "maxim um recovery" w hich is the "m arket v alue in the quantity
shipped." In order to be awarded this maximum , the claimant must pro ve that the loss has been "earned."
Profit, Earned (Ex amp le)
A broker purchases $5000 worth of bicycles from the manufacturer and has them shipped d irectly to the
consignee, who has agreed to purchase them for $6500. Thus the broker has an earned profit of $1500. If
the goods w ere lost or destroyed due to carrier negligence, the broker would be entitled to recover the
man ufactured price of the good s as well as the loss of pro fit. By contractual agreement the profit was "earned,"
and would have been realized up on d elivery of lading but for the carrier's negligence.
Manufacturers profit v. Full Actual Loss (Market Value At Destination)
Consider a shipment of m achine parts that are destroyed in a traffic mishap and replaced by the manufacturer.
W here the manufacturer files the claim, precedents abound where the courts awarded d amages at "dealer cost"
(wholesale) in opposed to the "manufacturers cost," as the latter denies the (earned) profit that wou ld have been
realized if the freight had been delivered in good condition.
Claim ant can not p rofit at the ca rrier's expe nse
Restitution paid to the claim ant cannot enrich his position beyond what would have existed had the
goods been delivered undamaged. Claimants are only entitled to recover the full amount of actual loss,
and may include some pro fits (earned) denied, freight charges, or other costs in addition to the invoice
value of th e goo ds.
Freight charges (See p.109: Appendix B)
W here the measure of damage is based upon invoice value, claimant is entitled to recover this amount and the
prep aid freight charges if not incorporated in the invoice. Wh ere freight is prepaid and included in the invoice
price to the cons ignee , the invoice value will properly reflect the "full actual loss." On collect shipments, where
the freight has been paid, the claimant m ay recover freight charges proportionate to the loss or
26
MEASURE OF DAMAGES
dam age incurred. If resulting from carrier negligence, the claim ant is entitled to recover the freight charges to
and from a repair facility (as co nstru ed by the court to b e part of th e actual loss).
SPECIAL v. GENERAL DA MAGES
Special dam ages
Special damages are "those that result from unique circumstances unknown to the carrier and would not
ordinarily be foreseeab le with out direct com mu nication from the shipper." They usually involve econ om ic
losses associated with shipment delays or a carrier's failure to transport the freight with reasonable dispatch, but
are not lim ited thereto . In such cases the courts can award dam ages in excess of ordinary m arket value.
Genera l damages
General damages are "those that occur naturally (usual) from the breach of contract, and proximately arise from
the loss or injury that could have been foreseeable." The measure of dam age aw arded by the court can include
marginal profit on som e costs, labor, administrative overhead, freight charges, interest and replacemen t costs et
al.
Genera l v. Special damages: A djudicated

On the m easure o f dam age being limited to market value, the former I.C.C. in its report to C ongress,
quotes the following: "T he funda mental co mm on law decision in this m atter, Hadley v. Bax endale,
156 Eng. Rep. 145 (1845), allowed recovery of general damage, defined as those occurrin g naturally
from the breach of contract . . . What is considered general damages may vary from court to court.
Hence, the difference between special dam ages and general dam ages is not easy to define, and varies
with the facts and circu mstances as w ell as the actions of the p arties in each particular case."
SPECULATIVE DAM AGES
The court will not award settlements based upon speculative, remote or indeterminate damage. In Crichfield v.
Julia, the court expressed the following: "The term s` peculative damages' usually applies in cases of breach of
contract where m oney is sought for loss of uncertain or rem ote pro fits not w ithin the understanding of the
parties, or where there is uncertainty as to whether the party has been, in fact, damaged, or whether the
dam ages resulted from the act of th e other, or where they are wholly uncertain in m easure of extent."
27
PROVING YOUR CLAIM
____________________________________________________________________________________
Tak en from Ex P arte N o. 40 3, pursuant to Section 211 of the Staggers Rail Act of 1 980, Interstate Comm ission).
BURDEN O F PROOF: DEFINED
Method used to resolve cases where the evidence is such that neither p arty can persuade the court. To prevent
such a dead lock, civil law requires that one of the parties assume the burden of persuading the jury by a
prep ond erance of the ev idence.
Plaintiff v. Private carrier
Gener ally, in such negligence cases, it is the plaintiff who must prove that the defendant was negligent, thereby
causing the injury. (However, this rule does not app ly in actions brought against a com mo n carrier).
Plaintiff obligation v. Co mm on carrier
MUST ESTABLISH A PRIMA FACIE CASE, i.e., against the carrier
The burden of the carrier occurs after the plaintiff has presented a prima facie case against it, showing that the
shipment was in good condition when accepted by the carrier and in a damaged condition at time of delivery
(or w as no t delivered with reaso nab le dispatch) and the amo unt of dam ages.
PLAINTIFF v. COMM ON CA RRIER
Com mo n carrier (once a "prima facie" case has been established)
First burden : The comm on carrier, as a virtual insurer of the go ods, has the com mo n law burden to
prove that the loss or dama ge was cau sed by on e of th e five excep tions on the bill of lading contract.
Second burden : In addition to proving one of the exceptions, the carrier must also prove it was not
negligent (E lmo re & Stahl, Su prem e Co urt).
Co urt R ule
By reason of the fact that the carrier is in sole possession of the goo ds during transportation, the evidence or
facts relative to its hand ling of the p roperty is w ell with in its contro l or k now ledge. Once in the possession of
the carrier, a shipper is denied this same opportunity. (Elmore & Stahl, supra at 143-144)
28
PROVING YOUR CLAIM
____________________________________________________________________________________
CARMACK AMEND MENT 49 U.S.C. (Codified common law)
Section 20(11 ); Revised (49 U.S .C. 11707,10730): "...although a carrier is not an insurer per se, it,
nonetheless, is fully liable for damage to or loss of goods transported by it unless the loss or damage occurred as
a result of one of the excepted cases (Refer to p.55). As a consequence, a carrier is virtually an insurer and the
Federal law summarily invalidates carrier argumen ts to the contrary unless there is a correlation of the defense
to an ex cepted cause (C om mo dity C redit Corporation v. N orto n 167 F.2d, 161 ,164 (194 8). Neither the
decisions of State courts which may be to the contrary ... may ov ercome this govern ing principle. Missouri Pac.
R.R ., 377 U.S. 948; and Condokes v. Southern Pac. Co., 303 F. Supp. 11 58 (D. M ass 1968 )." Also, refer
to
[Ex P arte 40 3 p.3 9; I.C.C ., Loss and Damage, supra, at 589-9 0].
Basic rules of liability established:
[1] The common carrier is liable for the "full actual loss, dam age or injury" . . . to prop erty
transported by it as a result of its own negligence rather than one of the Bill of Lading
exceptions (p.55).
[2] A carrier is liable as the "virtu al insurer" o f the goods transported by it."
B U RD E N O F P R OO F
In ab sence of ev iden ce to the co ntra ry, a carrier is pre sum ed liab le if
[1] A "prima facie" case is made by the consignee (claimant) showing that the "goods were
received in good condition b y the carrier and delivered in a dam aged condition ."
The carrier must then prove
[1] The proxim ate cause of the loss or damage was due to one of the excepted (bill of lading)
causes.
[2] It was not negligent in its handling of the shipment.
In other words, a ll th e c la im ant has to prove is that the goods left the shipper in good cond ition and arrived
damaged. The carrier, to be relieved of liability, must then pro ve that the dam ages were due to an e xcep ted
cause, e.g., "Act or Omission of the Shipper (poor packaging)," and that he was not negligent in his handling
the goods. If the carrier m akes a satisfa ctory case, the liab ility would then shift to the shipper or manufacturer
and rem ain there.
29
CLAIMS PROCESSING BY THE CARRIER
C A RR IE R'S LE G AL O BL IG A T IO N
As required b y federal regulations, the claimant carrier, upon receipt of a written cargo claim . . .
MU ST acknowledge receipt of the claim within 30 days
MUST indicate in its acknowledgm ent what, if any, additional docum entary evidence or o ther
pertinen t inform ation ma y be requ ired b y it to p roce ss the c laim .
Regulations demand that the carrier commence a prompt and thorough investigation. In addition thereto, the
carrier m ust
Pay, declin e or m ake a firm com pro mise settlem ent o ffer w ithin 1 20 day s of re ceipt o f a claim
when ever possible.
If such disposition is not feasible within that tim e, the carrier m ust
Then, and at each succeeding 60-day interval, notify the claimant as to the reasons for the delay.
CL AIM AN T B E A DV ISE D:
This stipulation does not auth orize the carrier to take 120 days to conclude cargo claims, rather it sets a
maximum time for paym ent without co nsignee notification!
SALVAGE RIGHTS
If a carrier pays your claim for the full invoice price of dam aged goods, unless otherwise agreed to, it is entitled
to the pro perty as salvage. H owever, the co nsignee is cautioned not to release the damaged go ods for salvage
until the carrier h as ack now ledged liability for the full value.
Salvage pick up (See p.32: D amaged freight salvaged by consignee)
Ru le 300 150 provides that w here carrier liability has been established it will take possession of the salvage as
soon as possible, but not more than 30 days from the date shipment was noted damaged on carrier delivery
receipt or, if concealed damage, from date of the inspection report. If the carrier fails to pick up the salvage
within this period of time, consignee m ust contact the carrier and request rem oval of the salvage
with in fifteen days from the date of notification. NOTE: Only applicable when it is agreed to by both carrier
and consignee that the carrier w ill handle disposition of the salvage.
30
Title 4 9 C .F.R ., 37 0.1 1 (fo rm erly 1 00 5.6 ), Ex Parte 2 63 pro vide s that . . .
(a) W henever baggage or material, goods, or other property transported by a carrier subject to the
provisions herein contain ed is damaged or alleged to be damaged and is, as a consequence thereof, not
delivered or is rejected or refused u pon tender thereof to the owner, consignee, or person entitled to
receive such property, the carrier, after giving due notice, whenever practicable to d o so, to the owner
and other parties that m ay have an interest therein, and unless advised to the contrary after giving
such notice, sha ll undertake to sell or dispo se of such prop erty directly or by the em ploym ent of a
com petent sa lvage age nt.
The carrier shall only dispose of the pro perty in a manner that w ill fairly and equally protect the best
interests of all persons having an interest therein. The carrier shall make an itemized record sufficient
to identify the property involved so as to be able to correlate it to the shipment or transportation
involved, and claim , if any, filed thereon. The carrier also shall assign to each lot of such property a
successive lot nu mb er and no te that lot num ber o n its record of shipm ent and claim, if any claim is
filed thereon.
(b) W henever disposition of salvage material or goods shall be made directly to an agent or employee of a
carrier or through a salvage agent or company in which the carrier or one or m ore of its directors,
officers, or m anagers has any interest, finan cial or otherwise, that carrier's salvage records shall fully
reflect the particulars of each such transaction or relationship, or bo th, as the case may be.
(c) Upon receipt of the claim on a shipment on which salvage has been pro cessed in the manner
hereinbefore prescribed, the carrier shall record in its claim file thereo n the lot n um ber a ssigned, the
amount of m oney recovered, if a ny , from the disposition of such property, and the date of transmittal
of such money to the person or person s lawfully entitled to receive the same.
WARNING: D isposal of the salvage without carrier notification and approval, whether prior or
subsequent to inspection, or where the carrier has not admitted liability, may cause your claim to be
denied or brin g about a substantial reduction in th e am oun t of paym ent.
Salva ge: Relea sed V alue R ates
31
W here salvage on released value shipmen ts are involved, and carrier liability established, claimant is to receive
the released value of the prop erty and retain th e good s for salvage, providing that their gain from this aggregate
does not exceed the "fu ll actual loss."
Refused freight salvaged by carrier
The consignee is legally bound to accept freight that is not completely destroyed. Failure to observe the law can
cost dearly! If an entire shipm ent is refused for partial da ma ge, the carrier is only resp onsible for the "full
actual loss" of the property actually lost or damaged at time of delivery (plus the proceeds from the sale of
und am aged goods).
Sup pose that (2 ) blenders out o f (30 ) are dam aged, costing $20.00 each. A jobber o ffers the best price,
agreeing to purch ase the entire lot at 50 % of actual value. Although the claimant suffered a loss of $600.00,
the carrier is only obligated by law to pay $310.00. (28 at $20.00 is $560 - 50% = $280 + $40.00 [cost
of 2 d amaged item s]. Total: $310.00 ).
Dam aged freight salvaged by consignee
It is recognized in comm on law that it is the duty of the consignee to accept injured goods that are not
"com pletely worthless," and to m ake every reasonable effort to mitigate the loss as much as po ssible. (See p.2:
Mitigate (lessen) the loss; (General Information Regarding Loss an d D am age C laims, Ap pendix to I.C.C.,
Ruling 120 , Item 4); A lso refer to Item 3001 50 of the NMFC 100, entitled "S alvage Retention."
The consignee is in a better position to mitigate the loss, and has several options at his disposal
Disco unt: Sell damaged items at a discount. Be sure to show the retail cost on the sales
receipt, less damage allowance, as this will reflect the amount claimed, i.e., the actual
loss in this instance.
Repair: Repair dam aged item s and claim the cost of parts, labor and other expen ditures.
Parts use: W here a numb er of like articles are dam aged , after a dvising the carrier and
following an inspection (if necessary), the con signee m ay remo ve parts and pieces
from som e units in order to salvage or make com plete as many articles as po ssible.
32
Salvage and carrier liability (Item 3 00150 of N MFC 100)
"... if there is doubt of carrier liability, the carrier will so advise consignee; in which event the consigne e may
hold the m erchand ise until liability o f carrier is determ ined, or m ay dispose of is so as to m itigate the dam age,
and m ay file claim for such damage..."
TW O OR M O RE CA RR IER S (Inter line shipm ents)
Often it is necessary that goods be interlined between two or more carriers from point of origin to point of
destination on a through bill of lading. Under these circumstances, the Interstate Commerce A ct provides
options to the claim ant as to the carrier with which he m ay file h is claim .
Claimant carrier: "Deliverer" or "Originator" of the shipment
Claims may be filed with either the *originating or delivering carrier, even though it may not be
know n which one may have caused the loss or d am age.
Paym ent cannot be w ithheld on liability issues
Connecting carriers may have to confer about various aspects o f liability. But once the validity of a
claim is established , they canno t withhold settlement w ith the claimant until they agree between
them selves who actu ally caused the loss or d amage!
All carriers are exclusively liable on through bills of lading
On a joint through bill of lading, both the origin and delivering carrier are liable for loss,
damage or delay
(49 U.S .C., Section 1170 7 (a)(1).
Claiman t carrier is liable (even if not responsible for loss/damage)
The carrier with whom the claim is properly filed (claimant carrier), is obligated by law to pay, decline
or make a firm compromise settlement offer in writing within 120 days of receipt, or every 60 days
thereafter while the claim remains pending, ad vise the claim ant in writing of the status o f the claim
and the reason for the delay in the disposition thereof 49 C.F.R. 370.9 ( formerly 1005.5 ), Ex P arte
263.
*Carm ack Am endment, 117 07 , Sec(a ) of the statute . . . "the carrier issuing a receipt or bill of lading for a
shipment is liable for the full actual value thereof. Furthermore, the carrier issuing the receipt or bill of lading
is responsible to a bona fide claimant even if the loss or damage occurs on the line of another carrier." (Ex
Parte 263 Q &A No .15).
33
Claimant carrier can find redress in the court
The carrier issuing the receipt or bill of lading ... or delivering the property ... is entitled to recover
from the
(1) receiving carrier,
(2) the delivering carrier, or
(3) the carrier over whose line or route the loss or injury occurred the amount required to be
paid to the owners of such property as evidenced by a receipt, judgment, or transcript, and
the amount of its expenses reaso nably incurred in defending a civil action brought by that
person ." (49 U .S.C. Section 1 1707(a)(1), (2)(6).
INSURANCE REQUIREMENTS
All motor common carriers of property and freight forwarders are required to maintain cargo insurance for the
protection of the shipping public. Under this protection, the insurance company is directly liable to a shipper or
consignee for any cargo claim for w hich the m otor carrier or freight forw arder m ay be legally liable. T hus, it is
normal for an insu rance comp any to decline a claim its insured has declined . Ho wever, this insurance
protection is of primary imp ortance if a motor carrier (1) unduly delays in settlement, or (2) is in poor
financial condition including the filing of bankruptcy.
(Note: Railroads are not required to m aintain cargo insurance. T he form er I.C.C. recom men ded to
Congress that rail carriers be required to maintain cargo insurance, but until the law is changed,
railroads must be con sidered as "self insured.")
34
Loss, Dam age or D elay: A Breach of Con tract
Carrier:
Common carriers move freigh t based up on a "contract o f carriage," and h ave the responsibility to
transport the goods ten dered to it with reaso nab le care and dispatch.
Shipper :
Shippers are obliged to tender their merchandise in accordance with existing tariff rules and
regulations that directly affect its transportation. Freight claims for loss, dam age or delay arise when
this m utual contract h as been breached.
Ship pers sub ject to carrier tar iff(s)
W hen tendering goods via common motor carrier, shippers are subject to the provisions of the bill of lading
contract or other contract of carriage, as well as any carrier tariffs duly filed with the appropriate Federal and
State regulatory agencies. Of particular importance is the National Motor Freight Classification 100.
National Motor Freight Classification 100
The provisions of this tariff contain the rules and regulations governing the transportation of freight from point
of origin to final destination. These rules cover the bill of lading contract, freight bill, com mo dity ratings,
classification of articles, general and specific packaging requirem ents, as well as the procedures for the proper
documentation, filing and processing o f freight claims. Inasmuch as the prov isions of this tariff are treated w ith
statutory significance by the courts, shipper's representatives should become acquainted with its contents (See
NMFC 100, Rule 360 , Sec 2 (c).
A copy of this publication should be found in the shipping an d receiving office and m ade available to all
essential traffic department personnel. For a cop y of this tariff, write to the
Am erican Tru ckin g A ssocia tion,

22 00 M ill Road,
Alexandria, VA 22314
35
SHIPPER'S RESPONSIBILITY
_________________________________________________________________________________
It is important that you familiarize yo urself with the basic obligations and responsibilities, as well as the liability assigned
to the shipper or carrier with regard to the tran sportation of lading. Ha ving a good und erstandin g in this area will prove
to be invaluable in the preparation and p rocessing of your claims for loss or damage. The laws, rules and regulations
associated with freight loss and dam age involves com plex issues, the perplexity of which is greatly increased by the
legalese used to define them. Wh ile the foregoing endeavors to simplify the various aspects of loss and damage liability,
some degree of jargon m ust necessarily be retained, as it is the peculiar idiom of the courts and regulatory agencies. As
such, fam iliarity with this language b ecom es absolutely essential to th ose who are involved in the claims process.
PR OPER PACKA G IN G O F THE G O O D S
The shipper has the primary obligation to properly load, block or brace a veh icle unless oth erwise pro vided in
the tariff, and to tender all products in accordance with existing packaging rules and regulations. Since the
majority of claims declined by the carrier are issued on the basis of "impro per packaging," this section discusses
the funda mentals o f packaging regulation as it pertains to the legal obligation s of both shipp er and carrier.
Critical to y our claim . . .
In the eve nt of loss or damage to the goods, should the inspection report indicate poor packaging
(proven to be the sole or proximate cause of damage), the carrier may decline your claim because of
the "Act or Default of the Shipper." This is one of the bill of lading ex ceptions discussed later in this
handbook (p.55). Being alert to this fact can save you valuable time and unnecessary paperwork, as a
claims declination can take anywhere from eight to sixteen weeks to obtain. Such a claim should
have been forwarded directly to the shipper or manufacturer for his disposition and resolve. On the
other hand, if the shipper or m anufacturer m aintains that the packaging meets all tariff requirem ents
for his prod ucts, he can prom ptly pro vide yo u with the tariff auth ority for its use. This information
can then be included in your claim s docum entation to be submitted to the carrier.
GENERAL PACKA GING REQUIREMENTS (RULE 680)
Rule 680 of the N ation al M otor Freight C lassification 100, contains the general packaging or packing
requirem ents for freight tendered via common motor carrier. These fundamental regulations should be
reviewed by the shipper to ensure that they are in com pliance with any and all of its pro vision s.
36
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Damage Claims: Packaging v. Handling
Most claims are filed against the common carrier for loss or damage, and typically allege mishand ling.
Claims declinations by the carrier generally purport the shipper's negligence in its use of "improper
packaging" or an "unauthorized m ethod of tender."
Impro per Pack aging: Act or D efault of Shipper
In damage cargo claims the packaging is always a primary factor in deciding liability. When a
packaging failure results from the shipper's act or omission, this being the sole or proximate cause of
such injury, under the term s and condition s of the bill of lading con tract the shipper shall be held
liable fo r the "full actual loss, dam age or injury" resulting from his action.
Rule 680: Packaging - General
Sec. 1. (a) The separate descriptions of articles name the acceptable packing requirem ents, see
No te 1. Num bered pack ages or other packing provisions (other than D ` O T Specification
Numbered packages, for w hich, see HM T) are authorized for use only when item descriptions
contain reference thereto. The definitions of o r specifications for packing requirements are
nam ed in (1) Items 200 through 297, (2) Numbered packages and (3) N ote references. The
material and construction specifications therein are minimum requirements and must be
observed.
TYPICAL NUMBERED PACKAGE CERTIFICATE
Nu mb ered Pack ages
Packaging system s designed for sp ecific types of products as referenced in individual items of the
Classification. When ending with an "F," the numbered designation is exclusive to articles of
furniture as described in individual items making reference thereto.
37
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Box Certification: Always "Rectangular" in shape
Special num bered packaging system s are designed exclusively for u se with certain pro ducts, the
definition and specifications for which are provided in the Classification. A special numbered package
is distinguished from a standard shipping container b y its certification. The standard bo x certificate is
"round" while a special numb ered package is "always rectangular" in shape. By its use the box m aker
certifies that the container and interior packaging forms do meet or exceed the tariff minimum
requirem ents fo r the num bered package designated.
(Ex: 30 00 S, 1F, 19F etc.).
Consumer Precaution
If your products require a num bered pack age, and in particular if you are ordering from a new
supplier, watch for con tainers bearing a "round" certificate. Be sure to check for the use of interior
packaging, the form types, their material construction and position within the shipping container.
Com pare with the specifications provided in the Classification. Should you find that the design has
been altered from w hat is p ublish ed, notify the shipper immediately.
In the event of damage, your c la im could be denied on the basis of such a packaging
violation. Ca rrier d eclina tion ma y cite "A ct or D efau lt of th e Sh ippe r." (Se e p.5 6,[4 ]).
RULE 680 Interior Packaging / P acking D evices
"W hether or not interior packing devices are a part of specific requirements, interior packing
devices must be provided where such are necessary to afford adequ ate protection aga inst
dam age to the co ntents of a container."
RULE 680 Box es mu st be filled to cap acity
"Article(s) and necessary interior packing d evices must reasonab ly occupy the full cubic
capacity o f the o uter container. . ."
A carrier cannot be expected to know how prod ucts are protected within sealed containers, and if they
are in compliance with the aforementioned minimum tariff requirements. This is a shipper
responsibility. The question of carrier liability only arises when, by ordinary observation or inspection,
defective p ackaging was readily ap paren t to the carrier or his agent.
38
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IMPROPERLY FILLED BOXES

(See p.77)
Unsup ported areas or excessive voids within the shipping container causes them to collapse or crush when under load,
whether tendered individually or unitized on pallets, platforms or skids. If you experience dam age to the packaging or its
conten ts on the basis of this tariff infraction, notify your supplier as soon as possible. A Carrier is not liable for loss or
dam age resulting from the "A ct or D efault of the shipper," refer to p.56[4 ]. (See p.37: Im prop er Packaging)
RU LE 68 0 C arrier's op tion to a ccept or refuse
Sec. 2. Except as provided in Item 423, ". . . whether or not the authorized minimum packing
requiremen ts are observed, outer (shipping) containers or packages, inner containers, interior protection
devices, meth od of packing within containers or packages, or other form of shipm ent auth orized m ust
be made of materials of such strength or be of such nature as to afford a reasonable and proper
protection of lading and to pro tect against damage to other freight or eq uipm ent, and carriers may for
good reason refu se to accept freight th e transportation of which , in th eir judgem ent, would not be
reasonably safe and practicable and so notify the shipper."
Carr ier accepta nce of fre ight v. Sh ipper liability
A carrier's option to accept rather than refuse a shipm ent does not necessarily negate th e shipper's
respon sibility to provide a reasonable protection of lading as req uired by tariff regulation!
RU LE 3 60, Sec. 2(c), of the N MF C 10 0 (Bill of lading)
". . . to avoid infractions of federal and state la ws, shippers are to acquaint themselves with the
description of articles in the tariff under which they ship..."
39
___________________________________________________________________________
Shippers in compliance with this regulation are not only made awa re of the "articles in the tariff under w hich they ship,"
but the packaging requirem ents th at are applicable to a particular class rating as w ell. A driver, on the other hand,
cannot be acquainted with the product line of every com pany, nor are such carrier representatives trained in the field of
classification and packaging regulation. Rarely will a driver have occasion to identify an existing packaging violation or
related tariff infraction, and especially when a potential hazard is concealed w ithin the shipping container.
In this type of claim situation, the sole burden can not be shifted to the com mon carrier by virtue of the fact
that he accepted the goods. While a truckline may have the regulatory discretion to refuse an article of freight,
its judgme nt is primarily dependent upon a visual, common sense evaluation. An assessment where only the
mo st blatant packaging violations are likely to be question ed (e.g., when undu e hazard to it or other freight is
obviou s). In the final analysis, the shipp er is m ost know ledgeable concerning his freight, being bound by
pub lished regulations pertaining to its p roper classification and appropriate metho d of tender.
Exception to the above:
If the driver is aware that the packaging is inadequate, or that a trailer is improperly blocked for b raced fo r safe
transportation, and with this knowledge accepts the shipment, a claim for loss or damage cannot be denied by
the carrier solely on the basis of the bill of lading exception "A ct or default of shipper."
The carrier cannot assert "improperly packaged goods" to absolve itself of liability if one of two conditions
are evid ent . . .
(1) The carrier possessed such knowledge at the time the freight was accepted, or
(2) The carrier could have know n through "o rdinary in spection" or observatio n, had it exercised
reaso nab le care, that th e packaging o r metho d of tender was inadequate.
Classification of freight
The shipper is respo nsible for providing an accurate description of its products on bills of lading.
40
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Inspection
Ru le 360, Sec. 3, NMFC 100, "When carrier's agent believes it is necessary that the contents of packages be
inspected, he shall make or cause such inspection to be made, or require other sufficient evidence to determine
the actual character of th e prop erty. W hen found to be incorrectly described, freight charges must be collected
according to proper description."
Commodity description
Ru le 360 , Sec. 2c, NMFC 100: Comp lete com mo dity word d escriptions m ust be used, and must
conform to tho se in the applicable tariff. A bill of lading must also contain the type of package and
num ber o f pieces for each separate com mo dity d escription.
Claims declination - Balance d ues
Freight rates are based upon the cla ss rating assigned to specific commodity groups within the
National Mo tor Freight Classification. These charges reflect the dam age ch aracteristics o f an article
based upo n its fragility, density in po und s per cubic foot, size, weight and m any other factors. C ertain
types of pack ages hav e been found to redu ce the risk of loss or dam age to a w ide variety of products
with in a specified group. Consequen tly, each entry in the tariff defines the various types of pack aging
or other meth od o f tender that is authorized for the commodity so described. For example, some
prod ucts may be shipped "loose," (no packaging), while others can only be tendered in "boxes or
crates."
Packaging p enalty may be assessed
Failure to tender freight in an authorized form can result in a penalty of 120 percent above the
original freight charges for LTL sh ipments and 110 percent on TL shipments (Rule 687, NMFC
100). As a general rule, claims for loss or damage, when due to improper packaging, will be
summarily declined due to a breach of contract i.e., the "A ct or D efault of the Shipper. (See p.56 ,[4])
Freight misdescribed on the bill of lading not only affects the charges, but the method of tender as
well. If, in the process of claim s, the carrier determines that the commod ity lost or damaged was
misdescribed on the bill of lading, he is obligated by law to collect the proper charges. The carrier can
law fully collect on sh ipmen ts going back two to three years, depending on whether they were
interstate or intrastate m oves. Balance dues o f this nature can be substan tial, far surpassing the loss
or dam age amo unt being claim ed by either shipper or consignee.
41
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SHIPPER/CARRIER RELATED ISSUES
Last clear chance (rule of law)
In cases where negligence is shared by bo th defendant and plaintiff, som e courts have held that . . .
"where the defendan t has h ad an op portunity to avoid the harm, th e plain tiff's negligence is
not the prox imate cause of the injury."
Carrier liability upon accepting freight
Upon accepting freight for transport the carrier becomes the "virtual insurer" of the goods and is liable for loss,
damage or injury unless it can prove . . . (See p.28: Proving Your Claim)
a. One of the bill of lading ex ceptions:
1. Acts of God
2. Public Enemy
3. Authority of Law
4. Act or D efault of Shipper, or O wner
5. Inherent V ice
b. That it (carrier) w as no t negligent.
This burden only comes after the claimant presents a "prim a facie" case against the carrier.
Shippers an d Con cealed dam age
It is not unusua l for the custo mer to find broken parts or pieces of an article within a shipping container that
is in "apparent goo d order," and w here there is no corresponding dam age to any of the interior pack aging forms.
IN THE ABSENCE OF CARRIER NEGLIGENCE, TWO PO SSIBILITIES EXIST:
(1) Dam age occurred during assembly or packaging prior to transportation, or
(2) Injury was sustained w hen unp acked or transported by the con signee.
42
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SH IPP ER SH O UL D B E P RE PA RE D T O PR O VID E T HE FO LL O W ING INF O RM AT IO N:
Assem bly pro cedures, and the types of tools and equipment needed to com plete the finished pro duct.
A record as to the handling of your product(s) from point of final assembly to the packaging area.
A description of how stock is stored, and what han dling, if any, is given it during this period of time.
Procedu res followed in the packing of goods, to include any quality assurance inspections conducted
prior to the enclosure of compo nents within packaging materials and sealing of the shipping container.
The material hand ling devices, if any, that are used in th e load ing, un loading or internal hand ling of
you r pro ducts.
Technique(s) that is used to load, block or brace a shipment in the vehicle, as well as the type of
material, placement and quantity of dunnage used.
Free On Board (FOB)
W ho has title to the goods and when title passes is a complicated matter, and is of vital importance to all
parties involved in the transportation or distribution of property. Understanding when title passes is critical as
it determines who in fact owns the property, and thus the legal right to file claims for loss or damage to the
goods.
W areho usem an: L imitation s on car rier liability (See p.49,52)
It is important to rem ember that the common carrier is liable for any loss, dama ge or injury to
property resulting out of their own negligence. However, when acting as a warehouseman , their
liability is limited to one of "reasonable care," as defined in U .C.C. A rticle 7(20 4-1 ):
"A war ehou sema n is liable for da ma ges for loss of or injury to the good s caused
by its failure to exercise such care in regard to them as a reasonably careful man
would exercise and under like circumstances but unless otherwise agreed he is not
liable for dam age which cou ld not have b een avoided by the exercise of such
care."
43
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FO B SH IPM EN TS: D ETE RM ININ G O W NE RSH IP O F G OO DS IN T RA NS IT
TERMS OF SA LE TIT LE PA SS ES TO . . .
FOB O rigin Buyer, w ho o wns the goods in transit

Freight Collect Buyer pays
Claims Buyer files any claim
FO B O rigin Buyer, w ho o wns the goods in transit

Freight P repa id Seller pays the freight charges
FO B O rigin Buyer, w ho o wns the goods in transit

Freight charged back Seller pays - adds to buy er invoice
TERMS OF SA LE TIT LE PA SS ES TO . . .
FOB D estination Seller, wh o ow ns the goo ds in transit

Freight Collect Buyer pays
Claims Seller files any claim

Freight P repa id Seller pays

Freight Collect (allowed) Buyer pays - deducts from invoice
It is commonly believed that the one who pays the freight charges is the rightful ow ner o f the goods. This is
false. Ownership of the goods is determined by th e "term s of sale" in the sales contract. The precedin g chart is
only a general guideline. When ownership of the goods is in doubt, it is not uncommon for such matters to be
settled by th e court.
BILL OF LADING EXCEPTIONS
Ship pers' risk
Noting the bill of lading - "SHIPPER'S RISK DUE TO IMPROPER PACKA GING," does not absolve the
carrier from liability in the loss or d am age of goods.
44
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It is still incumbent upon the carrier to show where the sole or proximate cause of loss or damage was due to one of
five exceptions permitted in the bill of lading viz., "Act o r Default of Shipper." If the carrier knowingly accepts freight
improperly loaded or packaged he waives his defense under the bill of lading contract (See also Shipper Load and
SHIPPER LO AD AN D C OU NT , SLC further in this section). In such cases the carrier should invoke Rule 680,
Sec 4 of the National Motor Freight Classification 100, and refuse the sh ipment until it can be tendered comp liant with
existing rules and regulations.
Pallets Said To Contain (Carrier: Origin, Interline or Delivery)
Signing bills of lading for "pallets s` aid to contain' (?)-pieces," where the count could have been verified at time
of pick up or interline conveya nce, affords about as much legal protection as th e consignee (receiver of the
good s) who signs the freight bill: "subject to count" or "subject to inspection." All parties to the shipment are
severally liable, and have the legal obligation and business im perative to determine any loss or damage that
might ex ist at tim e of pick up, interline transfer or delivery.
Carrier Load
The carrier is vulnerable to litigation in such cases, for if a shortage is determined at time of delivery,
the burden of proof is up on the carrier to sh ow that it "could not have known through ordinary
inspection and observation, or in the exercise of reasonable care, that the goods were received short at
time of pick up!" (No te: Un der the Bills of Lad ing A ct, the carrier is required to count the
packages of goods, or ascertain the kind an d quantity if bulk freight). (See p.47: 49 U.S.C. 81,
Section 20).
Ship per L oad: "S LC " No tation, m eaning of
W here the shipp er loads and the consignee unloads, the carrier shall not be liable for any loss or
dam age resulting from their action (if proven to be the sole or proxim ate cause o f dam age).
I M PO RTA N T E X C EPTIO N: Even when the goods are loaded by the shipper, the courts
have generally held that where the carrier is given an opportunity to inspect the condition
and quantity of freight, the carrier may be held liable for any shortages, damage or improper
loading that was apparent or which could have been discovered by ordinary observation. (See
also p .47: 49 U.S .C. 81, Sec. 21 ).
45
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IM PROPER L O A D : An im proper load must be refused until it is tendered in accordance

with existing rules and regulations.
A P P A RE N T DAM AGE: Where there is apparent damage, the carrier is not relieved of its
liability on the basis of an "SLC" n otation, nor can it claim "A ct or Default of the Shipper"
as a defense.
SHORTAG E: As for a confirmed sho rtage, the carrier's agent need o nly anno tate the bill
of lading to reflect the actua l count. The shipp er's signature on the bill of lading shall serve
to confirm this notation as being a "m atter of fact."
QU ESTIO NS LIKEL Y TO BE A SKED : (Carrier and Shipper)
1. W as the carrier given an opportunity to exam ine and coun t the freight loaded by the shipper
before the trailer was sealed?
2. If an improper load, what would have made it "apparent" to the driver and not the shipp er's
personnel who loaded the go ods - those who should b e mu ch m ore know ledgeable about its
shipping characteristics?
3. Carrier/Interline transfers: At time of receipt, were the goods as originally tendered and as
indicated on the freigh t bill, and were you able to examine lading for apparent damage or
verify the piece count? If not, receipt accordingly.
SHIPPER LOAD AND CO UNT (SLC)
A "Shipper Lo ad and C oun t (SL C)" is wh ere th e carr ier drops a trailer at the shipper's dock to be loaded and
sealed by their personnel, who then picks it up at a later date without having visually inspected or counted the
freight. An SL C no tation o n the bill of ladin g is an adm ission by th e ship per that th ey (so lely) visually
inspected, loaded and counted each piece of freight. When a carrier is denied the opportunity to inspect a
load, this exception greatly increa ses a claimant's burden of proof. For the claimant must demonstrate by a
preponderance of the evidence that all freight was accounted for and loaded in apparent good order at the time
of carrier receipt. The claimant has the further ob ligation to prove that such loss or damage actually existed at
time of delivery. (See p.51 : Liability and SL C loads [Carrier]).
As a genera l rule, an SL C no tation should not be permitted on b ills of lading where the driver was afforded an
opportunity to count and inspect the goods before the trailer is sealed.
46
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Carr ier liability
If the claimant is successful in showing that the shipment was in good condition at time of acceptance by the
carrier, and delivered in a dam aged condition (aided by excep tions on the freight b ill), the burden then shifts to
the carrier to prove that the cause of damage w as due to one of the five bill of lading exceptions. For exam ple,
"The Act or Default of the Shipper," where damage resulted from improper loading or packaging. Upon
satisfying this legal burden, the carrier would not be liable for any loss or damage - with or without an SLC
exception.
Ge nera l: An "SL C" e xcep tion ma y no t hold up in court w here . . .
[1] A carrier was ask ed to suggest a m ore appropriate m etho d of tender and failed to do so.
[2] Carrier loading instructions were implemented whole or in part by the consignor (shipper)
and accep ted fo r shipment.
[3] A carrier knowingly accepts cargo believed to be improperly loaded or packaged.
[4] A carrier willingly signs a b ill of lading for an unk now n quantity of packages viz., Pallets/Package
"Said To C ontain (#) pieces," w hich by external (ordinary) observation could h ave been determined at
time of receipt.
When the carrier loads: Improper "SLC" notation
Bills of Lading Act, 49 U.S.C. 81, Chapter 4, Sec 20 and 21
"WHEN GO ODS AR E LOAD ED BY A C AR RIER: such carrier shall count the packages of
goods, if packaged freight, and ascertain the kind and quantity if bulk freight, and such carrier shall
not, in such cases, insert in the bill of lading or in any notice, receipt, contract, rule, regulation, or
tariff, S
` hippers, weight, load, and count,' or other words of like purp ort . . . If so inserted, contrary to
the provisions of this section, said words shall be treated as null and void and as if not inserted
therein."
NO TE : The carrier is only responsible for "counting the packages"
NOT T HE CO NTE NTS TH ER EO F.
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Carrier liability relieved
W hen signing the bill of lading "C ONTE NTS AN D CO NDITION UN KN OW N," a carrier is
relieved of liability in the event of shortages as the freigh t bill is only "prima facie" evidence as to the
"num ber of packages received" by the consignee, and does not establish the actual quantity or
condition of contents (wh en delivered in the same condition as originally received). . .
When shipper loads: "SLC" notation
Bills of Lading Act, 49 U.S.C. 81, Chapter 4, Sec 21
Freight loaded by the shipper: "and the goods are described in the bill of lading merely by statement of marks
or labels upon them or upon p ackages containing them, or by a statement that the goods are said to be goods of
a certain kind or quantity, or in a certain cond ition, or it is stated in the bill of lading that pack ages are `s aid to
con tain' good s of a certain kind or quality or in a certain condition, or that the contents or condition of the
`c on tents of pack ages a re un know n,' or w ords of like purport are contained in th e bill of lading,
such statem ents, if tr ue, sh all not make liable the carrier issuing the bill of lading, although
the goods are not of kind or quality or in the condition w hich the mark s or labels upon them
indicate, or of the kind or quantity or in the co ndition th ey w ere said to b e by the co nsignor.
In other w ords, the carrier m ust be ab le to confirm the kind of goods, or the quantity and co ndition of property
as described on the bill of lading, or he cannot be made liable in the case of a discrepancy.
Carrier precaution
The carrier may insert in the bill of lading the w ords "Ship per's w eight, load, an d cou nt," or similar
language, to ind icate th at the goods w ere loaded by the shipper, and that the description of lading was
also p rovided by him.
If this statement is proven true, then the carrier shall not be liable for damages caused by
a. Improper loading
b. Nonreceipt of goods (shortages) or
c. Misdescription of the cargo in the bill of lading.
48
CARRIER’S BASIC RESPONSIBILITY
___________________________________________________________________________
It is the carrier's fu nda mental respo nsibility to deliver goods ten dered to it in the sam e con dition in which it
was received. A carrier is also obligated by law to execute "reaso nable d ispatch" in th e transportation of lading, and to
handle freight in a safe and prudent manner.
Transportation, legal definition
Includes " . . . all services in connection with the receipt, delivery, elevation, and transfer in transit, ventilation,
refrigeration or icing, storage, and handling of the pro perty transported." (49 U .S.C.,
Sec (1)(3)[a] 19 64).
W hen transpo rtation is completed
Delivery is completed when there is nothing left to be done to finish the transportation of lading.
When delivery is completed
Comm on law requires that the land carrier deliver to the door o f the consignee. (See p .50: N ote).
To the d oor, or p lace o f deliv ery, m eaning, the "unloading platform or the customary place used for
delivery."
Delivery has been m ade comp lete when no further d uty or action is required of the carrier to execute delivery!
Undeliverable freight: Carrier as a warehouseman
W here a con signee refuses the freight, and the carrier retains both possession and control of the
proper ty, a lawfu l delivery m ay not have been com pleted . In such cases, the carrier's liability would
rem ain as the "v irtual insurer of the go ods," rath er than the lesser status o f a "warehousem an." A s a
rule, a carrier's status reverts to that of a warehouseman when storing property by request of the
shipper or consignee, or when freight is refused after proper tender of delivery. As the "virtual insurer
of the goods," freight handling by a common carrier is subject to a more stringent standard than that
of a warehouseman. W hen acting as warehouseman, the carrier's liability is reduced to that of
"reasonable care," i.e., the same degree of care you might exercise in the handling of your own
property.
49
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Liability questions relative to refused or undelivered freight should be resolved by carrier and claimant prior
to the filing of a claim . (Refer to th e Bill of La ding contract, S ections 1 (b), and 4 (a) limitin g the carrie r's
com mo n law liability).
LOAD IN G AN D U N LO A D I N G
Unless otherwise provided in carrier's individual tariffs, when freight (per package or piece) in a single container,
or secured to pallets, platform s or lift truck sk ids, or in any other autho rzied form of shipm ent::
(a) W eighs 11 0 po und s or less, the carrier wil perform the loading and unloading
(b) Weighs more than 110 pounds but less than 500 pounds: Carrier will perform the loading and
unloading where the consignor (shipper) or consignee prov ides a dock, platform or ram p directly accessible to
the carrier's vehicle except w here restricted by th e size limitations (greatest or greatest and intermediate
dimensions) published in Rule 568 of the National Motor Freight Classification. Where the consignor or
consignee does not pro vide a dock, platform or ram p, the truck driver, on req uest, will assist the consignor or
consignee in loading or unloading.
(c) W eighs 500 pounds or mo re the consignor (shipper) will perfo rm the loading and the con signee will
perform the unloading. O n request of consignor or consignee, the truck driver will assist the consignor or the
consignee in loading and unloading.
(d) exceeds 8 feet in its greastest dimension or exceeds 4 feet in each of its greatest and interm ediate
dimensions the co nsignor w ill perform the loading and the consignee will perform the unloading. On request of
consignor or consignee, the truck driver will assist the consignor or consignee in loading and unloading. These
provisions will not apply to the extent provisions are published in paragraph (b) (2) of Rule 568.
Please refer to Rule 568 of the NMFC 100 for the specific size and/or length restrictions on heavy or bulkly freight
and consult with the carrier's agent prior to shipment, as other tariff restrictions m ay apply. NOTE: Freight charges
cover transpo rtation o nly "to the doo r" of the co nsignee (place of delivery). "Inside delivery," is a supplementary service
mad e available by the carrier for an additional (published) charge.
General liability
The carrier assumes the liability for any loss or dam age incurred as a consequen ce of its loading and unloading.
How ever, if the shipper or consignee has the responsibility or arbitrarily elects to load/unload the shipment, and
where the carrier assists but does not serve in a supervisory capacity, either the shipper or consignee would
assume the liability for any loss, damage or injury resulting from its negligence or lack of experience.
50
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Liability and SLC Loads
An SLC notation on the bill of lading, if accurate, exem pts the carrier from any liability, as it clearly
indicates his lack o f participation in the actual loading of the freight.
Carlo ad ship men ts
.. In carload shipm ents, th e duty of the carrier is lim ited only to that o f transportation.
.. It is the duty of the shipper to properly load and brace cargo w ithin th e veh icle in such
ma nner "as w ill afford a reason able protection of lading (Rule 68 0, Sec 1, NM FC 100)."
Heavy or bulky freight, specific liability: (Rule 568, NMFC 100)
Consignee/ Shipper: If the shipper or consignee elects to load or unloaded freight utilizing their own m en and
equipm ent, contrary to existing tariff regulations, they will beheld liable for any damage or
injury resulting from their negligence or lack of experience.
Carrier: W here tariff regulations permit the carrier to furnish men and equipm ent to load or unload
freight, and so requested b y the shipper or con signee, upon rendering such assistance the
carrier shall be liable for any dam age or injury resulting from its negligence.
Carrier: W here tariff regulations prov ide for the consignee to unload and the carrier arbitrarily
assumes this responsibility (without such service having been requested by th e con signee) it is
liable fo r any dama ge or injury arising out o f its ow n negligence.
PRECAUTIONS: CARRIER - SHIPPER - CONSIGNEE
Carrier should notify the shipper/consignee of its regulations regarding the loading or unloading of
heavy or bulky articles
Carrier should confirm whether the shipper or consignee will assume the duty of loading or unloading.
Solicit an official request from shipper/consignee for the carrier to load/unload the freight under the
terms and co nditions of its governing tariff(s).
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Carrier, shipper or consignee representatives should confer with their respective department heads and
determine, prior to the loading or unloading of goods, w hich com pany will actually sup ervise the operation. In
the event of damage, THE COURT WILL GENERALLY ASSIGN LIABILITY TO THE ONE
PROVIDING SUPERVISION IN THE LOADING OR UNLOADING OF FREIGHT.
Co nsignee re fuses to un load (S ee p.49 : Und eliverable fre ight)
If the property is not rem oved by the consignee lawfully entitled to receive it, where it has the duty to unload,
then the carrier may invo ke the prov isions of the bill of lading contract, Section 4(a), and goods m ay be "kep t
in vessel, vehicle, car, depot, wareho use or place of business of the carrier, subject to the tariff charge for storage
and to carrier's responsibility as ware ho us em an, ONLY, or at its option, remove the freight to public storage
at the owners ex pense, and held there withou t liability on the part of the carrier, and subject to a lien for all
freight and other law ful charges, includ ing reason able charge for storage."
BILL OF LA D IN G
All regulated carriers are required to issue a receipt or bill of lading for any property they receive for
transportation. Ho wever, th e language therein is lim ited to that shown in the exam ples set forth on pages
269-276, and page 2 79, or as am ended, of the Classification. (See Ru le 36 0, S ec. 1(g) of the NMFC 100.
Should you h ave an y questions in this area, request assistance from your carrier agent, or obtain a copy of the
NM FC 100 from the Am erican T rucking Asso ciation (See page 35).
Shipper may issue its own bill of lading
Shipper's electing to furnish their own bills of lading may do so, but the requirem ents of Sec 1(a) through Sec
1(d) and Sec 2 of the afo rementioned rule m ust be observed. Most carriers use the Uniform Bill of Lad ing to
meet these requirem ents. It is suggested th at you become acquainted with this document, particularly the
reverse side co ntain ing standa rd clauses of this contract of carriage as they relate to carrier liability, inclu ding
those pertaining to cargo claim s.
Bill of Lad ing: A bindin g, legal contra ct
In addition to the prim a facie evidence provided by the delivery receipt, the court recognizes and is
guided in its legal opinion by all provisions of the bill of lading contract, a document that both the
carrier and shipper have sign ed.
52
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CARRIER'S LIABILITY
Und er the provisions of the Interstate Commerce A ct, all freight carriers subject to fed eral regulation are held . . . "fully
liable fo r the ` a ctual va lue of goo ds' w hen loss or dama ge results fro m its ow n ne gligence."
W hen liab ility "Begins an d En ds"
A carrier's liability begins once an item is accepted fo r shipm ent and ceases only when the transportation of a
shipment has been completed, and delivery effectuated. (See p.49)
Carrier as bailee
A bailment is brou ght about by a transfer of property from one party to another for a special purpose. "At
common law a carrier is an ` e xtrao rdinary bailee' beca use he has such co mp lete knowledge and contro l of the
prop erty that is in his possession . (Ex P arte 40 3).
Proper or Lawful delivery (Bills of Lading Act, Section (9) and (10)
A carrier is liable to anyone having "a right o f property or possession in the goods" if he fails to deliver the
good s as autho rized:
(a) A person law fully entitled to possess the good s.

(b) The consignee nam ed in a straight bill for the go ods.
(c) A person in p ossession o f an order bill for the goods, by the terms of which the goods are
deliverab le to his order; or which has been indorsed to him, or in blank by the consignee, or
by the m ediate or imm ediate indorsee of the consignee.
Released Rates (Limits on liability) (See p.110: Appendix C)
Common carrier liability can b e limited through the use of "Released Rates," (Sec 20 (11) but only under the
following conditions:
1. Established by written declaration of the shipper, or

2. Initiated by written agreement between the carrier and shiper
as to the released value of the property.
Released Rates: Freight charges are assessed higher or lower depending upon the greater or lesser value of
good s as declared by the shipper.
53
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Valid only if the shipper is permitted an opportunity to elect greater or lesser liability at a correspondingly greater or
lesser freight charge. If denied a clear and inform ed choice between full value and released (variable) rates, any limitation
on carrier liability could b e adjudicated as un lawful. (Discussed in Ex P arte 40 3, p.7-11 ).
Exception to Common L aw (Carmack) Liability
By c om m on law a carrier can not enter a contract with the shipper that attempts to rem ove its liability
for "full actual loss, dam age or injury." However, w hen the shipper is given a choice between released
and full value rates, the carrier's liability can be limited in the amount of the declared valuation for
this designated charge. (49 C.F.R., Sec. 11707[4]; 10 730(a),(b)1,2).
The Carr ier does n ot "declar e value!"
W here rates are based upon "released or actual value," the carrier does not declare the value! Released
rates are predicated upon the declared value assigned by the shipper "in writing," and so stipulated on
the Bill of Lading. Once signed, all parties become legally bound by the term s of this contract.
Unfortunately, goods are often shipp ed at the lowest possible rate reflecting a lesser (declared) value.
In case of loss or dam age, the reco very amo unt is not always com men surate with the "actual value" of
the goods.
E X A M P LE : D E CLA RE D VAL U E NO T E XCE E DING $ 0.10 CE NTS PE R PO U ND
a. 500 items shipped weighing 1 oz each, valued at .10 a piece, and 16 are lost or damaged:
Va lue: $1 .60 A mo unt of r ecove ry: $0 .10 ce nts
b. 500 items shipped w eighing 2 oz a piece, actual value $20.00 each. (8) are lost or dama ged
.. at $0.10 per pound:
Va lue: $1 60 .00 A mo unt of r ecove ry: $0 .20 ce nts
Tendering prod uct (a) at the lowest rate and valu ation makes good sense because of its low cost. However,
shipping product (b) at the same declared value would result in a substantial loss in the event of damage. For
this prod uct, a "full value" rate would be mo re appropriate. Customers should advise their vendors as to the
released valuation, if any, that is to be declared on their goo ds. If in dou bt, contact the carrier fo r tariff autho rity
relative to th e applicatio n of released rates for your specific com mo dities.
54
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CO NSID ER TH E F O LL O W IN G . . .
[1] The value of the individual pro duct(s).
[2] The po tential risk for loss or dam age.
[3] Actual percentage of loss o r dam age (if kno wn).
[4] Differential between full value and released rates and char ges relative to economic factors
[1],[2 ] and [3].
[5] Consult with carrier an d shipp er relative to any claim s

and th e application of released and full value rates.
CARRIER EXEMPT FROM LIABILITY
FIV E EXC EPTED C AU SES (Bill of Lading C ontract)
1. Acts of G od (Storms, floods, earthquak es, fire, w ind et al.)

2. The Public enemy
3. The authority of law
4. The act or default of shipper or owner
5. Inherent nature o f the comm odity or a latent vice
[1] Acts of God
It is important to recognize that a carrier is not relieved of respons ibility fo r loss or dam age arising fro m these
bill of lading exceptions where it was not the immediate or proximate cause. Some argue it must be the "so le
cause." An act of God is a natural event that p recludes m an's intervention, a set of circum stances which could
not have been foreseen or prev ented by hum an agency. Fo r exam ple, flash floo d, win d an d lightning fires.
Extr eme cold or heat are natural phenomena but do not, in themselves, constitute acts of God. Seasonal
freezing or hot weather conditions are predictable, the effects of which can be averted through human
intervention. Rain, too, is an act of God. Nevertheless, a carrier is not excused from liability if water came
into contact w ith his freight due to holes or cracks in his equipment. If the bill of lading is marked "Protect
From Freezing," or a carrier picks up or solicits freigh t know n to be tem perature sensitive, it can be held liable
for the loss or dam age arising out of its negligence.
55
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[ 2] T he Public En em y
This exception is rare in peace time, as it was intended to apply to foreign military forces at war with the
dom estic governm ent.
[3] The Authority of Law
A carrier is not responsible for the loss or damage to freight resulting from the statutory seizure of unlawful
com mo dities, for exam ple illegal drugs or other contro lled substances, slot machines etc., contaminated goods or
stolen property. And here again, the burden of proof falls upon the common carrier to show where the
"authority of law" w as the sole and prox imate cause of any loss or damage.
[4] The A ct or Default of Sh ipper or O wner
The act or default of shipper or owner," is generally used to defend against improper loading o r bracing,
inadequate packaging, or any unauthorized method of tender. An unauthorized form of shipmen t, once
accepted by th e carrier, cannot receive any less care in han dling than freight thought to be com pliant w ith
existin g tariff rules and regulations.
A carrier bea rs the burden o f proo f to bring forth conclusive evidence to show where the act or default by the
shipper or ow ner w as the sole and prox imate cause of loss or dam age. It is also incum bent upon the carrier to
prove that it was free from any contributory negligence. Courts will not grant pro-rated settlements between
carrier and claimant, as freight loss and dam age statutes do not recognize "a degree of negligence." The act or
default of the shipper notwithstanding, when a carrier handles improperly packaged freight in such manner so
as to have contributed to its loss or damage, then it can be held liable. If loss and damage resulted solely from
the act or d efault of shipper, then the carrier is free of any liability.
[5] Inherent V ice
A carrier is not liable for loss or damage due to natural defects in the proper ty (inhere nt nature, vice, defect or
infirmity of the goo ds). Such claim s generally result from the decay of perishables, or the natural death or
deterioration of livestock. Courts have held that a carrier is not absolutely liable for spoilage or natural
deterioration if he has exercised reasonable care during the course of transportation. A common car rier is not
responsible for dam age to a shipm ent due to the affect of natural laws upon it, and when such dam ages were
caused solely by the act or default (omission) of the shipper.
56
^DAMAGE DETECTION PACKAGING GUIDE
CARRIER - SHIPPER
Be alert to the potential claim hazards represented here and closely examine all freight displaying these
characteristics. Design changes in the packaging or method of tender can often reduce or eliminate the types of
dam ages resulting from the packaging failures d epicted here, and with little or no investmen t in new materials.
Claims prevention is the ultim ate go al and should be of prim ary concern to all parties involved, and especially
the shipper and carrier, as both depend upon one key factor for their success. The customer! If they lose him,
they cease to have need for one ano ther. They cease to be!
CONSUM ER
The following is a pictorial guide illustrating the mo st com mo n pack aging erro rs often resulting in freight loss
and damage. Upon encountering any one of these conditions, the consignee should consult with the shipper or
man ufacturer prior to the filing a claim . W hen either the method of tender or packaging system does not m eet
the minimum tariff requirements, claims may be declined on the Bills of lading ex ception v iz., "Act or d efault
of the shipper." Where carrier negligence is thought to be a contributing factor, both the shipper and carrier
should be notified.
Although your product may not appear on the following pages, the dynamic principles illustrated are common
to virtually all types of freight. For example, while windshields are represented, steel band tension can crush
metal furniture, cut into w ood or crack plastic articles etc. It is the "cause and effect," rather than the product
itself, that freight handlers should become familiar with.
TEST YOUR SKILL
Study the drawings o n the next three pages, can you sp ot the potential loss or damage situations. These two
dimensional line drawings cannot truly reflect the conditions one might observe in a three dimensional environment, nor
was this the original intent. Rather, the primary purpose of this simple exercise is to bring into focus potential claims
situations that might not ordinarily attract the viewer's attention, thus heightening the awareness of the freight handler
in these specific areas. Hop efully, this section will provide some assistance in the training of new and inexperienced
shipp ing or receiving personn el.
A list of the packaging defects or problem s concealed within the follow ing draw ings, are printed at the end of this test.
57
CONDITION A
58
CONDITION B
59
CONDITION C
60
DAMAGE DETECTION PACKAGING GUIDE (p. 58-60)
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Condition A
1 a. Material overhangs about 1" and can be damaged by fork lift. (See p.68)
b. There are insufficient transverse memb ers to pro vide even support for the flexible sheets.
(See pp.71 -73 )
c. No cross-member support in the first critical 48 inches of length to protect underside of

freight from being damaged by the blades of mechanical handling equipment. (See pp.71-
73)
d. No dunnage (bottom) sheet to provide even support along the full length of the load, the
sheets will bow into the large apertures and break. Metal sheet stock creases or buckles in
these areas. (See pp.63-65)
2. a. Stakes often cause the very dam age they ar e supp osed to preve nt, as under load, when
imp roperly positioned, such dunn age will collapse into boxes above and below and dam age
the contents. To be effective the stakes must rest against something solid, such as an integral
frame, and mu st run the full length or w idth of the con tainer, i.e., corner to corner on every
side. (See pp.65,66)
b. Runners of to p loa ded pallet w ill dig into the top boxes of glazed pictures stacked below.
(See pp.63-65)
3. W hile the machine is banded properly, there is no runner or stringer support. With all of the weight
concentrated in the area of the legs, this unit can easily collapse into the pa llet. Listing will cause
damage to its fragile components and to other freight in the vehicle. (See p.67)
4. No tice the lack of a center stringer or runner in the pallet. As road shock causes the load to increase
in weight, loose or bulk freight tends to shift toward the center of gravity. The deck board may flex
and break in transit causing the bands to become loose and the freight dumped onto the trailer floor.
(See p.67)
5. Overhang on a p allet causes top loaded freight to press the bottom boxes over the edge of the
platform. Sheet metal products, displays and fluorescent light fixtures are among the most common
articles damaged by such loading techniques. (See p.68)
61
DAMAGE DETECTION PACKAGING GUIDE (p. 58-60)
______________________________________________________________________________
Condition B
1. Top tier, third box on the right has two indentations where orig inally strap ped ; also, a second tape
application has been placed o ver the original tape suggesting possible pilferage
2. Second box down from the top, left side, th e tape width is smaller than all the others. Again,
suggesting possible pilferage
3. Bottom box, far right, has a different type of tape
4. Box to its immediate left has a completely different label, and notice that it has rounded corners
Condition C
1. a. Top tier, bo x at the far left show evidence of pilferage. Notice the dark shado w by the tape.
The flap has been pushed in and returned to a position just beneath the tape seal. (See
pp.80,81)
b. Box to the far right has indentation where a strap was originally placed.
2. Second tier down from the top, second bo x to the right, observe that the bottom left corner has been
crushed. In a unitized load this type of dam age w ould be im possible unless the pallet had been
reworked either in distribution or during the course of transportation.
3. a. Third tier down from the top, second box to the right, the tape seal is missing. Again,
suggesting that the box was pilfered and the pallet reworked.
b. Box to the far right is upside d own - con trary to the directional m arkings.
4. Bottom tier, seco nd b ox to the right also m issing tape seal.
62
PALLET STACKING
Doub le face pallets consist of three flush stringers (runners) faced

both sides, top and bottom, with deck boards ranging from 3 to 4
inches in width . They are reversible and extremely sturdy , able to
support greater load weight than most any other type of similar
dun nage.
Sin gle faced pallets are not only a weaker structure, but in stacked
load situations they may cause damage to the freight positioned
directly below.
Unless rigid dunnage sheets or bo ards are utilized, these pallets are
not recommended for use where they are apt to be the "top load"
and likely to be supported by shipping containers made of
corrugated fibreboard, or any other type of packaging produced from
pap er goods.
Un like the double faced pallet depicted abo ve where the weight is
even ly distributed across its surface, on a single face pallet the entire
weight of the load is centered at only three points, i.e., along the
length and width of its three stringers.
The surface area of a standard 48 x 48 inch single face wood pallet is 2304 square inches (16 square feet). A thousand
pound load rests upon the three run ners 1.5 x 4 8 inches each or 2 16 square inches (1.5 square feet) of load bearing
surface. This com putes to 4 .6 poun ds per squ are inch (666.66 pounds per square foot) being supported by wh atever
packaging is stacked below.
If the pallet were of double face construction the stress is reduced to 0.434 pounds p er square inch (62.5 pound s per
square foot) because the weight is now distributed evenly across the full pallet surface. The drawing above depicts the
kind of dam age commonly associated with the improper use of such du nnage.
63
PALLET GAP
Ano ther problem associated with unitized loads is that of "gapping." A pallet contains deck boards that are spaced from
one to several inches apart. Many shippers who design and build their own dunnage, whether for econom y or other
reasons, tend to use fewer bo ards and thus create even wider apertures. The wider the space between load bearing
boards, the greater the risk for dam age.
Goods packaged and transported in compliant (fle xible ) shipping containers, as with paper bags illustrated in the top
diagram, are highly susceptible to rupture when tendered on open deck pallets. This is particularly true w hen the conten ts
is packaged in "bulk" either in granulated or pellet form. Such material is fluid in nature, and thus able to accumu late in
the unsupported areas of the pallet platform. Dynamic shocks imposed by the road surface coupled with the weight of the
unitized load work to gether to simu late an imp act ex trusion process. W ith each jolt the upper tiers of the load co mp ress
the bottom b ags, forcing its contents betw een the apertures o r unsupported spaces in the platform .
Narrow deck boards greater than 1" inch in thickness po se a sim ilar problem for boxed m aterials. This is especially
critical where the pro ducts hav e a large surface area, fo r exam ple acoustic wa ll pan els or dividers and similar types of
articles. At each impact the weight of the articles stacked above work to drive the deck boards up into the surface of the
bottom container. A "blunted shear effect" causes the box and its contents to collapse around each deck board (i.e.,
configuring itself to the contour of the platform upon which it rests). A so lid platform or deck is necessary to eliminate
the problem .
64
DECKING - STAKING DAMAGE
Similar to pallet gap, the use of irregular load bearing su rfaces in the design and construction of larger pallet bases can
cause considerable dam age of an internal or external nature.
STAKING: To be effective th e stakes m ust be flush with the package!
STA KIN G MU ST N OT BE US ED w ithout a rigid frame work around the item being protected,
providing adequate support for such dunnage at all edges. This can be accomplished though the use of
sturdy packaging forms, or the framing that forms an integral component of the product design itself, as
with glass wind ow s or skylights etc. If the stakes are shorter than the package being protected or there
is no support structure, the irregular surface will dig into the layered packaging causing varying degrees
of dam age at each tier. D am age to lading in such cases would result from a packaging failur e. (See
p.66 ).
TOP LOAD: The stacking of this type of pallet base is similar to that caused by single face pallets discussed earlier in
this packaging guide. To eliminate the potential claim hazard, pallet bases should be designed and
constructed with a so lid deck, or a dun nage sheet of plyw ood should be placed on the platform to
provide an even load bearing surface as illustrated on the following p age.
65
A rigid sheet of material made from wood or dense paperboard stock , equal to the dimensions of the load, should be
provided between the freight and the platform of the wooden pallet. This dunnage device helps to distribute the weight
even ly across the full surface of the pallet. As the pounds per square inch are spread over a larger area, dynam ic or static
stress is not absorbed nor focalized in any one location.
DUNNAGE SUPPORT
Staking between tiers on unitized loa ds must have a solid

surface upon w hich to rest. This can be achieved through
the use of an integral frame form ed by lum ber or other
rigid types of material.
A skeletal structure of this sort is necessary when a frame

work does not form an integral part of the pro duct itself,
for example, such as windows and skylights. Or if the
conten ts of the box is other than rigid in its material
com position or co nstru ction.
66
PALLET LOADS
Be particularly alert to the lack of necessary

stringers or runners in the design and
construction of pallets. W ithout adequ ate
integral support an uneven load will cause the
pallet to break apart.
Dynamic stress is greatly intensified in an

unsupported area of a pallet or platform . This
is highly apparent in com pliant load situations.
The steel bars show n here are typical of such
freight. No tice how each piece has shifted or
gravitated tow ard the center of the pallet.
Solid or rigid loads that accomm odate apertures

in the base area are also po tential claim
hazards. The gross w eight of the fireplace on
your left is only being supported by two deck
boards. Excessive strain is placed upon these
load bearing surfaces when the pallet is in
transit, and could collapse when elevated or
man euvered by m echa nic a l ha n d ling
equipm ent. A support must be placed on
either side of the center stringer to prevent the
deck boards from rupturing.
67
PALLET OVERHANG
Pallet overhang is a frequ ent cause of dam age in unitized loads.

Those items most comm only tendered in this mode are
fluorescent light fixtures, laminated plastic or metal in sheet stock
sizes of 4 x 8 and 4 x 10 feet in length. Dynam ic stress applied
by the weight of the upper tiers and any top loaded freight, causes
the bottom boxes to literally bend over the edge of the pallet. To
prevent damage of this type a larger skid must be used, or the
dim ensions increased through the use o f a rigid dun nage sheet.
In all cases, the weight bearing surface must equal or exceed the
dim ensio ns of the lo ad p laced upo n it.
IRREGULAR STACKING
A similar kind of damage will result when boxes or

packages of irregular dimensions are stacked o ne upon the
other. W hen tendered on pallets, a rigid load bearing
dunnage sheet must be used between each tier to prevent
crushing of the variety illustrated in this drawing. It
distributes the weight even ly across the full surface and
reduces the dynamic stress in psi (pounds per square inch)
upon each individual package in the load.
68
PYRAMID LOADS
Pyramiding is where boxes are stacked uniformly

on the pallet except for a "packaging cap," i.e., a
single box placed on top of the last tier. The
shipper does this intentionally to prevent the top
loading of other freight. Unfortunately, other
goods must be loaded on top of this freight to
com pletely fill the trailer. This method of tender
actually causes the very k ind of damage it was
intended to prevent.
Consider a unitized load 48 x 48 x 48 inches

having a load bearing surface of 16 square feet.
Sup pose that the box forming this pyramid is 12
x 12 inches. It would have a load bearing surface
of 1 square foot. If a mere 100 poun ds were
placed upo n this pyram id, the top box and all
those in its colum n, would be supp orting the full
weight, i.e., 100 p ounds per square foot.
Com pare this with the top tier where each box
only supports 6.25 pounds per square foot.
In pyramid loads a single column from the top

box dow n actually suppo rts the weight of any top
loaded freight! Like a wedge, this top box is
driven down into the vertical column with every
impact shock sustained over the course of routine
transportation. A great am ount of dam age can
result before the load collapses to a point where
the weight is distributed over a more uniform
load bearing su rface.
69
Colum n stacking a palletized load (block pattern) is
used for packages hav ing equal length and width
(boxes o r cylinders) that are basically sym metrical.
Since it provides much less stability than m ost other
load styles, it should be av oided whenever possible.
W here colum n stacking mu st be used, shipper's should

consider one o f three m ethod s:
(1) Gluing the bo xes together w ith a modest

bonding agent.
(2) Dual four-way b anding utilizing edge

protectors.
0
(3) The use of angled 90 degree sup ports
fabricated from solid fibreboard, 1/8 inch or
more in thickness. These devices are placed
at all corners, and run the full height of the
unit. They can be secured to the load by
banding or shrinkwrap applications. Such
packaging affords excellent reinforcement and
prevents individual box es from shifting (pallet
list) and the subsequent crushing of the lower
tiers (boxes) while the load is in transit.
I N TE RLO CKIN G L O A D
Inter lock ing (b otto m le ft dra win g) pro vide s the m ost sta ble load, and m ake s the b est use of valuable d eck space.
70
BASE DESIGN
W hether lading is being tendered in a wooden crate

or on a platfo rm, the base design and construction
must be in com pliance with tariff packaging rules
and regulations (Rules 245, 265 or 680) as
pub lished in the National Mo tor Freight
Classification 100 . On crate design refer to pages
71-75.
The illustration on your left depicts several examples

of an improper crate or pallet base. Rule 245, Sec
(5) of the Classification prohibits the use of such
dunnage. Regulations specify that transverse cross-
mem bers must form an integral part of the base and
be sufficient in strength to protect underside of
article from damage by mechanical handing
equipm ent. Such open structures present a
potential claim hazard and should not be used.
The design and construction of the two-w ay pallet

bases show n here are typical of those that will
provide a reasonable protection of lading. W hile
pallets or skid bases are not specifically named in
Rule 245, the principle set forth in Sec (5) would
app ly via the general provisions of Rule 680.
Always check the underside of crates having a pallet
or skid base design. Concealed dam age, if any, is
likely to be found h ere.
71
To the untrained observer, custo m p latforms or pallets typically appear to be both sturdy and well constructed. It is not
uncommon to find the runners or stringers made of 4 x 4 solid timber, or fabricated using several 2 x 4 bo ards fastened
together. A recurring problem with custom built platforms over five feet in length is the lack of transverse members and
improp er positioning. To cut expenses, cross-members are sparse, thus spaced further a part, creating apertures of
excessive dimensions. When the platform is elevated the blades of the fork lift are braced against the underside of the
freight, frequently causing extensive damage.
CA RR IER /RE CE IVE R:
Give careful attention to crates or pallets bases where an open deck design is used. Be especially alert where the apertures
(spaces betw een b oards) are excessive. Most critical is the first 36 to 48 inches at each en try point of a dual access pallet
or sk id base exceeding 5 feet in its greatest dim ension.
72
This drawing illustrates the principle behind Rule 2 45, section (5), requiring sufficient cro ss-memb ers to protect underside
of an article from damage by mechanical handling equipment. While this rule applies to the base of wooden crates, the
principle is valid for freigh t tendered on dunn age requ iring the use of lift truck or similar equipment to load, unload or
maneuver.
PALLET BASES GREATER THAN 48 X 48
(1) W hen platform mem bers are spaced m ore than 12 inches a part, the probability for damage (underside of
article) is greatly increased, as such dunnage, even if a dual entry platform, may be accessed on any one of four
sides in an attempt to load, unload or maneuver the pa ckage into or out of a vehicle. Spaces should be kept to
an absolute minimum!
(2) Make sure the first 48 inches along the length at each end is well structured, i.e., little or no spacing between
the (deck boards) cross-members. This prevents the blades of a fork lift from entering between the boards as the
pallet is elevated and/or w hen the fo rks are tilted back , thereby d am aging the freight.
AS A G EN ER AL RU LE :
Apertures should be no greater than th e width of the boards being used . The potential for damage increases
proportionately to the extension of the aperture beyond this nominal width.
73
CRATE CONSTRUCTION
Rule 24 5 of the N MF C 10 0, definition for wooden

crates:
". . . containers co nstructed of memb ers made of wood

or metal with apertures between, or members of wood
or metal combined with fibreboard, securely nailed,
bolted, screwed, riveted, welded, dovetailed, or wired and
stapled together, having sufficient strength to hold the
article packed therein so as to pro tect it from dam age
when handled or transported with ordinary care.
Crates must be con structed so as to protect contents on
sides, ends, tops and bottoms, and in s uc h manner that
the crate containing its contents may be taken into our
out of the vehicle . . ."
A crate having three-w ay locking corners, as provided

by Rule 24 5, is the best possible choice (S ee p.75 ).
How ever, in the absence of such construction, Numb er
3 would be the best choice out of the three crates
depicted in the detailed draw ings.
Crate (1) is a light structure and highly susceptible to

dam age if supporting top loads or subjected to the
lateral shift of freight loaded along side. Crate (2) has
slightly more strength and affords a degree of end
protection. Crate (3) is notably stronger, able to
support reasonable top loaded weight without
collapsing. The sides and ends are reinforced to
prevent damage to its contents by other freight
positioned along side.
74
PROPER CRATE DESIGN
Critical to the integrity of a crate, no matter

what species and thickness o f lum ber u tilized, is
its method of constru ction. Imp roper assemb ly
is the primary cause of m ost all crate failures.
The draw ing at the top of this page illustrates a
"three-way locking corner." It is recommended
by packaging engineers because of its rem arkable
strength and econom y.
These drawings are representative of the

assem bly techniques most widely accepted by
shippers and carriers. Notice h ow each board is
supported by all the others, so that the integrity
of the crate is not solely dependent upon the
fastenin g devices. Also, the nails or staples are
not driven into the "end grain," of any board!
In the bottom drawing see how the diagonal
brace is sheared at one corner, so that it attaches
flush to the vertical frame.
The specifications for wooden crates is provided

for in Rule 24 5 of the N MFC , Section (3 ),
". . . Crates m ust be constructed with

three-way lock corners, where members
will be joined with na ils or staples
driven into side grain of joining
memb ers."
75
BANDED LOADS
W hen banding materials made of nylon or steel are

used to secure contents within a container, excessive
tension can cause major dam age unrelated to carrier
handling. Windshields and sheet metal products are
commo nly damaged in this manner and receiving
personnel should be alert to banding shear - where
the straps hav e cut into the wall of a shipping
package. Or where the box wall (edge) is buckled or
crushed beneath the band.
In the exploded drawing you see where the band has

cut through the wall of a corrugated fiberboard box.
This is caused not only by ex cessive tension, but due
to the fact that the sh ipper failed to use "edge
protectors," to provide necessary reinfo rcem ent.
76
BE ON THE ALERT
W hen ed ge pro tectors are not use d: Shearing of the box w all (edge) may indicate internal product dam age.
Whe n edge protectors are used: Any crushing of the

box wall at corners or edges directly beneath the
bands m ay signal internal product dam age.
CORRUGATED BOXES
A box of smaller dimensions can easily crush an

imp roperly filled pack age upon which it is stacked.
End buckling that forms a trapezo id pattern, usually

located at the top or bottom of the box, m ay indicate
excessive top loaded weight or that contents is not
self-supporting and (a) reinforcing packaging materials
were not used or (b) the box is not completely filled
by contents an d/or suitable interior p ackaging devices.
Improperly filled containers can be easily crushed by

packages of smaller dimension. Even single face
pallet runners cannot easily collapse a box where
either the contents and/or the inner packaging
reaso nab ly occupy the full cubic capacity of the
shipping container. Failure to adequately fill the box
is a violation of Rule 680 of the National Motor
Freight Classification 100. (See p.39)
Even moderate weights cannot be supported, as

dyn am ic stress can increase the load by several G 's.
For exam ple, one cubic foot boxes weighing 50
pounds each, loaded eight feet high, places 350 static po und s on the bottom box . In transit the g forces at wo rk co uld
increase this weight by as much as 700 pounds or more. Damages vary depen ding upo n where the freight is lo aded in
the trailer.
77
HANDLING DAMAGE
In the category of visible damage, perhaps one of the

mo st overlooked is that of the "pleated corner." Where
the box shows a modest depression at one or more
corners. Usually they are no m ore than 1" inch deep
and from 3 to 4 inches in length. In the exploded
drawing, observe how the box wall is rolled or pleated -
literally crushed rather than buckled. With rare
exception, this type of dam age is always the result of
improp er handling and occurs in all sectors of
comm erce: manufacturing, shipping and warehousing,
and transportation via common mo tor ca rrier. In this
case, even the consumer cannot be excluded!
Such corner damage results when the box is dropp ed

from a significant height. W all pleating occurs because
the conten ts of the box is rigid or unyielding, and either
suspended within a foam plastic inner pack or protected
at all corners with built up corrugated fibreboard
running the full vertical height and/or length of
conten ts. Because the box wall is so well reinforced, it
does not buckle inw ard or outward. Instead, it tends to
collapse in a vertical direction, i.e., upon itself. Freight
handlers should be on the alert for this type of dam age,
whether shipp er, carrier or consignee.
78
BURST OR SHEAR FACTOR
Often the corrugated fibreboard box m ay appear to be structurally

sound. How ever, close attention should be given to all corners, and
especially those at the bottom of the box. W hen a package is
dropped flat in a corn er location , pressure is exerted against the
inner packaging form , this often causes the box wall to shear at the
point of stress. Shipping containers usually display nothing more
than a minor perforation, ranging fro m about 1/8 to 3/8 inches in
size.
If there is excess clearance between contents and the inner walls of

the container, perforation may occur at the bottom corner.
Depending upon d rop height, produ ct and method of inner pack,
the collapse of the box wall is rather insignificant in this area. The
void may seem to be a box manufacturing defect, i.e., where the
bottom flaps are not exac tly aligned . In reality, the corn er is
punctured from the inside out, by the interna l shift of packaged
article.
Corrugated fibreboard boxes have a manufacturer's joint, that

corner where the ends of the sheet are joined together by taping,
stitching or gluing. W hen the box is dropped on this corner, and especially if its co ntents is not rigid, this corner will
often burst. Look for ragged glue edges or fibers, or popped stitching. Be particularly alert for what appears to be trivial
tears, ranging in size anywhere from 1/4 to 1 /2 inch in size
79
SEALING
BOX RETAPED
Quickly scan the to p/end surfaces of all boxes, whether

loose or unitized. Be careful to look for tampering of the
original sealing tape. Removal of the first application
always leaves a rough surface, as part of the linerboard
sticks to the tape as it is being p ulled away. R arely is the
second tape application reapplied precisely over the first,
and a portion of the scarred surface is usually visible on
the ends or th e top of the shipping container. W hen clear
tape is used, the scarring can be seen beneath the second
tape application regardless of how precisely it is applied.
MISSING STAPLES
Check for taped bottom s when such containers from

certain vendors are usually stapled. If boxes are b oth
stapled and taped, scan the packages w hen loaded or
unloaded and look for tape over m issing staples. T his is
evidence of possible pilferage, thus the box should be
opened and a joint inspection conducted to determine if
there is any loss or damage to the con tents. The bill of
lading or d elivery receipt should be an notated accordingly.
80
TAPE APPLICATION
Be on the alert for box flaps that are slightly

depressed, specifically where the tape is taunt but
does not seem to be attached along the full length of
one flap. This problem is most common w ith
gumm ed paper tape. If brush heads of tape
applicators are worn, the bristles do not contact the
full surface area of the adhesive side of the tape. To
pilfer, one need o nly strike the flap briskly or p ush
it in and rem ove the contents.
Be looking for dual tape applications of different

colors, irregular sizes or exact tape styles. Once a
box is sealed at the factory there is little or no cause
to open and reseal it. If custom s break a tape seal,
they close the box using a special tape that identifies
their agency. Also, many carriers utilize recouping
tape that bears their company name. Dual tape
application indicates the probab ility of sh rinkage in
that particular container(s).
Different tape sizes used to seal the same box (top

and bottom) is also a sure sign of probable pilferage.
The larger sized tape will most likely be on the
bottom, as the dissimila rity in size is less obvious
because only the end can be observed. Remember,
pilferers have time to m atch the tape as near to
type, size and color as possible and tape alignment
will be close. But in most cases the second
app lication is not precise. With practice, it can be
easily discerned.
81
TRAPEZOID CREASING
Filing cabinets and other types of for med

sheet metal pro ducts are extremely
vulnerable to imp act shock . Acting as a
"one time spring," the metal walls buckle
as they absorb kinetic energy caused by a
flat drop (usu ally on their base), and from
excessive heights. Protection at all corners
constrains the movem ent, i.e, its linear
motion is limited by the vertical corner
pads. In such cases th e filing cabinet is
forced to collapse upon itself with little or
no structural damage to the shipping
container.
THE TRA PEZ OID CRE AS IN G

PATTERN is yet another deceptive form
of damage that is often overlooked by the
freight handler. It is generally found on
one side only, located at the base of the
container. This pattern differs from the
trapezoid deformation of a partially filled
box that buckles outward. The box wall
collapses in sym pathy with its con tents,
but since deformation is not generally
acute and fibreboard has a limited
memory, it will tend to return to its
original shape. M odest creases are formed
during this process, and are th e only
visible sign as to the possibility of internal
dam age.
82
FURNITURE & APPLIANCES
Interior corrugated packaging forms are extremely popular among furniture and appliance manufacturers because of the
versatility of corrugated fibreboard. This material can be built up in size or die-cut and formed into just about any
configuration imaginable. It does have one major drawback, however, in that it is a product manufactured from wood
pulp and thus highly abrasiv e. Unless otherwise coated or faced with special materials, over a given period of time the
constant motion of fibreboard against practically any finished surface will produce a damaging "Co rrugated Stress Pattern."
(See next page).
83
S i
ngl
e
wa
l l
cor
r u
gat
e d
fib
reb
oar
d
c o
n si
sts
o f
on
e
fla
t
fac
ing
glued to each side of a corrugated mem ber. D ouble wall is com prised of two flat facings and two corrugated m emb ers.
Each alternate furrow or ridge in the inner portion of the com bined corrugated fibreboard is called a "flute." When und er
stress the force of the load against the wall of the shipping container rests upon each of these flutes. Consequently, the
apex of each convex ridge becomes a pressure point, as these furrows support a higher percentage of the load or weight
over a given am oun t of surface. Resonant vibration experienced by the package during the course of routine
transportation causes these pressure points to wear against the surfaces of its contents. If the inner packing is inadequate,
striations or parallel lines are formed as the finish erodes, i.e., a flute imprint, commonly referred to as "box or friction
burn."
Such dam age is not due to imp roper handling but the result of an inefficient inner packaging system. Furniture
manufacturers of quality products will coat the inside surface of corrugated fibreboard pads with wax, or apply a facing
ma de from non -abrasive materials to elim inate the problem.
84
DIRECTIONAL MARKINGS
Directional or precautionary mark ings must be used

on packages con taining fragile articles, or prod ucts
made of glass or earthenware. (See Rule 580 of the
NMFC 100).
No tice in the drawing on your left that the glass

aquarium is protected at all vertical corners by the
use of built up corrugated fibreboard pads. The
vertical position of the shipping co ntainer affords its
conten ts the greatest strength and, therefore, the b est
possible protection. Pack aging sys tems designed as
mono -directional loads, are identified on the outside
of the box with "arrows," to indicate this correct
loading position.
If the box is positioned on its side, the strength of

the inner packaging is seriously weakened. For
0
while the orth ogon al (90 or right angle) pads offer
some reinforcement, they are susceptible to bending
or bowing with respect to their length. The greater
the span the weaker the memb er. Keep in min d, in
the upright position the vertical pads are rigid and
supported by th e box w all. Ho wever, if the box is
laid horizontal, the interior pads and box w all work
independent of each other. Both w ill depress under
load in proportion to span in dim ension of length
and width. Therefore, the weakest point is found in
the central area of the shipping container. (See this
principle demo nstrated on the following page).
85
Three separate forces are at work here: (1) Resonan t vibration, where just rolling down the highway the wheels of a truck
hitting against the surface of the road pro duce a frequen cy equivalent to 1g. (2) Impact shock, w here the glass, if
positioned in the trailer with its broadest dim ensions of length or width perpendicular to the ground plane, will bend
prop ortionate to the span, i.e., begin to sag under its own weight commensurate with the force applied against it. (3) The
weight of top loaded freight: Even packages of modest weight can tend to work as a battering ram to buckle or crush the
unsuppo rted packages upon which they ride. Conten ts m ay sp lit, crack, dent, shatter or break as a consequence. In the
illustration abov e, either of the three forces could easily break this fragile article when improperly positioned for loading
and handling. W hen picking up, interlining or receiving freight positioned contrary to the directional markings clearly
shown on the shippin g con tainer, freigh t han dlers shou ld no te the bill of lading or freight b ill accordingly.
Be especially alert when handling these products: Fluorescent light fixtures / Automo bile W indsh ields / F urniture / S tall
Partitions / Sheet steel products / Glass, sheet stock / G lass or Earthenware goods etc.
86
87
Suspension packaging systems incorporate corrugated fibreboard corner pads, expanded plastic pellets and polyurethane
(expanded) foam plastic. Ex pan ded foam plastic com e in rigid mo lded form , e.g., styro foam shap es or may be applied in
liquid form, commercially known as Foam-In-Place packaging. Selection of the most advantageous cushioning
application technique for any particular problem requires consideration of various factors, especially the nature of the item,
the degree of protection sought, and the cost related to each application .
Full suspension or encapsulation is becoming the more commonly used m etho d of inner packaging d esign, p rimarily
utilized to protect electronic equipment or appliances, scientific apparatus, expensive lamps, works of art and a wide variety
of fragile commodities that are sensitive to vibration and shock. This type of packaging system provides excellent
protection against drops of other k inds of im pact shock , as w ell as rigid support to withstand the force exerted upon it by
top loaded freight. As such, it is a prime candidate for "B ox wall pleating," (p.78) when dropped from excessive heights or
subjected to und ue stress.
88
Die-cut suspension system s are m ade from corrugated fibrebo ard, and are popular w ith m any lamp m anufacturers. A
section of board is cut out to the configuration of the lamp which is then placed in this cavity to ab out 50% percent of its
depth and shrinkwrapped in place. The unit is positioned in the box diagonally, i.e., the panel contacts only two vertical
corners of the shipping co ntainer. A shrink film and wire form assembly incorporating this basic design is an alternative
method used by many firms.
Often these items will be buckled due to the amount of air space permitted by this unique design. These buckled areas
are usually the result of low impacts received w hen stacked, loaded, unloaded or transported with other freight. As a rule,
prod ucts utilizing this method of protection always require vertical positioning (unless otherwise marked on the shipping
container). If han dled or loaded contrary to the position so indicated, the goods are m ore likely to be dam aged. In
particular, check for modest bowing of its panels (broadest dimensions of length and width) or unusual soil and abrasion,
indicative that the box may have been laid flat . . .
(1) When moved within the manufacturer's or shipper's facility.

(2) Prior transp ortation to wa rehouse and /or han dling at distribution plant.
(3) During the course of transportation to you - the ultimate consumer.
89
FIBREBOARD DUST
Quasi-perio dic vibration pro duces a large am plification of input forces, and dam age results when these discrete frequencies
exceed the natural ability of the packaging ma terials to dam pen or absorb the shock. C oncealed dam age m ay result
without inner packaging or in the use of substandard interior pack aging materials. Vibration transm issibility can produce
structural, or superficial damage - that w hich is ruinous to the aesthetic quality o f an item. Paper goods exp erience
surface wear that accumulates as "FIBREBOA RD D UST," brought on by friction and the dynamics of resonant
vibration. In the above d iagram no interior packaging is used, and excessive clearances are maintained between con tents
and the inner w alls of the box. Assuring resonan t vibration dam age!
RAILROAD: The principle source of both vertical and lateral vibration of lading during shipment by rail, to include
TOFC, is the movem ent of the wheels along the rails. The forced lateral vibrations are caused primarily by what is
known as "hun ting," of the wheel treads against the steel rails. Vertical forced vibrations are caused by elasticity of the
rails, un even ness in their surface, gap s betw een adjacent rails, flat spo ts on wheels or wheel imbalance.
TRUCKING: Vibration transm itted to packages are com mo nly caused by im pacts of the wheels at various speeds against
irregularities in the road, wheel shimmy , engine vibration and suspension imbalance. This is a natural phenomenon that
can only be eliminated through package cushion design. A buffer must be put between the inner box wall and the surface
of the product itself, e.g., plastic film or sheeting, styrofoam encapsulation or sheet pads, die-cut dividers or retainers and
other typ es of p ackaging materials.
90
GLASS PRODUCTS
Many packaging engineers consider glass to be a "congealed liquid," rather than a solid. Glass is a major component in a
vast percentage o f today's mod ern furn iture products and building materials, used by commercial and residential customers
alike. W hile considered to be extrem ely fragile, in truth, it is incredibly damage resistant when packaged, handled and
transported correctly.
Unless specifically designed for "flat" loading, such as tightly banded sheet glass, packaging engineers, pack aging materials
manufacturers, claims analysts and professionals within the glass industry advise that glass must always be transported and
handled "on edge!" Flat load ing (broadest d imension of length and width perp endicular to the ground plane) unduly
exposes the glazed surface to a high degree of vertical impact shocks. The most common are identified as oyster cracks or
elliptical fractures ranging in size from one to two inches in diameter. Similar in appearance to the damage caused by the
imp act of a sm all ston e when striking an auto mo bile w indsh ield.
WARNING: Be sure to pay particular attention to the placement of "deck boards" when such ar ticles are tendered on
wood pallets! Check for large apertures or spaces as these products are frequently damaged on the underside (bottom
unit) by the fork lift blades of mechanical handling equipment. (See pp.71-73)
91
WATCH FOR THE FOLLOWING CONDITIONS
(1) Sheet glass of various sizes tendered in wooden crates (Drawing A). If the sheets of shorter length are placed
between tho se of greater length, the longer sheets will flex ov er the edge of the sm aller sheets.
(2) Glass resting upon lumber dunnage in a corrugated fibreboard box or the frame of a wooden crate. Padding of
pulpboard, thick (dense) styrofoam or built up corrugated fibreboard should be used to absorb shock and road
vibration.
(3) Glass windshields that are cracked on either one or both sides of their respective interior retaining form, w hen
taped secure (Drawing B). If the shipping container is laid on its side while in transit it may not show any signs
of structural dam age. S om etimes the side w all will show mo dest bowing and a degree of ground in soil or
scuffing. In the flat p osition a windshield will flex under its own weight when subjected to impact road shock,
and subsequ ently break over the edge of the dev ice designed to restrain its movem ent. D am age is generally
found, but not confined to, the central area of shipping container.
(4) Be alert to the sound of fragmented glass, or powered glass leakage when unloading/transferring freight in crates,
large boxes or unitized loa ds.
0 0
(5) Glass articles (general), when hand unloaded tip each box 90 to 180 degrees and listen for the sound of glass
fragmentation.
92
STEEL DRUMS
Steel drums are used by industry for the transport and storage of both dry and liquid commodities. The majority of
failures occur in steel drums containing fluid materials of modified viscosity. One of the chief reasons for damage is due
to the reuse of "Single Trip C ontainers (STC )," a violation of Rule 260 of the NM FC 100 , if they are not reconditioned
according to the requirements of Note 4 of the Item. In the event of damage, check around the circumference of the
drum and lo ok for a certification sticker affixed to its side indicating w hen it was reconditioned and/or tested as sho wn in
the illustration above.
93
Type A fracture: Circumferential crack forms wh en the work ing (bending) of the head when jolted is above a certain
level of intensity.
Typ e B fractu re: Rad ial crack forms where the bu ckle ridge terminates in the bend o f the chim e, causing increased stress
and failure.
Typ e C fracture: (Not illustrated above), where stress is greatly intensified due to som e type of deform ation, causing a
fracture in the central region of the drum head.
Ductile shear is another form of dam age where the metal fractures during head oscillation, appearing as though the metal
had been punctured with a sharp object. This is because the drum head work s or moves vertically in response to internal
pressure pulses caused by impact shock and vibration during the course of transportation. If failure should occur as the
head is deflected upw ard, the direction of the shear w ill tend to be inw ard, i.e., bend up ward, into the body o f the d rum .
94
During the co urse o f routine transp ortation the head of a drum will oscillate thousand s of tim es per minute. Over time
this repeated load stress, above a certain level of intensity , will bring on metal fatigue (crystallization) and failure. Internal
pressure pulses, similar to that of hydraulic force, act as a battering ram to break down and distort the bottom drum head.
Illustrated at the top left is the bottom of a drum where the head has sustained a num ber of deform ations. The sheet
steel has buckled to form a series of ridges that follow the circum ference of the drum .
Und er nor ma l conditions the drum head is recessed below the chim e as shown in the upper right draw ing. But when
containing a liquid of heavy viscosity, and loaded on the rear of a truck, tensile stresses over the surface of the bottom
drum head can build up in excess of the normal 10,00 0 pounds per square inch. Sufficient pressure to cause the convex
deformation of the metal as depicted in the upper left illustration.
On the next page are a list of the most common causes of drum failure and what freight handlers should look for at time
of receipt.
95
DRUM FAILURE: WHAT TO LOOK FOR
Listing (slightly tipped) or unstable (rocky) drums that will not rest flush with the
ground p lane.
Flat spots, dents or bends along the circumference of the bottom chime, or around
the dru m w all itself.
Dried seepage alon g the seam of the bottom chime or run ning vertically up the side.
CAUSES OF DRUM FAILURE
W hile drum failure can be attributed to m ishandling (dropped), most dam age is due to metal fatigue of the variety listed
below:
High intensity stress - lon g/short duration crystallization (failure).

Corrosion
Corrosion fatigue
Stress corrosion cracking
Type A , B and C fractures (metal fatigue)
Buckle ridge phen omena and failure rates
Radial and circum ferential fractures
Rad ial cracks (w ithout buckle ridges)
Cyclic stress and damaged m etal
Ductile (shear) fracture
Reconditioned drums, improperly restored
DETERIORATION: DRUMS IN STO RAGE or IDLE
Corrosion, interior
Corrosive environment, exterior
Water damage in idle drums
If there is no structural damage to the drum and the aforem entioned conditions exist, metal fatigue is the likely cause.
Upon receip t, annotate the freight bill to sh ow the ex tent o f any dam age or leakage as the case m ay be. Co ntact the
shipper for immediate advice and further assistance. C arrier personnel should docum ent such dam age if it occurs in
transit, or take good exceptions if interlining the freight. Avoid making unqualified remarks on the freight bill relative to
"fork lift dam age" or ex ceptions that attem pt to describe the type of hand ling received, e.g., "appears to have been
dropped." A d etailed inspection conducted by trained investigators afford a much better means by which to identify the
cause of dam age.
96
RECEIVING PROCEDURES
_________________________________________________________________
(See Quick Check L ist, p.ii)
ONLY TRAINED PERSONNEL SHOULD RECEIVE FREIGHT
A critical time to form a sou nd basis upon which to bu ild a cargo claim is when the goo ds are being received. If
at all possible, a person know ledgeable in receiving freight should be assign ed to this task.
ALWAYS COM PARE DOCUMENTS
In conjunction w ith the delivery receipt, if the shipper provided an invoice, bill of lading or packing slip, further
evidence of the goods given to the carrier, compare this documentation against the property actually received at
time of delivery.
SIGN and DATE FREIGHT BILL
Delivery receipt m ust be "SIGNED ” and "D AT ED " by the d river .
On claims for concealed damage the loss or injury must be reported within (15) days from the date recorded on
the freight bill. Failure to date the delivery receipt greatly complicates this task, increasing the claimants "burden
of proof." Such information must then be obtained from loading manifests or other documentation supplied by
the carrier. Because of clerical errors, delivery delays or other complications, the accuracy of these records may
be in doubt, and perhaps insufficient to satisfy the legal requirements of your claim.
D O N OT S IG N F O R FRE IGH T "S IGH T U NSE E N"
NEV ER perm it personn el to sign the freight b ill in any location o ther than wh ere th e goo ds ar e actu ally
located (d elivered).
This represents one of th e most co mm on emp loyee erro rs for which not a few claims have been sum ma rily
declined. Upon arriving at the shipping and receiving dock and finding no one to assist, the driver will unload
his cargo and go to the front office for a signature. In a vast number o f these situations a consignee
representative is unable to leave his or her d esk and signs the delivery receipt with out examin ing the freigh t.
Later, receiving personnel return to discover that the goods are either short or visibly dam aged, and without
exceptions on the freigh t bill.
RE M EM BE R: The con signee (not the carrier) h as the legal obligation to inspect freigh t at tim e of delivery.
Failure to exercise this right only jeopardizes your chances of recovery!
97
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CONFIRM PRO PER CONSIGNEE
Check all labels and tags, mak e sure the freight is directed to the consignee, at the address and location ind icated
on the freight b ill.
Be sure to check the labels on all cartons to verify that the freight belongs to you, as misdeliveries do occur, and
may give the false impression of an accurate count. Either due to error or contrivance, piece counts are often
ma de co rrect by using freight consigned to an other comp any. Common carriers that are party to interline
shipments are especially vulnerable to this practice.
IMPOR TANT : All copies of the original freight bill should be annotated to reflect the actual shortage existing
at time o f delivery p rior to surrendering any misrouted or m isdelivered p ackage(s).
V ER IFY COU N T
Check freight carefully on all sides, count the number of pieces and tally against what is indicated on the freight
bill or bill of lading.
An y discrepa ncy in the piece count, whether short or over, m ust be noted on the delivery receipt.
Shortage - Overage? It may be that the load was altered somewhere in transit, such as the breaking
out of a pallet or skid to tak e advantage o f vehicle cube. In such cases the claim ant's b urden of proof is
made easier should concealed damage be discovered after delivery.
1. Are packages or box es the "original shipper's containers?"

IF NO T, be sure to note the freight bill accordingly.
2. Is the pallet, tape, shrinkwrap, banding etc. familiar to you?

IF N OT, m ake these exceptions clear on the freight b ill.
SIGNING FOR . . . "PIECE COUNT" or "UNIT COUNT"
NE VE R sign for a "num ber of pieces" when the bill of lading or freight bill indicates a "quantity of unitized
loads" (i.e., skids or pallets, banded or shrinkwrapped), unless the count can be verified!
Other than a "Shippers Load and Count," where the trailer is sealed prior to carrier pick up, both carrier and
consignee representatives must pay close attention to the actual method of tender, and especially where it relates
to the con dition and quantity of goods shipped.
98
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PIECE COUNT: SAID TO CONTAIN (?) PIECES
W hen signing a freight b ill for a num ber of unitized load s (Pallets or S kids) said to contain a quan tity of pieces,
it does not necessarily compro mise a shortage claim. Th e clause "said to contain" is usually inserted on the bill
of lad ing by the carrier to indicate that the d river could not verify the actua l piece coun t at tim e of receipt.
PR EC A U TIO N : To be v alid the integrity of the shipment mu st be intact, that is, no evidence of tampering or
recouping. The packaging and dunnage must be as originally tendered. If not, sign the freight bill accordingly,
detailing the manner in which lading was received.
VERIFY METHOD OF TEND ER (How originally shipped)
Compare the manner in which your freight is received against the method of tender indicated on the bill of
ladin g, ship ping tag o r freigh t bill.
The shipper m ay tender "1 pallet, containing (3) p ieces of machinery and may arrive at the interline carrier's
dock or destination consisting of "(1) pallet and (2) loose pieces, of machinery." While the total piece count
appears to be correct, and although there may be no signs of visible damage, the evidence clearly shows that the
origin al load was tam pered with. The probability for co ncealed dam age under these circumstances is extrem ely
high. DO sign the freight bill describing exactly how lading was received and its known condition at time of
receipt.
NO TE "D IREC TIO NA L A RR OW S or A DV ICE"
If box (es) are no t in the cor rect load ing po sition, be sure to no te this fact on the deliver y receipt.
W hen packaging engineers design a packaging system for a specific type of product they consider, am ong other
things, the packaging environment, as well as the size, weight and fragility of the item being protected. Some
items are susceptible to damage by vibration, others are vulnerable to dynamic shock associated with various
types of impacts. On the basis of lab or field testing, the product is positioned and protected within the shipping
container in a m anner that affo rds th e least p oten tial for dam age during the course of routine transp ortation.
Consequently, any deviation from the markings on the shipping container severely impedes or destroys the
ability of the "packaging sy stem " to provide an adequate protection of lading. Concealed dam age is highly
probable in this case. Photographing improper loading situations is highly recommended.
99
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CHECK FOR "TILT and SHOCK DETECTING DEV ICES"
If activated, record this fact on the freight bill even if there is no evidence of visible damage to container or
its contents.
TILTWATCH
An incline indicating device is used on prod ucts that are vulnerable to

damage when subjected to irregular attitudes. Once tripped, it cannot be
reset. It is affixed to the side of a package and becomes activated when a
container has fallen over on its side, becom e upended or has been tipped
beyond allow able limits. The circle in the center of th e arrow turns a
bright red, alerting freight handlers that a mishap has occurred. Such a
device affords protection to claim conscious carriers as well as
consumers. Also, carriers can use such devices to locate a recurring
source of damage and take steps to further reduce their liability!
SHOCK WATCH
This special device is affixed to

the box wall and designed to
turn "red" if the package has
been d ropp ed or o therw ise
impacted. These devices can
be purchased at different "g"
ratings depending upon the
fragility of the product being
shipp ed.
Both the Shockwatch and

Tiltwatch are manufactured by
Media Recovery, Inc., 1195 Empire Central, Dallas, TX. 75247. Phone: (800) 527-9497
The Bureau features the Media Recovery devices because of their reliability, wide acceptance throughout the industry, and
the fact they are ad vertised as "carrier friend ly," (i.e., convention al hand ling will not activate them ).
100
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METHO D OF SEALING CO NTAINERS - ARE ALL IDENTICAL?
Check in divid ual boxes for tape or sealing application s that differ from the m etho d(s) originally or p revio usly
used by m anufacturer or shipper
a. Differen t colored tape, usually visible on top surface or ends?

b. Different types of tape (paper, plastic, reinforced etc.)?
c. Irregular ta pe separation (gum med paper), in central locations?
d. Rem oval of staples, or im pressions left by (missing) band s?
e. Any evidence of boxes having been retaped?
DUNNAGE
a. Different style of pallet, platform or skid?

b. Dissimilar types or colors of shrinkwrap film?
c. Inconsistent method of securing unitized loads?
PACKAGING
a. Unusual bo x(es) or other type of shipp ing container(s)?

b. "Loose" in opposed to "packaged" goods?
c. Does packaging match w hat is d escribed on the freigh t bill?
INSPECT THE GOOD S (DRIVER AND CONSIGNEE)
Both driver and receiving clerk should conduct a joint inspection, duly noting any loss or damage on the
delivery receipt.
Such procedures relieve the driver or w arehousem an of any suspicion as hav ing comp licity in the pilferage
(shrinkage) or d am age documented at tim e of delivery, if any. OPEN BOXES ? Obtain a cou nt if feasible
using the piece count indicated on the box or packing slip. On bulk shipments involving hundreds or thousands
of parts, place the box and its con tents on a scale and record this weight on the delivery receipt.
IM PORTA N T: In cases where driver assists in unloading the freight, have his or her packages placed in an
area separated from the products handled by you.
Boxes visibly damaged can be overlook ed by the con signee or interline carrier, as any crushed
areas or punctures m ay be turned toward the freight handler, or possibly sandwiched between
boxes unloaded two or three at a tim e. W hile drivers may be con scientious in this regard , in
their rush to move freight quickly they, too , can beco me careless.
101
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WRITE ON TH E FREIGHT BILL: ANY VISIBLE CONTAINER DA MAGE.
Record condition of the damaged shipping containers even if injury to contents is unconfirmed at time of joint
inspection.
Often a d river and consignee representative, or freight handler in the case of interline shipmen ts, will notice a
punctured shipping container. A cursory examination is usually limited to pulling back a portion of the
perforated fibreboard wall to obtain a clear view of the contents. If no damage is observed, all parties may agree
not to m ake note of it on the freigh t bill.
PR EC AU TIO NS :
P U N CT U RE D /T O R N B O X (See p.105 , Diversionary D amage)
a. Was the wall punctured by an object entering straight into its surface (i.e., parallel with the ground
floor)? If so , any resultin g dama ge to contents should be visible directly behind the flap or box wall
segments.
b. Was the wall punctured from an oblique position (i.e., coming in at an acute angle). If so, the point
of contact and resulting dam age is likely to be located further aw ay from the perforation, concealed
behind the undamaged portion of the shipping container.
c. The fragile nature of the product mu st also be considered
Box static (at rest)?
If the box was stationary (static) on impact, and without apparent damage to its contents, the
probab ility of hidden dama ge is less likely.
Box dyna mic (in m otion)?
But if the box w as in motion (dynam ic) at time of im pact (i.e., as from a fall or drop), even
with out apparent dam age to contents, the possibility of "concealed dam age" is greatly am plified.
RU LE OF TH UM B:
Record any pun cture or tear even w ithout confirm ation of resulting dam age to contents. If "visible" dama ge is
not determ ined at time of receipt, a "prima facie" case has been established in the event that concealed d amage
is discovered at a later date. Remember, the freight bill is not a substitute for an inspection report.
102
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The following adv isory (m odified) is taken, in part, from Administrative Ru ling 120 issued by the form er Interstate
Commerce Commission: (See p.1)
INSPECT PACKAGES INDICATING THE PROBABILITY OF DAM AGE
Carefully check for any visible signs of damage to the articles or containers, take note of the condition
of unitized loads. Include any unusual "rattles" or "shifting" of items not generally associated with your
products. If evidence of damage exists, the package(s) should be opened immediately and a joint
inventory and exam ination of contents undertaken by b oth the driver and yourself. A full detailed
description of the results of such inspection should be endorsed on the carrier's portion of the delivery
receipt and your cop y as well. If driver and consignee are un able to open each container and inspect its
contents due to tim e or o ther restrictions - at least indicate th e numb er of box es structurally dama ged.
DO NO T S IGN BIL L "S UB JEC T T O IN SP EC TIO N."
LEGAL RIGHT TO INSPECT THE PROPERTY (See Duty: Appendix A, pp.106-108)
W hen dam age exists, the consignee by law is granted the right to inspect the goods and mak e a
determination as to their present value. If in the judgment of the consignee, the damage goods are
"totally worth less" he is entitled to refuse th e entire ship ment an d ho ld the carrier liable for its fu ll
actual loss.
CONSIGNEE MUST ACCEPT PARTIALLY DAMAGED SHIPMENTS
On the other hand, a consignee m ust accept partially damaged shipmen ts and fulfill his obligation to
mitigate th e loss as much as po ssible.
C ONS IG N E E P RO H IB ITE D FRO M INSPECTING TH E G O O DS
The consignee cannot arbitrarily open and inspect containers that do not indicate the probability of
dam age (as the v ehicle is b eing unloaded) without first having signed the delivery receipt.
W hen no probability of damage exists: Courts have generally ruled that the consignee or receiver "may
not open the containers and examine contents before giving a receipt to the carrier (signing for the
freight), unless the containers indicate the probability of damage." (boxes that are crushed, punctured,
wet, torn etc.).
EN D T H E FOR M E R I .C.C. RE CO M M E N D A TIO NS
103
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A V OID T H E US E O F V A GU E E X CEP TIO NS
Do not write or permit vague or general exceptions on the freight bill relative to short and damaged freight.
Exa mp les: "1 short" ... "1 piece damaged" ... "1 box open"
Consignee: Do not make general notations on shipments in apparent good order, such as, "Subject To
Inspection." Such exceptions do not relieve the consignee of its legal burden to count and
inspect the goods at time of delivery. And especially those boxes or packages that indicate the
probab ility of dam age!
Carrier: W hen picking up freight, the driver sho uld avoid the u se of exceptions on the bills of lading, such as,
"Ship At Owners Risk." An annotation of this sort does not relieve the carrier of liability in the event
of loss or damage. Here it clearly suggests that the carrier representative had reason to believe that the
good s were im prop erly pack aged, and as such, the load sh ould have been refused!
IDEN T IFY D A M A G ED G O O D S
Alw ays specify the qua ntity of go ods lost o r dam aged, an d identify them by on e or m ore of th e follow ing:
a) Stock cod e
b) Catalog num ber
c) Mod el numb er
d) Serial number
e) Product name or similar descriptive classification.
Consignee / Carrier:
This en sures that a proper claim is filed for the m erchan dise actually dam aged. For example, to m erely stipulate
"63 glasses broken " does not identify the dam aged prod ucts, as a shipment may contain similar items of higher
and lower value. Were the crystal glasses priced at $16.95 each actually damaged, or was it the tumblers costing
$0.89 cents a piece? W hen dam aged goods are not clearly identified on the freigh t bill at tim e of receipt, it
unduly increases the claimant's burden of proof and exposes the carrier to a much greater risk. The situation
promotes antagonism and is unproductive for both carrier and customer!
104
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DIVERSIONARY DAMAGE
Co nsider ev ery pa ckagin g defor ma tion for p roba bility of dam age du ring joint insp ection at tim e of delive ry or re ceipt.
A prev alent receiving and interline situation that com monly trips up even the m ost experienced freight handler
is that of "diversionary damage." As is generally the case, the box might have a buckled or crushed corner and a
punctured or torn side, the latter being the type of damage sure to attract the attention of both driver and
receiving personnel. If and when it is determined that there is no correspon ding dam age between the punctured
area and the go ods, it typically brings relief - then carelessn ess! O ther existing deform ation s are com pletely
ignored because they appear to be m inimal by com parison. Mo re often as not this is where the dam age is later
discovered, long after the driver has left!
LOADING/UNLO ADING PRECAUTION (SHIPPER - CARRIER - CONSIGNEE)
NEV ER arbitrarily assume the responsibility of loading or unloading freight without a clear understanding as
to your (company) liability.
a. In general, whether carrier or consignee, the party assuming responsibility for loading or
unloading is liable for any loss or damage resulting from their negligence.
b. Shou ld a carrier assume responsibility for unloading freight, even if such action is deemed
unlawful and in violation of their own tariff regulations, they are liable for any loss or damage
resulting from their negligence. (See Item 568 of the NM FC 100; Section 4(a) of the bill of
lading contract.
REFUSING DAMAGED FREIGHT
See A ppendix A on pages 106 -108 , respectively, as well as the General Index under the subject heading.
105
APPENDIX A
INSPECTION PRIOR TO RECEIPT OF THE GOODS
One of the mo re controversial issues in transportation concerns the question of inspecting the goods prior to receipt, that
is, before signing the freight bill. Answering the question legally does not solve the problem presented to both carrier and
consignee, but it can assist in respondin g to th e question of responsibility and liability w hich is the primary in tent o f this
handbo ok.
Gen eral view of the co urt: "A consignee may not open the containers and examine the merchandise before
giving a receipt to the carrier . . UNLESS THE CONTAINERS INDICATE THE PROBABILITY OF
DA MA GE ."
Du ty to insp ect
If there exists the probability of damage, the consignee has the legal sanction to inspect the freight for loss or
damage at time of delivery.
(Refer to the NMFC 100, Item 300130, 300135)
App arent Go od O rder
The con signee has neither the right nor legal sanction to open and inspect the goods wh ere the container(s) does
not indicate the "probab ility of dam age."
Partial dam age
1
The du ty of the consignee to accept partially damaged freight is a well established principle of law. The fact
that goods are dama ged d uring tran sportation do es not of itself justify their refu sal by the co nsum er.
Furthermore, upon acceptance, th e con signee has th e legal o bligation to mitigate the loss as much as po ssible.
See p.2: Mitigate (lessen) the loss (General Information Regarding Loss and Damage Claims, Appendix to I.C.C.
Ruling 120, Item [4].
Co mp lete destructio n (V irtually W orthless)
If the shipm ent is deem ed "virtually worthless" taking into account the cost of restoration or pair, discount,
dam age sale ("as is") o r other typ e of salvage to m itigate th e loss as requ ired b y law , the entire shipment may be
refused and the carrier held liable for full actual loss if proven negligent. (continued on the following page)
1
While the rights of the consumer are not lost on the court, they must be weighed against other statutes providing equal protection under
the law for the carrier or shipper, or anyone placed at risk by his actions.
106
REFUSING FREIGHT
The con signee will un doubtedly com ply w ith the directives of m anagem ent relative to th eir corporate p olicy in
this regard. How ever, receiving perso nnel sho uld be aware of the following:
Dam age salvaged by carrier
Failure of the consignee to fulfill its legal ob ligation to accept a shipment not deem ed "v irtually
worthless," may sub stantially limit their ability to collect the full actual loss. By law, freight abandoned
to the carrier is to be "disposed of in an equitable manner protecting the best interests of all persons
having an interest therein." The law further requires that the carrier turn over the salvage proceeds for
the unda ma ged goods, in addition to the co st of the merchand ise actually lost or d am aged. The total
amount recovered can be less than the total am ount of the loss! (Refer to p.32: Refused freight
salvaged by carrier)
Lim it on carrier liability
The carrier is only liable for the "full actual loss," that is, for goods actually lost or damaged at time of
delivery. See 49 C.F.R 3 70.11( formerly 10 05.6), Ex Parte 263, "Processing o f Salvage").
Con signee can be sued (by the shipper)
A shipp er m ay also have legal reco urse against the consignee for illegally rejecting a shipment if in
violation of the U niform Com mercial Cod e accepted in mo st states.
ANALYSIS:
W here goods are found to be "virtually w orthless" they m ay be refused by the consignee p rior to receipt,
i.e., before signing the freight bill. This only applies where there exists the probability of damage at
time of delivery. Legal precedence for this rule is well established in the courts. If goods must be
signed for regardless of their condition, and prior to inspection, the carrier would be under no legal
obligation to permit their refusal under any circumstances. Such action would be in direct contradiction
to ex isting law .
The problem with the law is that it often does not work in the world of everyday commerce. Freight
not virtually worthless is refused wholesale by businesses across the country, a problem for which there
is no legal remedy in the practical sense. It is neither economically feasible nor good business to resolve
such disputes through costly and time consuming litigation. In an effort to protect themselves, carriers
continue to demand a signature on the freight bill before allowing the consignee to open and inspect the
goods. A m ajority of shipments are refused based upon a fear rather than the fact of dam age,
increasing the carrier's risk of injury though excess handling. Moreover, merchandise must be
reordered, a delay that o ften results in the loss of valuable custo mers.
107
A C CE PT ED L O AD S : "W I N " - "W I N " S IT U AT IO N
Perm itting the con signee to ex amine pack ages indicating the probability of dam age all but elim inates fraud - to
the advantage of the carrier! It prevents a company from claiming damage that never truly existed at time of
delivery, other than to th e packaging itself wh ich promp ted the ex ception on the freight bill. Acceptance of a
partially damaged shipment is beneficial to the consignee as well. Customer o rders are filled, undam aged
merchandise is put to stock to meet current demand, and the damaged portion of the shipment, being noted on
the delivery receipt, facilitates th e pro per h and ling an d paym ent of their claim .
R EF U SE D SH IP M E NT S : A "L O SE " - "L O SE " S IT U AT IO N
When an enire order is refused the potential for additional loss and damage rises significantly. When a
shipment of (10) washers are refused because (2) units are damaged, several more are likely to be damaged on
the return m ove. Existing damage to goods m ay substantially increase, so that products which were otherwise
salvageable, might be rendered worthless by the time they arrive at the shipper's dock. No winners!Most carriers
have an "all or noth ing" policy with regard to refused loads. If the consignee wishes to accept the un dam aged
portion of the shipment, then he must receipt for the damaged portion as well. Even with the probability of
dam age, many carriers insist upon a signed delivery receipt before perm itting the consignee to open and inspect
the goods. As a rule the consignee's legal rights are not violated by this procedure, because the actual
percen tage of d am aged sh ipm ents that a re "virtua lly wor thless," IS EX TR EM ELY LOW !
Carriers adopted this measure in response to the common practice of industry to refuse freight based upon
conditions over which the carrier has no control, e.g., goods of the wrong style or color, improper order, pricing
disputes, lack of fund s, and a h ost of other reasons entirely unrelated to transportation. W hen a carrier permits
inspection of a load that is otherwise in "apparent good order and condition," he becomes vulnerable to an
arbitrary decision on the part of the consignee to reject the shipment for virtually any cause. Such capricious
rejection has led to unnecessary loss an d dam age of go ods, the econo mic burden for which, am ong o ther factors,
is reflected in higher transp ortation costs. W hile the law perm its inspection o f partially damaged load s prior to
receipt, it also prohibits any dem and to inspect shipm ents that are in "apparent goo d order and condition."
Neither the carrier o r con signee can m ake use of the law only w hen it serves their special interest.
In the final analysis, comp rom ise rem ains as the o nly viable and adva ntageous solution to this problem.
108
APPENDIX B
F RE IG H T C HA R GE S A N D TH E P A YM E NT O F C LA IM S
Administrative Ruling 65 and 128
Section 217 (b) of the Interstate Com merce A ct (49 U.S.C. 317 (b) prohibits a motor comm on carrier from
demanding or collecting any different compensation for transportation or for services than the rates, fares and
charges specified in that carrier's effective tariffs. The Elkin's Act also prohibits every kind of rebate. (49
U.S.C. 41 United States v. Brav erman, 37 3 U .S. 40 5 (19 63). [AR 128, Para 4].
Carr ier O bligation (T o collect freigh t charges)
A carrier cannot postpone the collection of freight charges because the shipper or consignor has filed a claim for
the loss or damage of property so transported. The carrier must collect its lawfully established charges or mak e
every effort to legally enforce such collection. A claim for loss or d am age filed by th e shipper o r con signee is
distinct from the collection of lawfully established freight charges, and does not in any way relieve the carrie r
from the duty to collect such charges. (AR 65)
Consignee/Claimant Obligation (To pay the freight b ill)
The com mo n carrier canno t legally perm it a claiman t to deduct law fully establish ed ch arges from any freight bill,
to fully compensate or offset the amount of the loss on a pending claim or claims. Such remedy can only be
apportioned by the court, and only in cases where the carrier has filed for bankruptcy and the debtors and
creditors subjected to the jurisdiction of the bankruptcy court (A R 128, Para 5 ). The Supreme Court upholds
the carrier's right to collect, and the shipper's duty to pay such freight charges, as regularly published rates are a
matter of law. (Louisville & N.R . Co. V . Dickerson, 1 91 F. 70 5, 70 9 6th Cir. 1911); Baldwin v. Scott
County Milling. co., 3 07 U.S . 478,485 (1939). Failure to pay a freight bill means that the carrier did not
collect the law fully established charges, thus providing grounds for declination o f the claim or claims filed against
it! (AR 128)
Carrier Burd en
Statutes also prohibit a common carrier from withholding payment on a claim as compensation for
unp aid freight charges levied against another (u nrelated) sh ipm ent or shipments.
109
APPENDIX C
FREIGHT CLAIMS AND RELEASED RATE LIABILITY
Shipper's are charged w ith the law of "constructive know ledge," in that they are presum ed to be aware of carrier tariffs
duly filed w ith federal and state regulatory bod ies, and und erstand their p rovisions. However, in the case of "released
rates," a carrier canno t limit its liability b y this m ere fact alone . . .
The Supreme Court decision, in Adams Express Co., v. Croninger, 226 U.S. 491 (1913, primarily
held that "a carrier could, by fair, open, just and reasonable contract limit th e am oun t recoverable in
case of loss or damage to an agreed value for allowing the shipper to use the lower of two or m ore
rates."
ANALYSIS:
1. (a) Shipper must be afforded an opportunity to declare a higher value for his goods and consequently,
incur a greater shipping expense.
(b) Carrier liability cannot be limited under Carm ack 10 730 unless the shipper had an opportunity to
elect a greater liability by paying a greater shipping charge. (Ex Parte 403, p.7-11)
2. The released or declared value statement must be in writing, and must appear on the bill of lading at
time of shipm ent (Carmack).
3. Obscure language used on the Bill of Lading, e.g., "Rel @ .10 lb," or "RVNX $1.50 cwt," as ruled
upon b y some courts, will not suffice as a legal "declaration of value."
ALSO
.. Released rates are comp ulsory on m any freight items, and tariffs require shipments to be refused
lacking a proper declaration.
.. Some tariff prov isions allow the carrier to assess the highest class where a shipper fails to declare a
value. Up on receiving proof of a lo wer "actu al value," such charges will be adjusted.
Consult with the carrier concerning the application of released value rates in conn ection w ith your freight. Always request
tariff autho rity. You need to inquire as to the effect these rules and regulations w ill have on your claims relative to
specific shipments. The amount of recovery on released rates can be substantially less than what the langu age implies,
depending upon whether there was a total or partial loss of goods. W hen paym ent is issued for less than the actual value,
based upo n the shipper's d eclared value, the claim ant feels cheated and the carrier often loses a valuable custom er though
no fault of his own . Comm unication betw een all parties is abso lutely essential.
110
LIST OF ABBREVIATIONS AND TERMS
Bailee One to whom property is delivered in bailment

Bailor Owner of the goods
Bailment The transfer of property from the bailor to a

bailee for a special purpose as agreed upon
either by contract or other arrangement
B/L Bill of Lading
Bill of Lading A receipt issued by the carrier or shipper for property accepted for transportation
C.F.R. (Title 49) Code of F ederal R egulations (Agen cy Regs)
Claimant carrier Carrier with whom the claim is filed, and who is responsible for its processing and payment
Com mon carrier Rail, water or m otor carrier

Com mon mo tor carrier Truckline
Consignor Shipper of th e good s
Consignee Receiver of the goods
Dunnage Devices or m aterials that facilitate the hand ling of packaged good s, viz., pallets,
platforms or skids, banding, blocking/bracing materials etc.
Ex P arte In the interest of one party. A legal probe launched by the former I.C.C. for a
specific purp ose
FOB Free on board
I.C.C. Interstate Commerce Commission

I.C.A Interstate C om merce Act (49 U .S.C.)
Lading Freight or cargo

LTL Less than truckload
NMFC National Motor Freight Classification
OS&D Ov er, Short and Dam age
111
LIST OF ABBREVIATIONS AND TERMS
Packaging system Method of tender, embracing the total package It includes the shipping container, interior
packaging form s and all necessary dunnage
"prima facie" W hat is immed iately clear (first glance)"prima facie" evidence
Evidence sufficient to establish a fact, or raise a presumption o f fact, unless
rebutted
RVNX Released Value Not Exceeding

Rel Val Released Value
Sec 20 (11) & (12) Carm ack The Interstate Comm erce A ct (49 U.S .C.)
Revised: 49 U.S.C. Section 11707
Sec 31 9 & 101 3 Carmack The Interstate Comm erce A ct (49 U.S .C.)
Revised: 49 U.S.C. Section 10730
SLC Shipper Load and Count

STC Single Trip Co ntainer
TAB Transportation Arbitration Board

Tariff Publication; Schedule of rates and charges
Tendered The offering of cargo for transport
TL Truckload
U.C.C. Uniform Com mercial Cod e (Law in mo st states)

U.S.C. United States Cod e (Federal Law s)
112
GENERAL INDEX
Act or D efault of Shipper/O wner

Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Acts of God
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Actual Loss
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Apertures, Pallet or Platform

Sizing rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Arbitration, Claims
Carrier/Claimant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Attorney Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Authority of Law
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Banding
Pallet loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Bill of Lading
A contract: Shipper/Carrier bound by . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Binding, legal contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Carrier to issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Claims documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Exceptions to carrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Shipper may issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Taking improper exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Bills of Lading Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Bon d of Indem nity

Liability of the undersigned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Loss of delivery receipt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Box
Burst, rupture or shear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Pleated corner damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Breach of C ontract
Loss, Damage or D elay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
113
GENERAL INDEX
Burden of Proof
Carrier/Con signee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
W hen it shifts to the carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Burden of Proo f, Carrier

How relieved from . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Burden of Proo f, Concealed D amage

Rests with the claimant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Burden of Proo f, Consignee

W ith a clear bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Carmack Amendment
Statute on carrier liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Carrier
Basic responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Interline shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Liability exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Liability, General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Option to refuse freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Salvage of refused freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Carrier's E xclusively Liab le

Through Bills of Lading (Interlines included) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Claim
How to prov e your case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Claim Statement
W hat constitutes a claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
W hat is n ot a claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Claiman t Carrier
Cannot withhold payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Deliverer or Originator of Shipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Claims
Ack now ledgem ent, process and paym ent time limits ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
All interline carriers - equally liable . . . .... ..... .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Arbitration alternative . . . . . . . . . . . . . . .... ..... .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Carrier investigation . . . . . . . . . . . . . . . . .... ..... .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
114
GENERAL INDEX
Claim ant carrier liable for payment (regardless) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Concealed damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Documentation in support of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Earned profit recovera ble . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Exp editing the p rocess . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Freight charges, reco verab ility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
I.C.C. Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Profit, earned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Special v. General D amages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Speculative damages (prohibited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
W ays to m itigate the loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Claims Declinations
Not always final . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Claims processing by the carrier

Legal obligations of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Claims, Concealed dam age

Right to reject com prom ise settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Claims, General
Ho w to file . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Loss and D amage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Concealed Dam age

Definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Container d amage (Retail Sales Cartons)

W ho is liable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Containers
Impro perly filled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Corrugated Stress Pattern . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Counting
Freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,45
Counting the freight

Carrier liability relieved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Carrier respon sibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Crate
115
GENERAL INDEX
Construction of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,75
Dam age
Diversionary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Reported after delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Shippin g (Retail Sales) con tainer only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Dam age, Concealed

15 Day R ule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,9
Shipper involvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Dam age, Loss, Delay

Breach of C ontract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Dam age, Undiscovered

Concealed v. Visib le . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Dam age, V isible

Definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
10 D ay Rule (D o not accept erron eous advice) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Dam ages
Measure of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Special v. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Speculative, prohibited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Delivery
W hen com pleted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Delivery Receipt
Implications when signed clear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Loss of (Bond of Indemnity) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Part of claims documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Documentation, Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Drum Failure
What to look for . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Drums
Metal fatigue / deformations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Metal fatigue fractures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
116
GENERAL INDEX
Du st
Fibreboard (resonant vibration) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
Elkin's Act
Rate discrimination pro hibited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Exceptions
How to note them . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
On delivery receipt - prima facie evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
To carrier liability (Bill of Lading) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
FOB
W hen title passes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Forms, Interior packaging

Die-cut Suspension System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Free on Board (FO B), General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Freezing (Da mage) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Freight
Carrier acceptance and liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . 39,42
Counting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . ... 1
Dam aged, Salvaged by consignee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Heavy/Bulky . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Inspection upon delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . ... 1
Refused, Carrier retains possession . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Refused, Salvaged by carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Refusing, carrier option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Standard, Loading/Unloading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Freight B ill
Loss of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Freight Bill, Original

Part of claims documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Freight Bill, Signed clear

W hat it implies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Freight Charges
Recoverab ility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,27
117
GENERAL INDEX
Freight Charges
Paymen t of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
Freight, Refused
Law concerning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Gaps or Apertures
Pallet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,65
Pallet (sizing rule) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
General Dam ages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Glass
Proper handling/packaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Proper packaging of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
I.C.C.
Registering a complaint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Inherent V ice
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Inspection
Carrier's failure v. Salvage rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Consignee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Consignee responsibility prior to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Handling prior to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
W aived . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Inspection, Freight
Upon delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Prior to receipt (Appendix A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106,107
Inspection, Joint
Consignee/Carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Insurance Requirem ents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Invoice
Irregular load bearing surface

Pallet or platform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
118
GENERAL INDEX
Irregular load surface

Protective dunn age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Lab els
Check for misdelivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Last Clear Ch ance

Rule of Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Law Suit
Attorn ey's fees not recovera ble . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Commencement of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Time limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Liability
Carrier burden of proof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Carrier exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Carrier v. improper packaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Carrier's, General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Delayed shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Loading/Unloading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Released Value limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SLC situations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Liability, Carrier
Actual loss or injury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Carmack Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,33
Exceptions to (Released V alue Rates) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,54
Presumption of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Released rate (Appendix C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
Liability, Claimant/Interline Carrier

All liable for loss/dam age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Redress in the courts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Loading the trailer

Shipper obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Loading/Unloading
General liability issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Loss
Claimant must mitigate (see p 32) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,13
119
GENERAL INDEX
Loss and damage test situations (p.58-60)

Answers - Condition A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Answers - Condition's B and C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Loss, Consignee must mitigate (see pp 2,13)

How accomp lished . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Market Value At Destination

Full actual loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Ma rkings
Directional or precautionary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
National Motor Freight Classification (NMFC)

General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Overhang
Pallet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Package
Retaped (tam pering) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Trapezoid creasing pattern . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Packages
Impro perly filled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Packaging
Act or D efault of Shipper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Carrier obligation to count . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Fibreboard suspension system . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Improper, penalty for . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Interior . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Liability issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Must be filled to capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Numbered . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Shipper m ust com ply with . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Suspension System s, foam plastic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Used . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Packaging Guide
An swers to loss/dam age test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Banded loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Bases, improper design of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Bases, pallet or crate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
120
GENERAL INDEX
Box: Bursting, ruptured or sheared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

Boxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Corner (pleated) damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Die-Cut suspension systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Directional markings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85,86
Fibreboard dust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
Gapping (apertures), pallet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Glass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Improperly filled containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Irregular load bearing surfaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Ov erhang, pallet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Pallet loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Pallets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Pyramiding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Stacking, pallet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Staking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,66
Steel Drums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Suspension Packaging Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Tape application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Test - Condition A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Test - Condition B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Test - Condition C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Three-w ay lock corner (crate) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Trapezoid creasing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
W ooden crates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Packaging v. Handling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Packaging, Interior
Abra sive damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Pallet
design and construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Pallet Load
Improper construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Pallets
Imp roper constru ction or use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Pilferage
Dual tape application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
121
GENERAL INDEX
Tape seal broken (one flap) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Platform
Design and construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Precautions
Declared/Released Valuations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Exceptions on freight bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Loading/Unloading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
New /Used Containers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Numbered packages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SLC exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
prim a facie
Establishing the case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Evidence, Bill of Lading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Plaintiff m ust establish . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
W hen established (against carrier) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Prima Facie, Evidence

Not conclusive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Profit
Earned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Protect from freezing

Act of God . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Protectors,
Edge (band ing) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Pro ving your claim

I.C.C. Ex Parte 403 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Public Enemy
Defined . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Pyramiding
Palletized load . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Quick C heck L ist

Receiving procedu res . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Receipts
122
GENERAL INDEX
Receiving Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Refused Freight
Carrier liability issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Law concerning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Salvaged by carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Released value
Liability limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Released/Declared Value
Who assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Report, Inspection
Retaping
Possible tampering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Ridges, Buckle
Steel Drum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Steel drums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Rule 245 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73,74

Sec (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71-73
Rule 360
Rates and Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Shipper, tariff obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Rule 568
Heavy/Bulky restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Rule 580
Directional or Precautionary M arkings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Rule 680
Full box requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Gen eral pack aging requirem ents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Interior packaging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Rule, 15 Day
Concealed damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
123
GENERAL INDEX
Exceptions critical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Ruling 120, I.C.C.

Appendix: General, Claims Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-5
General, Freight handling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103-105
Said to contain
Liability risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Shipper liability risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Salvage
Carrier's failure to inspect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Ex P arte 26 3 requirem ents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Pick up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Released value rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Salvage and Carrier Liability

Question p ertaining to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Salvage Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Settlem ents, Co mp rom ise

Claiman t's right to reject . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Shipper
Basic responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Must be fam iliar with tariff(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Relating to concealed dam ages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Shipper Load and Count (See "SLC" this index)

Definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Meaning of (Notation) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Shippers' Risk
Improper exception . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Shortages
Carrier load situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Shipper load situation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Shrinkage
See Pilferage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
124
GENERAL INDEX
SLC
Carrier risk of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Improper use of (Carrier load) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Meaning of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Liability situations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Shipper liability risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Special Dam ages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Speculative D amages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Stacking
Boxes of irregular dimensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Column (Block) . .......... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Interlocking . . . . .......... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Pallet Loads . . . . .......... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63-70
Staking, (tiers) layered loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
STC (Single Trip Container)

Steel drums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Suits
See L awsuits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Tampering
Evidence of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Tariffs
Shipper sub ject to . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Tilt and Sho ck Detecting Devices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Transportation
Legal definition of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
W hen com pleted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Transportation Arbitration Board (TAB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
125
GENERAL INDEX
Vibration
Quasi-periodic, resonant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
W arehousem an, Carrier

Lim ited liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Refused freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
W hen consignee refuses to unload . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
126
BIBLIOGRAPHY
The con tents of this Handb ook w as ob tained from the O ffice of the S ecreta ry, W ashin gton , D.C ., extracted from Title
49 C .F.R and U .S.C., respectively, and other d ocum entation graciously provided by the Interstate Com merce
Commission.
SOURCE MA TERIALS
I.C.C. Ad min istrative Ru ling 120 and Ap pendix
10730 Rates and liability based on value
Sec 12 Rates and liability based on value
11707 Liability of common carriers under receipts and bills of lading
Sec 26 Enforcement, processing of loss and damage claims
Sec 29 Insurance
11902 Civil penalty for accepting rebates from comm on carrier
11903 Rate, discrimination, and tariff violations
11915 Punishm ent of corp oration for violations comm itted by certain individ uals
11916 Conclusiveness of rates in certain prosecutions
Ex P arte I.C.C. Rail Carrier Cargo Liability Study

403
49 C.F.R. Principles and practices for the investigation and voluntary

100 5.1-6 disposition of loss and dam age claims and pro cessing salvage
(Regulations under 1005.1-6 changed to 49 CFR Part 370.1-11)
49 U.S.C. Bill of Ladings Act
NMFC 100 American Trucking Association

Alexandria, VA
National Motor Freight Classification

viz., Rule 245, 265, 360, 568, 580, 680
Items 300100 through 300155
127
REFERENCE MATERIALS
______________________________________________________________________________
For a detailed analysis of freight loss and damage law that goes well beyond the scope and intent of this Handbook, the
following publications are highly recommended:
Miller's Law of Freight L oss an d D am age C laims,

Richard R. Sigmon, W M. C. Brown Com pany Pub lishers,
Du buqu e, IA (427 pages)
Freight Claims in Plain English,

W illiam J. Au gello, E sq.,
Shippers N ational F reight Claim C ouncil, Inc., Publishers,
Huntington, NY (O ver 1200 pages)
Failures in Steel Shipping Drums

Dep artment of Engineering Research
No rth Carolina State College
Raleigh, NC
National Wooden Pallet and Container Association

Washington, DC
Fibre Box Handbook

Longview Fibre Company
Springfield, M A
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A B O UT T HE A UT H O R

RECEIVING PR OCED URES (See p.97 for a complete detailed explanation)

Only trained perso nnel sho uld receive the freight.

Alw ays co mp are documents before signin g the freight bill.

Be sure the freight bill is Signed and Dated by driver.

Verify the piece count:

Directional M arkings: No te on the freight bill the im prop er position of

Note Tiltwatch or Shockwatch devices when "RED." (See p.100)

Method used to seal containers: Are they all identical?

Con tainers: A re they sh ipper originals?

Record any Packaging/C ontainer dam age on the freight bill.

Av oid vague or general statements. Example: "1 B ox short" (incorrect).

Commencement of a suit (See Arbitration ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Arb itration (Carrier and Claim ant) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Concealed dam age: 1 5 day ru le . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Visible D amage (D efinition of) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Concealed Damage (Definition of) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Shipper load (SLC ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

If the carrier is at fault . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Shipper - Carrier precautions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Original delivery receipt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Erroneo us advice: (Visible Dam age 10 D ay Rule) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Loss of original freight bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Annotated delivery receipt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

THE INSPECTION REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

MEASURE O F DAM AGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

ACTUA L LOSS (Defined) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

SPECIAL v. GENERAL DA MAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

General v. Special damages: A djudicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

SPECULATIVE DAM AGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Plaintiff v. Comm on carrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Carmack amendment 49 U.S.C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Burden of proof (Sh ipper - Carrier - Co nsignee) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

CLAIM PROCESSING BY THE CARRIER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Dam aged freight salvaged by consignee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

TWO O R MORE CARRIERS (Interline shipmen ts) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

All carriers exclusively liable on through bills of lading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

General packaging requirements (Rule 680) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Impro per Pack aging: Act or D efault of Shipper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

RU LE 6 80 Interior P ackaging / Packing D evices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

RU LE 680 Carrier's option to accept or refuse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

RU LE 360, Sec. 2(c), of the N MFC 100 (Bill of lading) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

SHIPPER/CARRIER RELATED ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Carrier liability upon accepting freight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Free On Board (FOB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Pallets Said To Contain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

SHIPPER LOAD AND CO UNT (SLC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

General: An "SLC " exception may not hold up in court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

W hen shipper loads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

CARRIER'S BASIC RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Loading and unloading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Heavy/Bulky freight (liability): (Rule 568, NMFC 100) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

CARRIER EXEMPT FROM LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

D A M A G E D ETE CTIO N P A CKA GIN G GU IDE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Inspect packages indicating the probability of damage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Consignee m ust accept partially damaged shipmen ts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Loading/Unloading precaution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105

Liability, Released Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110

GENERAL INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113

ICC R EC OMM E N D A TIO N S

Counting the freight

Ch eckin g all lab els

Inspecting the goods