Freight Claims, Shortage, Damage

Overview and Process

 OVERVIEW

It is regrettable when a shortage or damage claim must be filed. We realize that somewhere an error was made in spite of efforts to prevent them. TLM will assist in helping you resolve the matter as quickly as possible with the carrier.

TLM acts on your behalf to properly prepare the Bill of Lading and clearly identify and define the pickup and delivery requirements of every shipment to reduce the potential for shortage and/or damage failures.   TLM establishes quality programs with each carrier utilized also to reduce the potential for shortage and damage.  Still, damages and shortages will occur from time to time for a wide variety of reasons – most commonly human error.  With this in mind, it is extremely critical that the person(s) receiving the freight at the point of delivery must inspect and count all items received and clearly document on the delivery receipt any and all suspected or apparent damages and/or shortages.  Failure to do so will in most cases result in a claim being denied. 

 REDUCING SHORTAGES AND DAMAGES

The beginning of this process is focused on the standards and procedures in place for receiving freight. To that end, TLM works in conjunction with the receiving department or assigned representative on ensuring that a clear understanding of expectation has been discussed and that an understanding of the steps involved has been agreed upon.

 Receiving Freight Process

Every shipment should be checked for damages and shortages.  Please review the following steps, to insure proper understanding and process for all freight deliveries:

Inspection for damage

Inspect the freight in the presence of the delivery driver. Look for any obvious signs of damage (crushed boxes, re-taping, holes, broken pallets, etc).  Make detailed notes on the delivery receipt of any sign of potential damage to the freight or the packing, even if the damage to the freight itself cannot be verified before the driver leaves.  Take a picture prior to opening if possible.  Open immediately and verify the damage.  Again take pictures.  Call TLM immediately upon discovering damage and TLM will work with you and the carrier on getting an inspection scheduled (if needed) and helping you start the claims process.

Visible Damage 
Be as specific as possible in describing the damage and avoid general terms such as "cartons damaged."  Failure to note damage on the delivery receipt prior to signing it and in the presence of the delivery driver can result in a denied claim.

Concealed Damage (Damage not reported on delivery receipt paperwork)
When damage is discovered after delivery, it should be reported to TLM and the delivering carrier immediately (within 24 hours) and a concealed damage inspection requested. The carrier will either waive the inspection or advise you to submit a claim or TLM will coordinate having an inspector sent to examine the freight. You should hold the freight and all packing and shipping materials, pallets and containers until disposition is given.  It is important to take pictures documenting the concealed damage immediately upon discovery.

Shortages 

Count your freight in the presence of the driver.  TLM will work with your shippers to record the number of pallets and pieces on the pallets on every Bill of Lading – this protects you on pieces count shortages.  Carefully count your pieces.  Make detailed notes on the delivery receipt in the presence of the driver and prior to signing it.  Call TLM immediately upon discovering shortages and TLM will work with the carrier to locate the missing pieces and/or helping you start the claims process.

The consignee should verify that the freight actually belongs to him. In the event there appears to be a shortage, a recount should be made to be sure. When there are shortages, be sure to identify exactly what is short on the delivery receipt in the presence of the delivery driver and prior to signing the delivery receipt.  Consignees must carefully inspect and count the pieces to ensure a shortage does not exist.  Failure to note a shortage on the delivery receipt prior to signing it and in the presence of the delivery driver can result in a denied claim.

In most cases, the carrier is liable for all shortages and damages while it is in their possession.  Regardless of whether a shipment moves FOB Origin or FOB Destination, but if the consignee signs the delivery receipt clear and does not note any shortages and/or damages prior to the delivery driver leaving, the carrier may refuse to honor an associated claim.

FILING A CLAIM

What is a Claim?
A claim is a demand in writing for a specified amount of money and properly identifies the shipment in question.  Before any claim can be filed or considered by the carrier, the freight charges for that shipment must be paid to TLM who will in turn pay the carrier.  Carriers will not consider claims for which freight charges are not paid (unless for a shipment moving under a guaranteed rate for which the carrier agrees to exonerate the freight charges if the shipment is late).

Process: As set forth, contact TLM if any damage or shortage is visible.  From that point, TLM will:

1.      Obtain the necessary Carrier Claim Form

2.      Complete the form with all information available to TLM

a.       A copy of the original Bill of Lading.

b.      A copy of the delivery receipt with your notations as to damage and/or shortage.

c.       The damaged or short product invoice.

3.      Forward completed form to the customer’s Onsite Contact for completion of additional information, such as:

a.       Expanded description of damage

b.      Quote for the cost of repairs

c.       Claims Amount

4.      Once information has been completed, the customer’s Onsite Contact will need to review the claims package with TLM representative and sign the claim where appropriate. 

5.      Once completed, either the customer’s Onsite Contact or the TLM representative can submit the claim.

6.      Once submitted, and a claim number is provided, TLM will contact the appropriate Carrier service representative until the claim is resolved.

 Note: If during the course of investigation, it is determined that other documents are required, we will advise accordingly.

GENERAL INFORMATION

Time Limits 
Damage claims must be filed within nine months after delivery. Claims for failure to make delivery must be filed within nine months after a reasonable time for delivery has elapsed.

Who May File 
Either the shipper, consignee or owner of the goods may file the claim.

What Cannot be Included in a Claim 
The claim can be filed only for the actual cost of the item(s).  Stress and anguish is also not a claimable item.

Who To File Claim With 
The claim can be filed with any carrier that participated in the movement.   TLM will assist you in this matter.

Mitigation 
In the event there is loss or damage, the loss should be mitigated as much as possible. The complete shipment should not be refused just because a portion is lost or damaged. Damaged items should be repaired or discounted whenever possible and practical to do so.  TLM will work with the shipper, carrier and/or consignee in working to resolve claims.  In all scenarios, the processing and the payment of claims is between the shipper/carrier/consignee.  TLM assumes no responsibility in the approval or payment of any claim.

Additional Insurance

If the value of the goods being shipped exceeds the limitations described in the paragraph titled “Carrier Responsibility”, additional insurance is available through Transportation Logistics Management, Inc.  It is the responsibility of the customer to make this known to Transportation Logistics Management, Inc.  and request additional insurance coverage prior to the freight being picked up by the carrier. Transportation Logistics Management, Inc. always confirms value of freight and liability coverage by the carrier.  If the freight value exceeds the carrier liability coverage, Transportation Logistics Management, Inc. will notify the customer of such and recommend additional coverage.

Shipper's Responsibility
The shipper has the responsibility to properly mark the shipment and package it in such a way that damage does not occur through normal transportation. When damages occur, the shipper should assist in repairs when possible and practical to do so.  Packaging requirements are clearly defined in the National Motor Freight Classification publication.  NMFC requirements apply to all carriers.  If a shipper fails to properly package a shipment, the carrier is instructed to refuse to make the pickup until the shipment is properly packaged to reasonably move without exception.

Consignees Responsibility

Regardless of whether the freight moves FOB Destination or FOB Origin, it is the consignee’s responsibility to inspect the freight upon presentation by the delivering driver and clearly note any suspected shortage or damage clearly on the delivery receipt.  Failure to note a shortage or damage or sign thereof on the Delivery Receipt in most cases exonerates the shipper and the carrier for any liability.

Carrier Responsibility 
Our Carrier’s goal is to deliver the shipment in the same condition as it was received. When this does not happen and the shipment is either short or damaged, the carrier has an obligation to compensate you for the loss or damage caused by their company, subject to certain terms and conditions as outlined in Title 49 USC Section 14706, the Uniform Straight Bill of Lading as published in the NMFC 100 series, each carrier’s tariffs specify any liability limits.   

 Note: Transportation Logistics Management, Inc. adheres and complies with the guidelines established by the NMFC, Interstate Commerce Commission and adhered to Carrier Rules Tariffs.